Abingdon Health plc
("Abingdon" or "the Company")
Final Results
York, U.K. 8 October 2024: Abingdon Health plc (AIM: ABDX), a leading international lateral flow contract research (CRO) and contract development and manufacturing organisation (CDMO), announces its final results for the year ended 30 June 2024.
Financial highlights
· Revenue growth of 52% to £6.1m (2023: £4.0m) - 49% growth when excluding acquisitions.
· H2 FY 2024 showed revenue growth of 55% compared to H1 FY 2024.
· Adjusted* EBITDA losses reduced significantly to £1.1m (2023: £2.9m loss).
· Gross margin of 60% (2023: 51%).
· Cash as at 30 June 2024: £1.4m (2023: £3.2m) - with additional net proceeds of £5.1m raised post-year end
*Earnings before interest, tax, depreciation, amortisation and one-off costs as outlined above, is a non-GAAP measure used by management and is not an IFRS disclosure.
Operational highlights (including post-period end)
· 51% year-on-year revenue growth in CRO/CDMO business due to an increase in customers utilising Abingdon's contract development, scale-up, technical transfer and manufacturing services; as well as an expansion in the Company's range of services such as regulatory support.
· Three customer products transitioned into manufacturing in FY24:
o Salignostics (saliva pregnancy test),
o LoopDX (sepsis),
o Up Front Diagnostics (stroke).
· Product business revenues up 56% year-on-year - benefitting from the launch of three lateral flow tests with Boots.
· Continued expansion of product range and sales and distribution platform expected in FY25 to generate further product sales growth.
· Acquisition of IVDeology for a maximum consideration of £0.7m in shares completed in May 2024 strengthens existing regulatory service offering.
· New US commercial office and R&D laboratory targeted for Q4 of calendar year 2024.
· Acquisition of Compliance Solutions (Life Sciences) for a maximum consideration of £3.2m in cash and shares completed in August 2024 also increases breadth of international regulatory service offering.
· £5.6m (gross) fundraise completed in August 2024 to be used to invest in product development, analytical laboratory service expansion and for working capital.
Chris Yates, Chief Executive Officer of Abingdon Health, said: "As a CRO/CDMO focused on lateral flow technology with a well-established track record of bringing products from 'idea to market' we believe we are well-placed to support a broad range of customers. The recent acquisitions of IVDeology and Compliance Solutions (Life Sciences), and the further investment in expanding our analytical laboratory service mean that we can now offer more a comprehensive service.
"Our key financial priorities are to grow our revenues and reduce our cashburn through continued close cost management, therefore moving the Company to a positive cashflow position, having achieved a cashflow positive quarter in Q4-FY2024. We are confident that our contract services customer base and our current growing pipeline means we are well positioned to grow our business and deliver shareholder value going forward."
Enquiries:
| Abingdon Health plc | ||
| Chris Yates, Chief Executive Officer | Via Walbrook PR | |
| Chris Hand, Non-Executive Chairman | | |
| | | |
| Zeus Capital (Sole Broker and Nominated Adviser) | Tel: +44 (0) 20 7220 1666 | |
| Chris Fielding / Isaac Hooper/Alex Campbell-Harris (Corporate Finance) | | |
| Fraser Marshall (Corporate Broking) | | |
| | | |
| Walbrook PR (Media & Investor Relations) | Tel: +44 (0)20 7933 8780 or abingdon@walbrookpr.com | |
| Paul McManus / Alice Woodings | Mob: +44 (0)7980 541 893 / +44 (0)7407 804 654 | |
| Phillip Marriage | +44 (0)7867 984 082 | |
The person responsible for arranging the release of this announcement on behalf of the Company is Chris Yates, Chief Executive Officer of the Company.
About Abingdon Health plc
Abingdon Health Group is a leading med-tech contract service provider offering its services to an international customer base.
The Company's CDMO division offers lateral flow product development, regulatory support, technology transfer and manufacturing services for customers looking to develop new assays or transfer existing laboratory-based assays to a lateral flow format. Abingdon Health's CDMO division has the internal capabilities to take lateral flow projects, in areas such as infectious disease and clinical testing, including companion diagnostics, animal health and environmental testing, from initial concept through to routine and large-scale manufacturing; from "idea to commercial success".
Abingdon's regulatory services companies, Compliance Solutions (Life Sciences) and IVDeology, provide a broad range of regulatory services to the in vitro diagnostic and wider medical device industry, to support customers in bringing products to market across a range of territories including the USA, EU and the UK. Our consultancy services range from design, implementation and maintenance of quality management systems, preparation of technical files for regulatory approvals, part-time and interim management support, auditing both internal and external, management reviews and presentations, training and mentoring.
Abingdon Health's Abingdon Simply Test range of self-tests is an e-commerce platform that offers a range of self-tests to empowers consumers to manage their own health and wellbeing. The Abingdon Simply Test e-commerce site offers consumers a range of information to support them in making informed decisions on the tests available. In addition, the site provides Abingdon's contract services customers with a potential route to market for self-tests. The Abingdon Simply Test range is also sold through international distributors and through other channels in the UK and Ireland, such as pharmacy chains.
Founded in 2008, Abingdon Health is headquartered in York, England.
For more information visit: www.abingdonhealth.com
Chairman & CEO Joint Statement
We are pleased to report continued revenue growth in the year ended 30 June 2024 and an improving cashflow and EBITDA performance, particularly in the second half of the financial year. Revenue increased by 52% to £6.1m (2023: £4.0m) and Adjusted EBITDA losses reduced to £1.1m from £2.9m in FY23.
As well as increasing our revenue in the year, we also completed two acquisitions (one post year-end) that will enhance our regulatory service capability. We successfully raised £5.6m post year-end to support expansion of the analytical laboratory services at our Doncaster site, enhance product development, and provide additional working capital.
Our service proposition is resonating well with our international customer base, and we believe we are well placed for continued revenue growth. The lateral flow market continues to grow, and we are seeing expanding use of the technology across a range of applications. As a knowledge leader in the application of lateral flow technology Abingdon is proud to support its customers in bringing innovative rapid testing products through development and onto the market.
Abingdon's mission is improving life through making rapid tests accessible to all; and we seek to fulfil this by supporting our customers in bringing their innovative lateral flow products to market. We are seeing growth in the market and Abingdon is active across a broad range of applications including clinical (point of care and self-test), animal health, plant pathogen, food and environmental testing.
Our customer service proposition is to provide all the "pieces of the jigsaw" to allow a customer to take a project from idea through to commercial success. Abingdon's service offering includes contract research and development, scale-up, technical transfer, manufacturing, packaging design and kitting, regulatory support, and analytical laboratory services. Abingdon's integrated Contract Research Organisation ("CRO") and Contract Development and Manufacturing Organisation ("CDMO") model continues to resonate well with a diverse customer base and we have broadened and deepened our service offering in the year and post-year-end through the acquisition of regulatory service providers IVDeology, in May 2024, and Compliance Solutions (Life Sciences), in August 2024. Furthermore, we will invest to expand our analytical laboratory service offering following the fundraising completed in August 2024 which raised gross proceeds of £5.6m.
The rapid diagnostic market is forecast to be worth over $280 billion by 2033 growing at a cumulative annual growth rate (CAGR) of 20.8% between 2023 and 2033. The lateral flow segment is estimated to be the largest segment of the rapid testing market, accounting for 36% of the market in 2023 (Source: Precedence Research: 2024 Rapid Diagnostics Market report). This growth is being driven in part by reduced barriers to adoption for lateral flow technology ("LFT") due to the widespread adoption of LFT during the COVID-19 pandemic. According to Statista (Tests for COVID-19 most impacted countries worldwide 2022 | Statista), there were 1.15 billion and 0.5 billion COVID-19 lateral flow tests performed in the US and the UK respectively by December 2022. Most people in the USA, the UK and other western countries have performed a lateral flow test and understand the technology. The second growth driver is innovation. We believe the COVID-19 pandemic has driven a second wave of innovation in the lateral flow market and this is driving greater use of the technology as the usability and performance of lateral flow technology improves.
Further growth drivers include the expansion in infectious disease testing, growing use within chronic disease management, rising consumer interest and growth in home testing kits, integration of digital technologies, and regulatory and reimbursement developments.
We remain confident that Abingdon Health's knowledge leadership position in the lateral flow industry and our integrated service offering will continue to lead to sustainable revenue growth. Our key objective remains to move the company to sustained positive cashflow and we are making solid progress towards this objective.
Our strategy
Our mission at Abingdon Health is to improve life by making rapid results accessible to all. We achieve this by supporting our customers, as an integrated lateral flow CRO & CDMO, in developing and manufacturing lateral flow tests across a range of sectors including clinical (human health), animal health, plant pathogen and environmental testing.
Our technology focus continues to be on the lateral flow market which is large and growing. Our acquisitions of IVDeology and Compliance Solutions (Life Sciences) give us access to other regulatory, clinical testing, and quality assurance elements of the lateral flow market and also provide access to adjacent markets. Key drivers of the growth in the lateral flow sector include reduced barriers to adoption of lateral flow technology following widespread lateral flow testing during the COVID-19 pandemic, innovation in the lateral flow market, as well as other factors such as a drive towards the decentralisation of testing to improve patient and economic outcomes, the increase in rates of infectious disease and the emergence of new pathogens; and the increased demand from consumers for diagnostic tools to enable them to manage their own health.
Abingdon Health's focus within the lateral flow market is two-fold:
1) Lateral flow CRO/CDMO - providing 89% of 2023/4 revenues
Our core service proposition is to provide our customers with a fully integrated, contract research and contract development and manufacturing service enabling Abingdon to manage the lateral flow development projects in full, from 'idea through to commercial success', and to provide large-scale automated manufacturing. The CRO and CDMO business model, well-established in the pharmaceutical industry, has direct application to the medical diagnostics market, and our contract services include R&D, optimisation and scale-up, technical transfer and manufacturing as well as added-value services such as reagent development, regulatory and clinical trial support and packaging design and kitting service provision. The ability to offer this range of services, providing outsourcing options to our customer base, continues to resonate well. It has been pleasing to see a number of customers benefit from this integrated service in the year utilising Abingdon not only for development, scale-up and technical transfer but also, for example, regulatory and analytical laboratory support. We continue to drive greater awareness of the capabilities of, and innovation in, lateral flow technology through a regular cadence of blogs and articles and we also attend third party workshops and conferences to promote the use of lateral flow technology and share knowledge. To that end we were delighted to sponsor the 2024 Next Generation Diagnostics Conference in Washington DC in August 2024.
2) Lateral flow product sales & distribution - providing 11% of 2023/4 revenues
We continue to build a route to market initially within Europe for lateral flow self-tests. Our route to market will be a combination of both direct sales, on Amazon or through our website www.abingdonsimplytest.com and through retail and distribution agreements. We have established our own self-test lateral flow brand, Abingdon Simply Test™, which currently includes 16 self-test products.
Going forward, the core element of our strategy is to be a preferred supplier of lateral flow tests to major retailers, in essence a trusted partner in the sourcing of tests both through our own CDMO customer base and externally through third parties. We were therefore delighted to announce the launch of self-tests for Vitamin D and Ferritin (Iron) in March 2024 and saliva pregnancy test (May 2024) with Boots under the Boots own-label brand. We continue to pursue opportunities to expand the number of products we supply to Boots and other major European retailers with a focus on the provision of own-label solutions.
We regard our lateral flow sales & distribution platform as complementary to our CRO/CDMO business. It is intended to provide support to a number of our CDMO customers who are developing self-tests, with a ready-made route to market to drive early commercial adoption. The first such example was the launch of SalistickTM, the first ever saliva pregnancy test, in the UK. The product is currently distributed in a number of major retailers including Superdrug and Boots.
Performance in the year
We were pleased with the financial performance in FY24 with revenue growth of 52% compared to FY23. The Group's revenues were £6.1m (2023: £4.0m) and excluding the impact of the acquisition of IVDeology in May 2024, FY24 revenues were £6.0m which was 49% higher than FY23.
Our CRO/CDMO business grew 51% year-on-year. This strong revenue growth arose from an increase in the number of customers utilising our contract development, scale-up, technical transfer and manufacturing services; and an expansion in our range of services such as regulatory support. Our model is based on bringing customers through the development process and into manufacturing and then supporting these customers in the long-term as manufacturing and regulatory customers. We saw three customer products transition into manufacturing in FY24: Salignostics (saliva pregnancy test), LoopDX (sepsis) and Up Front Diagnostics (stroke). We expect further technical transfers to transition into manufacturing in FY25 to continue to build upon our manufacturing customer base.
We were also pleased to see our Product business revenues grow strongly during FY24 with 56% year-on-year growth. We benefited in H2 FY24 from the launch of three lateral flow tests with Boots and in FY25 we will build on this progress with continued expansion of our product range and sales and distribution platform to generate further Product sales growth.
Acquisition of IVDeology
In May 2024 Abingdon acquired IVDeology, a UK-based leading provider of regulatory consultancy support to an international customer base in the in vitro diagnostics sector for total consideration of up to £700,000.
IVDeology provides a range of regulatory services including those in support of IVDR (the In Vitro Medical Devices Regulation (EU) 2017/746) for the EU market, UKCA (UK Conformity Assessed) marking for the UK market, and FDA support for the US market to an international customer base. The acquisition strengthened Abingdon's existing regulatory service, knowledge leadership and expertise in the regulatory area. The regulatory environment for in vitro diagnostics, including lateral flow tests, is going through a period of significant change with the implementation of IVDR in Europe and the creation of UKCA marking in the UK. In addition, there have been recent changes to the classification of various categories of lateral flow products in the USA. These changes create opportunities for Abingdon to support existing and new customers in navigating this landscape.
The acquisition was satisfied by the issue of 5 million ordinary shares of 0.0025 pence each in Abingdon Health plc ("Ordinary Shares") to the owners of IVDeology at an issue price of 10 pence per Ordinary Share, equating to £0.5m. In addition, subject to achieving certain revenue targets in the two financial years following acquisition, an earn-out of £0.2m will be payable at the time. In its financial year ending 31 January 2024, the IVDeology group generated combined turnover of £392k; resulting in a combined loss before tax of £30k.
Concert Party
On 30 August 2023, we announced the break-up of a concert party established at IPO which effectively prevented those shareholders who together were holding approximately 35% of the issued share capital in Abingdon being able to buy additional shares. Now that this 'IPO concert party' has been split into three smaller concert parties, those shareholders in the original concert party may now buy additional shares.
Team
During the financial year our average staff numbers were 85 (2023: 82). As at 31 August 2024 there were 120 employees within Abingdon Health following the completion of the acquisition of Compliance Solutions (Life Sciences) which had 36 employees as at 31 August 2024.
We would like to thank all of the Abingdon Health team for their efforts in the last year, which resulted in significant revenue growth for the Business. We would also like to welcome the IVDeology and Compliance Solutions (Life Sciences) teams to the Group.
Governance and People
Mary Tavener is the Company's Senior Independent Non-Executive Director, having been appointed in November 2020 prior to listing on AIM. Abingdon Health's other Non-Executive Director is Dr Chris Hand who is a co-founder of Abingdon Health, Non-Executive Chairman, and retains a significant shareholding in the Company as noted in the Directors Report.
Melanie Ross, Chief Financial Officer, left the business in October 2023 and we would like to thank Melanie for her service.
Our Audit Committee and Remuneration Committee currently comprises Mary Tavener (Chair) with Chris Hand. The Executive Director Chris Yates is invited to attend as required from time-to-time.
The Board has concluded that at this time the Group does not currently require a Nominations Committee but will review this assessment on a regular basis including discussing the matter with its Nominated Advisor.
The Board remains focused on ensuring its own effectiveness and that of the governance processes throughout the Group, and that these governance structures remain fit for purpose as the Group develops and grows over time. Mary Tavener is Abingdon Health's only Independent Non-Executive Director and, as such, the Board's current composition does not comply with the requirements for a minimum of two Independent Non-Executive Directors under the QCA Corporate Governance Code, being the corporate governance code that the Company has chosen to apply. Although this is not in compliance with the Code, given the size of the Group, the Board believed that this met the needs of the business at that time. As the business continues to grow and expand, there is now a need to improve the strength and depth of the Board and a process has begun to recruit a new Chief Financial Officer and an additional new non-executive director. Both recruitment processes are underway, and the Board will update shareholders in due course.
USA and Board Management
To accelerate the Group's commercial progress, and to gain additional access to the US market, Abingdon is planning to open a commercial office and R&D laboratory in the United States during Q4 of calendar year 2024. Chris Yates, CEO, has been asked to focus on global commercial growth, establishment of an Abingdon Health USA-based subsidiary and management of US operations. To facilitate this expansion, Chris Hand will be appointed Executive Chairman. These changes will be effective from 15 October 2024. Chris Hand will manage day to day R&D, operational and financial activities with Chris Yates focused on organic revenue growth, cross-selling between Group members' (Abingdon Health, Compliance Solutions (Life Sciences), IVDeology) customers, and potentially by acquisition. Chris Yates will focus his time on growing Abingdon's international presence specifically in the United States. As an illustration of the importance of the US market the United States economy is c.49% larger than that of the European Union (Source: World Bank); and it is also the largest diagnostics market globally, accounting for 39% of the global market (Source: Vision Research Reports).
Post Balance Sheet Events
Acquisition of Compliance Solutions (Life Sciences)
In August 2024 Abingdon completed the acquisition of Compliance Solutions (Life Sciences) group which specialises in meeting regulatory requirements of its international and UK client base in the in vitro diagnostic (IVD) and medical device markets. The Compliance Solutions group's team (currently c.36 employees) provides consultancy services, ranging from preparation of technical files for regulatory approvals, clinical strategy advice and protocol design and regulatory inspection gap analysis; design, implementation and maintenance of quality management systems; technical file and design file reviews, clinical evaluation reports and biological safety evaluations; and internal audit programmes; supplier audits, pre-audit preparations (e.g. FDA, MHRA, Notified Body, unannounced) and mock Notified Body/FDA audits. In its financial year ending 30 June 2023, the main trading entity Compliance Solutions (Life Sciences) Limited generated turnover of £2,716k; resulting in EBITDA of £393k.
The Compliance Solutions Group's activities are complementary to those of the Abingdon Group and the recently acquired IVDeology; and increase the breadth and depth of the Group's regulatory expertise.
Furthermore, there is, in the Board's opinion, the opportunity to cross-sell the Group's services, such as lateral flow development and manufacture and analytical laboratory support, into the Compliance Solutions Group's customer base and vice versa.
The maximum consideration of £3.2m comprises:
| i) | cash of £1.36m paid as follows: £700,000 on completion and then 3 equal payments of £220k at the end of the first, second and third month following completion; and |
| ii) | the sum of £1.0m satisfied by the issue of 9,216,590 Ordinary Shares; and |
| iii) | an amount in cash equal to the amounts received by Compliance Solutions (Life Sciences) Limited in respect of certain aged debtors in the 24-month period from Completion, subject to a maximum amount of £340k; and |
| iv) | subject to achieving certain revenue targets in the period starting on the first anniversary of the acquisition and ending on the second anniversary of the Acquisition, an earn out of up to £0.5m to be satisfied by the issue of such number of further Ordinary Shares. |
Fundraising
In August 2024 we completed a fundraising which raised gross proceeds of £5.6m (net proceeds of £5.1m). The fundraising comprised a Placing with institutional investors which raised gross proceeds of £5.2m and a retail offer which raised gross proceeds of £0.4m. The use of proceeds is summarised as follows:
| Product development | £3.0m |
| |
| Analytical laboratory service expansion | £1.0m |
| |
| Working capital and placing costs | £1.6m |
| |
| | | ||
Product development
The Board proposes to use up to £3.0m of the proceeds to enhance the Group's product offering through development of lateral flow self-tests alongside use of the Group's patented AppDx® technology - a smartphone based lateral flow test reader.
Expansion of analytical laboratory service
The Board also proposes to use up to £1.0m of the proceeds of the Placing to strengthen its analytical laboratory service. The Group has been providing this service since 2023 as part of its strategy of providing a comprehensive contract development and manufacturing service and supporting its customers in bringing products to market.
The Placing will allow the Group to expand its in-house analytical laboratory services and also extend these capabilities to a range of other test formats including PCR, LAMP, other isothermal amplification assays, antigen and antibody detection immunoassays and other point-of-care assays, in addition to supporting basic research. The laboratory will be based at the Group's Doncaster site.
Outlook & Funding
Cash at the end of the financial year was £1.4m and as at 4 October 2024, following the completion of the fundraising and the acquisition of Compliance Solutions was £4.5m. We believe we have sufficient cash resources to fund progress beyond 12 months from the signing date of the accounts, with our priority continuing to be moving the Company to a positive cashflow position, having achieved a cashflow positive quarter in Q4-FY2024.
Our strategic focus is on growing our CRO/CDMO business and expanding the reach of our lateral flow product range.
The recent acquisitions of IVDeology and Compliance Solutions (Life Sciences), and the further investment in expanding our analytical laboratory service, mean that we can offer a comprehensive service to our customers to fully support them in bringing their innovative products to market. We will also continue to grow our European distribution platform for self-tests both through increasing the number of retailer and distribution agreements in place and secondly through broadening the self-test product range including those developed in partnership with our CRO/CDMO customers.
Our key financial priorities are to grow our revenues and reduce our cash-burn through continued close cost management. To this end we will continue to focus our team's activities on CRO/CDMO and associated regulatory, QA and analytical laboratory business to provide near-term revenues.
As a CRO/CDMO focused on lateral flow technology with a well-established track record of bringing products from "idea to market" we believe we are well-placed to support a broad range of customers across the clinical (point of care & self-test), pharmaceutical, animal health, food, plant pathogen and environmental testing markets. We believe our full-service contract service proposition strongly resonates with customers, and we look forward to continuing to support our customers in bringing their innovative tests to market.
We would like to thank all our employees for their hard work, dedication and commitment during the past year as we continued to grow our revenues. We are confident that our contract services customer base and our current growing pipeline means we are well positioned to grow our business and deliver shareholder value going forward. We would like to thank shareholders for their support.
Operating and Financial Review
Revenue and Margins
The Business delivered strong revenue growth in the period, growing 52% when compared to the previous financial year, and 49% when excluding the impact of the IVDeology acquisition which completed in May 2024.
Revenue by Geographical Market
|
Geographical Market | 2024 £m | % * | 2023 £m | %* | Growth/ (Decrease) |
| UK | 2.6 | 41% | 1.3 | 32% | 94% |
| USA/Canada | 2.0 | 33% | 0.8 | 21% | 137% |
| Europe | 1.2 | 20% | 1.7 | 41% | (26)% |
| ROW | 0.3 | 6% | 0.2 | 6% | 47% |
| Total | 6.1 | 100% | 4.0 | 100% | 52% |
*percentages are calculated on exact totals and not the rounded amounts shown above
Revenue by Operating Segment
| Operating Segment | 2024 £m | %* | 2023 £m | %* |
Growth |
| Contract Development | 3.2 | 54% | 2.2 | 57% | 45% |
| Contract Manufacturing | 1.3 | 20% | 1.1 | 26% | 19% |
| Regulatory | 0.9 | 15% | 0.3 | 7% | 236% |
| Products | 0.7 | 11% | 0.4 | 10% | 56% |
| Total | 6.1 | 100% | 4.0 | 100% | 52% |
*percentages are calculated on exact totals and not the rounded amounts shown above
Contract Development (R&D activity based on a fee for service and manufacturing of validation batches) increased 45% year on year because of both increased contract development activity and more projects moving into technical transfer.
Contract Manufacturing (manufacture of products for third parties) increased 19% over the period.
Regulatory services revenues increased by 236% and excluding the impact of the acquisition of IVDeology revenues increased by 200% compared to the prior year. The increase was the result of expanding the services offered to our customers and providing a more integrated service solution to customers looking to take projects from idea to commercial success.
Product sales (own products) increased by 56% in the relevant period benefiting from the launch of three products with Boots in the second half of the financial year.
Gross margin in the financial year was 60% (2023: 51%) with the improvement driven by operational gearing benefits from increased revenues.
Administrative expenses reduced to £5.0m (2023: £5.2m) following continued cost management during the year despite the ongoing challenges operating in an inflationary environment.
Adjusted EBITDA
The Business uses adjusted EBITDA as a measure, as this excludes items which can distort comparability as well as being the measure of profit that most accurately reflects the cash generating activities of the Group. The reconciliation of these adjustments is as follows:
|
| Year Ended 30 June 2024 £'000 | Year Ended 30 June 2023 £'000 |
| Adjusted EBITDA | (1,132) | (2,893) |
| Share based payment expense | (48) | (28) |
| Impairment charges | - | (86) |
| Gain on Lease Modification | - | 390 |
| Non-recurring legal and professional fees | (32) | (33) |
| Non-recurring redundancy costs | - | (162) |
| Non-recurring settlement payment | (108) | - |
| Gain on settlement | 373 | - |
| Other exceptional costs | - | (88) |
| Statutory EBITDA | (947) | (2,900) |
| Amortisation | (27) | (29) |
| Depreciation | (399) | (659) |
| EBIT | (1,373) | (3,588) |
Adjusted EBITDA loss in the period was £1.1m (2023: loss £2.9m), a significant decrease on the prior year driven by both increases in the revenue and cost reductions year on year.
Headcount in the Group was an average of 85 (2023: 82). Staff costs overall, within both cost of sales and administrative costs, were £4.3m (2023: £4.0m), including £0.1m of non-recurring costs (2023: £0.2m) set about in the table above. Headcount at the end of the year was 84 and included the addition of 8 employees following the acquisition of IVDeology in May 2024.
Premises costs were £0.7m in the year (2023: £0.6m). Prior year underlying premises costs were £0.9m when adjusted for the one off £0.3m gain (in exceptionals) due to a release of the Right of Use asset resulting from releasing its contractual lease obligations on space at its York site. In addition, a dilapidations provision of £100k was included as a prior year adjustment to take account of the legal requirement under the Doncaster lease to return the condition of the property back to that in which the property was prior to the commencement of the lease. Given our investment in opening an analytical laboratory in Doncaster and the likelihood of extending the lease beyond 2 November 2026 it is the Board's view that the likelihood of this provision crystallising in the short-to-medium-term is remote. Note 11 below provides further details.
Professional costs (excluding exceptionals) in the year were £0.3m (2023: £0.4m).
Marketing and Travel costs were £0.2m (2023: £0.2m) as the Business continued to attend exhibitions and visit customers in person.
Cash Resources
Net cash outflow from operating activities was £1.7m (2023: inflow £0.9m) with the previous financial year positively impacted by the settlement of outstanding liabilities from the Department of Health and Social Care.
Overall, we saw a net cash outflow of £1.8m and a closing cash position of £1.4m (2023: £3.2m).
Financing
Post-year end, in August 2024 the business completed a fundraise which raised gross proceeds of £5.6m (net proceeds of £5.1m).
Key Performance Indicators ("KPIs")
The business considers various factors when determining the KPI measures and these evolve as the business changes to meet differing market demands to ensure continued success. In this financial year the KPI measures focused on revenue growth, reduction in (adjusted) EBITDA loss and reduction in the cash burn of the business. These metrics are felt to be the most important to ensure that the business achieves cash breakeven and profitability. Other internal measures introduced in the new financial year will focus on contract progression from Development to Manufacturing, as well as the number of tests manufactured per FTE.
Earnings per Share
Basic and diluted earnings per share was a loss of 0.42p in the period and basic and diluted adjusted EPS was a loss of 0.37p in the same period.
| | EPS |
| Basic EPS Loss | 0.42p |
| Loss before taxation attributable to equity owners of the parent | £(1,399)k |
| Add: Share Based Payments | £48k |
| Add: Non recurring legal fees | £32k |
| Add: Non recurring settlement payment | £108k |
| Add: Depreciation and Amortisation | £426k |
| Add: Finance Costs | £26k |
| Deduct: Gain on settlement | £(373)k |
| Adjusted Loss attributable to Shareholders | £(1,132)k |
| Adjusted Basic EPS Loss | 0.37p |
The basic EPS calculated above uses a weighted average number of ordinary shares of 304,732,264.
The weighted average number of ordinary shares above includes 182,316,812 deferred shares of 0.025p each. Technically this is correct. However, it should be noted that the deferred shares are non-voting shares, with no rights to dividends, but holders of deferred shares are entitled to receive the nominal value of that share (0.0025 pence sterling) once on a return of capital, a repurchase of those shares by the Company or in connection with a sale of those shares. The total nominal value of all the deferred shares is £46k.
Consolidated Statement of Comprehensive Income
For the Year Ended 30 June 2024
| | Year ended 30 June 2024 | Year ended 30 June 2023 |
| |
| as restated |
| | £'000 | £'000 |
| | | |
| Revenue | 6,135 | 4,045 |
| | | |
| Cost of sales | (2,456) | (1,970) |
| Gross profit | 3,679 | 2,075 |
| | | |
| Administrative expenses | (5,070) | (5,220) |
| Other income | 259 | 252 |
| | | |
| Adjusted EBITDA (before adjusting items) | (1,132) | (2,893) |
| | | |
| Amortisation | (27) | (29) |
| Depreciation | (399) | (659) |
| Impairment charges | - | (86) |
| Share based payment expense | (48) | (28) |
| Non-recurring legal, professional and fundraising fees | (32) | (33) |
| Non-recurring redundancy costs and termination awards | (108) | (162) |
| Lease modification | - | 390 |
| Other exceptional costs | - | (88) |
| Gain on settlement | 373 | - |
| | | |
| Operating loss | (1,373) | (3,588) |
| | | |
| Finance income | 31 | 89 |
| Finance costs | (57) | (75) |
| | | |
| Loss before taxation | (1,399) | (3,574) |
| | | |
| Taxation credit | 128 | 105 |
| | | |
| Loss for the financial period | (1,271) | (3,469) |
|
Other comprehensive income for the year net of tax | - | - |
|
| | |
| Total comprehensive loss for the year | (1, 271) | (3,469) |
| | | |
| Attributable to: Equity holders of the parent | (1, 271) | (3,469) |
| Basic losses per share (pence) | (0.42) | (1.14) |
| | | |
| Diluted losses per share (pence) | (0.42) | (1.14) |
Consolidated Statement of Financial Position
As at 30 June 2024
| | 30 June | 30 June 2023 | 30 June 2022 |
| |
| as restated | as restated |
| | £'000 | £'000 | £'000 |
| | | | |
| Non-current assets | | | |
| Goodwill | 379 | - | - |
| Other intangible assets | 153 | 90 | 36 |
| Property, plant, and equipment | 997 | 1,257 | 1,840 |
| Investment | 13 | - | - |
| | 1,542 | 1,347 | 1,876 |
| | | | |
| Current assets | | | |
| Inventories | 441 | 329 | 534 |
| Trade and other receivables | 1,466 | 1,147 | 7,844 |
| Income tax receivable | 201 | 50 | 183 |
| Cash and cash equivalents | 1,440 | 3,236 | 2,397 |
| | 3,548 | 4,762 | 10,958 |
| | | | |
| Total assets | 5,090 | 6,109 | 12,834 |
|
| | | |
| Current liabilities Trade and other payables | 1,704 | 2,033 | 5,059 |
| Borrowings | - | - | 115 |
| Obligations under leases | 120 | 87 | 150 |
| | 1,824 | 2,120 | 5,324 |
| | | | |
| Non-current liabilities | | | |
| Borrowings | 722 | 708 | 435 |
| Obligations under leases | 207 | 224 | 580 |
| Provisions | 88 | 85 | 82 |
| | 1,017 | 1,017 | 1,097 |
| | | | |
| Deferred tax liabilities | - | - | - |
|
| | | |
| Total liabilities | 2,841 | 3,137 | 6,421 |
| | | | |
| Net assets | 2,249 | 2,972 | 6,413 |
|
| | | |
| Equity | | | |
| Attributable to the owners of the parent: | | | |
| Share capital | 77 | 76 | 76 |
| Share premium | 30,808 | 30,309 | 30,309 |
| Share based payment reserve | 124 | 80 | 153 |
| Accumulated deficit | (28,760) | (27,493) | (24,125) |
| Total equity | 2,249 | 2,972 | 6,413 |
Consolidated Statement of Changes in Equity
For the Year Ended 30 June 2024
| | Share Capital | Share premium | Share based payment reserve | Accumulated deficit | Total equity attributable to owners of the parent
|
| | £'000 | £'000 | £'000 | £'000 | £'000 |
| Balance at 1 July 2022 (as restated) | 76 | 30,309 | 153 | (24,125) | 6,413 |
|
| | | | | |
| Year ended 30 June 2023: | | | | | |
| Profit and loss | - | - | - | (3,469) | (3,469) |
| Total comprehensive loss for the year | - | - | - | (3,469) | (3,469) |
| Other movements: | | | | | |
| Share option expense | - | - | 28 | - | 28 |
| Share options exercised | - | - | (4) | 4 | - |
| Share options cancelled | - | - | (97) | 97 | - |
| | | | | | |
| Balance at 30 June 2023 (as restated) | 76 | 30,309 | 80 | (27,493) | 2,972 |
| | | | | | |
| Year ended 30 June 2024: | | | | | |
| Profit and loss | - | - | - | (1,271) | (1,271) |
| Total comprehensive loss for the year | - | - | - | (1,271) |
(1,271) |
| Other movements: | | | | | |
| Issue of shares | 1 | 499 | - | - | 500 |
| Share option expense | - | - | 32 | - | 32 |
| Earn-out consideration classified as share-based payment | - | - | 16 | - | 16 |
| Share options cancelled | - | - | (4) | 4 | - |
| | | | | | |
| Balance at 30 June 2024 | 77 | 30,808 | 124 | (28,760) | 2,249 |
Consolidated Statement of Cash Flows
For the Year Ended 30 June 2024
| | 30 June | 30 June |
| |
| As restated |
| | £'000 | £'000 |
| | | |
| Cash flows from operating activities: | | |
| Loss for the year | (1,271) | (3,469) |
| Adjustments for: | | |
| | | |
| Other income | (255) | (252) |
| Net finance cost/(income) | 26 | (14) |
| Tax credit | (128) | (105) |
| Amortisation and impairment of intangible assets | 27 | 29 |
| Share-based payment expenses | 48 | 28 |
| Depreciation and impairment of property, plant and equipment | 399 | 745 |
| Loss on sale of property, plant and equipment and intangible assets | 33 | - |
| | | |
| Changes in working capital: | | |
| (Increase)/decrease in inventories | (112) | 205 |
| (Increase)/decrease in trade and other receivables | (297) | 6,647 |
| Decrease in trade and other payables | (335) | (3,180) |
| | | |
| Cash generated (used in)/from operations | (1,865) | 634 |
| Interest paid (including leases) | (25) | (48) |
| Income taxes received | 231 | 325 |
| Insurance claim proceeds | - | 2 |
| | | |
| Net cash (outflow) / inflow from operating activities | (1,659) | 913 |
| | | |
| Interest received | 31 | 89 |
| Purchase of intangible assets | (6) | (82) |
| Purchase of property, plant and equipment | (35) | (75) |
| Proceeds on disposal of property, plant and equipment | - | 1 |
| Acquisition of other investments | (13) | - |
| | | |
| Net cash used in investing activities | (23) | (67) |
Consolidated Statement of Cash Flows
For the Year Ended 30 June 2024
| | 30 June | 30 June |
| | £'000 | £'000 |
| | | |
| Financing activities | | |
| Cash withheld for SAYE scheme | - | (1) |
| Proceeds from new bank loans and borrowings | - | 250 |
| Payment of loans | - | (115) |
| Payment of lease obligations | (114) | (141) |
| | | |
| Net cash used in from financing | (114) | (7) |
| | | |
| Net (decrease)/increase in cash and cash equivalents | (1,796) | 839 |
| | | |
| Cash and cash equivalents at beginning of the year | 3,236 | 2,397 |
| | | |
| Cash and cash equivalents at end of the year | 1,440 | 3,236 |
|
| | |
| Recognised in the Statement of Financial Position as: | | |
| Cash at bank and in hand | 1,369 | 3,236 |
| Restricted cash | 71 | - |
|
| 1,440 | 3,236 |
The Group holds the sum of £70,628 in trust in a separate interest-bearing account on behalf of an original shareholder in Molecular Vision from whom Abingdon Health acquired its shares in Molecular Vision in 2014.
Abingdon has been unable to transfer this consideration to the original shareholder and has been advised by its legal advisers that the consideration needs to be held in a separate account for a period of 12 years (until November 2026) and at this time, if the transfer to the shareholder has not been made, the consideration will be paid into court.
Notes to the Financial Statements
For the Year Ended 30 June 2024
Company information
Abingdon Health PLC ("the Company") is a public limited company domiciled and incorporated in England and Wales. The Company is quoted on the London Stock Exchange's Alternative Investment Market ("AIM"). The registered office is York Biotech Campus, Sand Hutton, York, YO41 1LZ. The consolidated financial information (or "financial statements") incorporates the financial information of the Company and entities (its subsidiaries) controlled by the Company (collectively comprising the "Group").
The principal activity of the Group is to develop, manufacture and distribute diagnostic devices and provide consultancy services to businesses in the diagnostics sector.
Basis of preparation
The financial information set out in this preliminary announcement does not constitute statutory accounts as defined by section 434 of the Companies Act 2006.
The financial information for the year ended 30 June 2024 and the year ended 30 June 2023 does not constitute the Company's statutory accounts for those years. Statutory accounts for the year ended 30 June 2023 have been delivered to the Registrar of Companies. The statutory accounts for the year ended 30 June 2024 were approved by the Board on 7 October 2024 and will be delivered to the Registrar of Companies in due course. The statutory accounts for the period ended 30 June 2024 will be posted to shareholders at least 21 days before the Annual General Meeting and made available on the Group's website.
The Group's statutory financial statements for the year ended 30 June 2024, from which the financial information presented in this announcement has been extracted, were prepared in accordance with UK adopted international accounting standards ("IFRS"). The financial statements have been prepared on the historical cost basis with the exception of certain items which are measured at fair value as disclosed in the principal accounting policies set out in the Group's Annual Report. These policies have been consistently applied to all years presented.
The preparation of financial 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 financial statements and the reported amounts of revenues and expenses during the reporting period. Although these estimates are based on management's best knowledge of the amount, event or actions, actual results ultimately may differ from these estimates.
The auditor's reports on the accounts for 30 June 2024 and 30 June 2023 were unqualified and did not contain a statement under 498(2) or 498(3) of the Companies Act 2006.
Judgements and key sources of estimation uncertainty
The preparation of the financial statements in conformity with IFRS requires management to make judgments, estimates and assumptions that affect the application of policies and reported amounts of assets and liabilities, income and expenses. The estimates and associated assumptions are based on historical experience and various other factors that are believed to be reasonable under the circumstances, the results of which form the basis of making the judgements about carrying values of assets and liabilities that are not readily apparent from other sources. Actual results may differ from these estimates.
Estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognised in the period in which the estimate is revised and in any future periods affected.
Critical judgements
The following judgements (apart from those involving estimates) have had the most significant effect on amounts recognised in the financial statements:
Right of use asset recognition
Management have assessed each lease liability for recognition under IFRS 16 and recognised a right of use asset where appropriate. Further explanation of this judgement will be provided in the statutory accounts.
One lease includes a material component of service charge by comparison to the headline rental payments, where this service charge partially covers shared areas and facilities which would normally form part of a rental price. The Directors have applied judgement in splitting out a rent-like component from the service charge of £12,000 which qualifies for capitalisation as a right of use asset. In the current year the lease was reassessed due to an inflationary rental increase, the accounting estimate has been applied consistently.
Revenue recognition
In line with IFRS 15 management are required to determine appropriate revenue recognition points for all revenue streams. Where multiple contracts are entered into with a single counterparty any instalment payments are not considered to be a key indicator of the satisfaction of a performance obligation, although linked contracts with a counterparty are considered in conjunction when identifying the appropriate point for revenue recognition.
Deferred consideration
A portion of the consideration for the acquisitions in the year was a contingent deferred consideration. Under IFRS 3 the 'earn-out' contingent deferred consideration has been treated as employee remuneration. The earn-out is payable in 2 years and is dependent on cumulative revenue. Management are very confident that this will be payable, particularly with reference to expected revenue synergies. Accordingly, a discount rate akin to a borrowing rate has been applied.
Key sources of estimation uncertainty
The estimates and assumptions which have a significant risk of causing a material adjustment to the carrying amount of assets and liabilities are as follows:
Valuation and impairment of cash generating units (including goodwill)
Goodwill is tested annually for impairment as part of a cash generating unit ("CGU"). The test considers future cash flow projections of each CGU on a group basis, as the group as a whole is considered to be a single CGU. In the current year, two tests have been performed, a discounted cash flow model and a value-in-use model, which have both approximated to the same value.
Where the discounted cash flows are less than the carrying value of the CGU, an impairment charge is recognised for the difference, which for the prior year will be shown in Disclosure Note 5 of the statutory accounts. Further analysis of the estimates, judgements and sensitivities in the estimates are disclosed in Disclosure Note 13 of the statutory accounts.
Useful lives and impairment of intangible assets
The Group have estimated the expected useful lives of intangible assets arising from acquisitions based on qualitative and quantitative data. For identifiable intangible assets arising on acquisition of a business, the useful lives are determined based on the lower end of benchmark data. Details of these amortisation rates are set out in the accounting policies. Useful lives are regularly reviewed and should management's assessment of useful lives change then amortisation charges in the financial statements would be adjusted and carrying amounts of intangible assets would change accordingly.
Going concern
Since the end of the last financial year, the Group completed a fundraising which raised £5.6m (£5.1m net of expenses) from institutional and retail investors. The Group remains focused on growing its CRO/CDMO revenues and continuing to maintain control over this operational cost base in order to reduce the Group's cashburn.
The Directors have prepared cash flow forecasts under a number of scenarios The budget is the base case scenario and this is sensitised to consider plausible downside scenarios for example significantly reducing revenue growth in the next fiscal year.
These forecasts cover a period of at least 12 months from the expected date of approval of the financial statements and the Business continues to evaluate financial forecasts on a regular basis. The focus of the group remains on expanding its fee for service CRO/CDMO model and any increase in headcount and/or operational footprint will be on the basis of an increase in the number of secured contracts, revenue and cash inflows. At 30 June 2023 the bank balance was £1.4m. Cash as at 4 October was £4.5m. The Board is satisfied that based on the above and the current forecasts, there is sufficient headroom and concluded that it is appropriate to prepare the Annual Report and Accounts on a going concern basis.
The Directors have prepared the cashflow forecasts.
Non-recurring income and costs
The Group seeks to highlight certain items as exceptional operating income or costs. These are considered to be exceptional in size, frequency and/or nature rather than indicative of the underlying day to day trading of the Group. These may include items such as acquisition costs, restructuring costs, obsolescence costs, employee exit and transition costs, legal costs, profits or losses on the disposal of subsidiaries, and loan impairments. All of these items are charged or credited before calculating operating profit or loss.
The Directors apply judgement in assessing the particular items, which by virtue of their size and nature are disclosed separately in the Statement of Comprehensive Income and the notes to the financial statements as non-recurring income and costs. The Directors believe that the separate disclosure of these items is relevant to understanding the Group's financial performance.
Dilapidations
The Group have estimated a dilapidation provision that will fall due at the end of their operating lease term. The provision is an estimate and has been calculated by predicting both a wear and tear and capital element. The provision is discounted to its net present value as at the financial year end (Disclosure Note 21 in the statutory accounts).
1. Revenue
The Group applies IFRS 15 'Revenue from contracts with customers'. Under IFRS 15, the Group applies the 5-step method to identify contracts with its customers, determine performance obligations arising under those contracts, set an expected transaction price, allocate that price to the performance obligations, and then recognises revenues as and when those obligations are satisfied.
Segmental analysis of revenue
| | 2024 | 2023 |
| | £'000 | £'000 |
| Product sales | 650 | 418 |
| Contract manufacturing | 1,258 | 1,058 |
| Contract development | 3,327 | 2,301 |
| Regulatory | 900 | 268 |
| Total revenue from contracts with customers | 6,135 | 4,045 |
Revenue analysed by geographical market
| | 2024 | 2023 |
| | £'000 | £'000 |
| United Kingdom | 2,538 | 1,307 |
| Europe (excluding Belgium) | 737 | 1,179 |
| Belgium | 498 | 479 |
| USA & Canada | 2,039 | 861 |
| Rest of the World | 323 | 219 |
|
| 6,135 | 4,045 |
All revenue received in the current and comparative years has been recognised at a point in time in accordance with the Group's revenue recognition policy.
2. Taxation
|
| 2024 | 2023 |
|
| £'000 | £'000 |
| Current tax |
|
|
| UK Corporation tax on loss for the current year | (77) | 46 |
| Adjustments in respect of prior years | (25) | (151) |
| Total current tax | (102) | (105) |
|
| | |
| Deferred tax | | |
| Origination and reversal of temporary differences | (26) | - |
| Impact of change in tax rates | - | - |
| Total deferred tax | (26) | - |
| | | |
| Total tax credit | (128) | (105) |
The charge for the year can be reconciled to the profit per the Consolidated Statement of Comprehensive Income as follows:
| | 2024 | 2023 As A |
| | £'000 | £'000 |
| |
| as restated |
| Loss before taxation | (1,399) | (3,574) |
| | | |
| Expected tax credit based on a corporation tax rate of 25% | (350) | (733) |
| Tax effect of expenses that are not deductible in determining taxable loss | 30 | (55) |
| Income not taxable | (95) | - |
| Change in unrecognised deferred tax asset | 329 | 851 |
| Timing differences between depreciation and capital allowances | 93 | (5) |
| Unrecognised deferred tax on share-based payments | 8 | 6 |
| Prior year adjustment | - | (158) |
| Research and development | (126) | (20) |
| Unrecognised deferred tax on movement on provisions | (3) | (5) |
| Deferred tax on intangibles recognised on acquisition | (26) | - |
| Other differences | 12 | 14 |
| Total tax credit
| (128) | (105) |
The UK corporation tax rate was 19% until 1 April 2023 when it increased to 25%, giving a hybrid tax rate of 20.5% for the prior year.
Deferred tax balances at the reporting date are measured at 25%, which is the effective rate in place (2023: 25%; 2022: 19%).
4. Dividends
No dividends were paid in the current or prior year.
5. Earnings per share
The calculation of the basic and diluted earnings per share is based on the following data:
| | 2024 | 2023 |
| |
| as restated |
| Earnings used in calculation (£'000) | (1,271) | (3,469) |
| Weighted average number of ordinary shares | 304,737,264 | 304,033,363 |
| Basic EPS (pence/share) | (0.42) | (1.14) |
| Weighted average number of dilutable shares | 308,202,227 | 305,820,420 |
| Diluted EPS (pence/share) | (0.42) | (1.14) |
In each period there were share options outstanding. As at 30 June 2024, options which are out of the money are excluded from the calculation of the weighted average number of dilutable shares.
The Directors use adjusted earnings before certain non-recurring costs ("Adjusted Earnings") as a measure of ongoing performance and profitability. These non-recurring costs are presented as separate items on the face of the Consolidated Income Statement.
The calculated Adjusted Earnings for the current and comparative periods are as follows:
| | 2024 | 2023 |
| | £'000 | £'000 |
| |
| as restated |
| Loss before taxation attributable to equity owners of the Parent | (1,399) | (3,574) |
| Share-based payment costs | 48 | 28 |
| Impairment charges | - | 86 |
| Non-recurring legal fees | 32 | 33 |
| Non-recurring employee redundancy costs | - | 162 |
| Non-recurring settlement payment | 108 | - |
| Depreciation and amortisation | 426 | 688 |
| Net finance cost/ (income) | 26 | (14) |
| Lease modification | - | (390) |
| Other exceptional costs | - | 88 |
| Gain on settlement | (373) | - |
| Adjusted Earnings | (1,132) | (2,893) |
| | | |
| Basic and diluted Adjusted Earnings per share (pence/share) | (0.37) | (0.94) |
The calculation of Adjusted Earnings is consistent with the presentation of Adjusted Earnings before Interest, Tax, Depreciation, and Amortisation, as presented on the face of the Statement of Comprehensive Income. This adjusted element also removes non-recurring items, as explained further in Disclosure Note 5 of the statutory accounts. The Directors have presented this Alternative Performance Measure ("APM") because they feel it most suitably represents the underlying performance and cash generation of the business, and allows comparability between the current and comparative period in light of the rapid changes in the business (most notably its admission to AIM and associated costs), and will allow an ongoing trend analysis of this performance based on current plans for the business. Tax is excluded from this APM because the Group has significant tax losses and so the tax charge is not representative of the cash generated.
6. Share capital and reserves
| | 2024 | 2023 |
| Ordinary share capital | | |
| Authorised | Number | Number |
| Ordinary shares of 0.025p each | 126,716,822 | 121,716,822 |
| Deferred shares of 0.025p each | 182,316,812 | 182,316,812 |
| | 309,033,634 | 304,033,634 |
| | | |
| Allotted and fully paid | Number | Number |
| Ordinary shares of 0.025p each | 126,716,822 | 121,716,822 |
| Deferred shares of 0.025p each | 182,316,812 | 182,316,812 |
| | 309,033,634 | 304,033,634 |
| | | |
| | £'000 | £'000 |
| Ordinary shares of 0.025p each | 32 | 31 |
| Deferred shares of 0.025p each | 45 | 45 |
| | 77 | 76 |
Reconciliation of movements during the year:
| | Number |
| | |
| At 1 July 2023 | 304,033,634 |
| Issue of new shares | 5,000,000 |
| At 30 June 2024 | 309,033,634 |
During the year, on 10 May 2024, there was a share issue of 5,000,000 shares with a nominal value of £0.00025 as a part of the IVDeology acquisition. The total amount paid per share amounted to £0.1 resulting in £1,250 recognised in Share Capital and £498,750 in Share Premium.
Reserves of the Company represent the following:
Share capital - Shares in the Company held by shareholders at a proportional level with equal voting rights per share.
Share premium - Excess over share capital of any investments.
Retained earnings - This comprises the accumulated trading results of the Group.
Share-based payment reserve - This reserve comprises the fair value of options share rights recognised as an expense. Upon exercise of options or performance share rights, any proceeds.
7. Share options
| Group & Company | Number of share options | Weighted average exercise price | ||
| | 30 June 2024 | 30 June 2023 | 30 June 2024 | 30 June 2023 |
| | Number | Number | £ | £ |
| | | | | |
| Outstanding at 1 July 2023 | 4,247,210 | 219,781 | 0.0773 | 0.3997 |
| Granted | 2,386,238 | 4,119,285 | 0.00 | 0.07 |
| Forfeited | (918,454) | (86,648) | 0.0697 | 0.4642 |
| Exercised | - | (5,208) | - | 0.0025 |
| | | | | |
| Outstanding at 30 June 2024 | 5,714,994 | 4,247,210 | 0.0463 | 0.0773 |
| | | | | |
| Exercisable at 30 June 2024 | 123,757 | 70,836 | 0.3230 | 0.0025 |
The options outstanding at 30 June 2024 had an exercise price ranging from £0.00 to £0.70 and a remaining contractual life of up to 2 years and 4 months. The options exist at 30 June 2024 across the following share option schemes:
| | Number of shares | Exercise price per share (£)
| Fair value of scheme | Vesting period |
| EMI scheme granted in April 2021 | 66,668 | 0.00025 | 54,880 | 1 year |
| SAYE scheme granted in March 2021 | 57,089 | 0.70 | 6,295 | 3 years |
| LTIP scheme granted in December 2022 | 3,204,999 | 0.07 | 107,542 | 3 years |
| LTIP scheme granted in October 2023 | 2,386,238 | 0.00 | 7,491 | 3 years |
| | 5,714,994 | | 176,208 | |
The fair value of the scheme is being expensed over the vesting period. All share options expire 10 years after the date of issue.
| | Group | |
| | 30 June 2024 £'000 | 30 June 2023 £'000 |
| Expenses recognised in the year Arising from equity settled share-based payment transactions |
48 |
28 |
| | 48 | 28 |
9. Acquisition of a business
On the 3rd May 2024 the Group acquired 100% percent of the issued capital of IVDeology Holdings Ltd. In accordance with IFRS 3 Business Combinations, goodwill of £378,923 arising from the acquisition and £104,582 of separable intangibles assets have been recognised.
The total consideration for the acquisition was £700k. Of the total consideration, £500k was made up of share issues granted Abingdon Health plc to the previous shareholders of IVDeology Holdings Ltd as at the date of completion. In addition to this there is a total amount of £200k earn-out consideration similarly to be settled in the issue of share capital in Abingdon Health Plc. The earn-out consideration constitutes employee remuneration and is considered to represent a share-based payment. This consideration is spread across the vesting period and as a result, £16,667 has been expensed as a share-based payment in the Statement of Profit and Loss. This consideration has been excluded from total consideration in the below reconciliation.
The net assets of the business acquired are as follows:
| Group | Book value | Adjustments | Fair value |
|
| £'000 | £'000 | £'000 |
| | | | |
| Property, plant and equipment | 57 | - | 57 |
| Intangible Assets | 4 | 104 | 108 |
| Trade and other Receivables | 40 | - | 40 |
| Cash and Cash equivalents | 1 | - | 1 |
| Trade and other payables | (59) | - | (59) |
| Deferred tax | - | (26) | (26) |
| | | | |
| Total identifiable net assets | 43 | 78 | 121 |
| Goodwill | | | 379 |
| Total consideration |
|
| 500 |
| | | | |
10. Events after the reporting date
In August 2024 Abingdon completed the acquisition of Compliance Solutions group which specialises in meeting regulatory requirements of its international client base in the UK IVD and medical device markets.
The Compliance Solutions group's team (currently c.36 employees) provides consultancy services, ranging from preparation of technical files for regulatory approvals, clinical strategy advice and protocol design and regulatory inspection gap analysis; design, implementation and maintenance of quality management systems; technical file and design file reviews, clinical evaluation reports and biological safety evaluations; and internal audit programmes; supplier audits, pre-audit preparations (e.g. FDA, MHRA, Notified Body, unannounced) and mock Notified Body/FDA audits.
In its financial year ending 30 June 2023, the main trading entity Compliance Solutions (Life Sciences) Limited generated turnover of £2,716k; resulting in EBITDA of £393k.
The Compliance Solutions Group's activities are complementary to those of the Group and recently acquired IVDeology; and increase the breadth and depth of the Group's regulatory expertise. Furthermore, there is, in the Board's opinion, the opportunity to cross-sell the Group's services, such as lateral flow development and manufacture and analytical laboratory support, into the Compliance Solutions Group's customer base.
The maximum consideration of £3.2m comprises:
i. cash of £1.36m to be paid as follows: £700,000 on completion and then 3 equal payments of £220k at the end of the first, second and third month following completion; and
ii. the sum of £1.0m to be satisfied by the issue of 9,216,590 Ordinary Shares; and
iii. an amount in cash equal to the amounts received by Compliance Solutions (Life Sciences) Limited in respect of certain aged debtors in the 24-month period from Completion, subject to a maximum amount of £340k; and
iv. subject to achieving certain revenue targets in the period starting on the first anniversary of the acquisition and ending on the second anniversary of the Acquisition, an earn out of up to £0.5m to be satisfied by the issue of such number of further Ordinary Shares.
Due to the proximity of the completion of the acquisition to the signing of the current year financial statements, a purchase price allocation exercise has not yet been carried out in respect of Compliance solutions Group. As such, further detail on the acquisition is not disclosed.
In August 2024, Abingdon Health Plc completed a fundraising that raised gross proceeds of £5.6m as set out below:
· £5m in respect of a placing with various Venture Capital Trusts
· £0.2m in respect of a placing with various other institutional shareholders
· £0.4m in respect of a retail offer
11. Prior period adjustment
A restatement has been made to recognise a dilapidation provision in respect of a lease held under IFRS 16 for property used in trade. There were terms present in the lease from inception that required the property to be returned to the original condition, therefore the provision has been recognised in the prior year at the same value it would have been at 1 July 2022, if recognised at the inception of the lease in 2020.
Management have assessed that of a total dilapidation provision of £100,000, 5% would be in relation to wear and tear, which has been treated as an expense. The remaining proportion of the provision that is in relation to capital outflows has been treated as an addition at the inception of the lease and is depreciated over the term of the lease to 2 November 2026.
Changes to the statement of financial position (Group)
|
| At 1 July 2022 | At 30 June 2023 | ||||
|
| Previously reported | Adjustment | As restated | Previously reported | Adjustment | As restated |
|
| £'000 | £'000 | £'000 | £'000 | £'000 | £'000 |
| Non-current assets | | | | | | |
| Right of Use assets | 166 | 63 | 229 | 130 | 48 | 178 |
| Other property, plant & equipment | 1,611 | - | 1,611 | 1,079 | - | 1,079 |
| Total property, plant & equipment | 1,777 | 63 | 1,840 | 1,209 | 48 | 1,257 |
| Non-Current liabilities | | | | | | |
| Provisions | - | (82) | (82) | - | (85) | (85) |
| Capital and reserves | | | | | | |
| Accumulated deficit | (24,106) | (19) | (24,125) | (27,456) | (37) | (27,493) |
Changes to the statement of comprehensive income (Group)
|
|
| At 30 June 2023 | ||||
|
|
|
|
| Previously reported | Adjustment | As restated |
|
|
|
|
| £'000 | £'000 | £'000 |
| Depreciation |
|
| (644) | (15) | (659) | |
| Finance costs | |
|
| (72) | (3) | (75) |
| Loss for the financial period |
|
| (3,451) | (18) | (3,469) | |
|
|
|
|
|
|
|
|
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