REG - Ergomed plc - Interim Results <Origin Href="QuoteRef">ERGO.L</Origin> - Part 2
18/09/2017 07:35
- Part 2: For the preceding part double click ID:nRSR9653Qa
industries; licensees,
approvals and compliance; and the potential for cancellation or delay of
clinical studies by customers. It is anticipated that the risk profile will
not significantly change for the remainder of the year. Risk is an inherent
part of doing business and the profitability and strong cash position of the
Group, along with the growth profile of the business, leads the Directors to
believe that the Group is well placed to manage business risks successfully.
Going concern
The Directors have considered cashflow forecasts for the group, detailing cash
inflows and outflows for the period ending 31 December 2018. Based on their
review of these forecasts and consideration of the economic environment in
which the group operates, the Directors are satisfied that the Company has
sufficient resources to continue in operation for the foreseeable future,
being a period of not less than 12 months from the date of this report.
Accordingly, they continue to adopt the going concern basis in preparing the
financial information for the six months ended 30 June 2017.
Business Combinations
Acquisitions of subsidiaries and businesses are accounted for using the
acquisition method. The consideration transferred on acquisition is the fair
value at the date of transaction for assets and liabilities transferred. All
acquisition related costs are expensed as incurred.
Goodwill arises as the excess of acquisition cost over the fair value of the
assets transferred at the date of transaction. Goodwill is reviewed for
impairment annually, and is carried at cost less accumulated impairment
losses. Impairment losses are not reversed in subsequent periods.
Goodwill arising on the acquisition of a foreign operation, including any fair
value adjustments to the carrying amounts of assets or liabilities on the
acquisition, are treated as assets and liabilities of that foreign operation
in accordance with IAS 21 and as such are translated at the relevant foreign
exchange rate at the statement of financial position date.
Adoption of new and revised standards
There are no new standards that have been issued but are not yet effective for
the financial year that are expected to have a material impact on the Group.
2. REVENUE
Clinical research services Drug safety and medical information services Totalrevenue
£000s £000s £000s
Six months ended 30 June 2017
Net service revenue** 8,747 10,729 19,476
Reimbursement revenue** 3,336 95 3,431
Revenue** 12,083 10,824 22,907
Six months ended 30 June 2016
Net service revenue** 7,238 5,477 12,715
Reimbursement revenue** 4,770 68 4,838
Revenue** 12,008 5,545 17,553
Year ended 31 December 2016
Net service revenue** 15,938 13,286 29,224
Reimbursement revenue** 9,839 170 10,009
Revenue* 25,777 13,456 39,233
* Audited
** Unaudited
3. EARNINGS PER SHARE
The calculation of the basic and diluted earnings per share is based on the
following data:
UnauditedSix monthsended30 June 2017£000s UnauditedSix monthsended30 June 2016£000s AuditedYearended31 December 2016£000s
Earnings for the purposes of basic earningsper share being net profit attributable toowners of the Company 474 636 479
Effect of dilutive potential ordinary shares - - -
Earnings for the purposes of diluted earnings per share 474 636 479
No. No. No.
Number of shares
Weighted average number of ordinary sharesfor the purposes of basic earnings per share 40,534,603 31,116,420 35,573,733
Effect of dilutive potential ordinary shares
Share options 2,058,829 1,368,600 1,484,600
Weighted average number of ordinary shares for the purposes of diluted earnings per share 42,593,432 32,485,020 37,058,333
4. GOODWILL
£000s
Cost
At 1 January 2016* 7,488
Arising on acquisition of subsidiaries** 17,720
At 30 June 2016** 25,208
£000s
Cost
At 1 January 2016* 7,488
Arising on acquisition of subsidiary* 4,797
At 31 December 2016* 12,285
Adjustment arising during measurement period** 57
At 30 June 2017** 12,342
Accumulated impairment losses
1 January 2016*, 30 June 2016**, 31 December 2016* and 30 June 2017** -
Net book value
At 30 June 2017** 12,342
At 30 June 2016** 25,208
At 31 December 2016* 12,285
* Audited
** Unaudited
Goodwill in relation to the acquisition of Haemostatix was increased by
£58,000 during the period, following a re-assessment of the deferred tax asset
arising on the transaction.
Goodwill arising on acquisition of subsidiaries in the first half of 2016 was
based on initial valuations. Goodwill was subsequently reduced upon
identification of the associated intangible assets once purchase price
allocation was complete.
5. TRADE AND OTHER RECEIVABLES
Unaudited30 June 2017£000s Unaudited30 June 2016£000s Audited31 December 2016£000s
Trade receivables 11,179 8,358 9,540
Other receivables 1,191 485 1,025
Prepayments 792 483 841
Accrued income 2,753 2,774 2,538
Corporation tax receivable 843 222 1,014
16,758 12,322 14,958
6. INVENTORY
Unaudited30 June 2017£000s Unaudited30 June 2016£000s Audited31 December 2016£000s
Clinical trial material 695 67 450
7. TRADE AND OTHER PAYABLES
Unaudited30 June 2017£000s Unaudited30 June 2016£000s Audited31 December 2016£000s
Trade creditors 3,027 3,148 3,037
Amounts payable to related parties 54 29 49
Social security and other taxes 876 389 632
Other payables 785 432 600
Accruals 1,877 3,135 2,759
6,619 7,133 7,077
8. ACQUISITION COSTS
UnauditedSix months ended30 June 2017 UnauditedSix months ended30 June 2016 AuditedYearended31 December 2016
£000s £000s £000s
Acquisition of Sound Opinion - 7 7
Acquisition of Haemostatix - 269 370
Acquisition of O+P & GASD - 73 85
Acquisition of PharmInvent - - 118
Other M&A activities 52 3 4
52 352 584
9. EXCEPTIONAL ITEMS
UnauditedSix months ended30 June 2017 UnauditedSix months ended30 June 2016 AuditedYearended31 December 2016
£000s £000s £000s
Establishment of PrimeVigilance US office - - 177
- - 177
In line with the way the Board and chief operating decision makers review the
business, large one-off exceptional costs are separately identified and shown
as exceptional costs. In the full year of 2016, these were directly related to
the establishment of the PrimeVigilance US office.
10. EBITDA and EBITDA (adjusted)
UnauditedSix months ended30 June 2017 UnauditedSix months ended30 June 2016 AuditedYear ended31 December 2016
£000s £000s £000s
Operating profit 722 819 598
Adjust for:
Depreciation and amortisation charges within Other administrative expenses 212 103 256
Amortisation of acquired intangible assets 552 307 771
EBITDA 1,486 1,229 1,625
Share-based payment charge 278 204 398
Deferred consideration for acquisition - - 690
Write-back of deferred consideration for acquisition - - (460)
Acquisition costs (note 8) 52 352 584
Exceptional items (note 9) - - 177
Adjusted EBITDA 1,816 1,785 3,014
This information is provided by RNS
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