REG - Cambridge Cognition - Preliminary Unaudited Results
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RNS Number : 9248G Cambridge Cognition Holdings PLC 01 May 2025
1 May 2025
Cambridge Cognition Holdings plc
("Cambridge Cognition", the "Company" or the "Group")
Preliminary unaudited results for the year ended 31 December 2024
Commercial progress and order book growth
Cambridge Cognition Holdings plc (AIM: COG), the brain health software group
specialising in digital products to advance clinical research and patient
treatment, announces its preliminary unaudited results for the year ended 31
December 2024.
Financial highlights
· 2024 revenue of £10.3m (2023: £13.5m).
· Operating costs reduced by £4.4m in 2024 to £10.0m
(2023: £14.4m).
· Improved Adjusted EBITDA loss to £43k (2023: loss of
£1.0m).
· Completed a £2.6m equity fundraising in June 2024.
· Cash at 31 December 2024 of £1.3m (2023: £3.2m).
· Reduced borrowing to £1.9m at 31 December 2024 (2023:
£2.5m).
· Order book at 31 December 2024 £13.6m (2023: £17.2m).
A strong Q1 2025, with new Sales Orders of £4.2m, gives an increased Order
Book of £15.8m at 31 March 2025. The Group anticipates delivering 2025
revenue of £8.5m from the current Order Book before the impact of contracting
further new Sales Orders in Q2-Q4 2025.
Overview
Cambridge Cognition has taken decisive steps to return to growth. The Group is
a brain health company whose market leading software tools provide an accurate
detection of cognitive change to improve the diagnosis and treatment of brain
health.
Built on rich, curated data and deep technical expertise we are building a
strong global brand with scalable technology that will support the rising
world demand for diagnosing and treating brain health, mental health, and CNS
disorders. The Board believes that the Group has the potential to deliver
annual new Sales Orders of £75-100m by 2030 and will create shareholder value
through organic sales growth, strategic partnerships, joint ventures and
spin-outs.
Critical steps were taken in 2024 and in Q1 2025 to achieve this vision and
these have delivered a material improvement in new Sales Orders - with £7.4m
contracted in 2024, of which £3.1m contracted in Q4, and £4.2m contracted in
Q1 2025.
Commercial
· Commercial team rebuilt and strengthened.
· Revised the commercial strategy to focus on building
long term relationships with larger, well-funded pharmaceutical and biotech
companies.
Leadership
· Alex Livingstone-Learmonth recruited to lead the
regeneration of the Group's commercial activities.
· Appointed Rob Baker (Chief Operating Officer) and Alex
Livingstone-Learmonth (Chief Commercial Officer) as Joint Acting Managing
Directors in September 2024, following the CEO's departure.
· Initiated a CEO selection process in Q1 2025.
· Strengthened the Board with three new Non-Executive
Director appointments: Nick Rodgers, Stuart Gall and Jon Kempster.
· Created a new Scientific Advisory Board to advise on
the scientific and technology development of the Group.
Product and technology advancements
· Launched a new in-house Rater Training service to
complement and expand the service offering in clinical trials.
· Submitted a Letter of Intent to the U.S. FDA to qualify
CANTAB® as an objective measure for cognitive impairment in schizophrenia
('CIAS') as a Drug Development Tool.
· Demonstrated CANTAB's effectiveness in a post-hoc
analysis of Bristol Myers Squibb clinical research on cognitive impairment in
schizophrenia.
· Demonstrated the effectiveness of an innovative
Automated Quality Assurance ('AQUA') tool developed using Winterlight
technology.
· Secured a £1.0m Innovate UK grant to provide voice and
touchscreen cognitive assessments for the Global Alzheimer's Platform
Foundations Bio-Hermes 2 project.
· Supported Biogen and Apple in the Intuition Brain
Health study, one of the world's largest brain health studies, with findings
published in Nature Medicine.
· The valuation of the Group's investment in its
spin-out, Monument Therapeutics, increasing to £1.7m following equity
financings in 2024.
Current trading and Outlook
Following the return to commercial growth in late 2024 with new Sales Orders
of £3.1m in Q4, this has continued into 2025 with a further £4.2m in Q1.
The Group therefore believes that the revised commercial strategy is
delivering growth. The Order Book increased to £15.8m at 31 March 2025, up
from £13.6m at 31 December 2024. The Order Book is anticipated to deliver
£8.5m in Revenue in 2025 and this will increase as new Sales Orders are
contracted during 2025.
Costs were reduced materially in 2024 and the focus on cost control,
profitability and cash generation continues. Cambridge Cognition is committed
to reaching sustained profitability as measured by Adjusted EBITDA.
As the Group secures new Sales Orders during the year, which brings upfront
cash generation, this is expected to increase cash resources and enable the
Group to reach sustained profitability and positive cashflow without further
fund raising. In addition, based on the anticipated servicing of the loan
facility the balance of the loan will reduce from £1.9m at 31 December 2024
to £0.9m by end of 2025.
Steven Powell, Chairman commented:
"2024 was a year of significant change for the Group. We rebuilt the
Commercial team and focused on increasing the Order Book. While continuing our
focus on Clinical Studies and Academic Research, the strategic objective is
now to generate additional income from both the Healthcare and Consumer Health
& Wellness segments, both of which represent substantial addressable
markets.
"The new financial year has started strongly and we are continuing our growth
trajectory to achieve sustained growth in equity value."
Enquiries:
Cambridge Cognition Holdings plc Tel: 012 2381 0700
Rob Baker, Joint Managing Director and Chief Operating Officer press@camcog.com
Panmure Liberum Limited (NOMAD and Joint Broker) Tel: 020 7886 2968
Freddy Crossley / Will Goode / Mark Rogers (Corporate Finance)
Rupert Dearden (Corporate Broking)
Dowgate Capital Limited (Joint Broker) Tel: 020 3903 7715
David Poutney / James Serjeant
Hudson Sandler (Financial PR and IR) Tel: 020 7796 4133
Dan de Belder / Hattie Dreyfus / Jackson Redley cog@hudsonsandler.com
Notes to Editors
About Cambridge Cognition
Cambridge Cognition is a brain health software group specialising in digital
health products that advance brain health research and treatment.
Built on rich, curated data and deep technical expertise we are building a
strong global brand with scalable technology that will support the rising
world demand for diagnosing and treating brain health. The Company creates
shareholder value through organic sales growth, strategic partnerships, joint
ventures and spin-outs. The Company has identified four market sectors:
· Clinical Studies for new pharmaceuticals;
· Academic Research for scientists to understand CNS
disorders;
· Healthcare to provide physicians with cognitive
assessments to allow them to diagnose and treat patients; and,
· Consumer Health & Wellness to provide individuals
access to accurate, reliable and meaningful data to assess their cognitive
health.
For further information, visit: www.cambridgecognition.com
SERVICE OFFERING AND BUSINESS MODEL
The Group develops proprietary technologies for the assessment of cognition as
a measure of brain health. These deliver patient assessments via:
· Digital touchscreen cognitive assessments, known as CANTAB®,
where participants complete specific tasks that generate objective cognitive
data and brain health insights.
· Voice-based cognitive assessments, which were materially enhanced
and expanded through the acquisition of Winterlight Labs in 2023.
These assessments can serve four market segments:
· Clinical Studies to assess the efficacy and safety of new
pharmaceutical or other healthcare products.
· Academic Research focussed principally on understanding
underlying disease mechanisms.
· Healthcare to support physicians in diagnosis, treatment and
monitoring of patients in a real-world setting by measuring cognitive
function.
· Consumer Health & Wellness applications to allow individuals
to assess cognitive function with a reliable, accurate and meaningful output.
To date the Group has only generated consistent and significant revenue from
Clinical Studies and Academic Research. It is a strategic objective to
generate income from both the Healthcare and Consumer Health & Wellness
channels through corporate partnership.
2024 2024 2023 2023
£m % £m %
Clinical Studies 9.3 90.2% 12.5 92.7%
Academic Research 0.9 8.4% 0.9 6.6%
Healthcare 0.1 1.4% 0.1 0.7%
Total Revenue 10.3 100.0% 13.5 100.0%
Clinical Studies
In 2024 the Group earned 90.2% (2023: 92.7%) of its revenue supporting
clinical studies conducted by pharmaceutical and biotechnology companies
developing new drugs. These new drug products are typically being developed to
treat central nervous system ('CNS') disorders where the customer seeks to
measure the effect of a drug candidate on a patient's cognition. The Group
believes the largest potential growth areas to be assessed using CANTAB and
Voice are: Alzheimer's disease, major depressive disorder and schizophrenia.
To support clinical studies the Group offers three further services:
· eCOA, or electronic clinical outcomes assessment, was
materially enhanced by the acquisition of eClinicalHealth (or 'Clinpal') in
October 2022. eCOA employs electronic questionnaires and clinical scales to
enable faster and more accurate study delivery compared to paper clinical
outcome assessment scales.
· AQUA - the Group developed and launched a unique,
automated quality assurance platform powered by Winterlight Labs' innovative
speech analysis platform, which was acquired in 2023. AQUA analyses audio
recordings during administration of CNS clinical scales to detect deviations
in administration and scoring to ensure that clinical data is both
standardised and accurate and it maximizes the likelihood of success in the
clinical study.
· Rater training - in 2024 the Group launched its
advanced in-house rater qualification and management programme that ensures
raters administer and score cognitive assessments consistently and to the
highest standards. The Group's method is founded on the comprehensive insight,
developed over more than 20 years, into the typical challenges and error
patterns faced by raters in CNS clinical studies. The training aligns the
experience levels of each rater with the clinical study to reduce the training
burden and accelerates the timeline for study start-up.
Academic Research
The Group supports researchers in academia who use the CANTAB Connect Research
('CCR') platform. CCR is based on the full CANTAB Connect platform but has
been tailored to meet the needs of academic researchers at a more affordable
price point. Backed by over 30 years of scientific discovery and validation,
CANTAB assessments have been referenced in over 3,000 peer reviewed papers and
articles. The Group believes that the Academic Research market segment has the
scope for continued growth and is developing focussed academic market access
routes to expand usage.
Healthcare
The Group has historically sought to deliver its technology to physicians for
patient cognitive assessment through a limited number of partner and
distributor relationships. The return on these has been disappointing. Since
Q4 2024, these relationships have been re-evaluated based on capability, fit
and delivery against targets. As a result, several agreements have been
terminated. A dedicated team is now seeking to identify new partners with the
commercial reach, infrastructure and desire to bring these technologies to
market to benefit physicians and patients.
Consumer Health & Wellness
The Group believes a significant opportunity exists within the Consumer Health
& Wellness market. Increasingly, individuals can access an array of health
and wellness services online and via apps, enabling them to self-monitor
aspects of their health. Data must be accurate, reliable and meaningful so
that it can be trusted should the individual wish to seek input from a
healthcare professional. A dedicated team has been established to evaluate
routes to market entry, with the Group being well positioned to address this
growing need.
The Group looks forward to making further updates on the Healthcare and
Consumer Health & Wellness markets during 2025.
Technology Licensing
The Group has generated a substantial bank of data relating to cognitive
health over 30 years of research. The Group is actively seeking routes to
create value from this data.
Monument Therapeutics Limited ('Monument'), in which the Group holds a 22.1%
stake, typifies a strategic opportunity to realise long-term value. Spun out
in 2021, Monument combines the Group's digital biomarkers with novel drug
development. Its lead programme is targeting cognitive impairment in
schizophrenia. In 2024, Monument raised £2.5m in new equity, leading the
Group to increase the fair value of its investment to £1.8m; an uplift of
£1.7m.
OPERATING REVIEW
Commercial
The Group's most important activity in 2024 has been to rebuild, re-energise
and refresh its Commercial team. The Group's Order Book had fallen from an
all-time high of £19.9m in June 2023 to £13.1m in September 2024, as new
Sales Orders failed to replace revenue recognised.
Alex Livingstone-Learmonth was appointed as Chief Commercial Officer in
February 2024. During 2024, Alex has worked to recruit and build an effective
Sales team and strengthen the marketing function. At the same time, he has
revised the strategic sales focus to build long-term relationships with large
pharmaceutical companies and well-funded biotechs through dedicated account
management. Developing these relationships provides greater visibility of
opportunities and reduces friction during the contracting process.
The changes in the Commercial team and the revised focus are delivering
results. In January to September 2024, the Group closed £4.3m of Sales
Orders, of which a substantial proportion were change orders and extensions to
existing studies. In Q4 2024 the Group secured £3.1m in Sales Orders, of
which 80% comprised new clinical studies. At 31 December 2024, the Order Book
had stopped its decline and stood at £13.6m.
Continuing the improvement seen in Q4 2024, the Group secured new Sales Orders
in Q1 2025 of £4.2m, approximately 85% of which are new clinical studies. At
31 March 2025, the Order Book had increased to £15.8m. The Group has reported
several recent notable contract wins:
· The award of large Phase III autoimmune disease
clinical trial which will generate approximately £1.0m in revenue.
· The award of digital cognitive and voice assessments
for two Phase III clinical trials in adolescents with Major Depressive
Disorder which will generate approximately £1.2m in revenue.
· The expansion of the relationship with Actinogen
Medical Limited (ASX: ACW) for the Phase IIb/III XanaMIA Alzheimer's disease
trial.
Leadership
The Board has strengthened the leadership of the Group at both a non-executive
and executive level.
The Company has appointed three highly experienced Non-Executive Directors:
Nick Rodgers and Stuart Gall joined the Board in January 2024, and Jon
Kempster joined in February 2025.
Following the departure of the CEO in September 2024, the Board appointed Rob
Baker (Chief Operating Officer) and Alex Livingstone-Learmonth (Chief
Commercial Officer) as Joint Acting Managing Directors. Since their
appointment, the Group has seen substantial positive development and a return
to sales growth with the Order Book recovering and future revenue prospects
improving. Through their leadership there has also been increased
communication across the international teams and with shareholders. Post the
reporting period, and with increased stability in the Group, the Board has
initiated a process to identify and select a CEO to deliver the next phase in
the development of Cambridge Cognition. The Board will keep shareholders
updated on the outcome of this process.
To ensure the continued growth in the Group's technology and scientific base,
a new Scientific Advisory Board has been formed to advise on relevant
developments in the CNS field. This comprises Professor Judith Jaeger,
Professor John Harrison, Liam Kaufman (VP Corporate Business Development and
former CEO of Winterlight Labs), and Dr Francesca Cormack (Cambridge
Cognition's Chief Scientist).
Product and technology
Science and technology lie at the core of the Group's offering, based on a
deep understanding of neuroscience and particularly cognition and diseases
which affect cognition. This is combined with the creation of innovative
software-based solutions to assess, monitor and measure cognition in human
health with tools for each specific market segment. The Group believes that
continued investment and development is essential. Over 2024 the Group:
· Launched the Rater Training service to complement the
suite of tools and services to support CNS clinical studies alongside CANTAB
and voice assessments, eCOA and AQUA. Rater Training ensures individuals
conducting cognitive assessments on patients in a clinical study ('raters')
have been prepared to the highest standards for a particular study, ensuring
high quality data is collected.
· Submitted a letter of intent to the U.S. Food and Drug
Administration ('FDA') under the Drug Development Tool pathway. This outlines
the Group's plan to develop and validate an objective and reliable measure of
cognitive impairment associated with schizophrenia ('CIAS'). This could serve
as a co-primary outcome in schizophrenia clinical trials, alongside functional
improvement. Unlike other schizophrenia symptoms, CIAS tends to persist
regardless of whether other symptoms are well-controlled. There is no approved
treatment which targets CIAS. The Group's proposed approach to digital
cognitive assessment is intended to reduce the burden associated with lengthy
and potentially less accurate paper-based cognitive tests.
· Announced that Bristol Myers Squibb used data from
CANTAB cognitive assessments to conduct a post-hoc analysis of two-Phase III
trials, which was published in The American Journal of Psychiatry. The CANTAB
assessments showed improvement in patients with pre-specified cognitive
impairments after treatment with the drug Cobenfy™.
· Demonstrated the value created through the spin-out,
Monument Therapeutics ('Monument') which raised a further £2.5m in new
equity. The Group has fair valued its investment in Monument to £1.8m, an
increase of 1.7m.
· Presented new data at the International Society for CNS
Clinical Trials and Methodology conference which demonstrated that AQUA has
strong alignment with expert reviewers on key quality indicators of Clinical
Dementia Rating ('CDR') recordings in an Alzheimer's disease trial. AQUA
analyses the audio recording of CNS clinical interviews and detects deviations
in administration and scoring by the rater. This allows AQUA to enhance COA
review processes and offer an efficient solution to support central
monitoring.
· Secured a £1.0m Innovate UK grant to provide voice and
touchscreen cognitive assessments for the Global Alzheimer's Platform
Foundations Bio-Hermes 2 project.
OUTLOOK
Following a return to commercial growth in late 2024, with new Sales Orders of
£3.1m in Q4, the Group had another strong quarter in Q1 2025 with new Sales
Orders of £4.2m. These included several multi-study agreements and repeat
business with top tier pharma companies. The Group is confident that the
revised sales strategy is yielding results.
The Order Book, which represents contracted work which has not been executed
and recognised as revenue, increased to £15.8m at 31 March 2025, up from
£13.6m at 31 December 2024. This provides visibility of revenues of £8.5m
for 2025, £4.1m for 2026 and £5.1m for 2027 and beyond. The pipeline of
sales opportunities which the Group is pursuing is £38.3m, up from £34.2m at
31 December 2024.
Clinical studies are typically executed over a two- to five-year period.
Therefore, new Sales Orders will only deliver a portion of their revenue in
2025. While further wins are required to reach market expectations, the strong
sales performance over the last six months gives the Group confidence that the
Order Book will grow materially during 2025.
Costs were reduced materially in 2024 and the focus on cost control,
profitability and cash generation continues. This focus will remain as the
Group scales up operations to accommodate the increased number of clinical
trials it anticipates delivering. The Board and management remain committed to
reaching profitability at an Adjusted EBITDA level.
The Group typically invoices a significant portion of a contract upfront and
continues to invoice ahead of completing work throughout the contract. This
means cash is closely linked to winning new Sales Orders and is generated
ahead of revenue. As the Group continues to close new Sales Orders this will
increase cash resources across the year.
The Board is monitoring recent trade developments in the United States
closely. The US is a key market, representing approximately half of the
world's pharmaceutical research and development spend. The Group believes that
the current tariff increases will have a limited impact on Cambridge
Cognition. However, there may be broader market effects on the appetite to
conduct and fund pharmaceutical R&D. The Group is paying close attention
to signals and is seeking ways to mitigate any impact.
Based on the improving sales performance, reduced costs, and focus on future
cost control, provided the recovery in new Sales Orders continues, the
Directors believe that the Group will close the year with strong revenues, an
improvement in Adjusted EBITDA, reduced borrowing and increased cash
resources. A materially strengthened Order Book will underpin future revenue,
profitability and cash flow.
Finally, 2024 was a year of significant disruption both internally and in
international markets. Cambridge Cognition has emerged from the past year
stronger, leaner and with renewed ambitions. This would not have been possible
without the leadership of the executive, the hard work of the operational
teams and the enduring support of shareholders. We look forward to carrying
the strong performance of Q4 2024 and Q1 2025 onwards into the future.
FINANCE REVIEW
Summary
While 2024 saw Revenue reduce to £10.3m (2023: £13.5m) the Group recorded an
improved Adjusted EBITDA loss of £43k (2023: £1.0m). At year end, the
Group's Order Book, which represents future contracted work, was £13.6m
(2023: £17.2m) of which £6.6m is anticipated to be recognised in revenue in
2025. The Group closed the year with Cash of £1.3m (2023: £3.2m), reduced
borrowings of £1.9m (2023: £2.5m) and a net debt position of £0.6m (2023:
net cash £0.7m). Liquidity was improved through a £2.3m equity issuance in
June 2024.
Order Book, Sales Orders & Revenue
The Order Book underpins revenue. Nearly all revenue is generated through
long-term contracts from Sales Orders. When contracted, this is referred to as
Order Book and is subsequently recognised as revenue when work is undertaken.
Due to the duration of clinical studies, which can range from 6 months to over
5 years, the Order Book provides visibility of future revenue. Most of the
revenue in any given year is derived from the opening Order Book, with the
balance coming from Sales Orders contracted and work undertaken during the
year.
The Order Book, as shown below, was £17.2m at 1 January 2024, of which £8.9m
was scheduled to be recognised as revenue in 2024. During 2024 the Group
secured total new Sales Orders of £7.4m, and these contributed £2.1m to
revenue in the year. This resulted in £10.3m of Revenue, after other
adjustments.
The decrease in Revenue to £10.3m (2023: £13.5m) was driven by:
· The fall in the Order Book during 2023; and
· Low Sales Orders during early 2024 with only £3.3m contracted in
H1 2024.
Given the duration of clinical studies, new Sales Orders received in the first
half of any financial year will yield greater revenue in the year than those
Sales Orders received in the second half.
Order Book Revenue recognition FY
2024 2024 2025 2026 2027 2028+ 2023
At 1 January 17.2 8.9 3.4 1.5 1.4 2.0 17.6
Acquisitions 1.5
New Sales Orders 7.4 2.1 3.5 1.3 0.4 0.1 10.9
Other adjustments(1) (0.6) (0.7) (0.3) 0.8 (0.6) 0.1 0.7
Revenue recognised (10.3) (10.3) - - - - (13.5)
At 31 December 13.6 - 6.6 3.6 1.2 2.2 17.2
1. Impact of foreign currency exchange rates, cancellations and
delays.
At 31 December 2024, the Order Book stood at £13.6m. While this is a decline
from 1 January 2024 (£17.2m) and 30 June 2024 (£14.6m), it shows the start
of a recovery. The Order Book had reached a low of £13.1m at the end of Q3
2024.
New Sales Orders in 2024 were £7.4m (2023: £10.9m). During Q1 to Q3, £4.3m
was contracted; however, only 44% was new clinical studies, with £2.3m being
change orders and extensions to existing studies. In Q4 2024, £3.1m was
contracted, with 80% being new clinical studies.
In Q1 2025, £4.2m of new Sales Orders were contracted, with 85% being new
clinical studies. This brings total new Sales Orders in the last six months to
£7.3m and increased the Order Book at 31 March 2025 to £15.8m, providing
visibility to £8.5m of Revenue in 2025.
Since September 2024, trading conditions remained challenging and the Group
believes that the increase in new Sales Orders is largely driven by the
recruitment of new Commercial leadership, rebuilding the sales and marketing
team, and by a change in focus to those larger well-funded pharmaceutical and
biotech companies which have portfolios of multiple potential studies.
The Group's principal source of Revenue is from Clinical Studies. Revenue by
market segment is as follows:
2024 2023 Movement Movement
£m £m £m %
Clinical Studies 9.3 12.5 (3.2) (25.6)
Academic Research 0.9 0.9 - -
Healthcare 0.1 0.1 - -
Total Revenue 10.3 13.5 (3.2) (23.7)
Gross margin and gross profit
Gross profit decreased 22% to £8.4m (2023: £10.8m), caused by lower revenue
in 2024. Gross margin was 81.2% (2023: 79.9%), improving slightly due to
operational efficiencies realised through the restructuring exercises
undertaken in 2024 and 2023, and a reduced number of lower margin study start
start-ups.
Operating expenditure
The Group focused significant effort on operational efficiencies and reducing
its cost base starting in 2023 and continuing in 2024. A significant
multi-departmental restructuring exercise was implemented in the first half of
the 2024. This resulted in annualised cost savings of £2.0m, bringing total
annualised cost saving of £3.5m from restructurings and cost cutting measures
completed in 2023 and 2024.
Operating expenditure was as follows:
2024 2023 Movement Movement
£m £m £m %
Research and development expense 2.6 3.8 (1.2) (31.6)%
Sales and marketing expense 2.3 3.0 (0.7) (23.3)%
Administrative expense 4.9 6.1 (1.2) (19.7)%
Non-recurring items 0.2 1.5 (1.3) (86.7)%
Total operating expense 10.0 14.4 (4.4) (30.6)%
Non-recurring items includes costs associated with acquisitions and
integrations of £0.1m (2023: £1.2m) and restructuring costs of £0.1m (2023:
£0.2m). These decreased year-on-year as there were no acquisitions in 2024,
and the integrations of Winterlight and Clinpal were materially completed in
2023.
Other operating income
Other operating income primarily relates to grant income, and this increased
by 167% in 2024 to £0.5m (2023: £0.3m). The Group participated in two grant
schemes during the year: Bio-Hermes 2 funded by Innovate UK, and
Trials@Home.
Adjusted EBITDA
The Group presents the non-GAAP measure of Adjusted EBITDA, to assist in
year-on-year comparisons of underlying, day-to-day operations. This is a
change from Adjusted operating profit/loss as presented in prior year. This is
reconciled to Operating Loss as follows:
2024 2023
£m £m
Operating loss (1.2) (3.3)
Adjusting items
Depreciation of property, plant and equipment 0.1 0.1
Amortisation of intangible assets 0.6 0.5
Share-based payments 0.3 0.2
Non-recurring items 0.2 1.5
Adjusted EBITDA - (1.0)
Adjusted EBITDA loss decreased to £43k (2023: loss of £1.0m). Adjusted
EBITDA excludes:
· depreciation of property, plant and equipment as a non-cash cost.
· amortisation of intangible assets primarily relates to the
amortisation of assets arising as a result of the acquisitions of Winterlight
and Clinpal, for which there has been no direct cash cost and does not reflect
the economic realities of the Group's day-to-day operations.
· share-based payments as a non-cash cost.
· non-recurring items related to non-core activities (acquisition,
integrations, significant restructuring exercises).
Liquidity: Cash, Borrowing and Net Cash/Debt
The Board recognises the need to ensure that the Group reaches sustained
profitability and cash flow. Cash flow, cash resources and financial
commitments are standing items at all Board meetings.
In June 2024, the Group completed a £2.6m equity fundraising, through the
issue of 6,561,057 new Ordinary Shares at 40p each which was supported by both
new and existing shareholders. These funds enable the Group to grow technical,
business development and commercial activities and strengthen the balance
sheet through provision of working capital. The Group believes the impact of
strengthening the Commercial group is being seen in the improvement in new
Sales Orders particularly over the six months to 31 March 2025.
The Group ended the year with £1.3m of cash (2023: £3.2m).
Loans and borrowings decreased to £1.9m (2023: £2.5m) due to repayments on
the principal of the term loan entered in September 2023. The associated
Finance costs increased to £0.6m in 2024 (2023: £0.2m) as a result of the
facility being in place for the entire year.
As a result, at 31 December 2024 the Group's net debt was of £0.6m (2023: net
cash £0.7m).
Investment in Monument Therapeutics
At 31 December 2024, the Group held a 22.1% (2023: 28.9%) investment in
Monument Therapeutics Limited ('Monument'). Monument closed two rounds of
equity funding in 2024, raising £2.5m. A further fundraise of £0.9m
completed in early 2025. The Group did not participate in these funding
rounds.
The Group's investment was fair valued on 31 December 2024 based on a
mark-to-market basis to the enterprise value for these investment rounds. This
increased the value of the investment to £1.8m (2023: £0.2m).
CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
Year to Year to
31 December 31 December 2023
2024
Notes £'000 £'000
Revenue 4 10,342 13,515
Cost of sales (1,955) (2,717)
Gross profit 8,387 10,798
Research and development expense (2,559) (3,847)
Sales and marketing expense (2,358) (2,983)
Administrative expense (4,930) (6,139)
Non-recurring items (155) (1,456)
Total operating expense (10,002) (14,425)
Share of profit after tax from joint ventures 32 -
Other operating income 416 322
Operating loss (1,167) (3,305)
Adjusted EBITDA (43) (1,024)
Adjusting items(1) (1,124) (2,281)
Operating loss (1,167) (3,305)
Interest receivable 21 16
Finance costs (563) (168)
Loss before tax (1,709) (3,457)
Tax expense (76) (51)
Loss for the year (1,785) (3,508)
Other comprehensive income/(loss)
Items that may subsequently be reclassified to profit or loss:
Exchange differences on translation of foreign operations (408) (210)
Items that may not subsequently be reclassified to profit or loss:
Fair value movements in equity investments 1,688 107
Total comprehensive loss for the year (505) (3,611)
Loss per share (pence)
Basic 5 (4.6) (10.1)
Diluted 5 (4.6) (10.1)
All items of income are attributable to the equity holders in the Parent. The
above results relate to continuing operations.
1. Adjusting items comprise amortisation of intangible assets
of £552,000 (2023: £568,000), depreciation of property, plant and equipment
of £68,000 (2023: £97,000), non-recurring items of £155,000 (2023:
£1,456,000) and share-based payments of £349,000 (2023: £160,000).
CONSOLIDATED STATEMENT OF FINANCIAL POSITION
At 31 December 2024 At 31 December 2023
Notes £'000 £'000
Assets
Non-current assets
Goodwill 3,454 3,653
Other intangible assets 3,335 4,089
Property, plant and equipment 34 133
Investments 1,844 156
Trade and other receivables 20 20
Total non-current assets 8,687 8,051
Current assets
Inventories 128 187
Trade and other receivables 2,627 2,417
Current tax receivable 292 351
Cash and cash equivalents 6 1,295 3,222
Total current assets 4,342 6,177
Total assets 13,029 14,228
Liabilities
Current liabilities
Trade and other payables 2,119 2,603
Deferred income on contracts with customers 4 5,511 7,699
Loans and borrowings 985 566
Current tax payable 147 99
Total current liabilities 8,762 10,967
Non-current liabilities
Loans and borrowings 905 1,978
Total non-current liabilities 905 1,978
Total liabilities 9,667 12,945
Equity
Share capital 419 350
Share premium 17,641 15,169
Other reserves 5,205 5,613
Own shares (71) (71)
Retained earnings (19,832) (19,778)
Total equity 3,362 1,283
Total liabilities and equity 13,029 14,228
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
Share capital Share premium Other reserves Own shares Retained earnings
Total
£'000 £'000 £'000 £'000 £'000 £'000
At 1 January 2023 312 11,151 5,823 (71) (17,120) 95
Loss for the year - - - - (3,508) (3,508)
Other comprehensive loss
Exchange differences on translation of foreign operations - - (210) - - (210)
Fair value movements in equity investments - - - - 107 107
Total comprehensive loss for the year - - (210) - (3,401) (3,611)
Transactions with owners
Issue of new shares in relation to business combinations 34 3,966 - - - 4,000
Issue of new shares in relation to exercise of employee share options 4 52 - - - 56
Credit to equity for share-based payments - - - - 160 160
Post-combination remuneration - - - - 309 309
Issue of warrants - - - - 274 274
Transactions with owners 38 4,018 - - 743 4,799
At 31 December 2023 350 15,169 5,613 (71) (19,778) 1,283
Loss for the year - - - - (1,785) (1,785)
Other comprehensive loss
Exchange differences on translation of foreign operations - - (408) - - (408)
Fair value movements in equity investments - - - - 1,688 1,688
Total comprehensive loss for the year - - (408) - (97) (505)
Transactions with owners
Issue of new shares in relation to equity fundraising 66 2,559 - - - 2,625
Transaction costs relating to issue of share capital - (446) - - - (446)
Shares issued on settlement of share based arrangements 2 304 - - (306) -
Issue of new shares in relation to exercise of employee share options 1 55 - - - 56
Credit to equity for share-based payments - - - - 349 349
Transactions with owners 69 2,472 - - 43 2,584
At 31 December 2024 419 17,641 5,205 (71) (19,832) 3,362
CONSOLIDATED STATEMENT OF CASH FLOWS
Year to Year to
31 December 2024 31 December 2023
Notes £'000 £'000
Net cash flows used in operating activities 6 (3,085) (4,967)
Investing activities
Dividends received from joint ventures 32 -
Acquisition of subsidiary, net of cash acquired - (3,002)
Interest received 21 16
Purchase of property, plant and equipment (3) (33)
Net cash flow generated from/(used in) investing activities 50 (3,019)
Financing activities
Proceeds from share issue 2,624 -
Transaction costs arising on issue of shares (446) -
Proceeds from borrowings, net of fees incurred - 3,054
Proceeds from exercise of share options 57 56
Repayment of borrowings (547) (116)
Interest payments (563) (109)
Net cash flows generated from financing activities 1,125 2,885
Net decrease in cash and cash equivalents (1,910) (5,101)
Cash and cash equivalents at start of year 3,222 8,322
Exchange differences on cash and cash equivalents (17) 1
Cash and cash equivalents at end of year 6 1,295 3,222
NOTES TO THE CONSOLIDATED FINANCIAL STATAMENTS
1. General information
Cambridge Cognition Holdings plc ('the Company') and its subsidiaries
(together, 'the Group') develops and markets digital solutions to assess brain
health.
The Company is a public limited company which is listed on the AIM market of
the London Stock Exchange (symbol: COG) and is incorporated and domiciled in
the UK. The address of its registered office is Tunbridge Court, Tunbridge
Lane, Bottisham, Cambridge, CB25 9TU.
2. Basis of preparation
The preliminary financial information for the year ended 31 December 2024 is
unaudited. As such, the unaudited preliminary financial information
presented does not represent statutory financial statements within the meaning
of section 435 of the Companies Act 2006.
Statutory accounts for the year ended 31 December 2023 have been filed with
the Registrar of Companies. The statutory accounts for the year ended 31
December 2024 will be delivered to the Registrar in due course.
The Group financial statements will be properly prepared in accordance with UK
adopted international accounting standards. The accounting policies adopted
will be consistent with those followed in the preparation of the consolidated
financial statements for the year ended 31 December 2023, except as noted
below:
· The Group has made the following changes to the presentation of
the Consolidated Statement of Comprehensive Income, which has resulted in
restatements of prior period balances. The Non-GAAP measure Adjusted operating
profit/loss has been replaced with Adjusted EBITDA. This is intended to align
presentation with the internal accounts available to management and to
shareholder expectations. Adjusted operating profit/loss was defined as
operating profit/loss before: non-recurring items, amortisation of
acquisition-related intangible assets and share-based payment charge. Adjusted
EBITDA additional excludes amortisation of intangible licences and
depreciation of property, plant and equipment. The adjusted operating loss for
the year ended 31 December 2023 was £(1,128,000).
3. Going concern
In adopting the going concern basis for preparing the financial statements,
the Directors have considered business activities in the context of the
current operating environment. To support the going concern conclusion, the
Directors have developed several working capital models covering from the
signing of these financial statements through to 31 May 2026. The specific
scenarios modelled are:
Scenario Outcome
Base case
Based upon the Group's most recent Board approved forecasts. The Group maintains a positive cash balance throughout the going concern
period. The Group is able to meet all forecasted obligations as they fall due.
Reverse stress case
A scenario modelled to determine the minimum value of sales orders required A flat reduction in sales orders from the base case resulted the Group's cash
for the Group to maintain a positive cash balance over the going concern balance reducing to nil in Q3 2025, although there are additional potential
period. This includes the impact of certain direct cost savings arising from cost savings that could be made that have not been modelled.
reduced sales orders.
Given the Group's base case maintains a positive cash balance, the financial
statements for the year ended 31 December 2024 have been prepared on the going
concern basis of accounting.
The Group invoices a significant portion of a sales order at the point of
signature. As a result, future cash generation is heavily dependent upon both
the value and timing of future deals. The Group's reverse stress case
demonstrates that a potential downside in future sales orders from the base
case would result in currently available financing being insufficient to meet
the Group's liquidity requirements over the going concern period. Should a
downside scenario occur, the Board has identified several actions it could
take to save or defer costs. In such a scenario, the Group may also need to
seek additional sources of financing. This represents a material uncertainty
that may cast significant doubt upon the Group's ability to continue as a
going concern. The Directors continually review the Group's cash situation.
The financial statements do not include the adjustments that would be required
if the Group and the Company are unable to continue as a going concern.
4. Revenue
An analysis of the Group's revenue for each major revenue stream is as
follows:
2023
2024
£'000
£'000
Clinical studies 9,329 12,532
Academic research 869 891
Healthcare 99 92
Royalties 45 -
10,342 13,515
An analysis of the Group's revenue for each major product and service category
is as follows:
2024 2023
£'000 £'000
Software 4,765 6,532
Services 5,234 6,364
Hardware 298 619
Royalties 45 -
10,342 13,515
Costs cannot be directly attributed to either the products and services, or
revenue streams above so profit measures are not presented.
Geographical information
The revenue from external customers by geographical location is detailed
below:
2024 2023
£'000 £'000
United Kingdom 1,199 1,010
United States of America 6,987 9,368
European Union 644 2,505
Rest of World 1,512 632
10,342 13,515
Non-current assets held in the United Kingdom amounted to £2.9 million (2023:
£1.4 million). Non-current assets held in all foreign countries amounted to
£5.8 million (2023: £6.6 million). Material non-current assets are held in
Canada amounting to £5.8 million (2023: £6.5 million). No other country
holds material non-current assets.
Information about major customers
One customer accounted for more than 10% of reported revenue in 2024,
amounting to 18% of the total (2023: one customer amounting to 18%).
Revenue from contracts with customers
All revenue in 2024 and 2023 comes from contracts with customers.
Timing of revenue recognition
Some software and services are recognised over a period of time ('over time'),
and some at a point in time ('point in time'). The split of revenue in line
with these factors is as follows:
2024 2023
£'000 £'000
Software - over time 4,666 6,440
Software - point in time 99 92
Services - over time 4,413 5,492
Services - point in time 821 872
Hardware - point in time 298 619
Royalties - over time 45 -
10,342 13,515
Of the £7.7 million Deferred income from contracts with customers at 31
December 2023, £6.4 million was recognised as revenue in 2024. Of the £12.3
million Deferred income from contracts with customers at 31 December 2022,
£9.1 million was recognised as revenue in 2023.
Payment terms can vary from customer to customer and are subject to
negotiation. Normally, software will be invoiced at the point of initial sale
and services invoiced as delivered. This creates a deferred income balance in
respect of software which will be reduced as the software is used.
Contract balances
Contract balances are as follows:
2024 2023
£'000 £'000
Trade receivables 1,199 1,039
Accrued income on contracts with customers 213 211
Deferred income on contracts with customers 5,511 7,699
Trade receivables increased due to higher sales volume in the last quarter of
2024 compared to 2023.
Accrued income on contracts with customers did not materially change.
Deferred income on contracts with customers decreased as revenue was
recognised in excess of invoicing. This was caused by lower year-on-year sales
orders.
Deferred commissions
Deferred commissions are presented as part of Trade and other receivables. The
Group does not consider any of these amounts impaired. The movement of this
account specifically is as follows:
2024 2023
£'000 £'000
At 1 January 382 706
Recognised in Consolidated Statement of Comprehensive Income (259) (385)
Net addition from sales in year 80 71
Exchange adjustments 28 (10)
At 31 December 231 382
5. Earnings per share
The calculation of basic and diluted earnings per share ('EPS') is based on
the following data:
Earnings
2024 2023
£'000 £'000
Earnings for the purposes of basic and diluted EPS per share being net loss (1,785) (3,508)
attributable to owners of the Company
Weighted average number of ordinary shares:
2024 2023
'000 '000
For the purposes of basic EPS 38,640 34,586
For the purposes of diluted EPS 38,640 34,586
The diluted loss per share is considered to be the same as the basic loss per
share. Potential dilutive shares are not treated as dilutive where they
would result in a loss per share.
2024 2023
pence pence
Basic EPS (4.6) (10.1)
Diluted EPS (4.6) (10.1)
6. Notes to the cash flow statement
2024 2023
£'000 £'000
Loss before tax (1,709) (3,457)
Adjustments for:
Depreciation of property, plant and equipment 68 97
Impairment of property, plant and equipment - 3
Amortisation of intangible assets 552 568
Share-based payments charge 349 160
Share of profit after tax from joint ventures (32) -
Finance costs 563 168
Acquisition related expenses deferred amounts (59) 318
Interest receivable (21) (16)
Research and Development expenditure tax credit (17) (73)
Operating cash flows before movements in working capital (306) (2,232)
Decrease in inventories 59 29
(Increase)/decrease in trade and other receivables (210) 2,235
Decrease in trade and other payables (484) (445)
Decrease in deferred income on contracts with customers (2,188) (4,667)
Cash used in operations (3,129) (5,080)
Taxation credit received less tax paid 44 113
Net cash used in operating activities (3,085) (4,967)
Reconciliation of liabilities arising from financing activities
2024 2023
£'000 £'000
Debt at 1 January 2,544 -
Term loan draw down - 3,054
Repayment of borrowings (547) (116)
Interest expense 563 147
Interest paid (563) (88)
Offsetting
- Transaction costs - (175)
- Warrant costs - (274)
Exchange adjustments (107) (4)
Debt at 31 December 1,890 2,544
Cash and cash equivalents
2024 2023
£'000 £'000
Cash and cash equivalents 1,295 3,222
Cash and cash equivalents comprise cash and short-term bank deposits with an
original maturity of three months or less. The carrying amount of these assets
is approximately equal to their fair value.
7. Annual Report and Annual General Meeting
Details of the Annual General Meeting ('AGM') will be communicated to
shareholders via the Company's website and a Regulatory Information Service in
due course.
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. END FR WPUWUCUPAGMURecent news on Cambridge Cognition Holdings
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