Source - RNS
RNS Number : 8661K
Eden Research plc
27 September 2016
 

 

Eden Research plc

 ("Eden" or "the Company")

 

Half-year Report

 

Eden Research plc (AIM: EDEN), the AIM listed company that provides breakthrough natural microencapsulation technologies to the global agrochemicals, animal health and consumer products industries, announces its interim results for the six months ended 30 June 2016.

 

Business highlights

 

Commercial:

·     First commercial sales of lead agrochemical product, 3AEY, in Kenya, Greece, Spain and Italy

·     Sales development progressing in-line with expectations with market demand being realised by Eden's partners through the botrytis application season (late August and September)

·     Appointment of Strategic Commercial Advisor (plant protection)

·     Appointment of Regulatory Strategy Advisor (plant protection)

 

Regulatory:

·     EU approval received for Eden's first agrochemical, fungicide product, 3AEY, in Southern Europe in Spain, Italy and Bulgaria

·     Further national-level authorisations expected to follow in France and Portugal in time for 2017 growing season

·     Label extensions in Greece and Spain for new crops and disease targets

·     Label extensions received in Kenya now include authorisation for the treatment of roses

 

Financial highlights

 

·   Placing of £2.6m (gross) in March 2016

·   Revenue for the period of £0.11m (H1 2015: £0.16m)

·   Operating Loss for the period was £0.86m (H1 2015: loss of £0.70m), £0.45m excluding the non-cash items, amortisation and share based payments (H1 2015: loss of £0.31m). Administrative expenses of £0.55m (H1 2015: £0.47m)

·   Cash and cash equivalents at 30 June 2016 of £2.01m (at 30 June 2015: £0.1m)

·   Expanding investment in regulatory clearances unlocking commercial potential in new, important territories

·   Cash outflow increase (H1, 2016: £0.60m, H1, 2015: £0.33m) due to rise in creditor payments

 

Sean Smith, Chief Executive Officer of Eden, said:

 

"So far this year, we have seen the first significant commercial sales of 3AEY into the agrochemicals market in Kenya, Greece, Italy and Spain. Whilst the botrytis season is not quite over and, as such, we don't have final sales quantities from our commercial partners for this season, Eden and its partners are very pleased with the sales that have been generated so far. Particularly in Italy where our partner, Sipcam Italia SpA, has invested a significant amount of resource into the commercial launch of "3logy", the brand name they have chosen for 3AEY in that region.

 

"For our nematicide product, negotiations are continuing with a multi-national industry leader, and progress has been made towards a satisfactory conclusion. A final agreement is expected this year covering multiple territories around the world, subject to further negotiations.  A number of evaluation projects for both Eden's technologies and products are on-going and I am pleased with the progress that is generally being made, as well as with regulatory progress where territories such as the USA are now being actively pursued.

 

"I am also pleased to welcome two new people to the team at Eden. Michel Villeneuve has joined as Senior Strategic Commercial Advisor. Michel has over thirty years' experience in a variety of senior commercial, regulatory and management roles with major multinational companies involved in plant protection. Peter Watson has been appointed as Regulatory Strategy Advisor. Peter has worked for the UK's Chemicals Regulation Directorate and Dow Chemical in a number of senior regulatory roles. Both gentlemen bring tremendous experience, insight and drive to our efforts to accelerate commercialisation of our first products.

 

"I look forward to providing shareholders with a more comprehensive update on 3AEY sales and other commercial progress in due course."

 

Enquiries:

 

Eden Research plc          

www.edenresearch.com

Sean Smith, Chief Executive Officer

Tel: 01285 359 555

Alex Abrey, Chief Financial Officer

 

 

 

Shore Capital and Corporate Limited     

www.shorecap.com

Stephane Auton/Patrick Castle

Tel: 020 7408 4090

 

 

Walbrook PR Ltd

Tel: 020 7933 8780 or [email protected]

Paul McManus

Mob: 07980 541 893

Lianne Cawthorne

Mob: 07584 391 303

 

 

 

 

Eden Research plc

Consolidated Statement of Comprehensive Income for the six months ended 30 June 2016

 

 

 

Six

months ended 30 June 2016 GBP'000 unaudited

 

Six

months ended 30 June 2015

GBP'000 unaudited

 

Year ended 31 December 2015  

GBP'000 audited

 

 

 

 

 

 

 

 

 

Group Revenue

 

109

 

160

 

883

 

Cost of sales

 

(11)

 

-

 

(99)

 

Gross profit

 

98

 

160

 

784

 

Administrative expenses

 

(550)

 

(472)

 

(1,020)

 

Amortisation of intangible assets

 

(337)

 

(335)

 

(655)

 

Share based payments (note 8)

 

(73)

 

(52)

 

(248)

 

Total other operating expenses

 

(960)

 

(859)

 

(1,923)

 

Operating loss

 

(862)

 

(699)

 

(1,139)

 

Finance income/(costs)

 

2

 

(20)

 

(20)

 

Loss on ordinary activities before taxation

 

(860)

 

(719)

 

(1,159)

 

Tax on loss on ordinary activities

 

82

 

101

 

101

 

Loss for the financial period

 

(778)

 

(618)

 

(1,058)

 

Other Comprehensive Income net of tax

 

-

 

-

 

-

 

Total Comprehensive Income since last Report

 

(778)

 

(618)

 

(1,058)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Loss per share (pence) - basic and diluted (note 5)

 

(0.44)

 

(0.40)

 

(0.68)

 

 

 

 

 

 

Eden Research plc

Consolidated Statement of Financial Position as at 30 June 2016

 

 

30 June 2016

 

30 June 2015

 

31 Dec 2015

 

GBP'000

 

GBP'000

 

GBP'000

 

unaudited

 

 

unaudited

 

 

audited

 

ASSETS

 

 

 

 

 

NON-CURRENT ASSETS

 

 

 

 

 

Intangible assets (note 6)

5,290

 

5,621

 

5,543

Investments in associates (note7)

923

 

-

 

923

 

 

 

 

 

 

 

 

 

 

 

 

 

6,213

 

5,621

 

6,466

 

CURRENT ASSETS

 

 

 

 

 

Trade and other receivables

238

 

48

 

164

Cash and cash equivalents

2,007

 

136

 

148

 

 

 

 

 

 

 

 

 

 

 

 

 

2,245

 

184

 

312

 

 

 

 

 

 

 

 

 

 

 

 

TOTAL ASSETS

8,458

 

5,805

 

6,778

 

 

 

 

 

 

LIABILITIES

 

 

 

 

 

CURRENT LIABILITIES

 

 

 

 

 

Trade and other payables

598

 

428

 

752

 

 

 

 

 

 

 

 

 

 

 

 

TOTAL CURRENT LIABILITIES

598

 

428

 

752

 

 

 

 

 

 

 

 

 

 

 

 

TOTAL LIABILITIES

598

 

428

 

752

 

 

 

 

 

 

EQUITY

 

 

 

 

 

Called up share capital

1,847

 

1,541

 

1,588

Share premium account

29,140

 

26,014

 

26,861

Merger reserve

10,210

 

10,210

 

10,210

Warrant reserve

808

 

539

 

735

Retained earnings

(34,145)

 

(32,927)

 

(33,367)

 

 

 

 

 

 

TOTAL EQUITY attributable

 

 

 

 

 

to owners of the parent

7,860

 

5,377

 

6,027

 

 

 

 

 

 

 

 

 

 

 

 

TOTAL EQUITY AND LIABILITIES

8,458

 

5,805

 

6,779

 

 

 

 

 

 

 

 

 

 

Eden Research plc

Statement of Changes in Equity as at 30 June 2016          

 

 

Share capital

Share premium

Merger reserve

Warrant reserve

Retained earnings

Total

 

GBP'000

GBP'000

GBP'000

GBP'000

GBP'000

GBP'000

Six months ended 30 June 2016

 

 

 

 

 

 

 

 

 

 

 

 

 

Balance at 1 January 2016

1,588

26,861

10,210

735

(33,367)

6,027

 

 

 

 

 

 

 

Loss and total comprehensive income

-

-

-

-

(778)

(778)

 

Transactions with owners

 

 

 

 

 

 

- Share issue

- Options granted

259

-

2,279

-

-

-

-

73

-

-

2,538

73

- Options exercised/lapsed

-

-

-

-

-

-

 

 

 

 

 

 

 

Transactions with owners

-

-

-

-

-

-

 

 

 

 

 

 

 

Balance at 30 June 2016

1,847

29,140

10,210

808

(34,145)

7,860

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Six months ended 30 June 2015

 

 

 

 

 

 

 

 

 

 

 

 

 

Balance at 1 January 2015

1,541

26,014

10,210

524

(32,346)

5,943

 

 

 

 

 

 

 

Loss and total comprehensive income

-

-

-

-

(618)

(618)

 

 

 

 

 

 

- Options granted

-

-

-

52

-

52

- Options exercised/lapsed

-

-

-

(37)

37

-

 

 

 

 

 

 

 

Transactions with owners

-

-

-

15

(15)

-

 

 

 

 

 

 

 

Balance at 30 June 2015

1,541

26,014

10,210

539

(32,927)

5,377

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Eden Research plc

Statement of cash flows for the six months ended 30 June 2016

 

 

 

 

 

 

 

 

Six months

 

Six months

 

 

 

ended

 

ended

 

Year ended 31

 

30 June 2016

 

30 June 2015

 

December 2015

 

GBP '000

 

GBP '000

 

GBP '000

 

unaudited

 

unaudited

 

audited

 

 

 

 

 

 

Cash flows from operating activities

 

 

 

 

 

 

 

 

 

 

 

Cash outflow from operations

(598)

 

(327)

 

(186)

Tax credit received

 

101 

 

101

Net finance charges paid

-

 

(20)

 

(20)

 

 

 

 

 

 

Net cash used in operating activities

(598)

 

(246)

 

(105)

 

 

 

 

 

 

Cash flows from investing activities

 

 

 

 

 

 

 

 

 

 

 

Capitalisation of development expenditure

(83)

 

(33)

 

(132)

Finance income

 

-

 

-

 

 

 

 

 

 

Net cash used in investing activities

(81)

 

(33)

 

(132)

 

 

 

 

 

 

 

 

 

 

 

 

Cash flows from financing activities

 

 

 

 

 

 

 

 

 

 

 

Share issue costs

(131)

 

-

 

(30)

Issue of equity shares

2,669

 

-

 

-

 

 

 

 

 

 

Net cash from financing activities

2,538

 

-

 

(30)

 

 

 

 

 

 

Increase/(decrease) in cash and cash equivalents

1,859

 

(279)

 

(267)

 

 

 

 

 

 

Cash and cash equivalents at

 

 

 

 

 

   beginning of period

148

 

415

 

415

 

 

 

 

 

 

Cash and cash equivalents at

 

 

 

 

 

   end of period

2,007

 

136

 

148

 

 

 

 

 

 

 

Cash and cash equivalents comprise bank account balances.

 

 

 

Notes to the Interim Results

 

1.            The above numbers have not been reviewed by the Company's auditors.

 

2.            Nature of operations and general information
 

Eden is an early stage revenue company with intellectual property and expertise in encapsulation, terpenes and environmentally friendly technologies to provide naturally occurring solutions to the global agrochemicals industry, the animal health industry, and consumer products. Revenues are earned by the Company through identifying suitable industrial partners and entering into licence or distribution agreements.

 

The financial information set out in this interim report does not constitute statutory accounts.  The Company's statutory financial statements for the year ended 31 December 2015 are available from the Company's website. The auditor's report on those financial statements was unqualified.

 

3.            Accounting Policies

 

Basis of Preparation 

 

These interim condensed consolidated financial statements are for the six months ended 30 June 2016. They have been prepared following the recognition and measurement principles of IFRS.  They do not include all of the information required for full annual financial statements, and should be read in conjunction with the financial statements of the Company for the year ended 31 December 2015.

 

These financial statements have been prepared on the going concern basis and under the historical cost convention.

 

These condensed consolidated interim financial statements have been prepared in accordance with the accounting policies adopted in the last annual financial statements for the year to 31 December 2015.

 

The accounting policies have been applied consistently for the purposes of preparation of these condensed interim financial statements.

 

4.            Copies of the interim statement are available from the Company at its registered office, as well as on the Company's website.

 

5.            Loss per share

 

 

Six months ended

30 June 2016

GBP '000 unaudited

 

Six months ended

30 June 2015 GBP '000 unaudited

 

Year ended

31 December 2015

GBP '000 audited

Loss per ordinary share (pence) - basic and diluted

(0.44)

 

(0.40)

 

(0.68)

 

Loss per share has been calculated on the net basis on the loss after tax of £0.78m (30 June 2015: loss £0.62m, 31 December 2015: £1.06m) using the weighted average number of ordinary shares in issue of 178,432,719 (30 June 2015: 154,142,880, 31 December 2015: 155,685,557).

 

Due to the loss for the period there is no dilution of the loss per share arising from options in existence.

 

 

6.            Intangible assets

 

 

Intellectual property

Licences and trademarks

Development Costs

Total

 

£

£

£

£

COST

 

 

 

 

At 1 January 2015

8,592

447

2,980

12,019

Additions

-

-

32

32

 

 

 

 

 

At 30 June 2015

8,592

447

3,012

12,051

Additions

65

-

177

242

 

 

 

 

 

At 31 December 2015

8,657

447

3,189

12,293

Additions

-

-

83

83

 

 

 

 

 

At 30 June 2016

8,657

447

3,272

12,376

 

 

 

 

 

AMORTISATION

 

 

 

 

 

 

 

 

 

At 1 January 2015

4,692

353

1,050

6,095

Charge for the period

220

18

97

335

 

 

 

 

 

At 30 June 2015

4,912

371

1,147

6,430

Charge for the period

220

(3)

103

321

 

 

 

 

 

At 31 December 2015

5,132

369

1,250

6,750

Charge for the period

219

9

108

336

 

 

 

 

 

At 30 June 2016

5,351

377

1,358

7,086

 

 

 

 

 

CARRYING AMOUNT

 

 

 

 

 

 

 

 

 

At 30 June 2016

3,306

70

1,914

5,290

 

 

 

 

 

At 31 December 2015

3,525

  79

1,939

5,543

 

 

 

 

 

At 30 June 2015

3,680

  76

1,865

5,621

 

7.            Investments in associates

 

Details of the Company's associates are as follows:

 

Name

Principal activity

Country of incorporation

Proportion of ownership interest and voting power held

 

 

 

%

TerpeneTech Limited

Development and sale of biocide products

England and Wales

29.9

 

The investment in associates is stated at cost.
 

8.            Share based payments

 

Share Options

 

              Eden Research plc operates an unapproved option scheme for executive directors, senior management and certain employees.

 

 

 

Six months ended 30 June 2016

Six months ended 30 June 2015

 

 

 

 

 

 

 

 

 

 

 

 

 

Weighted

 

 

 

Weighted

 

 

 

 

 

average

 

 

 

average

 

 

 

 

 

exercise

 

 

 

exercise

 

 

 

 

 

price (pence)

 

Number

 

price (pence)

 

Number

 

 

 

 

 

 

 

 

 

 

Outstanding at the beginning

 

 

 

 

 

 

 

of the period

 

12

 

6,255,000

 

12

 

4,650,000

Granted during the period

13

 

1,050,000

 

8

 

625,000

Exercised during the period

13

 

(530,000)

 

-

 

-

Lapsed during the period

13

 

(2,750,000)

 

18

 

(200,000)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

10

 

4,025,000

 

12

 

5,075,000

 

 

 

 

 

 

 

 

 

 

 

The exercise price of options outstanding at the end of the period ranged between 8p and 13p (30 June 2015: 8p and 18p) and their weighted average contractual life was 1.9 years (30 June 2015: 1.8 years). None of the options have vesting conditions.

 

              The weighted average share price (at the date of exercise) of options that lapsed during the period was 13p (30 June 2015: 18p).

 

The share based payment charge for the period was £73,300 (30 June 2015: £51,524).

 

Warrants

 

 

 

Six months ended 30 June 2016

Six months ended 30 June 2015

 

 

 

 

 

 

 

 

 

 

 

 

 

Weighted

 

 

 

Weighted

 

 

 

 

 

average

 

 

 

average

 

 

 

 

 

exercise

 

 

 

exercise

 

 

 

 

 

price (pence)

 

Number

 

price (pence)

 

Number

 

 

 

 

 

 

 

 

 

 

Outstanding at the beginning

 

 

 

 

 

 

 

of the period

 

14

 

5,497,867

 

13

 

3,340,000

Granted during the period

-

 

-

 

15

 

1,387,867

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

14

 

5,497,867

 

14

 

4,727,867

 

 

 

 

 

 

 

 

 

 

 

The exercise price of warrants outstanding at the end of the period ranged between 11p and 30p (30 June 2015: 11p and 30p) and their weighted average contractual life was 2.6 years (30 June 2015: 3.6 years).

 

The weighted average share price (at the date of exercise) of warrants that lapsed during the period was nil (30 June 2015: nil).

 

 

Other notes:

 

Eden is an early stage revenue company with intellectual property and expertise in encapsulation, terpenes and environmentally friendly technologies to provide naturally occurring solutions to the global agrochemicals industry, the animal health industry, and consumer products.

 

Eden's encapsulation technology harnesses the biocidal efficacy of naturally occurring chemicals produced by plants (terpenes) and can also be used with both natural and synthetic hydrophobic compounds. The technology uses yeast cells that are a by-product of numerous commercial production processes to deliver a slow release of natural compounds for agricultural and non-agricultural uses. Terpenes are already widely used in the food flavouring, cosmetic and pharmaceutical industries.

 

Historically, terpenes have had limited commercial use in the agrochemical sector due to their volatility, phytotoxicity and poor solubility. Eden's platform encapsulation technology provides a unique, environmentally friendly solution to these problems and enables terpenes to be used as effective, low-risk agrochemicals.

 

With leading consultants in their respective fields, the Company is developing these technologies through innovative research and a series of commercial production, marketing and distribution partnerships.

 

The Company has a number of patents and a pipeline of products at differing stages of development targeting specific areas of the global agrochemicals industry. To date, the Company has invested in the region of £12m in developing and protecting its intellectual property and seeking regulatory approval for products that rely upon the Company's technologies. Revenues earned by the Company have been modest whilst the Company has concentrated on securing patent protection for its intellectual property, gaining regulatory approvals, identifying suitable industrial partners, and entering into licence agreements. 

 

In May 2013, the three actives that comprise Eden's first commercial product, 3AEY, were approved as new ingredients for use in plant protection products.  This represents a major milestone in the commercialisation of Eden's technology and is a significant accomplishment for any company. To illustrate this point, one should note that in all of 2013, Eden's approvals represented three of only ten new active ingredients approved by the EC.

 

3AEY has been authorised for sale in Kenya, Malta, Greece, Bulgaria, Spain and Italy.

 

Eden was admitted to trading on AIM on 11 May 2012 and trades under the symbol EDEN.

 

For more information about Eden, please visit: www.edenresearch.com 

 


This information is provided by RNS
The company news service from the London Stock Exchange
 
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