REG - Eden Research plc - Preliminary results for the year ended 31 Dec 2024
06/05/2025 07:00
For best results when printing this announcement, please click on link below:
https://newsfile.refinitiv.com/getnewsfile/v1/story?guid=urn:newsml:reuters.com:20250506:nRSF4558Ha&default-theme=true
RNS Number : 4558H Eden Research plc 06 May 2025
6 May 2025
Eden Research
("Eden" or "the Company")
Preliminary results for the year ended 31 December 2024
Eden Research (AIM: EDEN), a leader in sustainable biopesticide and biocontrol
technology, announces its preliminary results for the year ended 31 December
2024.
Commercial and operational highlights
· Authorisation for Mevalone® received in the key US state of
California in January 2024.
· Mevalone® authorised for use in new crops and fungal pathogens in
Spain in June 2024.
· Authorisation for Mevalone® received in Germany and Czechia (post
period-end).
· More than 140 insecticide field trials were run in 2024 by Eden and
potential distribution partners, following significant interest in the
evaluation of Eden's development insecticide.
· Strengthening of the Commercial Team with the appointment of a
skilled team filling roles such as Commercial Lead, Product Management and
Marketing Lead and Supply Chain Lead.
· Eden named ESG Company of the Year at the prestigious 2024 Small Cap
Network Awards in recognition of its commitment to environmental, social and
governance matters and contribution to the green economy.
Financial highlights
· Revenue for the year grew to £4.3 million (2023: £3.2 million),
reflecting a growth rate of 34% year-over-year.
· Operating loss for the year was £2.2 million (2023: £1.9
million)
· Cash position at the year-end was £3.7 million (2023: £7.4
million)
The Group's full Financial Statements are available at: www.edenresearch.com
(http://www.edenresearch.com) .
Lykele van der Broek, Chairman of Eden Research plc, commented:
"Eden has seen another strong year of growth with overall revenue up 34% and
product sales also up by a similar amount.
In addition to this, several key milestones were reached in 2024 which will
all help to drive revenue in the short and medium term and get Eden to the
point of cashflow positivity, which will be a significant milestone for the
business.
I remain very optimistic about Eden's prospects and believe that the Company
is making excellent progress toward achieving its goal of becoming a leader in
the biological crop protection products and solutions industry."
The information contained within this announcement is deemed to constitute
inside information as stipulated under the retained EU law version of the
Market Abuse Regulation (EU) No. 596/2014 (the "UK MAR") which is part of UK
law by virtue of the European Union (Withdrawal) Act 2018. The information is
disclosed in accordance with the Company's obligations under Article 17 of the
UK MAR. Upon the publication of this announcement, this inside information is
now considered to be in the public domain.
For further information, contact:
Eden Research plc
Sean Smith (CEO) www.edenresearch.com (http://www.edenresearch.com/)
Alex Abrey (CFO)
01285 359 555
Cavendish Capital Markets Limited
(Nominated advisor and joint broker)
Giles Balleny / George Lawson (corporate finance) 020 7220 0500
Charlie Combe (corporate broking)
Michael Johnson (sales)
Oberon Capital (Joint broker)
Nick Lovering 020 3179 5300
Mike Seabrook
Adam Pollock
Hawthorn Advisors (Financial PR)
Victoria Ainsworth eden@hawthornadvisors.com
Notes to Editors:
Eden Research is the only UK-listed company focused on biopesticides for
sustainable agriculture. It develops and supplies innovative biopesticide
products and natural microencapsulation technologies to the global crop
protection, animal health and consumer products industries.
Eden's products are formulated with active ingredients, based on natural plant
defence molecules. To date, the Company's products have been primarily used on
high-value fruits and vegetables, improving crop yields and marketability,
with equal or better performance when compared with conventional pesticides.
Eden has three products currently on the market.
Based on plant-derived active ingredients, Mevalone(®) is a foliar
biofungicide which initially targets a key disease affecting grapes and other
high-value fruit and vegetable crops. It is a useful tool in crop defence
programmes and is aligned with the requirements of integrated pest management
programmes, and it is allowed for use in organic agriculture across the EU and
in select other countries. It is approved for sale in a growing number of key
countries whilst Eden and its partners pursue regulatory clearance in new
territories thereby growing Eden's addressable market globally.
Novellus®+ is an evolution of Mevalone, allowing improved rates in the
field, high levels of efficacy and a broader list of plant and disease
targets. This product was formulated to address the specific market demands
of certain territories and will be launched in these territories based upon
local conditions.
Cedroz™( )is a bionematicide that targets free living nematodes which are
parasitic worms that affect a wide range of high-value fruit and vegetable
crops globally. Cedroz is registered for sale on two continents and Eden's
commercial collaborator, Eastman Chemical, is pursuing registration and
commercialisation of this important new product in numerous countries
globally.
Eden's seed treatment product, Ecovelex™, was developed to safely tackle
crop destruction caused by birds - a major cause of losses in maize and other
crops. Ecovelex works by creating an unpleasant taste or odour that repels
birds, leaving the seeds safely intact and the birds unaffected and free to
find alternative food sources. The product is based on Eden's plant-derived
chemistry, registered in the EU, US and elsewhere, and formulated using Eden's
Sustaine(®) microencapsulation system.
Eden's Sustaine(®)( )encapsulation technology is used to harness the
biocidal efficacy of naturally occurring chemicals produced by plants
(terpenes) but can also be used with both natural and synthetic compounds to
enhance their performance and ease of use. Sustaine microcapsules are
naturally derived, plastic-free, biodegradable micro-spheres derived from
yeast. It is one of the only viable, proven and immediately registerable
solutions to the microplastics problem in formulations requiring
encapsulation.
Eden was admitted to trading on AIM on 11 May 2012 and trades under the
symbol EDEN. It was awarded the London Stock Exchange Green Economy
Mark in January 2021, which recognises London-listed companies that derive
over 50% of their total annual revenue from products and services that
contribute to the global green economy. Eden derives 100% of its total annual
revenues from sustainable products and services.
For more information about Eden, please visit: www.edenresearch.com
(http://www.edenresearch.com/) . You can also follow Eden's latest
developments via its social media channels: X (Twitter)
(https://twitter.com/edenresearch) and LinkedIn
(https://www.linkedin.com/company/eden-research-plc/) .
Chairman's Statement
I am pleased to report that Eden has seen another strong year of growth with
overall revenue up 34% and product sales also up by a similar amount.
In addition to this, several key milestones were reached in 2024 which will
help to drive revenue in the short and medium term and get Eden to the point
of cashflow positivity, which will be a significant milestone for the
business.
Authorisation for Mevalone® was received in the key US state of California at
the beginning of 2024. Once certain label restrictions have been removed,
which the Company is working hard to achieve, the opportunity in the US should
prove to be a considerable one.
Mevalone was also authorised for use in new crops and fungal pathogens in
Spain which has increased the addressable market and we are already seeing the
benefit of this in 2025.
More than 140 insecticide field trials were run in 2024 by Eden and a number
of potential distribution partners, following significant interest in the
evaluation of Eden's developmental insecticide and the team at Eden is now
negotiating to conclude commercial arrangements.
An emergency use authorisation was received for Ecovelex in Italy for the
second year running which led to meaningful sales towards the end of 2024. The
Company expects full authorisation by the Rapporteur Member State in mid-2025
which, once granted, will lead to approvals from other concerned Member States
being sought which will unlock the full potential throughout Europe.
At the end of 2024, regulatory approval was received for Novellus+, a new,
enhanced version of Eden's flagship fungicide, Mevalone, in Mexico. This is an
exciting development as Novellus+ represents an evolution of Mevalone,
allowing improved rates in the field, high levels of efficacy and a broader
list of targets, all contributing to a larger addressable market in select
territories.
As I know from my previous roles, such as Chief Operating Officer of Bayer
CropScience, the crop protection industry is heavily regulated, methodical,
slow-paced and, as such, often frustrating. However, the evolution of
biopesticides is not only a very positive development for the industry, the
environment and consumers, but also an increasingly valuable one.
The industry has seen a significant increase in investment in this area
through both internal development as well as M&A activity. It's clear that
there is a consensus that biopesticides, and other sustainable solutions, are
the future of crop protection.
As such, I remain very optimistic about Eden's prospects and believe that the
Company is making excellent progress toward achieving its goal of becoming a
leader in the biological crop protection products and solutions industry.
I would like to thank Eden's shareholders for their ongoing and much
appreciated support.
Lykele van der Broek
Non-Executive Chairman
2 May 2025
Chief Executive Officer's Review for the year ended 31 December 2024
Section one: Introduction
Over the past ten years, I've had the privilege of steering the Company's
growth from a business with no registered products to a well-established,
independent biopesticide leader, with a strong track record in developing
plant-derived crop protection solutions for sustainable agriculture. Today,
Eden, unique among its peers, boasts a portfolio of three products, with an
additional three in the pipeline, regulatory clearance in 24 markets, and over
101 crop use approvals.
The past year encapsulates the Company's evolution to date in more ways than
one. Not only have we delivered another year of significant revenue growth,
but we have also gained entry into some of the world's most strictly regulated
markets in California and Germany, and made significant development
advancements to grow our product offering. Advances have also been made in our
portfolio as we edge closer towards obtaining regulatory clearance for
Ecovelex and prepare for the next steps in the commercialisation of our first
bioinsecticide.
Macroeconomic context
Demand for our biopesticides continues to rise as the agriculture industry
grapples with an increased regulatory clampdown on conventional pesticides
with known detrimental effects on the environment and human health. We have
seen a clear trend amongst farmers looking to adopt top-tier technology to
efficiently maximise their yields and meet or exceed increasing regulatory
restrictions, paving the way for innovative alternatives such as Eden's
biopesticides. While these factors add wind to the sails for Eden, more urgent
action is needed to create a faster regulatory pathway for biopesticides,
helping to address the performance and environmental challenges faced by
farmers worldwide.
Across Europe, currently our largest market, product inventories eased
somewhat in the 2024 calendar year, following a year of pesticide de-stocking.
Purchasing patterns also shifted to a more real-time ordering approach, moving
away from the pre-buying trends which became commonplace in the face of supply
chain issues following the pandemic. This shift has contributed to greater
visibility of the supply chain and distribution channels whilst providing some
opportunities for quick sales where regulatory clearances allow.
In the US, growers have faced declining commodity prices, which have depressed
farm incomes and led to a 10% decline in pesticide expenditures in 2024
compared to the previous year. With no further indication that prices will
continue to fall sharply, these appear to have been short-term challenges,
primarily affecting the corn and grain market, which Eden has yet to enter in
North America. Looking ahead, ongoing antitrust litigation may disrupt the
established crop input distribution chain that has long relied on loyalty
schemes, providing new opportunities for alternative suppliers to enter the
market. As a relatively new supplier to the market in the US, we are
well-placed to take advantage of this shift.
Section two: Delivering on our strategy
Operating in an industry such as ours requires participants to navigate a
plethora of regulatory hurdles, more often than not outside of the Company's
control. It presents us with a double-edged sword. On one hand, we are at the
mercy of a regulator's timeline. On the other hand, the value of our growth
story and investment case depends on the growth of our certification count.
These regulatory wins define the pace with which we can move and the size of
the markets that we can address.
Against this backdrop, our Company strategy remains consistent, built on four
key objectives:
a) Business line diversification
- Pursuit of opportunities in seed treatments
- Development of insecticides
- Expand crops and diseases treated, increasing the addressable market
for existing products
- Geographic diversification
b) Research, development, and operations
- Supply chain optimisation
- Expansion of in-house screening and field trials capability
- Accelerate commercialisation of Sustaine for conventional actives
- Increase self-reliance in R&D
- Reduce time to market
c) Commercial growth
- Regulatory clearance in new countries, crops, and diseases
- Proactively pursue Sustaine business development
- Partnerships for Mevalone and Cedroz in new territories
- Pursue collaboration with majors and select national partners
- Route to market optimisation
d) Strengthening and growing the team
- Added capabilities in R&D, including microbiology, plant
biology, agronomy, and analytical chemistry
- Robust approach to data quality
- Expand commercial team
- Addition of in-house regulatory expertise - accelerating time to
market and reducing regulatory costs
Taking Ecovelex to market
Since Ecovelex's launch under emergency authorisation in Italy in 2023, we
have seen strong demand for the product from Italian farmers as they contend
with the pressures arising from the removal of conventional products from the
market. The product has so far meaningfully contributed to our revenue and
remains a core part of our sales growth strategy. This is despite recording a
smaller-than-expected product order in November 2024 compared to the previous
year's order (due to adverse weather conditions) which had a significant
impact on the number of hectares planted, a static addressable market, and
stock carried over from 2023.
In November 2024, we were pleased to have been granted an extension to our
licence under EU regulation 1107/2009. This extension permits us to continue
selling our sustainable seed treatment to Italian farmers under restricted
conditions.
Full, EU-wide authorisation for Ecovelex is currently expected this year,
subject to the pace of regulatory review and clearance. The dossier and
application have been submitted to the Austrian authorities, who are acting as
the interzonal rapporteur member state on behalf of the EU. EU rapporteur
member states are then invited to ratify the authorisation or require
additional information before granting local authorisations.
Expanding territorial reach
The growth of our flagship biofungicide, Mevalone, continues apace as we seek
new markets for its sale and use, bringing its benefits to farmers in
additional corners of the world. Mevalone now has 10 disease targets, 97 crop
uses, and market approval in 21 different territories.
We were pleased that 2024 commenced with the announcement of regulatory
authorisation for Mevalone in California. This approval is particularly
noteworthy, as California is the largest wine-producing region in the United
States, representing approximately 84% of the nation's total production.
Furthermore, the State enforces stringent agricultural regulations that
prioritise sustainable farming practices. With the timing of this
authorisation, we are positioned to begin distributing Mevalone to grape
growers across California through our commercial partner, Sipcam, and we
anticipate generating significant revenue in 2025 as we continue to refine our
commercial and marketing strategy. Refinements of the current label will yield
additional growth opportunities in years to come even as some restrictions do
little to dampen enthusiasm for Mevalone in California and beyond.
We have also had a number of regulatory breakthroughs for Mevalone in Europe
and elsewhere in 2024. Notably, Eden received regulatory authorisation for use
the use of Mevalone on grape vines to control Botrytis and apples to prevent
storage diseases in Germany. This was later complemented by the news in
December that Mevalone had been registered as an input for organic farming
across the nation. Germany is widely considered as one of the strictest
regulatory environments in Europe (and more broadly), and our regulatory
success here is clear validation of the strong efficacy of our product, as
well as its flexible and environmentally friendly qualities.
Eden also obtained a label extension in Spain for Mevalone, marketed as Araw
in the region. This extension expands the biofungicide's use to include 22 new
crops on 4 new fungal diseases. Most notably, these new crop additions include
almonds, which is one of the largest tree crops in Spain after olives with the
nation ranking third in terms of global production.
Our newly formulated version of Mevalone, marketed as Novellus+, has achieved
regulatory approval following the Mexican authorities' authorisation for the
product's use against botrytis on a range of horticultural crops. We expect
the addition of Novellus+ to meaningfully contribute to the Company's revenues
in the coming seasons.
Building on our strong partnership with Sumi Agro Europe across central
Europe, we were pleased to have appointed the firm as our exclusive
distributor for Austria to help grow our market presence in these specialist
wine and apple markets.
The growth potential of our bionematicide was also illustrated by
Cedroz's temporary approval in Greece for use on potatoes against
wireworms for the 2024 growing season. Wireworms, the larvae of click beetles
(Elateridae), are a significant global agricultural pest, particularly in
temperate regions. They attack the roots, seeds, and underground stems of
crops such as potatoes, corn, wheat, and carrots. The severity of the problem
varies depending on the species, soil type, climate, and crop rotation
practices. The resultant product approval has helped buoy Cedroz sales and we
continue to work with Eastman and the local regulators to secure its long-term
authorised use in Greece and elsewhere. Moreover, wireworms represent a
significant pest for growers in certain parts of the world.
Generally, Cedroz sales continue to rebound after a disappointing period
caused by production issues which have now been resolved. Revenue growth in
Morocco is particularly noteworthy, as sales there have propelled the country
into position as one of Eden's largest commercial markets. We are encouraged
by Eastman's new-found confidence in Cedroz following a challenging period,
and it truly gratifying to see growers embrace the product with such
enthusiasm, as was evident during a recent marketing trip with Eastman to the
north African nation.
Enhancing existing products
We are currently working towards a significant label extension for Mevalone to
include use on grapes to treat the major crop disease, downy mildew. Given the
fast pace with which key competitor products targeting this disease are being
removed from the European market, this label extension has the opportunity to
dramatically grow Mevalone's addressable market. Subject to regulatory
timelines, we anticipate a positive verdict as soon as 2025. As always, the
pace of regulatory action is largely outside of Eden's control, and we hope to
update the market as soon as we have news on this process.
Progressing our development pipeline
We are also focused on the progression of new products within our development
pipeline, which are based on our proprietary terpene-based chemistry and
yeast-based microencapsulation technology, though it should be noted that with
Eden's newly-developed in-house formulation capabilities, we now possess a
great deal of flexibility in terms of how and what we use to formulate our
products.
The most advanced of our new products is our first bioinsecticide which will
target key pests such as aphids, spider mites, and whiteflies. In June, we
announced encouraging results which involved more than 30 laboratory trials,
and more than 140 field trials conducted in Europe and the United States.
Results showed strong efficacy against all life stages of the target pests and
demonstrated equivalence or superior performance when compared with registered
biological reference products produced by some of the world's leading
biochemical companies. We are now in the process of negotiating an agreement
with potential commercial partners to support our marketing efforts and help
bring this product to market. We expect to make an announcement on our
progress in due course. Concurrently, we are also working towards regulatory
submissions in the US and Europe. Subject to authorisation, first sales of the
product could be achieved in the coming year in the US, given our active
ingredients have already been registered at a federal level.
Over the past year, we have also started work on two additional product
candidates which are in the early stages of development. The first of which is
a second biofungicide which is being formulated to target late blight and
similar pathogens primarily on potatoes and a range of other high-value fruits
and vegetables. There has already been a considerable amount of interest in
this product, and we are actively engaged with a number of industry partners
who are in the early stages of screening the product.
The second of these is another bioinsecticide. This will specifically target
Lepidoptera, an important pest target which is not covered by our first
bioinsecticide and represents a substantial commercial opportunity for the
company where there is a large gap in available sustainable solutions.
Increasing team capacity and capability
As our business continues to evolve, we have needed to ensure that Eden has
the capabilities and capacity to keep up with the pace of development and
regulatory workstreams. Therefore, we are delighted to have made several
important hires in strategic areas to guide Eden through its next growth
chapter. These include the filling of key regulatory and commercial roles such
as Global Commercial Lead, Head of Regulatory Affairs, and Global Product and
Marketing Lead, respectively. Each of the individuals that we have hired
brings rich industry experience at international agchem companies and strong
leadership in their field.
At Board level, we welcomed Derek McAllan as a new Non-Executive Director and
Chairman of the Audit Committee. Derek brings great balance to the Board
considering his accounting remit as a Partner of RSM UK and extensive
background advising listed and private businesses across the life sciences
sector.
Section three: Financial review
Revenue for the year was £4.3 million which marked a 34% increase on the
previous year (2023: £3.2m). This reflects a significant increase in product
sales which were £3.6m, a 38% rise on last year's product sales (2023:
£2.6m).
Our operating loss for the year was £2.2m (2023: loss of £1.9m).
Administrative expenses increased in line with expansion of the development
and commercialisation team to £3.5 million (2023: £3.0 million), while
additions to intangible assets, including development costs, increased to
£2.5 million from £1.7 million in 2023.
While the loss before taxation decreased to £2.2m (2023: £6.9m loss), this
was driven by a significant non-cash impairment of intangible assets in 2023
of £5.0m which was not repeated in 2024.
The increased strength of the Pound Sterling against the Euro throughout 2024
(from €1.15 at the beginning of the year to €1.21 per GBP as at 31
December 2024) negatively impacted reported revenue by £0.2 million.
As forecast, regulatory costs have been relatively high in 2024 due to the
costs associated with the renewal of Eden's three active ingredients in the
EU. Eden has also invested meaningfully in the development of its product
portfolio, both through advancing regulatory submissions (new formulations and
label extensions of existing products) and through laboratory and field work
to assist in the commercialisation of those products.
Our cash balance at year-end was £3.7m (2023: £7.4m).
At present, Eden does not expect to need to raise additional capital to
meet its existing working capital requirements for the foreseeable future.
There is currently no near-term plan to pay a dividend. However, the Board
continues to review the Company's dividend policy.
Section four: 2025 outlook
On 13 January 2025, we reiterated our £5 million revenue forecast for the
2025 financial year. This has been underpinned by repeat sales of Ecovelex
made under extended emergency approval in Italy and other European
territories, as well as sales growth of Mevalone and Cedroz due to increased
market share and approvals received in 2024.
There are a number of potential approvals and events that have not been
included in the 2025 revenue forecast, which would, if realised, add material
upside if these took place. These include the following:
· Full EU authorisation for Ecovelex well in advance of the year-end,
expanding its use beyond Italy on a long-term basis;
· Approval of Mevalone for the treatment of downy mildew in France,
marketed locally as Esseva; and
· Signing of a commercial agreement for exclusive distribution rights
for Eden's insecticide
Furthermore, we expect the ban of competitor products to Mevalone and Cedroz
to have a positive impact on the Company, where we are well-placed to increase
our market share. However, the immediate effects are unpredictable considering
the potential stocking (and allowed extended use) of these products before
their regulatory ban.
The Company's overheads are expected to increase in 2025 compared to 2024 as a
result of the full-year impact of the commercial and regulatory teams, but
investments in regulatory and product development are expected to stabilise
due to the reregistration costs for our active ingredients in the EU that took
place last year.
Section six: Summary
I would like to take the opportunity to thank everyone who has supported our
journey to date. The backing of shareholders, regulators, and industry has
been outstanding, but it is the efforts and skills of our exceptional
workforce that have established a company with such strong foundations and an
excellent culture based upon innovation, creativity and the shared purpose of
bringing sustainable and effective crop protection to farmers around the
world. Eden is very well-placed to continue its growth trajectory and maximise
the potential of our upcoming milestones.
Sean Smith
Chief Executive Officer
2 May 2025
Consolidated statement of comprehensive income
For the year ended 31 December 2024
2024 2023
Notes £ £
Revenue 4 4,302,603 3,192,027
Cost of sales (2,430,433) (1,426,547)
Gross profit 1,872,170 1,765,480
Other operating income 20,866 20,689
Amortisation of intangible assets 12 (364,319) (418,651)
Administrative expenses (3,510,068) (2,997,633)
Share-based payments 22 (204,928) (236,576)
Operating loss 5 (2,186,279) (1,866,691)
Interest income 8 110,483 34,014
Finance costs 9 (10,642) (17,207)
Foreign exchange (losses)/gains 9 (95,988) (68,802)
Impairment of intangible assets 12 - (4,968,529)
Share of profit/(loss) of equity accounted Investee, net of tax 15 2,279 (33,047)
Loss before taxation (2,180,147) (6,920,262)
Income tax credit 10 267,008 428,326
Loss and total comprehensive loss for the year (1,913,139) (6,491,936)
Loss and total comprehensive loss for the year is attributable to:
- Owners of the Parent Company (1,906,591) (6,494,249)
- Non-controlling interests (6,548) 2,313
(1,913,139) (6,491,936)
Loss per share 11
Basic (0.36p) (1.54p)
Diluted (0.36p) (1.54p)
The income statement has been prepared on the basis that all operations are
continuing operations.
Consolidated statement of financial position
As at 31 December 2024
2024 2023
Notes £ £
Non-current assets
Intangible assets 12 6,886,546 4,710,511
Property, plant and equipment 13 183,595 230,091
Right-of-use assets 14 138,706 212,437
Investments 15 299,476 297,197
7,508,323 5,450,236
Current assets
Inventories 17 532,650 964,552
Trade and other receivables 18 3,105,842 2,449,623
Current tax recoverable 10 584,209 317,201
Cash and cash equivalents 3,674,796 7,413,107
7,897,497 11,144,483
Current liabilities
Trade and other payables 19 3,399,502 2,819,153
Lease liabilities 20 109,039 142,849
3,508,541 2,962,002
Net current assets 4,388,956 8,182,481
Non-current liabilities
Lease liabilities 20 59,693 86,920
59,693 86,920
Net assets 11,837,586 13,545,797
2024 2023
Notes £ £
Equity
Called up share capital 23 5,333,529 5,333,529
Share premium account 24 6,413,652 6,413,652
Warrant reserve 25 790,154 758,234
Merger reserve 26 - -
Retained earnings (720,016) 1,013,567
Non-controlling interest 27 20,267 26,815
Total equity 11,837,586 13,545,797
The financial statements were approved by the Board of Directors and
authorised for issue on 2 May 2025 and are signed on its behalf by:
Sean Smith
Director
Company statement of financial position
As at 31 December 2024
2024 2023
Notes £ £
Non-current assets
Intangible assets 12 6,820,163 4,630,856
Property, plant and equipment 13 183,595 230,091
Right-of-use assets 14 138,706 212,437
Investments 15 299,476 297,197
7,441,940 5,370,581
Current assets
Inventories 17 532,650 964,552
Trade and other receivables 18 3,215,693 2,559,651
Current tax recoverable 10 584,209 317,201
Cash and cash equivalents 3,674,796 7,413,107
8,007,348 11,254,511
Current liabilities
Trade and other payables 19 3,399,502 2,819,153
Lease liabilities 20 109,039 142,849
3,508,541 2,962,002
Net current assets 4,498,807 8,292,509
Non-current liabilities
Lease liabilities 20 59,693 86,920
59,693 86,920
Net assets 11,881,054 13,576,170
2024 2023
Notes £ £
Equity
Called up share capital 23 5,333,529 5,333,529
Share premium account 24 6,413,652 6,413,652
Warrant reserve 25 790,154 758,234
Merger reserve 26 - -
Retained earnings (656,281) 1,070,755
Total equity 11,881,054 13,576,170
As permitted by s408 Companies Act 2006, the Company has not presented its own
income statement and related notes. The Company's loss for the year was
£1,900,044 (2023: loss of £6,496,561).
The financial statements were approved by the Board of Directors and
authorised for issue on 2 May 2025 and are signed on its behalf by:
Sean Smith
Director
Company Registration No. 03071324
Consolidated statement of changes in equity
As at 31 December 2024
Share Capital Share premium account Merger reserve Warrant reserve Retained earnings Total Non-controlling interest Total
Notes £ £ £ £ £ £ £ £
Balance at 1 January 2023 3,808,589 39,308,529 10,209,673 701,065 (43,309,440) 10,718,416 24,502 10,742,918
Year ended 31 December 2023:
Loss and total comprehensive loss - - - - (6,494,249) (6,494,249) 2,313 (6,491,936)
Transactions with owners in their capacity as owners:
Issue of share capital - net of costs 23/24 1,524,940 7,533,299 - - - 9,058,239 - 9,058,239
Capital reduction 24 - (40,428,176) - - 40,428,176 - - -
Transfer of merger reserve 26 - - (10,209,673) - 10,209,673 - - -
Options granted 22 - - - 236,576 - 236,576 - 236,576
Options lapsed 22 - - - (179,407) 179,407 - - -
Balance at 31 December 2023 5,333,529 6,413,652 - 758,234 1,013,567 13,518,982 26,815 13,545,797
Share Capital Share premium account Merger reserve Warrant reserve Retained earnings Total Non-controlling interest Total
Notes £ £ £ £ £ £ £ £
Balance at 1 January 2024 5,333,529 6,413,652 - 758,234 1,013,567 13,518,982 26,815 13,545,797
Year ended 31 December 2024:
Loss and total comprehensive loss - - - - (1,906,591) (1,906,591) (6,548) (1,913,139)
Transactions with owners in their capacity as owners:
Options lapsed 22 - - - (173,008) 173,008 - - -
Options granted 22 - - - 204,928 - 204,928 - 204,928
Balance at 31 December 2024 5,333,529 6,413,652 - 790,154 (720,016) 11,817,319 20,267 11,837,586
Company statement of changes in equity
As at 31 December 2024
Share Capital Share premium account Merger reserve Warrant reserve Retained earnings Total
Notes £ £ £ £ £ £
Balance at 1 January 2023 3,808,589 39,308,529 10,209,673 701,065 (43,249,940) 10,777,916
Year ended 31 December 2023:
Loss and total comprehensive loss - - - - (6,496,561) (6,496,561)
Transactions with owners in their capacity as owners:
Issue of share capital - net of costs 23/24 1,524,940 7,533,299 - - - 9,058,239
Capital reduction 24 - (40,428,176) - - 40,428,176 -
Transfer of merger reserve 26 - - (10,209,673) - 10,209,673 -
Options granted 22 - - - 236,576 - 236,576
Options lapsed 22 - - - (179,407) 179,407 -
Balance at 31 December 2023 5,333,529 6,413,652 - 758,234 1,070,755 13,576,170
Share Capital Share premium account Merger reserve Warrant reserve Retained earnings Total
Notes £ £ £ £ £ £
Balance at 1 January 2024 5,333,529 6,413,652 - 758,234 1,070,755 13,576,170
Year ended 31 December 2024:
Loss and total comprehensive loss - - - - (1,900,044) (1,900,044)
Transactions with owners in their capacity as owners:
Options lapsed 22 - - - (173,008) 173,008 -
Options granted 22 - - - 204,928 - 204,928
Balance at 31 December 2024 5,333,529 6,413,652 - 790,154 (656,281) 11,881,054
Consolidated statement of cash flows
For the year ended 31 December 2024
2024 2023
Notes £ £ £ £
Cash flow from operating activities
Cash absorbed by operations 31 (1,008,569) (2,130,252)
R&D tax credit received - 434,841
Net cash outflow from operating activities (1,008,569) (1,695,411)
Investing activities
Development of intangible assets 12 (2,540,060) (1,650,465)
Purchase of property, plant and equipment 13 (48,649) (102,391)
Interest received 8 110,483 34,014
Net cash used in investing activities (2,478,226) (1,718,842)
Financing activities
Issue of share capital - net of costs 23 - 9,058,239
Payment of lease liabilities 20 (145,796) (139,539)
Interest on lease liabilities 20 (9,732) (17,009)
Net cash generated from/(used in) financing activities (155,528) 8,901,690
Net increase/(decrease) in cash and cash equivalents (3,642,323) 5,487,437
Cash and cash equivalents at beginning of year 7,413,107 1,994,472
Effect of foreign exchange rates (95,988) (68,802)
Cash and cash equivalents at end of year 3,674,796 7,413,107
Relating to:
Bank balances 3,674,796 7,413,107
Non-cash movement on account of financing activities:
Note
14 Right of use asset additions of £63,605 (2023: £14,963).
22 Share-based payment charge of £204,928 (2023: £236,576).
Company statement of cash flows
For the year ended 31 December 2024
2024 2023
Notes £ £ £ £
Cash flow from operating activities
Cash absorbed by operations 31 (1,008,569) (2,130,252)
R&D tax credit received - 434,841
Net cash outflow from operating activities (1,008,569) (1,695,411)
Investing activities
Development of intangible assets 12 (2,540,060) (1,650,465)
Purchase of property, plant and equipment 13 (48,649) (102,391)
Interest received 8 110,483 34,014
Net cash used in investing activities (2,478,226) (1,718,842)
Financing activities
Issue of share capital - net of costs 23 - 9,058,239
Payment of lease liabilities 20 (145,796) (139,539)
Interest on lease liabilities 20 (9,732) (17,009)
Net cash generated from/(used in) financing activities (155,528) 8,901,690
Net increase/(decrease) in cash and cash equivalents (3,642,323) 5,487,437
Cash and cash equivalents at beginning of year 7,413,107 1,994,472
Effect of foreign exchange rates (95,988) (68,802)
Cash and cash equivalents at end of year 3,674,796 7,413,107
Relating to:
Bank balances 3,674,796 7,413,107
Non-cash movement on account of financing activities:
14 Right of use asset additions of £63,605 (2023: £14,963).
22 Share-based payment charge of £204,928 (2023: £236,576).
Notes to the Group financial statements
For the year ended 31 December 2024
1 Accounting policies
Company information
Eden Research plc (the "Company") is a public company limited by shares
incorporated in England and Wales. The registered office is 67c Innovation
Drive, Milton Park, Abingdon, Oxfordshire, OX14 4RQ.
The Group is defined as, and consists of, Eden Research plc, its subsidiaries,
TerpeneTech Limited (Ireland), Eden Research Europe Limited (Ireland) (see
note 16) and its associate company, TerpeneTech Limited (UK) (see note 15).
The Group and Company's principal activities and nature of its operations are
disclosed in the Directors' report.
1.1 Accounting convention
The Group and Company financial statements have been prepared in accordance
with UK-adopted international accounting standards ("IFRS') and as applied in
accordance with the provisions of the Companies Act 2006.
The financial statements are prepared in pound sterling, which is the
functional currency of the Group and Company. Monetary amounts in these
financial statements are rounded to the nearest £ unless otherwise stated.
The financial statements have been prepared on the historical cost basis,
except for the re-measurement of certain financial instruments that are
measured at fair value at the end of each reporting period. The principal
accounting policies adopted are set out below.
The Company applies accounting policies consistent with those applied by the
Group except where specified within the accounting policies disclosed below.
See note 2 for further information on changes to standards adopted during the
year and standards that have been issued but are not yet effective at the year
end.
The preparation of the Group and Company financial statements involves making
accounting estimates and assumptions concerning the future. The critical
accounting estimates and assumptions that have a significant risk to the
carrying amounts of assets and liabilities within the next financial year are
discussed in note 3.
1.2 Basis of consolidation
The consolidated financial statements consolidate the financial statements of
the Company and its subsidiary undertakings up to 31 December each year. The
profits and losses of the Company and its subsidiary undertakings are
consolidated from the date from which control is achieved. All members of the
Group have the same reporting period.
Subsidiary undertakings are entities controlled by the Company. The Company
controls an entity when it is exposed to, or has the right to, variable
returns from its involvement with the entity and has the ability to affect
those returns through its power over the entity.
Associates
Associates are those entities in which the Company has significant influence,
but not control, over the financial and operating policies. Significant
influence is presumed to exist when the Company holds between 20 and 50
percent of the voting power of another entity, or where the Company has a
lower interest but the right to appoint a director. The Company acquired 29.9%
of TerpeneTech Limited ("TerpeneTech (UK)") during 2015; TerpeneTech (UK) is
an associated undertaking.
Application of the equity method to associates
The investment in TerpeneTech (UK) is accounted for using the equity method.
The investment was initially recognised at cost. The Company's investment
includes goodwill identified on acquisition, net of any accumulated impairment
losses and any separable intangible assets. The financial statements include
the Company's share of the total comprehensive income and equity movements of
TerpeneTech (UK), from the date that significant influence commenced.
1.3 Going concern
The Directors have, at the time of approving the financial statements, a
reasonable expectation that the Group and Company have adequate resources to
continue in operational existence for at least 12 months from the approval of
the financial statements. Thus, the financial statements have been prepared on
a going concern basis which contemplates the realisation of assets and the
settlement of liabilities in the ordinary course of business.
The Group has reported a loss for the year after taxation of £1,913,139
(2023: £6,491,936). Net current assets at that date amounted to £4,388,956
(2023: £8,182,481). Cash at that date amounted to £3,674,796 (2023:
£7,413,107).
The Company has reported a loss for the year after taxation of £1,900,044
(2023: £6,496,561). Net current assets at that date amounted to £4,498,807
(2023: £8,292,509). Cash at that date amounted to £3,674,796 (2023:
£7,413,107).
Net cash outflow from operating activities for the Group was £1,008,569
(2023: £1,695,411) and net cash used in investing activities was £2,478,226
(2023: £1,718,842).
The Directors have prepared budgets and projected cash flow forecasts, based
on forecast sales provided by the Group's distributors where available, for a
period of at least 12 months from the date of approval of the financial
statements and they consider that the Group and Company will be able to
operate with the cash resources that are available to it for this period.
The forecasts adopted include revenue derived from existing contracts as well
as expected new contracts in respect of products not yet available for use.
The Group has relatively low fixed running costs, as production is undertaken
through toll manufacturers, and the Directors have previously demonstrated
ability and willingness to delay certain costs, such as research and
development expenditure, where required and are willing and able to delay
costs in the forecast period should the need arise. A positive cash balance is
forecasted to be maintained in this base scenario throughout the entire
forecast period.
The Directors have also considered a downside scenario which includes
reductions to revenue derived from existing contracts as well as elimination
of revenue from products not yet available for use offset by mitigations
around research and development expenditure as well as some reductions in
expansionary overheads. Under this scenario, a positive cash balance would be
maintained over the forecast period.
Consequently, the Directors are confident that the Group and Company will have
sufficient funds to continue to meet their liabilities as they fall due for at
least 12 months from the date of approval of the financial statements and
therefore have prepared the financial statements on a going concern basis.
The Group's achievement of long-term positive cash generation is reliant on
the completion of ongoing product development and successful initial approval
and registration of these products with various regulatory bodies, as well as
the registration of existing products in new territories.
The Group has planned its cashflows taking into account its current cash
availability and is satisfied that it can continue for the foreseeable future,
albeit with careful management of the levels of investment in the short term,
depending on the positive outcome and/or timing of certain commercial and
regulatory events.
However, given the plethora of opportunities and strong interest that the
Group is presented with, the Board of the Company may seek to invest to a
greater extent than it is currently able to and to expedite the
commercialisation of its product portfolio. To that end, the Board continues
to assess all funding and commercial opportunities, taking into account
commercial and market conditions.
1.4 Revenue
Revenue received by the Group is recognised net of any taxes and in accordance
with IFRS 15. Policies for each significant revenue stream are as follows:
Milestone payments
The Group receives milestone payments from other commercial arrangements,
including any fees it has charged to partners for rights granted in respect of
distribution agreements.
These agreements are bespoke, and any such revenue is specific to the
particular agreement. Consequently, for each such agreement, the nature of the
underlying performance obligations is assessed in order to determine whether
revenue should be recognised at a point in time or over time.
Revenue is then recognised based on the above assessment upon satisfaction of
the performance obligation.
The Corteva agreement entered into in 2021 included milestone payments of
£141,293 received in 2021, a further £164,148 in 2022 and £195,884 in 2023.
In 2024, a milestone payment of £450,904 was recorded in the year. These
milestone payments were assessed to relate to a performance obligation being
satisfied at a point in time.
The second performance obligation relates to product sales and will be
accounted for in line with the product sales policy disclosed below once the
commercial sales have commenced.
Upfront and annual payments made by customers at commencement and for renewal
of distribution and other agreements are recognised in accordance with the
terms of the agreement. Where there is no ongoing obligation on the Group
under the agreement, the payment is recognised in full in the period in which
it is made. Where there is an ongoing obligation on the Group, the separate
performance obligations under the agreement are identified and revenue
allocated to each performance obligation. Revenue is then recognised when a
corresponding performance obligation has been met.
R&D charges
The Group sometimes charges its partners for R&D costs that it has
incurred which usually relate to specific projects and which it has incurred
through a third party.
Upon agreement with a partner, or if a specific milestone is met, then the
Group will raise an invoice which is usually payable between 30 and 120 days.
Revenue is recognised upon satisfaction of the underlying performance
obligation.
Royalties
The Group receives royalties from partners who have entered into a licence
arrangement with the Group to use its intellectual property and who have sold
products, which then gives rise to an obligation to pay the Group a royalty on
those sales.
Generally, royalties relate to specific time periods, such as quarterly or
annual dates, in which product sales have been made. Revenue is recognised in
line with when these sales occur.
Once an invoice is raised by the Group, following the period to which the
royalties relate, payment is due to the Company in 30 to 60 days.
Sales-based royalty income arising from licences of the Group's intellectual
property is recognised in accordance with the terms of the underlying contract
and is based on net sales value of product sold by the Group's licensees. It
is recognised when the underlying sales occur.
Data sharing
The Group receives revenue generated from partners who wish to access certain
data and/or studies that Eden has generated for its own registration purposes.
The partner will pay an agreed fee to get access to, and use of, the data for
their own commercial and regulatory purposes.
This revenue is recognised when the data has been shared, and a Data Sharing
Agreement signed, with the partner.
Product sales
Generally, where the Group has entered into a distribution agreement with a
partner, the Group is responsible for supplying product to that partner once a
sales order has been signed.
At that point, the Group has the product manufactured through a third-party,
toll manufacturer. At the point at which the product is finished and is made
available to the partner to collect, or, if the Group is responsible for the
shipping, the product has been delivered to the partner, the partner is liable
for the product and obliged to pay the Group. Normal terms for product sales
are 90 to 120 days. Returns are accepted and refunds are only made when
product supplied is notified as defective within 60 days.
The Group does not have any contract assets or liabilities other than the
liability in respect of the Corteva milestone payments noted in the milestone
section (2023: none, other than the Corteva milestone payment).
Product sales are recorded once the ownership and related rights and
responsibilities are passed to the customer and the product is made available
to the partner to collect, or, if the Group is responsible for the shipping,
the product has been delivered to the customer.
No warranty provision is required as products are sold on the basis of meeting
an agreed specification, confirmation of which is provided by way of a
certificate of analysis.
Segmental information
The Group reports on operating segments in a manner consistent with the
internal reporting provided to the chief operating decision-maker in
accordance with IFRS 8. Please see note 4 for further details.
1.5 Intangible assets other than goodwill
Intellectual property, which is made up of patent costs, trademarks and
development costs, is capitalised and amortised on a straight-line basis over
its remaining estimated useful economic life of 6 years (2023: 7 years) in
line with the remaining life of the Group's master patent, which was
originally 20 years, with additional Supplementary Protection Certificates
having been granted in the majority of the countries in the EU in which the
Group is selling Mevalone® and Cedroz. The useful economic life of
intangible assets is reviewed on an annual basis.
An internally generated intangible asset arising from the Group's development
activities is recognised only if all the following conditions are met:
• the project is technically and commercially feasible;
• an asset is created that can be identified;
• the Group intends to complete the asset and use or
sell it and has the ability to do so;
• it is probable that the asset created will generate
future economic benefits;
• the development cost of the asset can be measured
reliably; and
• there are sufficient resources available to complete
the project.
Internally-generated intangible assets are amortised on a straight-line basis
over their useful lives from the date they are available for use. Where no
internally-generated intangible asset can be recognised, development
expenditure is recognised as an expense in the period in which it is incurred.
1.6 Property, plant and equipment
Property, plant and equipment are initially measured at cost and subsequently
measured at cost, net of depreciation and any impairment losses.
Depreciation is recognised so as to write off the cost or valuation of assets
less their residual values over their useful lives on the following
straight-line basis:
Leasehold land and buildings Over the term of the lease
Fixtures and fittings 5 years
Motor vehicles Over the term of the lease
The gain or loss arising on the disposal of an asset is determined as the
difference between the sale proceeds and the carrying value of the asset, and
is recognised in the income statement.
1.7 Impairment of tangible and intangible assets
The Directors regularly review the intangible assets for impairment and
provision is made if necessary. Assets that are subject to amortisation and
those that are under development are reviewed for impairment whenever events
or changes in circumstances indicate that the carrying amount may not be
recoverable. An impairment loss is recognised for the amount by which the
asset's carrying amount exceeds its recoverable amount. The recoverable
amount is the higher of an asset's fair value less costs to sell and value in
use. For the purposes of assessing impairment, assets are grouped at the
lowest levels for which there are separately identifiable cash flows
(cash-generating units). Non-financial assets other than goodwill that
suffered an impairment are reviewed for possible reversal of the impairment at
each reporting date. See note 12 for further details in the intangible asset
impairment review completed in the year.
1.8 Inventories
Inventories are stated at the lower of cost and estimated selling price, less
costs to complete and sell. Cost is based on the first-in-first-out
principle. Cost comprises direct materials and, where applicable, direct
labour costs and those overheads that have been incurred in bringing the
inventories to their present location and condition.
1.9 Financial instruments
(i) Recognition and initial measurement
Trade receivables are initially recognised when they are originated. All other
financial assets and financial liabilities (including trade payables) are
initially recognised when the Group becomes a part to the contractual
provisions of the instrument.
A financial asset (unless it is a trade receivable with a significant
financing component) or financial liability is initially measured at fair
value plus, for an item not at fair value through profit or loss ("FVTPL"),
transaction costs that are directly attributable to its acquisition or issue.
A trade receivable without a significant financing component is initially
measured at the transaction price.
(i) Classification and subsequent
measurement
Financial assets
(a) Classification
On initial recognition, a financial asset is classified as measured at
amortised cost or FVTPL.
Financial assets are not reclassified subsequently to their initial
recognition unless the Group changes its business model for managing financial
assets in which case all affected financial assets are reclassified on the
first day of the first reporting period following the change in the business
model.
A financial asset is measured at amortised cost if it meets both of the
following conditions:
- It is held within a business model whose objective is to
hold assets to collect contractual cash flows; and
- Its contractual terms give rise on specific dates to
cash flows that are solely payments of principal and interest on the principal
amount outstanding.
Investments in associates accounted for using the equity method and
subsidiaries are carried at cost less impairment.
(a) Subsequent measurement and gains and losses
Financial assets at amortised cost are subsequently measured at amortised cost
using the effective interest method. The amortised cost is reduced by
impairment losses. Interest income, foreign exchange gains and losses and
impairment are recognised in profit or loss. Any gain or loss on derecognition
is recognised in profit or loss.
Cash and cash equivalents
Cash and cash equivalents comprise cash balances and short-term highly liquid
investments with an original maturity of three months or less, that are
readily convertible to a known amount of cash and subject to an insignificant
risk of changes in value.
Financial liabilities and equity
Financial instruments issued by the Group are treated as equity only to the
extent that they meet the following two conditions:
(a) they include no contractual obligations upon the Group to deliver cash
or other financial assets or to exchange financial assets or financial
liabilities with another party under conditions that are potentially
unfavourable to the Group; and
(b) where the instrument will or may be settled in the Group's own equity
instruments, it is either a non-derivative that includes no obligation to
deliver a variable number of the Group's own equity instruments or is a
derivative that will be settled by the Group's exchanging a fixed amount of
cash or other financial assets for a fixed number of its own equity
instruments.
To the extent that this definition is not met, the proceeds of issue are
classified as a financial liability. Where the instrument so classified takes
the legal form of the Group 's own shares, the amounts presented in these
financial statements for called up share capital and share premium account
exclude amounts in relation to those shares.
Financial liabilities are classified as measured at amortised cost or FVTPL. A
financial liability is classified as at FVTPL if it is classified as
held-for-trading, it is a derivative or it is designated as such on initial
recognition. Financial liabilities at FVTPL are measured at fair value and net
gains and losses, including any interest expense, are recognised in profit or
loss. Other financial liabilities are subsequently measured at amortised cost
using the effective interest method. Interest expense and foreign exchange
gains and losses are recognised in profit or loss. Any gain or loss on
derecognition is also recognised in profit or loss.
Where a financial instrument that contains both equity and financial liability
components exists these components are separated and accounted for
individually under the above policy.
(iii) Impairment
The Group recognises loss allowances for expected credit losses (ECLs) on
financial assets measured at amortised cost.
The Group measures loss allowances at an amount equal to lifetime ECL, except
for other debt securities and bank balances for which credit risk (i.e. the
risk of default occurring over the expected life of the financial instrument)
has not increased significantly since initial recognition, which are measured
as 12-month ECL.
Loss allowances for trade receivables and contract assets are always measured
at an amount equal to lifetime ECL. During the year, an expected credit loss
provision of £nil (2023: £nil) has been recognised on trade receivables over
12 months old, on which payment is uncertain.
When determining whether the credit risk of a financial asset has increased
significantly since initial recognition and when estimating ECL, the Group
considers reasonable and supportable information that is relevant and
available without undue cost or effort. This includes both quantitative and
qualitative information and analysis, based on the Company's historical
experience and informed credit assessment and including forward-looking
information.
The Group considers a financial asset to be in default when:
- the borrower is unlikely to pay its credit obligations to the Company in
full, without recourse by the Company to actions such as realising security
(if any is held); or
- the financial asset is more than 120 days past due.
Lifetime ECLs are the ECLs that result from all possible default events over
the expected life of a financial instrument.
12-month ECLs are the portion of ECLs that result from default events that are
possible within the 12 months after the reporting date (or a shorter period if
the expected life of the instrument is less than 12 months).
The maximum period considered when estimating ECLs is the maximum contractual
period over which the Group is exposed to credit risk.
Measurement of ECLs
ECLs are a probability-weighted estimate of credit losses. Credit losses are
measured as the present value of all cash shortfalls (i.e. the difference
between the cash flows due to the entity in accordance with the contract and
the cash flows that the Group expects to receive). ECLs are discounted at the
effective interest rate of the financial asset.
Credit-impaired financial assets
At each reporting date, the Group assesses whether financial assets carried at
amortised cost are credit-impaired. A financial asset is 'credit-impaired'
when one or more events that have a detrimental impact on the estimated future
cash flows of the financial asset have occurred.
Write-offs
The gross carrying amount of a financial asset is written off (either
partially or in full) to the extent that there is no realistic prospect of
recovery.
1.10 Taxation
The tax expense represents the sum of the tax currently payable and deferred
tax.
Current tax
The tax currently payable is based on taxable profit for the year. Taxable
profit differs from net profit as reported in the income statement because it
excludes items of income or expense that are taxable or deductible in other
years and it further excludes items that are never taxable or deductible. The
Group's liability for current tax is calculated using tax rates that have been
enacted or substantively enacted by the reporting end date. The current tax
charge includes any research and development tax credits claimed by the Group.
R&D tax credits are accounted for on an accruals basis by reference to IAS
12 and are calculated based on development costs incurred by the Group through
third party contractors, as well as members of staff who are involved in
research and development of the Group's products.
Deferred tax
Deferred tax is the tax expected to be payable or recoverable on differences
between the carrying amounts of assets and liabilities in the financial
statements and the corresponding tax bases used in the computation of taxable
profit, and is accounted for using the balance sheet liability method.
Deferred tax liabilities are generally recognised for all taxable temporary
differences and deferred tax assets are recognised to the extent that it is
probable that taxable profits will be available against which deductible
temporary differences can be utilised. Such assets and liabilities are not
recognised if the temporary difference arises from goodwill or from the
initial recognition of other assets and liabilities in a transaction that
affects neither the tax profit nor the accounting profit.
Deferred tax liabilities are recognised for taxable temporary differences
arising on investments in subsidiaries and associates, and interest in joint
ventures, except where the Group is able to control the reversal of the
temporary difference and it is probable that the temporary difference will not
reverse in the foreseeable future.
The carrying amount of deferred tax assets is reviewed at each reporting end
date and reduced to the extent that it is no longer probable that sufficient
taxable profits will be available to allow all or part of the asset to be
recovered.
Deferred tax is calculated at the tax rates that are expected to apply in the
period when the liability is settled, or the asset is realised based on the
tax rates that have been enacted or substantively enacted by the end of the
reporting period. Deferred tax is charged or credited to profit or loss,
except when it relates to items charged or credited directly to equity, in
which case the deferred tax is also dealt with in equity.
Deferred tax assets and liabilities are offset when the Group has a legally
enforceable right to offset current tax assets against current tax liabilities
and when they relate to income taxes levied by the same taxation authority and
the Group intends to settle its current tax assets and liabilities on a net
basis.
1.11 Employee benefits
The costs of short-term employee benefits are recognised as a liability and an
expense, unless those costs are required to be recognised as part of the cost
of inventories or non-current assets.
The cost of any unused holiday entitlement is recognised in the period in
which the employee's services are received.
Termination benefits are recognised immediately as an expense when the Group
is demonstrably committed to terminate the employment of an employee or to
provide termination benefits.
A defined contribution plan is a post-employment benefit plan under which the
Group pays fixed contributions into a separate entity and will have no legal
or constructive obligation to pay further amounts. Obligations for
contributions to defined contribution pension plans are recognised as an
expense in the income statement in the periods during which services are
rendered by employees.
1.12 Retirement benefits
Payments to defined contribution retirement benefit schemes are charged as an
expense as they fall due.
1.13 Share-based payments
The Company has applied the requirements of IFRS 2 Share-Based Payments.
Unapproved share option scheme
The Company operated an unapproved share option scheme for executive
directors, senior management and certain employees up to September 2017.
Long-Term Incentive Plan ('LTIP')
In 2017, the Company established a LTIP to incentivise the Executives to
deliver long-term value creation for shareholders and ensure alignment with
shareholder interest. Awards were made annually and were subject to
continued service and challenging performance conditions usually over a
three-year period. The performance conditions were reviewed on an annual
basis to ensure they remained appropriate and were based on increasing
shareholder value. Awards were structured as nil cost options with a
seven-year lift after vesting.
Other than in exceptional circumstances, awards were up to 100% of salary in
any one year and granted subject to achieving challenging performance
conditions set at the date of the grant. A percentage of the award vested
for 'Threshold' performance with full vesting taking place for equalling or
exceeding the performance 'Target'. In between the Threshold and Target there
was pro rata vesting.
The LTIP was adopted by the Board of Directors of the Company on 28 September
2017.
Long-Term Incentive Plan ('LTIP') (continued)
Where share options are awarded to employees, the fair value of the options at
the date of grant is charged to the Statement of Comprehensive Income over the
vesting period. Non-market vesting conditions are taken into account by
adjusting the number of equity instruments expected to vest at each reporting
date so that ultimately the cumulative amount recognised over the vesting
period is based on the number of options that eventually vest. Market
vesting conditions are factored into the fair value of the options granted, as
long as other vesting conditions are satisfied. The cumulative expense is
not adjusted for failure to achieve a market vesting condition.
Where the terms and conditions of options are modified before they vest, the
increase in fair value of the options, measured immediately before and after
the modification is also charged to the Statement of Profit or Loss and Other
Comprehensive Income over the remaining vesting period.
In June 2021, the Company made changes to the LTIP.
The changes to the LTIP have been treated as a modification of the existing
plan for financial reporting purposes which means that the Fair Value of
previous awards has been recognised over their remaining term and the
incremental Fair Value of the new options granted has been recognised
separately over their own vesting period.
The Company issued options under the modified LTIP, details of which can be
found in note 22. These include graded vesting.
Share options which vest in instalments over a specified vesting period
(graded vesting) where the only vesting condition is service from grant date
to vesting date of each instalment are accounted for as separate share-based
payments. Each instalment's fair value is assessed separately based on its
term and the resulting charge recognised over each instalment's vesting
period.
Other share options
In addition to the LTIP grants, the Company awarded certain employees approved
options. Details of these options can be found in note 22. The accounting
treatment for these options is consistent with that indicated under the LTIP
section at the start of this page.
1.14 Leases
At inception, the Group assesses whether a contract is, or contains, a lease
within the scope of IFRS 16. A contract is, or contains, a lease if the
contract conveys the right to control the use of an identified asset for a
period of time in exchange for consideration. Where a tangible asset is
acquired through a lease, the Group recognises a right-of-use asset and a
lease liability at the lease commencement date. Right-of-use assets are
included within property, plant and equipment, apart from those that meet the
definition of investment property.
The right-of-use asset is initially measured at cost, which comprises the
initial amount of the lease liability adjusted for any lease payments made at,
or before, the commencement date, plus any initial direct costs and an
estimate of the cost of obligations to dismantle, remove, refurbish or restore
the underlying asset and the site on which it is located, less any lease
incentives received.
The right-of-use asset is subsequently depreciated using the straight-line
method from the commencement date to the earlier of the end of the useful life
of the right-of-use asset or the end of the lease term. The estimated useful
lives of right-of-use assets are determined on the same basis as those of
other property, plant and equipment. The right-of-use asset is periodically
reduced by impairment losses, if any, and adjusted for certain remeasurements
of the lease liability.
The lease liability is initially measured at the present value of the lease
payments that are unpaid at the commencement date, discounted using the
interest rate implicit in the lease or, if that rate cannot be readily
determined, the Group's incremental borrowing rate. Lease payments included in
the measurement of the lease liability comprise fixed payments, variable lease
payments that depend on an index or a rate, amounts expected to be payable
under a residual value guarantee, and the cost of any options that the Group
is reasonably certain to exercise, such as the exercise price under a purchase
option, lease payments in an optional renewal period, or penalties for early
termination of a lease.
The lease liability is measured at amortised cost using the effective interest
method. It is remeasured when there is a change in: future lease payments
arising from a change in an index or rate; the Group's estimate of the amount
expected to be payable under a residual value guarantee; or the Group's
assessment of whether it will exercise a purchase, extension or termination
option. When the lease liability is remeasured in this way, a corresponding
adjustment is made to the carrying amount of the right-of-use asset, or is
recorded in profit or loss if the carrying amount of the right-of-use asset
has been reduced to zero.
The Group has elected not to recognise right-of-use assets and lease
liabilities for short-term leases of machinery that have a lease term of 12
months or less, or for leases of low-value assets including IT equipment. The
payments associated with these leases are recognised in profit or loss on a
straight-line basis over the lease term.
1.15 Functional and presentation currency
The Group's consolidated financial statements are presented in pound sterling,
which is the Group's functional currency due to its own operations and assets
being based in the UK. For each entity, the Group determines the functional
currency, and items included in the financial statements of each entity are
measured using that functional currency.
1.16 Research and development
Expenditure on research activities is recognised as an expense in the period
in which it is incurred.
1.17 Financial risk management
The Group's activities expose it to a variety of financial risks: market risks
(including currency risk and interest rate risks), credit risk and liquidity
risk. Risk management focuses on minimising any potential adverse effect on
the Company's financial performance and is carried out under policies approved
by the Board of Directors. See note 30 for further information.
1.18 Transactions and balances
Foreign currency transactions are translated into the functional currency
using the exchange rates prevailing at the dates of the transactions or
valuation (where items are remeasured). Monetary assets and liabilities
denominated in foreign currencies are translated at the functional currency
spot rates of exchange at the reporting date. Foreign exchange gains and
losses resulting from the settlement of monetary assets and liabilities
denominated in foreign currencies are recognised in the income statement. All
foreign exchange gains and losses are presented in the income statement within
administrative expenses.
Translation differences related to items classified through other
comprehensive income are recognised in other comprehensive income (OCI), while
remaining translation differences are recognised in the income statement.
Non-monetary items that are measured in terms of historical cost in a foreign
currency are translated using the exchange rates at the dates of the initial
transactions. Non-monetary items measured at fair value in a foreign currency
are translated using the exchange rates at the date when the fair value is
determined. The gain or loss arising on translation of non-monetary items
measured at fair value is treated in line with the recognition of the gain or
loss on the change in fair value of the item (i.e. translation differences on
items whose fair value gain or loss is recognised in OCI or profit or loss are
also recognised in OCI or profit or loss respectively).
In determining the spot exchange rate to use on initial recognition of the
related asset, expense or income (or part of it) or the derecognition of a
non-monetary asset or non-monetary liability relating to advance
consideration, the date of the transaction is the date on which the Group
initially recognises the non-monetary asset or non-monetary liability arising
from the advance consideration. If there are multiple payments or receipts in
advance, the Group determines the transaction date for each payment or receipt
of advance consideration.
1.19 Current versus non-current classification
The Group classifies assets and liabilities in the statement of financial
position as either current or non-current.
An asset is classified as current when it is:
• Expected to be realised or intended to be sold or
consumed in the normal operating cycle
• Held primarily for the purpose of trading
• Expected to be realised within twelve months after the
reporting period; or
• Cash or cash equivalent unless restricted from being
exchanged or used to settle a liability for at least twelve months after the
reporting period.
All other assets are classified as non-current.
A liability is classified as current when it is:
• Expected to be settled in the normal operating cycle
• Held primarily for the purpose of trading
• Due to be settled within twelve months after the
reporting period; or
• There is no unconditional right to defer the
settlement of the liability for at least twelve months after the reporting
period.
The terms of the liability that could, at the option of the counterparty,
result in its settlement by the issue of equity instruments do not affect its
classification.
The Group classifies all other liabilities as non-current.
1.20 Equity and reserves
Ordinary shares are classified as equity. Incremental costs directly
attributable to the issue of new ordinary shares or options are shown in
equity as a deduction, net of tax, from the proceeds over nominal value in
share premium. Share premium represents the proceeds from shares, less the
nominal value and directly attributable costs.
1.21 Earnings per share
Basic earnings per share is calculated by dividing:
• the profit or loss attributable to owners of the
Company, excluding any costs of servicing equity other than ordinary shares;
• by the weighted average number of ordinary shares
outstanding during the financial year, adjusted for bonus elements in ordinary
shares issued during the year and excluding treasury shares.
Diluted earnings per share adjusts the figures used in the determination of
basic earnings per share to take into account:
• the after-income tax effects of interest and other
financing costs associated with dilutive potential ordinary shares; and
• the weighted average number of additional ordinary
shares that would have been outstanding, assuming the conversion of all
dilutive potential ordinary shares.
2 New standards and interpretations
The IASB and IFRS Interpretations Committee have issued the following
standards and interpretations with an effective date of implementation for
accounting periods beginning after the date on which the Group's financial
statements for the current year commenced.
i) New standards and amendments - applicable 1 January 2024
The following standards and interpretations apply for the first time to
financial reporting periods commencing on or after 1 January 2024:
Standard or Amendment Material impact on financial statements
Amendment to IFRS 16 - Leases: Leases on sale and leaseback No
Amendment to IAS 1 - Presentation of Financial Statements: Non-current No
liabilities with covenants
Amendments to IAS 7 - Statement of Cash Flows and IFRS 7 - Financial No
Instruments: Supplier finance
ii) Forthcoming requirements
As at 31 December 2024, the following standards and interpretations had been
issued but were not mandatory for annual reporting periods commencing on or
after 1 January 2025:
Standard or Amendment Effective for accounting periods beginning on or after Expected Impact
Amendments to IAS 21 - The Effects of Changes in Foreign Exchange Rates: Lack 1 January 2025 None
of exchangeability
Amendments to IFRS 9 Financial Instruments and IFRS 7 Financial 1 January 2026 None
Instruments: Disclosures
Amendments to IFRS 1 First-time Adoption of International Financial Reporting 1 January 2026 None
Standards
Amendments to IFRS 7 Financial Instruments: Disclosures and its 1 January 2026 None
accompanying Guidance on implementing IFRS 7
Amendments to IFRS 9 Financial Instruments 1 January 2026 None
Amendments to IFRS 10 Consolidated Financial Statements 1 January 2026 None
Amendments to IAS 7 Statement of Cash flows 1 January 2026 None
Contracts Referencing Nature-dependent Electricity - Amendments to IFRS 9 and 1 January 2026 None
IFRS
IFRS 18 Presentation and Disclosure of Financial 1 January 2027 Assessment ongoing
Statements
The Directors do not expect the adoption of these amendments and new standards
to have a material impact on the Group's financial statements, with the
exception of presentational changes as a result of IFRS 18. Given that IFRS 18
is not effective until the period beginning 1 January 2027, the impact
assessment of this standard is ongoing and will be considered further in the
coming years.
3 Critical accounting estimates and judgements
The Group and Company make estimates and assumptions concerning the future.
The resulting accounting estimates will, by definition, seldom equal the
related actual results. The estimates and assumptions that have a significant
risk to the carrying amounts of assets and liabilities within the next
financial year are discussed below:
Going concern
The Directors have considered the ability of the Group and the Company to
continue as a going concern and this is considered to be a significant
judgement made by the Directors in preparing the financial statements.
The ability of the Group and Company to continue as a going concern is
ultimately dependent upon the amount and timing of cash flows arising from the
exploitation of the Group and Company's intellectual property and the
availability of existing and/or additional funding to meet the short-term
needs of the business until the commercialisation of the Group and Company's
portfolio is reached. The Directors consider it is appropriate for the
financial statements to be prepared on a going concern basis based on the
estimates they have made. See note 1 for further information.
Associate
A judgement has been made that the Group exerts significant influence on
TerpeneTech (UK) such that it is an associate company and, as such, adoption
of equity accounting is appropriate. See note 1.2 for further information of
assumptions made. See note 15 for the carrying value of associates.
Impairment assessment of intangibles and investments
The Group and Company have made estimates of future revenues that are likely
to be derived from the business when considering the carrying value of
intangible assets owned by the Group. Assumptions have been made the products
will be successfully developed, registered and commercialised in reasonable
timescales and at reasonable cost. Estimates have also been made for weighted
average cost of capital and profit margins. See note 12 and note 15 for
further information of assumptions and estimates made along with the carrying
value.
Assessment of useful life of intangible assets
The Group and Company have estimated the useful life of intangible assets by
considering intellectual property protection that it owns, such as patents
which have a known expiry date. See note 12 for further information on
assumptions and estimates made.
Share-based payments
The Group and Company have used appropriate models to value share options
granted by the Company. Please refer to note 22 for information on estimates
and judgements used.
Other accounting judgements
In addition to the above, the Group and Company have made other judgements
which are considered of lesser significance.
Capitalised development costs and Intellectual property
The Directors have exercised a judgement that the development costs incurred
meet the criteria in IAS 38 Intangible Assets for capitalisation. In making
this judgement, the Directors considered the following key factors:
• The availability of the necessary financial resources
and hence the ability of the Group and Company to continue as a going concern.
• The assumptions surrounding the perceived market sizes
for the products and the achievable market share for the Group and Company.
• The successful conclusion of commercial arrangements,
which serves as an indicator as to the likely success of the projects and, as
such, any need to potential impairment.
£37,627 of research expenditure, not including R & D payroll costs, has
been recognised as an expense in the current year in the P&L in excess of
the amortisation of intangible assets as disclosed in note 12 (2022:
£64,273).
Revenue - Performance obligations
The Directors exercised a judgement that the performance obligations set out
in a contract with a customer had not yet been met and, as such, did not
recognise revenue which had been invoiced but not paid at the year end. See
note 1.4 for further information on policies applied.
4 Revenue and Segmental Information
IFRS 8 requires operating segments to be reported in a manner consistent with
the internal reporting provided to the chief operating decision-maker. The
chief operating decision-maker, who is responsible for the resource allocation
and assessing performance of the operating segments has been identified as the
Executive Directors as they are primarily responsible for the allocation of
the resources to segments and the assessment of performance of the segments.
The Executive Directors monitor and then assess the performance of segments
based on product type and geographical area using a measure of adjusted
EBITDA. This is the operating loss of the segment after excluding the
share-based payment charge, amortisation of intangible and Right of Use assets
and depreciation of plant, property and equipment. These items, together with
interest income and expense are allocated to Agrochemicals, being the Group
and Company's primary focus.
The segment information for the year ended 31 December 2024 is as follows:
Agrochemicals Consumer products Total
£ £ £
Revenue
R&D charges 444,480 198,576 643,056
Royalties 8,900 73,627 82,527
Product sales 3,577,020 - 3,577,020
Total revenue 4,030,400 272,203 4,302,603
Adjusted EBITDA((1)) (1,656,754) 272,203 (1,384,551)
Share Based Payment charge (204,928) - (204,928)
EBITDA (1,861,682) 272,203 (1,589,479)
Amortisation of intangible assets (350,753) (13,566) (364,319)
Depreciation of plant, property and equipment and right-of-use assets (232,481) - (232,481)
Finance costs, foreign exchange and investment revenues 3,853 - 3,853
Income Tax 267,008 - 267,008
Share of Associate's profit - 2,279 2,279
(Loss)/Profit for the Year (2,174,055) 260,916 (1,913,139)
Total Assets 15,219,079 186,741 15,405,820
Total assets includes:
Additions to Non-Current Assets 2,592,254 60,061 2,652,315
Total Liabilities 3,568,234 - 3,568,234
(1) Adjusted EBITDA is adjusted to remove the effect of the non-cash share
based payment charge only.
The segment information for the year ended 31 December 2023 is as follows:
Agrochemicals Consumer products Total
Revenue £ £ £
R&D charges 501,324 9,133 510,457
Royalties 17,391 50,811 68,202
Product sales 2,613,368 - 2,613,368
Total revenue 3,132,083 59,944 3,192,027
Adjusted EBITDA((1)) (1,064,982) 59,944 (1,005,038)
Share Based Payment charge (236,576) - (236,576)
EBITDA (1,301,558) 59,944 (1,241,614)
Amortisation of intangible assets (405,379) (13,272) (418,651)
Depreciation of plant, property and equipment and right-of-use assets (206,426) - (206,426)
Finance costs, foreign exchange and investment revenues (51,995) - (51,995)
Impairment of intangible assets (4,968,529) - (4,968,529)
Income Tax 428,326 - 428,326
Share of Associate's loss - (33,047) (33,047)
(Loss)/Profit for the Year (6,505,561) 13,625 (6,491,936)
Total Assets 16,458,177 136,542 16,594,719
Total assets includes:
Additions to Non-Current Assets 1,730,280 37,539 1,767,819
Total Liabilities 3,048,922 - 3,048,922
2024 2023
£ £
Revenue analysed by geographical market
UK 90,819 59,944
Europe 4,211,784 3,132,083
4,302,603 3,192,027
The above analysis represents sales to the Group's direct customers who
further distribute these products to their end markets.
Revenues of approximately £3,855,566 (2023: £2,464,372) are derived from
three customers who each account for greater than 10% of the Group's total
revenues:
2024 2024 2023 2023
Customer £ % £ %
A 1,269,185 29.5% 1,594,410 49.9%
B 2,046,109 47.6% 869,962 27.3%
C 540,272 12.6% - -
100% of the revenue generated in the year (2023: 100%)
was recognised at a point in time.
5 Operating loss
2024 2023
£ £
Operating loss for the year is stated after charging:
Fees payable to the Company's auditor for the audit of the Company's financial 75,000 78,000
statements*
Fees payable to the Company's auditor for interim review of half-yearly 4,295 8,000
results
Depreciation of right-of-use assets (note 14) 137,336 135,340
Depreciation on property, plant and equipment (note 13) 95,145 71,086
Amortisation of intangible assets (note 12) 364,319 418,651
Bad debt write off 34,057 -
Research expenses 1,816 37,627
Share-based payment charge (note 22) 204,928 236,576
*Included in the fees payable to the Company's auditor for the audit of the
Company's financial statements are overruns from the prior year audit of £nil
(2023: £10,000).
6 Employees
The average monthly number of persons (including Directors) employed by the
Group and Company during the year was:
2024 2023
Number Number
Management 5 5
Operational 18 14
23 19
Their aggregate remuneration (including Directors) comprised:
2024 2023
£ £
Wages and salaries 1,670,854 1,569,096
Social security costs 218,821 154,538
Pension costs 66,288 54,991
Benefits in kind 8,152 7,186
Share-based payment charge 204,928 236,576
2,169,043 2,022,387
7 Directors' remuneration
2024 2023
£ £
Remuneration for qualifying services 661,821 780,706
Company pension contributions to defined contribution schemes 33,339 31,010
Non-executive Directors' fees 122,921 120,000
Share-based payment charge relating to all Directors 174,363 198,749
992,444 1,130,465
Benefits in kind 8,152 7,186
Social security costs 115,612 77,384
1,116,208 1,215,035
The number of Directors for whom retirement benefits are accruing under
defined contribution schemes amounted to 2 (2023: 2).
The number of Directors who are entitled to receive shares under long term
incentive schemes during the year is 2 (2023: 2).
Remuneration disclosed above includes the following amounts paid to the
highest paid Director:
2024 2023
£ £
Remuneration for qualifying services (including pension and excluding 396,949 463,539
share-based payment charge)
2024 Salary Bonus Fees Pension Share-based Payments Total
£ £ £ £ £ £
A Abrey 228,042 55,870 - 14,299 74,793 373,004
S Smith 303,541 74,368 - 19,040 99,570 496,519
R Cridland - - 40,000 - - 40,000
L van der Broek - - 45,000 - - 45,000
D McAllan 26,254 26,254
R Horsman - - 11,667 - - 11,667
531,583 130,238 122,921 33,339 174,363 992,444
2023 Salary Bonus Fees Pension Share-based Payments Total
£ £ £ £ £ £
A Abrey 217,100 117,777 - 13,300 85,242 433,419
S Smith 289,030 156,799 - 17,710 113,507 577,046
R Cridland - - 40,000 - - 40,000
L van der Broek - - 45,000 - - 45,000
R Horsman - - 35,000 - - 35,000
506,130 274,576 120,000 31,010 198,749 1,130,465
Benefit in kind relates to cumulative life insurance charge and cannot be
allocated to individual directors.
8 Interest income
2024 2023
£ £
Interest income
Bank Deposits 110,483 34,014
Total interest income for financial assets that are not held at fair value
through profit or loss is £110,483 (2023: £34,014).
9 Finance costs and foreign exchange differences
2024 2023
£ £
Interest on lease liabilities 9,732 17,009
Credit charges 910 198
Finance costs 10,642 17,207
Foreign exchange losses (95,988) (68,802)
10 Income tax credit
2024 2023
£ £
Current tax
UK corporation tax on loss for the current year (309,636) (317,201)
Adjustments in respect of prior years 42,628 (111,125)
Total UK current tax income (267,008) (428,326)
The credit for the year can be reconciled to the loss per the income statement
as follows:
2024 2023
£ £
Loss before tax (2,180,147) (6,920,262)
Expected tax credit based on a corporation tax rate of 25% (2023: 23.52%) (545,037) (1,627,683)
Ineligible fixed asset differences 527 138,762
Income not taxable for tax purposes (570) -
Expenses not deductible for tax purposes 58,956 72,069
Additional deduction for R&D expenditure (357,913) (324,836)
R&D claim (309,636) (317,201)
Surrender of tax losses for R&D tax credit refund 774,090 660,006
Adjustment in respect of prior years 42,628 (111,125)
Temporary differences not recognised in the computation (2,321) -
Deferred tax not recognised 72,268 1,081,682
Taxation credit for the year (267,008) (428,326)
There are no future factors at the reporting date that are expected to impact
the Group's future tax charge. The Group is not within the scope of the OECD
Pillar Two model rules.
The taxation credit for the year represents the research and development
credit for the year ended 31 December 2024.
The current tax recoverable as at 31 December 2024 represents R&D tax
credits and is made up as follows:
2024 2023
£ £
Current tax
R&D cash tax credit for the current year (309,636) (317,201)
R&D cash tax credit for the prior year (317,201) -
Adjustments in respect of prior years 42,628 -
Total UK current tax recoverable (584,209) (317,201)
Deferred Tax
The losses carried forward, after the above offset, for which no deferred tax
asset has been recognised, amount to approximately £36,087,896 (2023:
£29,635,304).
The unprovided deferred tax asset of £9,021,974 (2023: £7,408,826) arises
principally in respect of trading losses. It has been calculated at 25% (2023:
25%) and has not been recognised due to the uncertainty of timing of future
profits against which it may be realised.
Only U.K. tax is considered as most of the operations are in the U.K and
Ireland is immaterial in terms of operations.
11 Earnings per share
Basic earnings per share is calculated by dividing the earnings attributable
to ordinary shareholders by the weighted average number of ordinary shares
outstanding during the period.
Diluted earnings per share is calculated using the weighted average number of
shares adjusted to assume the conversion of all dilutive potential ordinary
shares.
Share options outstanding are anti-dilutive in nature due to the loss incurred
and therefore are not considered for computing diluted EPS.
2024 2023
£ £
Weighted average number of ordinary shares for basic and diluted earnings per 533,352,523 420,921,123
share
Earnings (all attributable to equity shareholders of the Company)
Loss for the period (1,906,591) (6,494,249)
Basic and diluted earnings per share (0.36p) (1.54p)
12 Intangible assets
Group
Licences and trademarks Development costs Intellectual property Total
£ £ £ £
Cost
At 1 January 2023 456,684 9,074,031 9,507,057 19,037,772
Additions - 1,605,299 45,166 1,650,465
At 31 December 2023 456,684 10,679,330 9,552,223 20,688,237
Additions - 2,392,285 147,775 2,540,060
At 31 December 2024 456,684 13,071,615 9,699,998 23,228,297
Amortisation and impairment
At 1 January 2023 450,192 2,993,379 7,146,681 10,590,252
Impairment charge for the year 2,545 3,260,862 1,705,122 4,968,529
Amortisation charge for the year 1,388 253,811 163,452 418,651
At 31 December 2023 454,125 6,508,052 9,015,255 15,977,432
Amortisation charge for the year 1,044 296,237 67,038 364,319
At 31 December 2024 455,169 6,804,289 9,082,293 16,341,751
Carrying amount
At 31 December 2024 1,515 6,267,326 617,705 6,886,546
At 31 December 2023 2,559 4,171,278 536,674 4,710,511
Company
Licences and trademarks Development costs Intellectual property Total
£ £ £ £
Cost
At 1 January 2023 456,684 9,074,030 9,374,314 18,905,028
Additions - 1,605,299 45,166 1,650,465
At 31 December 2023 456,684 10,679,329 9,419,480 20,555,493
Additions - 2,392,285 147,775 2,540,060
At 31 December 2024 456,684 13,071,614 9,567,255 23,095,553
Amortisation and impairment
At 1 January 2023 450,192 2,993,379 7,107,158 10,550,729
Impairment charge for the year 2,545 3,260,862 1,705,122 4,968,529
Amortisation charge for the year 1,388 253,811 150,180 405,379
At 31 December 2023 454,125 6,508,052 8,962,460 15,924,637
Amortisation charge for the year 1,044 296,237 53,472 350,753
At 31 December 2024 455,169 6,804,289 9,015,932 16,275,390
Carrying amount
At 31 December 2024 1,515 6,267,325 551,323 6,820,163
At 31 December 2023 2,559 4,171,277 457,020 4,630,856
Intellectual property represents intellectual property in relation to use of
encapsulated terpenes in agrochemicals in the form of licences, patents and
development costs. Intellectual property includes patents and know-how
acquired by the Group. The remaining useful economic life of these assets is 6
years (2023: 7 years) to 31 December 2030.
Licences and trademarks include an inward licence in respect of a patented
technology.
Development costs includes trials and study costs relating to products that
have been, or are being developed, by the Group and Company.
£ 1,045,040 (2023: £1,096,545) of development costs relate to assets under
development for which no amortisation has been charged in 2024 or 2023.
Impairment review at 30 June 2023
The impairment review that was undertaken as part of the Group's 2022 accounts
preparation resulted in headroom over the carrying value of only £0.9m (down
from £8.3m in 2021), a small margin given intangible assets amounted to
£8.4m at that time.
Given the marginal headroom and general downward trend, the management team
and Audit Committee agreed it was appropriate to undertake a further
impairment review of the Group's intangible assets, as part of the preparation
of the Group's 2023 Interim reporting.
The need for an interim impairment review was also driven by external factors
such as continuing high interest rates and inflation which it was felt might
impact the discount rate used in the Cash Generating Unit (CGU) calculations.
The Board agreed to appoint an independent advisor to undertake an impairment
review, based on the current position of the Group and Company, and the
current financial environment.
The total carrying value of the intangible assets was allocated to the
Agrochemicals CGU as the largest CGU in which cash inflows are generated. The
recoverable amounts of the intangible assets were determined based on value in
use calculations based on the Agrochemicals CGU.
The Directors prepared a discounted cash-flow forecast, based on product sales
forecasts including those provided by the Group's commercial partners, and
have taken into account the market potential for the Group's products and
technologies using third party market data that the Group has acquired
licences to. The discounted cash-flow forecast is limited to those products
which are already being sold, or are expected to be sold in 2023, or early
2024.
The forecast covered a period of 7.5 years to 31 December 2030, with no
terminal value, reflecting the useful economic life of the patent in respect
of the underlying technology. Financial forecasts were based on the approved
budget. Financial forecasts were used on the approved long-term plan.
The discount rate was derived from the Group's weighted average cost of
capital, taking into account the cost of equity and debt, to which specific
market-related premium and company-related premium adjustments were made. The
discount rate used was 16.36%.
Tax rate was assumed at 25% which is in line with the rate in the years the
Group have earnings, however the current losses brought forward as at 30 June
2023 exceed £30m so not tax charge was included in the forecasted years where
the Group is profitable.
Based on the above assumptions, the value in use of the intangible assets was
£4,968,529 lower than the carrying value of the intangible assets indicating
that an impairment of intangible assets is required at 30 June 2023. The
impairment charge of £4,968,529 was charged immediately to the statement of
comprehensive income.
An impairment review was performed at December 2024, and no further
impairments have been identified at 31 December 2024.
Impairment review at December 2024
An annual impairment review is undertaken by the Board of Directors. The
Directors have considered the progress of the business in the current year,
including a review of the potential market for its products, the progress the
Group and Company have made in registering its products and other key
commercial factors to perform the review.
The total carrying value of the intangible assets was allocated to the
Agrochemicals CGU as the largest CGU in which cash inflows are generated. The
recoverable amounts of the intangible assets were determined based on value in
use calculations based on the Agrochemicals CGU.
The Directors prepared a discounted cash-flow forecast, based on product sales
forecasts including those provided by the Group's commercial partners, and
have taken into account the market potential for the Group's products and
technologies using third party market data that the Group has acquired
licences to. The discounted cash-flow forecast is limited to those products
which are already being sold, or are expected to be sold in 2025.
The forecast covered a period of 6 years to 31 December 2030, with no terminal
value, reflecting the useful economic life of the patent in respect of the
underlying technology. Financial forecasts were based on the approved budget.
Financial forecasts for 2025-2028 were used on the approved long-term plan.
Financial forecasts for 2029-2030 were extrapolated based on a long-term
growth rate of 50%.
The discount rate was derived from the Group's weighted average cost of
capital, taking into account the cost of equity and debt, to which specific
market-related premium and company-related premium adjustments were made. The
discount rate used was 17.11%.
Tax rate was assumed at 25% which is in line with the rate in the years the
Group have earnings, however the current losses brought forward as at 31
December 2024 exceed £30m so not tax charge was included in the forecasted
years where the Group is profitable.
The estimated recoverable amount of the CGU was higher than its carrying
amount by £0.01m.
As this initial assessment resulted in minimal headroom, the Board also
considered other factors such as the continued revenue growth seen over the
past few years, which is expected to continue for the foreseeable future and
beyond 2030.
Based on the overall review carried out, the Board is satisfied that
intangible assets are not impaired further.
The key assumptions of the forecast are the future cash flows, driven
primarily by level of sales, and the discount rate. The discount rate is
estimated using pre-tax rates that reflect current market assessments of the
time value of money and the risk specific to the CGU. The rate used was 17.11%
(2023: 16.62%). The increase in the rate reflects wider market movements as
well as increased forecasting risk given high, current inflation rates.
As part of the impairment review, a sensitivity analysis was conducted to
stress test the impairment review. The assumed sensitivities included
increasing the discount rate by 1% and reducing the growth rate in which
YE2029 and YE2030 are projected on by 1%. On a sensitised scenario, an
impairment of £0.7m would be required. However, as above, the Board believe
there to be additional value of the business which is not captured in the
Group's discounted cashflow forecast.
As set out in the Strategic Report, the business is in a critical phase of its
development as the development of products is transitioned to revenue
generation. The value of the CGU is supported by forecasts of continued
revenue growth of existing products and the successful introduction and growth
of sales of products currently under development. The forecasts are highly
sensitive to the revenue growth assumptions and are reliant on the Group
meeting the forecast sales, with small deviations from this leading to
impairment indicators.
The Board is therefore satisfied that reasonable changes in assumptions have
been considered and no further impairments have been identified at 31 December
2024.
13 Property, plant and equipment
Group and Company
Fixtures and Fittings Total
£
£
Cost
At 1 January 2023 332,956 332,956
Additions - owned 102,391 102,391
At 31 December 2023 435,347 435,347
Additions - owned 48,649 48,649
At 31 December 2024 483,996 483,996
Accumulated depreciation and impairment
At 1 January 2023 134,170 134,170
Charge for the year 71,086 71,086
At 31 December 2023 205,256 205,256
Charge for the year 95,145 95,145
At 31 December 2024 300,401 300,401
Carrying amount
At 31 December 2024 183,595 183,595
At 31 December 2023 230,091 230,091
14 Right-of-use assets
Group and Company
Leasehold premises Motor vehicles Total
£ £
£
Cost
At 1 January 2023 443,777 137,436 581,213
Additions - 14,963 14,963
Disposals - (22,282) (22,282)
At 31 December 2023 443,777 130,117 573,894
Additions - 63,605 63,605
Disposals - (50,208) (50,208)
At 31 December 2024 443,777 143,514 587,291
Accumulated depreciation and impairment
At 1 January 2023 210,741 37,658 248,399
Charge for the year 90,876 44,464 135,340
Eliminated on disposals - (22,282) (22,282)
At 31 December 2023 301,617 59,840 361,457
Charge for the year 90,876 46,460 137,336
Eliminated on disposals - (50,208) (50,208)
At 31 December 2024 392,493 56,092 448,585
Carrying amount
At 31 December 2024 51,284 87,422 138,706
At 31 December 2023 142,160 70,277 212,437
15 Investments
Current Non-current
Group and Company 2024 2023 2024 2023
£ £ £ £
Investment in associates - - 299,476 297,197
Details of the Group's associates at 31 December 2024 are as follows:
Name of undertaking Registered office Principal activities Class of shares held % held
Direct Voting
TerpeneTech Limited (UK) United Kingdom Research and experimental development on biotechnology Ordinary 29.90 29.90
2024 2023
£ £
Non-current assets 253,566 315,918
Current assets 406,880 311,599
Non-current liabilities - (23,819)
Current liabilities (300,756) (309,349)
Net assets (100%) 359,690 294,349
Company's share of net assets 107,547 88,010
Separable intangible assets 81,491 96,059
Goodwill 412,649 412,649
Impairment of investment in associate (302,211) (299,521)
Carrying value of interest in associate 299,476 297,197
Revenue 736,271 515,647
100% of loss after tax 56,344 (61,802)
29.9% of loss after tax 16,847 (18,479)
Amortisation of separable intangible (14,568) (14,568)
Company's share of profit/(loss) including amortisation of separable 2,279 (33,047)
intangible asset
The separable intangible assets relate to the biocide registration for
geraniol which TerpeneTech (UK) co-owns which was originally valued using
discounted cashflows.
The associate is included in the Consumer Products operating segment.
TerpeneTech Limited's ("TerpeneTech (UK)") registered office is Kemp House,
124 City Road, London, EC1V 2NX and its principal place of business is 3 rue
de Commandant Charcot, 22410, St Quay Portrieux, France.
The Directors have considered the progress of the business in the current
year, including a review of the potential market for its products, the
progress TerpeneTech (UK) has made in registering its products and other key
commercial factors to determine whether any indicators of impairment exist. As
a result of identification of indicators of impairment, an impairment review
of the investment in TerpeneTech (UK) was undertaken by the Board of
Directors.
The Directors have used discounted cash-flow forecasts, based on product sales
forecasts provided by TerpeneTech (UK), and have taken into account the market
potential for those products. These forecasts cover a 6-year period, with no
terminal value, in line with the patent of the underlying technology.
The key assumptions of the forecast are the growth rate and the discount rate.
The discount rate is estimated using pre-tax rates that reflect current market
assessments of the time value of money and the risk specific to the asset. The
rate used was 17.11% (2023: 16.62%). The increase in the rate reflects the
wider market movements as based on the comparable group as well as increased
forecasting risk given high, current inflation rates.
Based on the review the Directors carried out, it was determined that the
Investment was not impaired and, as such, no impairment charge (2023: £nil)
was recognised.
An increase in the discount rate of 11% would result in an impairment.
The growth rates are derived from discussions with the Company's commercial
partner, TerpeneTech (UK), as described above.
The average annual growth rate has been assumed at 20% (2023: 20%) and is
based on the sales of geraniol only.
With no growth in the forecast geraniol sales from 2025 over the entire
forecast period, there would be an impairment of £138,835.
The Directors have also considered whether any reasonable change in
assumptions would lead to a material change in impairment recognised and are
satisfied that this is not the case.
16 Subsidiaries
Details of the Company's subsidiaries at 31 December 2024 are as follows:
Name of undertaking Registered office Principal activities Class of shares held % held
Direct Voting
TerpeneTech Limited Republic of Ireland Sale of biocide products Ordinary 50.00 50.00
Eden Research Europe Limited Republic of Ireland Dormant Ordinary 100.00 100.00
TerpeneTech Limited ("TerpeneTech (Ireland)"), whose registered office is 108
Q House, Furze Road, Sandyford, Dublin, Ireland, was incorporated on 15
January 2019 and is jointly owned by both the Company and TerpeneTech (UK),
the Company's associate.
The Company has the right to appoint a director as chairperson who will have a
casting vote, enabling the Group to exercise control over the Board of
Directors in the absence of an equivalent right for TerpeneTech (UK). The
Company owns 500 ordinary shares in TerpeneTech (Ireland).
Eden Research Europe Limited, whose registered office is 108 Q House, Furze
Road, Sandyford, Dublin, Ireland, was incorporated on 18 November 2020 and is
wholly owned by the Company.
Non-controlling interests
The following table summarises the information relating to the Group's
subsidiary with material non-controlling interest, before intra-Group
eliminations:
2024 2023
Non-controlling interest (NCI) percentage 50% 50%
£ £
Non-current assets 66,383 79,655
Current assets 120,358 56,887
Non-current liabilities - -
Current liabilities (230,208) (166,914)
Net liabilities (100%) (43,467) (30,372)
Carrying amount of NCI (50% of net liabilities) (21,734) (15,186)
Revenue 73,627 50,811
Profit/(loss) after tax (13,095) 4,625
Other comprehensive income - -
Total comprehensive loss (13,095) 4,625
Share of NCI (50% of total comprehensive (loss)/profit) (6,548) 2,313
Cash flows from operating activities - -
Cash flows from investing activities - -
Cash flows from financing activities - -
Net increase / (decrease) in cash and cash equivalents - -
Dividends paid to non-controlling interests - -
17 Inventories
Group and Company
2024 2023
£ £
Raw materials 409,367 149,644
Goods in transit - 27,736
Finished goods 123,283 787,172
532,650 964,552
No provision was made for obsolete inventory in the current year (2023:
£nil).
Raw materials of £722,535 (2023: £1,276,677) were consumed during the year.
This has been recognised within cost of sales in the Consolidated statement of
comprehensive income.
18 Trade and other receivables
Group Company
2024 2023 2024 2023
£ £ £ £
Trade receivables 2,138,725 1,788,151 2,138,725 1,788,151
VAT recoverable 244,974 386,684 244,975 386,684
Other receivables 177,061 112,375 286,911 222,403
Prepayments and accrued income 545,082 162,413 545,082 162,413
3,105,842 2,449,623 3,215,693 2,559,651
No provision for doubtful debts in the current year (2023: £nil).
Trade receivables disclosed above are measured at amortised cost. The
Directors consider that the carrying amount of trade and other receivables
approximates their fair value.
Trade receivables of £1,571,516 (2023: £1,355,690) at the reporting date
were held in Euros and £112,540 (2023: £111,654) were held in USD, with the
remainder being in GBP. Please see note 30 for further details.
19 Trade and other payables
Group Company
2024 2023 2024 2023
£ £ £ £
Current
Trade payables 2,559,056 1,925,559 2,559,056 1,925,559
Accruals and deferred income 634,614 640,342 634,614 640,342
Social security and other taxation 108,490 56,841 108,490 56,841
Other payables 97,342 196,411 97,342 196,411
3,399,502 2,819,153 3,399,502 2,819,153
Trade payables of £1,023,914 (2023: £597,876) at the reporting date were
held in Euros and £558,234 (2023: £382,852) were held in USD, with the
remainder being in GBP. Please see note 30 for further details.
20 Lease liabilities
Lease liabilities are classified based on the amounts that are expected to be
settled within the next 12 months and after more than 12 months from the
reporting date, as follows:
Group and Company
2024 2023
£ £
Current liabilities 109,039 142,849
Non-current liabilities 59,693 86,920
168,732 229,769
Group and Company
2024 2023
Maturity analysis - total future payments due under leases: £ £
Within one year 109,039 152,694
In two to five years 69,426 89,285
Total undiscounted liabilities 178,465 241,979
Future finance charges and other adjustments (9,733) (12,210)
Lease liabilities in the financial statements 168,732 229,769
Set out below are the future undiscounted cash outflows to which the lessee is
exposed to that are reflected in the measurement of lease liabilities,
categorised by type of leased item:
2024 2023
Land and buildings £ £
Within one year 59,012 106,735
Between two and five years - 59,949
59,012 166,684
2024 2023
Motor vehicles £ £
Within one year 50,027 45,959
Between two and five years 59,693 29,336
109,720 75,295
Cash paid in respect of lease liabilities in the year was £155,528 (2023:
£156,548) excluding interest and expenses relating to leases of low-value
assets.
The Group holds nine leases, for two properties and seven vehicles. All leases
have fixed lease repayments and average remaining terms of 0.6 years (2023:
1.6 years) for the properties and 2.1 years (2023: 1.7 years) for the
vehicles.
The incremental borrowing rates applied to lease liabilities recognised in the
statement of financial position at the date of initial application of IFRS 16
were 4.75% for land and buildings and 8.71% for other assets.
2024 2023
Amounts recognised in profit or loss include the following: £ £
Interest on lease liabilities 9,732 17,009
Expense relating to leases of low-value assets - 740
21 Retirement benefit schemes
Defined contribution schemes
The Group operates a defined contribution pension scheme for all qualifying
employees. The assets of the scheme are held separately from those of the
Group in an independently administered fund.
The total costs charged to the income statement in respect of defined
contribution plans is £66,288 (2023: £54,991).
Retirement benefit contributions of £10,695 remained unpaid as at 31 December
2024 (2023: £nil).
22 Share-based payment transactions
Long-Term Incentive Plan ("LTIP")
Since September 2017, the Group has operated an option scheme for executive
directors, senior management and certain employees under an LTIP which allows
for certain qualifying grants to be HMRC approved.
LTIP Replacement Award
In 2021, the Company made changes to the LTIP in line with the requirements of
a fundraise completed in 2020. The new plan was deemed a more appropriate
scheme to incentivise management given the Company's stage of development and
replaced the 2019 Award, which lapsed in its entirety in 2021.
Pursuant to the updated plan, in 2021 the Company granted options over 10.5
million new Ordinary Shares, at a strike price of 6p each, in the amounts of 6
million awarded to Sean Smith and 4.5 million awarded to Alex Abrey. The
options vested immediately and lapse in three equal tranches in June 2022,
June 2023 and June 2024. For the first five years following grant, no shares
arising from the exercise of these options may be sold unless the Company's
prevailing share price is equal to, or in excess of, 10p.
The shares arising from exercise of options are subject to a one-year lock-in
restriction, followed by a one-year orderly market restriction.
For accounting purposes, the options granted under the LTIP Replacement Award
have been treated as a modification of the 2019 Award as per IFRS 2. Where
awards previously granted have been deemed to be modified, IFRS 2 requires the
share-based payment charge to comprise the original fair value of the awards,
together with an incremental fair value.
The following information is relevant in the determination of the fair value
of options granted under the LTIP Replacement Award.
Replacement Awards
Grant date 30/06/2021
Number of awards 10,500,000
Share price £0.10
Exercise price £0.06
Expected dividend yield -%
Expected volatility 55%
Risk free rate 0.03%
80
Vesting period Nil
Expected Life (from date of grant) 0.5/1/1.5 years
As the options have been issued at a significant discount to the share price,
the expected exercise has been assumed to equal the midpoint between the vest
and lapse date.
During the year, 3,500,000 (2023: 3,500,000) of the above options lapsed and
£171,251 (2023: £171,251) was transferred from the warrant reserve to
retained earnings.
At 31 December 2024, there were nil (2023: 3,500,000) options still in issue.
The share-based payment charge for the year ended 31 December 2024 in respect
of the above LTIP Replacement Awards was £nil (2023: £nil).
2021 Award
Also in 2021, the Company made a further grant of options in order to ensure
continuity of long-term incentive of options over 7,183,784 new Ordinary
Shares in the Company, at a strike price of 10.37p each, in the amounts of
4,102,703 awarded to Sean Smith and 3,081,081 awarded to Alex Abrey.
These grants expire on 31 July 2025 and vest as follows:
· 1/3 upon grant;
· 1/3 12 months from the date of grant; and
· 1/3 24 months from the date of grant.
The share-based payment charge for the year ended 31 December 2024 in respect
of the above 2022 LTIP awards was £nil (2023: £119,083).
22 Share-based payment transactions (continued)
Other share options
2021 Award
In addition to the options granted under the LTIP, certain employees were
awarded approved options over a total of 996,220 shares in 2021. These have
been issued at a strike price of 10-10.37p with expiry date between 30 June
2022 and 30 June 2024.
640,664 of these vested immediately with the remainder vesting over a 3-year
period. The share-based payments charge in respect of all these options for
the year ended 31 December 2024 was £nil (2023: £nil). During the year, none
(2023: none) of these options were exercised and 121,926 (2023: none) lapsed
and £1,757 (2023: £nil ) was transferred from the warrant reserve to
retained earnings.
2022 Award
In 2022, the Company granted to employees a total of 2,006,939 options at an
average exercise price of 6p. No awards were made to directors in 2022.
50% of the options vest immediately, with the remaining 50% vesting after one
year.
The following information is relevant in the determination of the fair value
of options granted under the 2022 Award.
Grant date 30/6/22
Number of awards 2,006,939
Share price £0.04
Exercise price £0.06
Expected dividend yield -
Expected volatility 63%
Risk free rate 0.95%
Vesting period 1 year
Expected Life (from date of grant) 3 years
The share-based payments charge in respect of all these options for the year
ended 31 December 2024 was £nil (2023: £nil). During the year, none (2023:
none) of these options were exercised, 190,476 (2023: none) lapsed and £4,245
(2023: £nil) was transferred from the warrant reserve to retained earnings.
2023 Award to Directors
The Company made a further grant of options in order to ensure continuity of
long-term incentive of options over 8,698,909 new Ordinary Shares in the
Company, at a strike price of 5.1p each, in the amounts of 4,968,000 awarded
to Sean Smith and 3,730,909 awarded to Alex Abrey.
The Options expire on 31 August 2027 and vest as follows:
• 1/3 upon grant;
• 1/3 12 months from the date of grant; and
• 1/3 24 months from the date of grant.
The following information is relevant in the determination of the fair value
of options granted under the 2023 Award to Directors.
Grant date 30/8/23
Number of awards 8,698,909
Share price £0.06
Exercise price £0.05
Expected dividend yield -
Expected volatility 65.6%
Risk free rate 5.4%
Vesting period 2 years
Expected Life (from date of grant) 3 years
The share-based payments charge in respect of all these options for the year
ended 31 December 2024 was £79,666 (2023:£79,666). During the year, none of
these options were exercised and none lapsed and £nil was transferred from
the warrant reserve to retained earnings.
2023 Award to Employees
In addition to the above options granted to Directors, the Company granted
employees a total of 2,224,976 options at an average exercise price of 6p.
The Options expire on 30 June 2026 and vest as follows:
• 1/2 upon grant; and
• 1/2 12 months from the date of grant.
The following information is relevant in the determination of the fair value
of options granted under the 2023 Award to Employees.
Grant date 18/12/23
Number of awards 2,224,976
Share price £0.04
Exercise price £0.05
Expected dividend yield -
Expected volatility 65.4%
Risk free rate 5.4%
Vesting period 2 years
Expected Life (from date of grant) 3 years
The share-based payments charge in respect of all these options for the year
ended 31 December 2024 was £nil (2023: £37,827). During the year, none
(2023: none) of these options were exercised and none (2023: none) lapsed and
£nil (2023: £nil) was transferred from the warrant reserve to retained
earnings.
2024 Award to Directors
The Company made a further grant of options in order to ensure continuity of
long-term incentive of options over 11,918,901, new Ordinary Shares in the
Company, at a strike price of 6.5p each, in the amounts of 6,805,852 awarded
to Sean Smith and 5,113,049 awarded to Alex Abrey.
The Options expire on 30 June 2028 and vest as follows:
• 1/3 upon grant;
• 1/3 12 months from the date of grant; and
• 1/3 24 months from the date of grant.
The following information is relevant in the determination of the fair value
of options granted under the 2024 Award to Directors.
Grant date 04/07/24
Number of awards 11,918,901
Share price £0.04
Exercise price £0.07
Expected dividend yield -
Expected volatility 65.6%
Risk free rate 5.4%
Vesting period 2 years
Expected Life (from date of grant) 3 years
The share-based payments charge in respect of all these options for the year
ended 31 December 2024 was £108,411 (2023: £nil). During the year, none of
these options were exercised and none lapsed and £nil was transferred from
the warrant reserve to retained earnings.
2024 Award to Employees
In addition to the above options granted to Directors, the Company granted
employees a total of 2,605,322 options at an average exercise price of 6.5p.
The Options expire on 30 June 2028 and vest as follows:
• 1/2 upon grant; and
• 1/2 12 months from the date of grant.
The following information is relevant in the determination of the fair value
of options granted under the 2024 Award to Employees.
Grant date 31/12/24
Number of awards 2,605,322
Share price £0.04
Exercise price £0.07
Expected dividend yield -
Expected volatility 65.4%
Risk free rate 5.4%
Vesting period 2 years
Expected Life (from date of grant) 3 years
The share-based payments charge in respect of all these options for the year
ended 31 December 2024 was £16,852. During the year, none of these options
were exercised and none lapsed and £nil was transferred from the warrant
reserve to retained earnings.
A summary of all the above options is set out in the table below.
Options awards
Number of share options Weighted average exercise price (pence)
2024 2023 2024 2023
Outstanding at 1 January 23,486,534 16,312,649 7 8
Granted during the year 14,524,223 10,923,885 7 5
Exercised during the year - (250,000) - 1
Lapsed during the year (3,812,402) (3,500,000) 6 6
Exercisable at 31 December 34,198,355 23,486,534 9 7
The exercise price of options outstanding at the end of the year ranged
between 6p and 10p (2023: 5p and 10p) and their weighted average contractual
life was 2.1 years (2023: 2.2 years).
The share-based payment charge for the year, in respect of options, was
£204,928 (2023: £236,576).
A total of £173,008 (2023: £179,407) was transferred from the warrant
reserve to retained earnings in relation to share options that lapsed in the
year.
23 Share capital
Ordinary share 2024 2023 2024 2023
Number Number £ £
Authorised, Issued and fully paid
At the beginning of the year 533,352,523 380,858,607 5,333,529 3,808,589
Issue of shares - 152,493,916 - 1,524,940
At the end of the year 533,352,523 533,352,523 5,333,529 5,333,529
Each ordinary share of £0.01 has voting and dividend rights attached to them.
24 Share premium account
Group and Company
2024 2023
£ £
At the beginning of the year 6,413,652 39,308,529
Issue of shares - 8,373,415
Share issue costs - (840,116)
Capital reduction - (40,428,176)
At the end of the year 6,413,652 6,413,652
25 Warrant reserve
Group and company
£
Balance at 1 January 2023 701,065
Share-based payment expense in respect of options granted 236,576
Share-based payment expense in respect of options/warrants lapsed/exercised (179,407)
Balance at 31 December 2023 758,234
Share-based payment expense in respect of options granted 204,928
Share-based payment expense in respect of options/ warrants lapsed/ exercised (173,008)
Balance at 31 December 2024 790,154
The warrant reserve represents the fair value of share options and warrants
grants, and not exercised or lapsed, in accordance with the requirements of
IFRS 2 Share Based Payments.
Group and Company
2024 2023
£ £
At the beginning of the year 6,413,652 39,308,529
Issue of shares - 8,373,415
Share issue costs - (840,116)
Capital reduction - (40,428,176)
At the end of the year 6,413,652 6,413,652
25 Warrant reserve
Group and company
£
Balance at 1 January 2023 701,065
Share-based payment expense in respect of options granted 236,576
Share-based payment expense in respect of options/warrants lapsed/exercised (179,407)
Balance at 31 December 2023 758,234
Share-based payment expense in respect of options granted 204,928
Share-based payment expense in respect of options/ warrants lapsed/ exercised (173,008)
Balance at 31 December 2024 790,154
The warrant reserve represents the fair value of share options and warrants
grants, and not exercised or lapsed, in accordance with the requirements of
IFRS 2 Share Based Payments.
26 Merger reserve
Group and Company
2024 2023
£ £
At the beginning of the year - 10,209,673
Transfer of merger reserve - (10,209,673)
At the end of the year - -
The merger reserve arose on historical acquisitions of subsidiary undertakings
for which merger relief was permitted under the Companies Act 2006.
In 2023, the carrying value of the intellectual property which had arisen from
an acquisition in 2003 had been reduced to zero. As such, under the Companies
Act 2006, the full balance of the merger reserve of £10,209,673 was
transferred to retained earnings.
27 Non-controlling interest
Group
2024 2023
£ £
At the beginning of the year 26,815 24,502
Share of total comprehensive loss/profit for the year (6,548) 2,313
At the end of the year 20,267 26,815
The non-controlling interest arose from the Company's 50% share in TerpeneTech
(Ireland) Limited. See note 16 for further information.
28 Other interest-bearing loans and borrowings
Change in liabilities, arising from financing activities are presented below:
Group and Company 2024 2023
£ £
Balance at 1 January 229,769 355,323
Changes from financing cashflows
Payment of lease liabilities* (145,796) (139,539)
Total changes from financing cashflows (145,796) (139,539)
Other changes
New leases 63,605 14,963
Adjustment to Right of Use Assets 21,154 (978)
Total other changes 84,759 13,985
Balance as at 31 December 168,732 229,769
*excluding lease interest of £9,732 (2023: £17,009)
29 Related party transactions
Remuneration of key management personnel
The remuneration of key management personnel, including Directors, is set out
in note 7 in aggregate for each of the categories specified in IAS 24 Related
Party Disclosures.
Group
During the year, the Group invoiced its associate, TerpeneTech (UK), £8,900
for administration charges (2023: £9,133).
Also, during the year the Group recharged £10,769 (2023: £7,054) of expenses
to TerpeneTech (UK) and incurred consultancy charges of £8,292 (2023:
£13,274).
At the year end, an amount of £167,586 was due from TerpeneTech (UK) (2023:
£233,686) to the Company. This amount is included within Trade Receivables.
At the year end, an amount of £97,342 was due to TerpeneTech (UK) (2023:
£99,820) from the Company. This amount is included within Other Payables.
At the year end, a net amount of £120,358 was due to TerpeneTech (Ireland)
from TerpeneTech (UK) (2023: £56,887 due to TerpeneTech (Ireland) from
TerpeneTech (UK)). It represents the amount due in respect of the intangible
asset reduced by fees receivable in respect of sales which amounted to
£73,627 (2023: £50,811). This amount is included within Other Receivables.
Company
During the year, the Company invoiced its associate, TerpeneTech (UK), £8,900
for administration charges (2023: £9,133).
Also, during the year the Company recharged £10,769 (2023: £7,054) of
expenses to TerpeneTech (UK) and incurred consultancy charges of £8,292
(2023: £13,274).
Further, at year end, £63,000 has been accrued in respect of management
recharges from the Company to TerpeneTech (Ireland) (2023: £10,000) and
£10,156 has been recharged for audit fees (2023: £22,914). An amount of
£240,070 (2023: £166,914) is included within the Other Receivables.
At the year end, an amount of £167,586 was due from TerpeneTech (UK) (2023:
£233,686). This amount is included within Trade Receivables.
At the year end, an amount of £97,342 was due to TerpeneTech (UK) (2023:
£99,820). This amount is included within Other Payables.
Related party transactions are made on an arms' length basis.
30 Financial risk management
Credit risk
Group Company
2024 2023 2024 2023
£ £ £ £
Cash and cash equivalents 3,674,796 7,413,107 3,674,796 7,413,107
Trade receivables* 2,138,725 1,788,151 2,138,725 1,788,151
VAT recoverable* 244,975 386,684 244,975 386,684
Other receivables* 177,061 112,375 286,354 222,403
6,235,557 9,700,317 6,344,850 9,810,345
*See note 18
The average credit period for sales of goods and services is 175 days (2023:
204). No interest is charged on overdue trade receivables. At 31 December
2024, trade receivables of £681,441 (2023: £262,322) were past due. During
the year the Group and Company provided for doubtful debts in the amount of
£nil (2023: £nil).
Trade receivables of £1,571,516 (2023: £1,355,690) at the reporting date
were held in Euros and £112,540 (2023: £111,654) were held in "USD".
Cash at bank of £1,512,694 (2023: £48,515) at the reporting date were held
in Euros and £4,826 (2023: £28,510) were held in "USD".
The Group's policy is to recognise loss allowances for expected credit losses
(ECLs) on financial assets measured at amortised cost. The Group measures loss
allowances for trade receivables at an amount equal to lifetime ECL. When
determining whether the credit risk of a financial asset has increased
significantly since initial recognition and when estimating ECL, the Group
considered reasonable and supportable information that is relevant and
available without undue cost of effect. This includes both quantitative and
qualitative information and analysis, based on the Group's historical
experience, information credit assessment and including forward-looking
information and consideration of any actual or expected significant adverse
changes in business, financial or economic conditions that are expected to
cause a significant change to the borrower's ability to meet its obligations.
The Group considers a financial asset to be in default and its credit risk to
have increased significantly when:
• the borrower is unlikely to pay its credit obligations
to the Group in full, without recourse by the Group to actions such as
realising security (if any is held); or
• the financial asset is more than 120 days past due.
Liquidity risk (excluding lease liabilities)
Group and Company
2024 2023
Notes £ £
Trade payables 19 2,559,056 1,925,559
Other payables 19 97,342 196,411
Social security and other taxation 19 108,490 56,841
2,764,888 2,178,811
The carrying amount of trade and other payables approximates their fair value.
The average credit period on purchases of goods is 113 days (2023: 117 days).
No interest is charged on trade payables. The Group has policies in place to
ensure that trade payables are paid within the credit timeframe or as
otherwise agreed.
Trade payables of £1,023,914 (2023: £597,876) at the reporting date were
held in Euros and £558,234 (2023: £382,852) were held in USD.
Maturity of financial liabilities (excluding lease liabilities)
The maturity profile of the Group's financial liabilities at 31 December 2024
was as follows:
2024 2023
£ £
In one year or less, or on demand 2,764,888 2,178,811
Over one year - -
2,764,888 2,178,811
Liquidity risk is managed by regular monitoring of the Group's level of cash
and cash equivalents, debtor and creditor management and expected future cash
flows. See note 1 for further details on the going concern position of the
Group and Company. For details of lease liabilities, see note 20.
Market price risk
The Group's exposure to market price risk comprises currency risk exposure.
It monitors this exposure primarily through a process known as sensitivity
analysis. This involves estimating the effect on results before tax over
various periods of a range of possible changes in exchange rates. The
sensitivity analysis model used for this purpose makes no assumptions about
any interrelationships between such rates or about the way in which such
changes may affect the economies involved. As a consequence, figures derived
from the Group's sensitivity analysis model should be used in conjunction with
other information about the Group's risk profile.
The Group's policy towards currency risk is to eliminate all exposures that
will impact on reported results as soon as they arise. Based on the foreign
currency break down provided under credit risk and liquidity risk, the impact
of 5%-10% movement in foreign exchange will not have material effect.
Capital risk management
The primary objective of the Group's capital management is to ensure that it
maintains healthy capital ratios in order to support its business and maximise
shareholder value.
The Group seeks to enhance shareholder value by capturing business
opportunities as they develop. To achieve this goal, the Group maintains
sufficient capital to support its business.
The Group manages its capital structure and makes adjustments to it in light
of changes in economic conditions.
The Group looks to maintain a reasonable debt position by repaying debt or
issuing equity, as and when it is deemed to be required.
No changes were made in the objectives, policies or processes for managing
capital during the years ended 31 December 2024 and 31 December 2023.
The Group monitors capital using a gearing ratio, which is net debt divided by
total capital plus net debt. The Group's policy is to keep the gearing ratio
below 10% (2023: below 10%). The Group includes within net debt, any
interest-bearing loans and borrowings (none in the current or prior year), any
loans from a venture partner (none in the current or prior year), trade and
other payables, less cash and cash equivalents. The Group is not subject to
any externally imposed capital requirements.
31 Cash absorbed by operations
Consolidated
2024 2023
£ £
Loss for the year after tax (1,913,139) (6,491,936)
Adjustments for:
Taxation credited (267,008) (428,326)
Interest on lease liabilities 9,732 17,009
Interest income (110,483) (34,014)
Foreign exchange currency losses 95,988 68,802
Amortisation and impairment of intangible assets 364,319 5,387,180
Depreciation and property, plant and equipment and right-of-use assets 232,481 206,426
Share of associate's loss (2,279) 33,047
Share-based payment expense 204,928 236,576
Bad debt write off 34,057 -
Movements in working capital:
Decrease/(Increase) in inventories 431,902 (339,094)
Increase in trade and other receivables (656,219) (1,790,757)
Increase in trade and other payables 567,152 1,004,833
Cash absorbed by operations (1,008,569) (2,130,252)
Company
2024 2023
£ £
Loss for the year after tax (1,900,044) (6,496,561)
Adjustments for:
Taxation credited (267,008) (428,326)
Interest on lease liabilities 9,732 17,009
Interest income (110,483) (34,014)
Foreign exchange currency (gains)/losses 95,988 68,802
Amortisation and impairment of intangible assets 350,753 5,373,908
Depreciation and property, plant and equipment and right-of-use assets 232,481 206,426
Share of associate's loss (2,279) 33,047
Share-based payment expense 204,928 236,576
Doubtful debt provision 34,057 -
Movements in working capital:
Decrease/(Increase) in inventories 431,902 (339,094)
Increase in trade and other receivables (656,042) (1,772,860)
Increase in trade and other payables 567,446 1,004,833
Cash absorbed by operations (1,008,569) (2,130,252)
32 Capital commitments
As at 31 December 2024, an amount of £251,226 (2023: £481,557) had been
committed to by the Group and Company, for work not yet completed, or
invoiced. Work performed in both years related to on-going field trials and
other regulatory studies. Work related to prior year commitments was invoiced
during 2024.
33 Contingent liabilities
The Company provides a two-year warranty for one of its products which solely
relates to the product not being defective.
Given the quality control processes that are in place, the Company is
satisfied that no provision is required in this respect.
34 Post balance sheet events
There were no adjusting or significant non-adjusting events between 31
December 2024 and the approval of the financial statements.
35 Controlling party
There is no ultimate controlling company or party of Eden Research plc.
This information is provided by RNS, the news service of the London Stock Exchange. RNS is approved by the Financial Conduct Authority to act as a Primary Information Provider in the United Kingdom. Terms and conditions relating to the use and distribution of this information may apply. For further information, please contact
rns@lseg.com (mailto:rns@lseg.com)
or visit
www.rns.com (http://www.rns.com/)
.
RNS may use your IP address to confirm compliance with the terms and conditions, to analyse how you engage with the information contained in this communication, and to share such analysis on an anonymised basis with others as part of our commercial services. For further information about how RNS and the London Stock Exchange use the personal data you provide us, please see our
Privacy Policy (https://www.lseg.com/privacy-and-cookie-policy)
. END FR GZGGKGVNGKZGRecent news on Eden Research
See all newsREG - Eden Research plc - Mevalone Approval in California - Powdery Mildew
AnnouncementRCS - Eden Research plc - Investor Presentation via Investor Meet Company
AnnouncementREG - Eden Research plc - Holding(s) in Company
AnnouncementREG - Eden Research plc - Preliminary results for the year ended 31 Dec 2024
AnnouncementREG - Eden Research plc - Thymol Supply Agreement For Bee Health
Announcement