HealthBeacon PLC HealthBeacon - HBCN - 2022 Interim Results
30/09/2022 07:00
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RNS Number : 2062B HealthBeacon PLC 30 September 2022
HealthBeacon plc
INTERIM RESULTS FOR THE SIX MONTHS ENDED 30 JUNE 2022
Increasing Momentum, Added to Digital Health Formulary, Managed through Chip
Supply Headwind
Dublin, 30 September 2022, HealthBeacon plc ("HealthBeacon" or the "Company")
and together with its subsidiary undertakings (together the "Group"), a
leading Irish digital therapeutics company, announces its interim results for
the six months ended 30 June 2022.
FINANCIAL HIGHLIGHTS
H1 2022 financial highlights (comparison to H1 2021):
· Deployed units increasing 144% to 10,206 (June 2021: 4,182)
· 57% growth in revenue to €0.9 million (June 2021: €0.5
million)
· Gross profit margin excluding Direct-to-Consumer ("DTC") sell-in
revenue of 38% (June 2021: 57%)
· Net cash position at 30 June 2022 of €20.0 million (December
2021: €26.6 million)
· Well positioned to deliver 10x growth in units over the next 18
months
Six months ended 30 June H1 2022 H1 2021 Change
€'000 €'000 %
Revenue 867 545 57%
Gross Profit 87 313 (72%)
Gross Profit Margin (Group) 10% 57%
Gross Profit Margin (ex. DTC sell-in) 38% 57%
Adjusted EBITDA* (4,573) (2,028)
Net cash 20,028 1,512
Units Deployed** (units '000) 10.2 4.2 143%
*Adjusted EBITDA is a non-accounting term which the Company has defined as:
Excluding Share Based Compensation, Expected Credit Losses, Fx Gains/Losses
and Warranty Expenses
**Units Deployed are units on lease or that have been sold to third parties
STRATEGIC AND OPERATIONAL HIGHLIGHTS
HealthBeacon continues to add new customers underpinning growth to 100k units
by end of Q1 2024
· Continued expansion of client base to 25 currently, from 19 at
the end of 2021
· Signed a major commercial contract in March 2022 with Evernorth,
one of the largest independent pharmacy benefits manager and speciality
pharmacy services in the US, owned by Cigna Corporation (NYSE: CI US).
· Added to Evernorth's Digital Health Formulary in September 2022,
an industry leading platform of credible health apps validating the quality
and effectiveness of HealthBeacon's Injection Care Management System ("ICMS")
· Commenced Specialty Pharmacy programmes, now working with three
of the top five speciality pharmacy organisations in the US, commercialisation
and scaling during 2023 from these programmes
· Launched inaugural NHSx programme in the UK, and actively engaged
with a number of NHS Trusts on potential deployment
· Entered into partnership with the American Pharmacists
Association Foundation ('APhA'), the largest national professional association
of pharmacists in the US
· Commenced trial of the ICMS platform in the US in relation to
Medicare reimbursement and expect to see further progress in H1 2023
Fully secured supply chain to deliver 100k units over the next 18 months
· Placed build order for 35,000 units to meet anticipated demand
from pharmaceutical clients, specialty pharmacy, DTX and DTC channel
· Resolved the supply chain delay in H1 2022 in relation to key
chip components
Continued innovation in partnership with customers
· Received approval from the Environmental Protection Agency
("EPA") for its Green Labs for sustainable processing of sharps bins and
injection waste; launched Novartis sustainable waste management service in
Ireland
· Launched Green Labs Dublin in April 2022 and Green Labs USA in
September 2022
· Launched the Company's Patient Safety Software with key long-term
partner in Ireland with negotiations under way for further rollout in Europe
· Launched Pill Management System and Integrated Smart Scale, for
commercialisation into 2024, as part of the overall ambition to be the leading
global medication adherence solution provider
Outlook
· HealthBeacon's ongoing engagement with new and prospective
customers, together with the increasingly supportive reimbursement and
healthcare system backdrop, underpins the current ten-fold growth expectations
to the end of Q1 2024 and the very significant potential of the business
beyond with the launch of new products and services.
· Implementation, systems and hiring progressing while
strengthening the foundation for the rollout of products and services across
key clients on the path to 100,000 units with run rate revenues of at least
€25 million at that point
· Expect ca 15,000 units deployed by year end
Jim Joyce, HealthBeacon plc Chief Executive Officer said:
"HealthBeacon's vision is to become the world's leading digital therapeutics
platform for patients managing medications in the home. During H1 2022 we
generated significant momentum, despite some meaningful global supply chain
challenges, adding important new clients, new products, key hires and
expanding our capabilities, infrastructure and routes to market. The progress
we have made to date, particularly in the specialty pharmacy services channel,
has set the foundation for us to become market leaders and to provide a
ten-fold increase in the number of patients using our technology in 2024. We
are excited by the progression and momentum the business has made in the time
since its listing on the Euronext Dublin Growth Market"
ANALYST PRESENTATION
A conference call for investors and analysts will be held today 30 September
at 12:00pm. Please use the link here
(https://www.investis-live.com/healthbeacon/6332d85a6a85cc120010ed99/trhw) .
An accompanying presentation is available at www.HealthBeacon.com
(https://healthbeacon.com/financial-reports-and-documents/)
CONTACT DETAILS:
HealthBeacon plc: Investor.Relations@HealthBeacon.com
(mailto:Investor.Relations@HealthBeacon.com)
Laurence Flavin
Goodbody (Euronext Listing Sponsor and Broker): +353 (1) 667 0420
David Kearney
Stephen Kane
Drury (Public Relations):
Billy Murphy +353 (0) 87 231 3085
Paul Clifford +353 (0) 87 327 2161
About HealthBeacon plc
Headquartered in Dublin, HealthBeacon is an Irish digital therapeutics company
that develops smart tools for managing medications for patients in the home.
The HealthBeacon Injection Care Management System tracks adherence and
persistence with medication schedules through the provision of medication
management reminders, safe and sustainable sharps disposal devices,
educational tools, and artificial intelligence (AI) driven data analytics.
Peer reviewed evidence supports a 19% improvement in therapy persistence by
patients and up to 26% improvement in adherence to therapy, which improves
clinical outcomes and significantly improves efficiency in health systems. The
Company has expanded its offering to growth management with the launch of its
integrated Smart Scale and oral adherence with the launch of HB Smart
Pills(TM) which integrate with its existing technology. The Company operates
across Europe, North America and the United Kingdom and employs more than 70
people and has obtained more than 30 design and utility patents. The Company's
mission is to become the world's leading digital therapeutics platform for
patients managing medications in the home.
Cautionary statement
This announcement contains certain projections and other forward-looking
statements with respect to the financial condition, results of operations,
businesses and prospects of HealthBeacon plc. These statements are based on
current expectations and involve risk and uncertainty because they relate to
events and depend upon circumstances that may or may not occur in the future.
There are a number of factors which could cause actual results or developments
to differ materially from those expressed or implied by these projections and
forward-looking statements. Any of the assumptions underlying these
projections and forward-looking statements could prove inaccurate or incorrect
and therefore any results contemplated in the projections and forward-looking
statements may not actually be achieved. Recipients are cautioned not to place
undue reliance on any projections and forward-looking statements contained
herein. Except as required by law or by any appropriate regulatory authority,
HealthBeacon plc undertakes no obligation to update or revise (publicly or
otherwise) any projection or forward-looking statement, whether as a result of
new information, future events or other circumstances.
Overview
H1 2022 was a positive foundation setting period for HealthBeacon in its
mission to become the world's leading digital therapeutics platform for
patients managing medications in the home demonstrating demand across our
existing customer base, our ability to acquire new customers and commencement
of the DTC channel entry in North America.
The Company continues to actively look to acquire new customers and during
2022 increased its client base from 18 at the end of 2021 to 25 customers
currently. In February 2022, the Company announced that it had added five
pharmaceutical and national healthcare systems to its client base including
the UK's National Health Service (NHS) and the Irish Health Service Executive
(HSE). These additions further strengthen the Company's customer base which
includes companies such as AbbVie, Accord Healthcare, Amryt, Clonmel
Healthcare, HSE, NHS, Novartis, Sanofi, Teva and Viatris.
In March 2022, the Company signed a major contract with Evernorth and was
added to its Digital Health Formulary. This provides HealthBeacon with
streamlined and integrated access to pharma manufacturers and access to a
group with over 100 million patients which further underpins the path to
100,000 units.
The Company launched its Pill Management System the 'HB Smart Pills(tm)', The
Pills solution, which provides smart storage for up to 6 weeks of doses for as
many as 9 different medications, and integrates seamlessly with the Company's
existing technology platform. The innovative system notifies the member
patient when prescription refills are required and records visual images of
pill containers to ascertain medication adherence.
The Company launched its Smart Scale, an integrated solution that forms part
of its ICMS. The HealthBeacon Smart Scale enables patients to add weight
monitoring to its ICMS, as the connected weight scale tracks weight
progression, providing clinical teams with insights on specific medication
outcomes. These innovations have come in partnership with our growing
customer base and we expect that commercialisation will occur into 2024,
underpinning future growth and our ambition to be the world's leading digital
therapeutics platform for patients managing medications in the home.
The Company placed a build order for 35,000 Smart Sharps Bin units to meet
anticipated demand during 2022 from pharmaceutical clients, specialty pharmacy
and DTC.
While the Company experienced unanticipated delays in the near-term supply of
chip components for its Smart Sharps Bin during the period, this has been
fully resolved and we now have security of supply to achieve the expected
100,000-unit deployment by the end of Q1 2024.
The Company received approval from the EPA for its Green Labs and launched the
offering in partnership with Novartis. The labs have been built in Dublin and
Orlando to provide sustainable processing of sharps bins and injection waste
management services.
In February 2022, the results of HealthBeacon's latest study, published in the
prestigious International Journal of Clinical Pharmacy, proves the significant
impact the Company's ICMS can have on medication adherence for patients across
a range chronic, autoimmune conditions. The new peer reviewed evidence
demonstrates up to a 26% improvement in medication adherence by patients using
the Company's ICMS. This Medication Adherence study represents the Company's
6th peer reviewed study of Injection Care Management and Adherence.
Orla O'Gorman joined the Board as a Non-Executive Director in April 2022. Orla
is a Chartered Accountant and Non-Executive Director of Cairn Homes plc and
Elite SpA. Orla is a member of the European Commission's SME Technical Expert
Group; Chartered Accountants Ireland Sustainability Expert Working Group and
the Ethics and Governance Committee; and the Advisory Board of Elkstone
Ventures. She was previously Head of Equity at the Irish Stock Exchange.
Omar Sosa joined as Vice President of Global Operations. He has previously
held senior roles at Priority Health Care, Aetna Specialty, Oncology
Therapeutics Network, Shoppers Drug Mart. Omar founded Mevesi Inc, a business
intelligence and data warehousing company serving the pharmacy industry and
served as CEO until it was acquired in 2018. Omar will oversee HealthBeacon's
business operations as it scales.
In September 2022, the Company entered a commercial partnership with the APhA.
The partnership will enable patients to access enhanced medication use support
through an integrated pharmacist offering with the HealthBeacon Injection Care
Management System ("ICMS") products in community pharmacies across the United
States.
Commenced trading in the U.S. on the OTCQX Market under the ticker 'HBCNF'.
The OTCQX is the top tier of the three marketplaces for the over the counter
(OTC) trading of stocks and is operated by the OTC Markets Group. For
companies listed on a qualified international exchange, trading on the OTCQX
facilitates more efficient access to the U.S. financial markets for
HealthBeacon and, through streamlined market standards, enables transparent
trading of the Company's stock for U.S. investors.
Financial Review
Revenues of €0.7 million were up 57% on June 2021. Revenue is comprised of
revenue from Patient Support Programmes ("PSP") of €0.4 million and Direct
to Consumer ("DTC") of €0.3 million. Expansion of the customer base,
provision of software licences and the introduction of the DTC offering in
North America are key contributors to the growth in revenue.
The Company had a net cash position of €20.0 million at 30 June 2022
(December 2021: €26.6 million). The decrease in cash is attributable to the
prepayments made to secure parts for the 35,000 unit order, working capital
requirements and fund day-to-day operations.
Commercial signing and implementation with Evernorth a top-5 US Specialty
Pharmacy and Insurance group of our smart sharps bin will build significant
momentum for the Company into 2023.
Reported gross profit margin for the Company was 10%. The gross profit margin
excluding the DTC channel was 38% (June 2021: 57%). Gross Margin excluding DTC
declined due to an increase in data and connectivity costs. The final DTC sale
to Hamilton Beach was completed in H1 2022 however the launch did not take
place until March, hence the Company generated revenue on the initial unit
sale to Hamilton Beach and did not generate revenue from the sell through to
the end user. As noted in the July trading update DTC rollout has been slower
than anticipated and is expected to be c.10% of the 100,000 near term unit
target. As DTC units are sold from Hamilton Beach to the end user HealthBeacon
will receive revenue from its share of the mark-up on the unit and the monthly
subscription recurring revenue which is paid by the end user. The Company
continues to expect run rate gross margins in excess of 60% as outlined at the
time of the IPO.
The Company recorded a loss from operating activities of €6.2 million (June
2021: loss €2.5 million). Costs relating to increases in wages and salaries
including non-cash Share Based Compensation expense of €1.0m contributed to
the increase in the operating loss for 2022. Average headcount increased to 73
employees (June 2021: 53 employees) as operations scale to meet the expected
growth and demand.
Principal Risks and Uncertainties
The Company has a risk management structure in place, which is designed to
identify, manage and mitigate business risk. Risk assessment and evaluation is
an essential part of the Company's internal control system. It is designed to
enable the Company to meet its business objectives by appropriately managing,
rather than eliminating, these risks.
Strategic, Operational and Financial Risks
Global Macro-Environment: The Company's business is influenced by economic
conditions in Ireland, North America, Europe and by global economic
conditions. Levels of healthcare spending and spending on pharmaceutical
products and medical devices have been and could be adversely affected by
decreases in people holding health insurance policies, disposable income
decreases, tax increases, unemployment increases, or the spending patterns of
customers changing to reflecting increased uncertainty or apprehension
regarding economic conditions or cessation of reimbursement schemes. Any of
these factors could have an adverse effect on the Company's ability to deliver
results.
Partnerships: The success of our business depends on achieving our strategic
objectives, including through entering into strategic partnerships with
pharmaceutical, specialty pharmacy and retail partners where we may have a
lesser degree of control over the business operations, which may expose us to
additional operational, financial, legal or compliance risks.
Product Adoption: There is early-stage uncertainty around the rate or level of
patient and medical professional adoption of the Company's Injection Care
Management System and the reliance on reimbursement schemes remains a primary
risk in achieving the Company's strategy. The Company's strategy depends on
the continued growth of the remote healthcare market in the United States,
Europe, and elsewhere. These trends which are unrelated to the performance of
the Company may have a material adverse effect on the performance of the
Company itself.
Intellectual Property: Our intellectual property portfolio may not prevent
competitors from independently developing products and services similar to or
duplicative to ours, and the value of our intellectual property may be
negatively impacted by external dependencies. If we are not able to protect
our intellectual property, the value of our brand and other intangible assets
may be diminished, and our business may be adversely affected. The Company
invests in R&D in order to protect and expand its current IP suite and
offer new solutions to patients for managing their medications, there is no
guarantee that R&D investment may result in new product development or
protect the Company against technological changes.
Supply Chain: Significant material shortages, supplier capacity constraints,
supplier production disruptions, supplier quality and sourcing issues or price
increases could increase our operating costs and adversely impact the
competitive positions of our products. Our reliance on third-party suppliers,
contract manufacturers and service providers, and third parties to secure
materials, parts and components used in our products exposes us to volatility
in the prices and availability of these materials, parts, components and
services. A disruption to these providers could have an adverse effect on our
ability to meet our commitments to customers or increase our operating costs.
Quality, capability and sourcing issues experienced by third-party providers
can also adversely affect our costs, margin rates and the quality and
effectiveness of our products and services and result in liability and
reputational harm.
Environment and Sustainability: The increasing global focus on environmental
and sustainability governance is recognised by the Group, and by its
stakeholders. Failure to appropriately assess, monitor and manage the Group's
impact on the environment and the communities in which it operates may result
in reputational damage, impacting the Group's ability to deliver results.
Growth Management: With continuous execution on growth initiatives, strategies
and operating plans, the Company anticipates expansion of its service
offerings to new therapeutic areas as well as future expansion into select
international markets. Any failures to effectively execute on growth
initiatives, business strategies, or operating plans will adversely affect the
Company's operations. If the Company is unable to attract new clients or
expand members with existing clients, revenue growth may take longer than
expected. Any inability to offer high-quality member support to patients could
also adversely affect the Company's relationships with future and prospective
payers, members, and subsequently adversely impact the Company's future
operations and financial condition.
Licences and Regulatory: The Company is dependent to a significant degree on
certain licences and regulatory approvals to conduct its business. The Company
is also subject to domestic, European and foreign laws and regulations
including but not limited to with respect to healthcare, consumer protection,
privacy and data protection, employment, accounting, customs, tax, antitrust
and competition matters. A failure to obtain, maintain, or comply with the
terms of such licences, applicable laws and regulations could have an adverse
impact on the Company.
Treasury and Foreign Currency: The Company is exposed to liquidity, interest
rate and credit risks. The Company's reporting currency is Euro. Exposure to
foreign currency is present in the normal course of business, together with
the Company operating in jurisdictions outside of the Eurozone.
Statement of Directors' responsibilities
The Directors confirm to the best of their knowledge that the condensed
consolidated interim financial statements have been prepared in accordance
with IAS 34 Interim Financial Reporting, as adopted by the EU, and to the best
of their knowledge and belief:
a) the condensed consolidated interim financial statements comprising the
Condensed Consolidated Group Income Statement, the Condensed Consolidated
Group Statement of Comprehensive Income, the Condensed Consolidated Group
Balance Sheet, the Condensed Consolidated Group Cash Flow Statement, the
Condensed Consolidated Group Statement of Changes in Equity and related notes
have been prepared in accordance with IAS 34 Interim Financial Reporting as
adopted by the EU, and are prepared in order to comply with the Euronext
Growth Market Rule Book;
b) the interim results include a fair review of the important events that have
occurred during the first six months of the financial year and their impact on
the condensed consolidated interim financial statements for the half year
ended 30 June 2022.
Signed on behalf of the Board
J
Joyce
L Flavin
29 September 2022 29 September 2022
Consolidated Statement of Profit or Loss and Other Comprehensive Income
For the six months ended 30 June 2022
(unaudited) (unaudited)
6 months to 6 months to
30-Jun 30-Jun
2022 2021
€'000 €'000
Income Note
Lease Revenue 4 208 316
Revenue from Contracts with Customers 3 659 229
Total Revenues 867 545
Cost of Sales 7 (780) (232)
Gross Profit 87 313
Operating Income / (Expenses)
Impairment losses on Financial Assets 16 (9) -
Other Operating Expenses 7 (6,295) (2,819)
Other Operating Income 6 66 -
Loss from Operating Activities (6,151) (2,506)
Finance Costs
Finance Income 8 67 -
Finance Expense 8 (115) (8)
Net Finance Costs (48) (8)
Loss before Taxation (6,199) (2,514)
Tax Expense 9 - -
Loss from Continuing Operations (6,199) (2,514)
Other Comprehensive Income / (Expense)
Measured through Other Comprehensive Income - -
Tax on Other Comprehensive Income - -
Other Comprehensive Income / (Expense) - -
Total Comprehensive Loss for the year (6,199) (2,514)
All amounts are attributable to the owners of the parent.
Basic Earnings per Ordinary Share 10 (0.37) (0.25)
Diluted Earnings per Ordinary Share 10 (0.37) (0.25)
All income relates to continuing operations. All profits and total
comprehensive income for the current and preceding financial year are
attributable to the equity holders of the company. The accompanying notes form
an integral part of these financial statements.
J Joyce L Flavin
Director Director
29 September 2022 29 September 2022
Consolidated Statement of Financial Position
As at 30 June 2022
(unaudited)
30-Jun 31-Dec
2022 2021
€'000 €'000
Non-Current Assets Note
Intangible Assets 11 2,803 2,651
Property & Equipment 12 1,116 1,203
3,919 3,854
Current Assets
Inventories 14 244 127
Trade and Other Receivables 16 2,181 2,348
Cash and Cash Equivalents 17 20,028 26,613
22,453 29,088
Total Assets 26,372 32,942
Equity
Share Capital 19 42 42
Other Reserves 19 1,232 231
Share Premium 19 29,926 29,926
Accumulated Deficit 19 (7,133) (934)
Total Equity 24,067 29,265
Non-Current Liabilities
Trade and Other Payables 18 127 112
127 112
Current Liabilities
Trade and Other Payables 18 2,178 3,565
2,178 3,565
Total Liabilities 2,305 3,677
Total Equity and Liabilities 26,372 32,942
J Joyce L Flavin
Director Director
29 September 2022 29 September 2022
Company Statement of Financial Position
As at 30 June 2022
(unaudited)
30-Jun 31-Dec
2022 2021
€'000 €'000
Non-Current Assets Note
Intangible Assets 11 2,803 2,651
Property & Equipment 12 970 1,012
3,772 3,663
Current Assets
Inventories 14 244 127
Trade and Other Receivables 16 2,217 2,384
Cash and Cash Equivalents 17 19,985 26,587
22,446 29,098
Total Assets 26,219 32,761
Equity
Share Capital 19 42 42
Other Reserves 19 1,232 231
Share Premium 19 29,926 29,926
Accumulated Deficit 19 (7,036) (848)
Total Equity 24,164 29,351
Non-Current Liabilities
Trade and Other Payables 18 - -
- -
Current Liabilities
Trade and Other Payables 18 2,055 3,410
2,055 3,410
Total Liabilities 2,055 3,410
Total Equity and Liabilities 26,219 32,761
J Joyce L Flavin
Director Director
29 September 2022 29 September 2022
Consolidated Statement of Changes in Equity
For the six months ended 30 June 2022
Share Other Share Accumulated Total
Capital Reserves Premium Deficit Equity
€'000 €'000 €'000 €'000 €'000
As at 1 January 2021 Note 6 - 18,072 (11,006) 7,072
Loss for the financial year - - - (2,514) (2,514)
Shares issuance 19 - - 357 - 357
As at 30 June 2021 (unaudited) 6 - 18,429 (13,520) 4,915
As at 1 January 2021 42 231 29,926 (934) 29,265
Loss for the financial year - - - (6,199) (6,199)
Long term incentive plan 19 - 1,001 - - 1,001
As at 30 June 2022 (unaudited) 42 1,232 29,926 (7,133) 24,067
Company Statement of Changes in Equity
For the six months ended 30 June 2022
Share Other Share Accumulated Total
Capital Reserves Premium Deficit Equity
€'000 €'000 €'000 €'000 €'000
As at 1 January 2021 Note 6 - 18,072 (10,930) 7,148
Loss for the financial year - - - (2,508) (2,508)
Shares issuance 19 - - 357 - 357
As at 30 June 2021 (unaudited) 6 - 18,429 (13,438) 4,996
As at 1 January 2022 42 231 29,926 (848) 29,351
Loss for the financial year - - - (6,188) (6,188)
Long term incentive plan 19 - 1,001 - - 1,001
As at 30 June 2022 (unaudited) 42 1,232 29,926 (7,036) 24,164
Consolidated Statement of Cash Flows
For the six months ended 30 June 2022
(unaudited) (unaudited)
30-Jun 30-Jun
2022 2021
Note € €
Loss Before Tax (6,199) (2,514)
Adjustments for:
Depreciation of Property & Equipment 12 266 235
Amortisation of Intangible Assets 11 295 243
Credit Impairment Charge 16 9 -
Interest Expense on Leases 8 4 5
Share Based Payments 7 - -
Warranty Expense 18 - -
Foreign exchange loss/(gain) 8 (67) 3
(4,684) (2,028)
(Increase)/Decrease in Receivables 224 (344)
(Increase)/Decrease in Inventory (117) 10
Increase/(Decrease) in Payables (1,300) (145)
Net Cash outflow from Operating Activities (5,877) (2,507)
Investing Activities
Additions to Property, Plant & Equipment 12 (180) (139)
Additions to Intangible Assets 11 (446) (353)
Net Cash outflow from Investing Activities (626) (492)
Financing Activities
Proceeds from the issuance of share capital 19 - 357
Lease liability payments 22 (82) (64)
Net Cash inflow/(outflow) from Financing Activities (82) 293
Net increase/(decrease) in cash and cash equivalents (6,585) (2,706)
Cash and cash equivalents at the beginning of the period 26,613 4,235
Cash and cash equivalents at the end of the period 20,028 1,529
Company Statement of Cash Flows
For the six months ended 30 June 2022
(unaudited) (unaudited)
30-Jun 30-Jun
2022 2021
Note € €
Loss Before Tax (6,188) (2,508)
Adjustments for:
Depreciation of Property & Equipment 12 222 201
Amortisation of Intangible Assets 11 295 243
Credit Impairment Charge 16 9 -
Interest Expense on Leases 1 2
Share Based Payments 7 999 -
Warranty Expense 18 9 -
Foreign exchange loss/(gain) (67) 1
(4,721) (2,061)
(Increase)/Decrease in Receivables 224 (314)
(Increase)/Decrease in Inventory (117) 10
Increase/(Decrease) in Payables (1,328) (169)
Net Cash outflow from Operating Activities (5,942) (2,534)
Investing Activities
Additions to Property, Plant & Equipment 12 (180) (139)
Additions to Intangible Assets 11 (446) (353)
Net Cash outflow from Investing Activities (626) (492)
Financing Activities
Proceeds from the issuance of share capital 19 - 357
Lease liability payments 22 (34) (42)
Net Cash inflow/(outflow) from Financing Activities (34) 315
Net increase/(decrease) in cash and cash equivalents (6,602) (2,711)
Cash and cash equivalents at the beginning of the period 26,587 4,223
Cash and cash equivalents at the end of the period 19,985 1,512
Notes to the Consolidated Financial Statements
1. General information
Basis of preparation
The condensed consolidated interim financial statements of HealthBeacon plc
and its subsidiaries (the 'Group') have been prepared in accordance with IAS
34, Interim Financial Reporting, as endorsed by the European Union.
The financial information in the condensed interim consolidated financial
statements has been prepared on a basis consistent with that adopted for the
year ended 31 December 2021. The accounting policies applied in the interim
financial statements are the same as those applied in the 2021 Annual Report.
The Half-Yearly Financial Report is unaudited and has not been reviewed by the
Group's auditor pursuant to the Financial Reporting Council guidance on Review
of Interim Financial Information. These interim financial statements are
prepared in order to comply with the Euronext Growth Market Rule Book and are
not statutory financial statements as they do not include all of the
information required for full annual financial statements and should be read
in conjunction with the HealthBeacon Group Annual Report (statutory financial
statements) for the year ended 31 December 2021. The audit report on those
statutory financial statements was unqualified and did not contain any matters
to which attention was drawn by way of emphasis.
The preparation of interim financial statements in compliance with IAS 34
requires management to make estimates and assumptions that affect the reported
amount of assets and liabilities and disclosure of contingent assets and
liabilities at the date of the interim financial statements and the reported
amounts of revenue and expenses during the reporting period. Actual results
could differ from those estimates. The areas involving a high degree of
judgement or complexity, or areas where assumptions and estimates are
significant to the financial statements are disclosed in the Group's Annual
Report for the year ended 31 December 2021 in note 1 and 2 on pages 41 to 50.
The Group's interim financial statements are prepared for the six-month period
ended 30 June 2022. The interim financial statements incorporate the Company
and all of its subsidiary undertakings. A subsidiary undertaking is
consolidated by reference to whether the Group has control over the subsidiary
undertaking. The Group controls an entity when the Group is exposed to, or has
rights to, variable returns from its involvement with the entity and has the
ability to affect those returns through its power to direct the activities of
the entity.
HealthBeacon plc is incorporated in the Republic of Ireland under registration
number 530689 with a registered office at Unit 20 Naas Road Business Park,
Muirfield Drive, Naas Road, Dublin 12, D12 WD85, Ireland.
Going Concern
The financial statements have been prepared under the assumption that the
Group and Company operates on a going concern basis and on an accruals basis
and under the historical cost convention as modified to include the fair
valuation of certain financial instruments.
The Group and Company recorded a loss for the financial period. After making
enquiries and reviewing the Group and Company's forecasts and projections, the
Directors have reasonable expectation that the Group and Company has adequate
resources to continue in operational existence for the foreseeable future. The
Group and Company is projecting to significantly increase revenues in 2022 and
is projecting profits in the near term onwards due to its broadening
partnership base. In 2021, the Group and Company has successfully fundraised
through the issuance of convertible loan notes facilitating the investment in
the projected growth. The Group also completed an equity listing on the
Euronext Growth which will further support the Group's long-term strategy,
including investment in infrastructure and research and development.
Accordingly, the Directors continue to adopt the going concern basis in
preparing the financial statements.
2. New Standards
New Standards, Amendments, and Interpretations
There have been no accounting standards, amendments and interpretations that
are effective for the first time in respect of the Group condensed interim
financial statements for the six months ended 30 June 2022.
New Standards and Interpretations not yet adopted
Certain new accounting standards and interpretations have been published that
are not mandatory for 30 June 2022 reporting periods and have not been adopted
by the Group. These standards are not expected to have a material impact in
the current or future reporting periods and on foreseeable future
transactions.
3. Revenue
The Group generates revenues primarily from the sale of data and project
management services and through the lease of injectable care management
systems.
30-Jun 30-Jun
2022 2021
€'000 €'000
Income
Revenue from Contracts 659 229
Lease Revenues (note 4) 208 316
Total Revenue 867 545
Major Products/service lines
Point in time
Activation Fees 26 28
Unit Sales 296 -
Total Point in time 322 28
Over time
Data & Project Management Services 225 103
Licence Fees 52 41
Other 60 56
Total over time 337 200
Total Revenue from Contracts 659 228
The Company's largest customer is a US-listed company with an investment grade
rating that accounted for 34% of Total Revenues in 2022 (2021: 0%).
The decline in customer concentration is attributable to the end of the
exclusivity agreement with a client during the proof of concept phase, new
market entries and customer expansion.
The Group has deferred income balances that are due to be recognised within
the next financial year of €74,939 (2021: €143,931).
For information on the Company's contract balances, including movements during
the period, refer to note 18.
4. Lease Revenues
30-Jun 30-Jun
2022 2021
€'000 €'000
Lease Revenues 208 316
5. Segment Information
The Group has two operating segments being Patient Support Programmes (PSP)
and Direct-to-Consumer (DTC). These operating segment reflects the Group's
organisational structure and the nature of the financial information reported
to and assessed by the Group Chief Executive and Chief Financial Officer, who
are together determined to fulfill the role of Chief Operating Decision Maker
(as defined in IFRS 8).
The principal factors employed in identifying the two operating segments were:
- the Group's organisational structure in 2022;
- the nature of the internal reporting documentation such as management
accounts and budgets; and
- the degree of homogeneity of products and services from which revenue is
derived.
Following consideration of the above there has been no additional operating or
reportable segment identified.
The Group will continue to monitor the quantitative thresholds included in
IFRS 8 and the qualitative guidance for operating and reportable segment
identification.
The accounting policies of the reportable segments are the same as the Group's
accounting policies described in these financial statements. Segment gross
profit or loss represents the profit or loss earned by each segment without
allocation of central operating expenses, other operating income and interest
costs. This is the measure reported to the Chief Operating Decision Maker for
the purpose of resource allocation and assessment of segment performance.
PSP DTC Total PSP DTC Total
30-Jun 30-Jun 30-Jun 30-Jun 30-Jun 30-Jun
2022 2022 2022 2021 2021 2021
€'000 €'000 €'000 €'000 €'000 €'000
Revenue from Contracts 363 296 659 229 - 229
Lease Revenue 208 - 208 316 - 316
Total Revenue 571 296 867 545 - 545
Cost of Goods Sold (354) (426) (780) (232) - (232)
Gross Profit 217 (130) 87 313 - 313
Centralised Operating Expenses (6,295) (2,819)
Credit Impairment Charge (9) -
Other Operating Income 66 -
Finance Expense (48) (8)
Loss before Tax (6,199) (2,514)
Inter-segment sales for the financial period amounted to Nil (2021: Nil).
All sales are to external customers. The management information provided to
the Chief Operating Decision Maker does not include an analysis by reportable
segment of assets and liabilities and accordingly no analysis by reportable
segment of total assets or total
liabilities is disclosed.
Assets and liabilities are reported to the Board at a Group level and are not reported on a segmental basis.
The Group operates in three principal geographical areas: Republic of Ireland (country of domicile), the United States of America and Europe. The Group's revenue from continuing operations with external customers is detailed below:
PSP DTC Total PSP DTC Total
30-Jun 30-Jun 30-Jun 30-Jun 30-Jun 30-Jun
2022 2022 2022 2021 2021 2021
Geographical Breakdown €'000 €'000 €'000 €'000 €'000 €'000
of Revenue
United States of America 76 296 372 79 - -
Ireland 321 - 321 314 - -
Europe 174 - 174 152 - -
571 296 867 545 - 545
The Group retains the majority of its assets in its country of domicile. The
necessary geographical information is not readily available and due to the
cost of producing discrete financial information in relation to the other
Geographies in which it operates the Group has not disclosed this information.
The Group will continue to monitor this.
As part of its expansion into the United States of America and the
Direct-to-Consumer channel the Group entered an exclusivity agreement with an
established retail partner. The Group sells products to the retail partner who
then distributes these to consumers. Once sold to the consumer the Group
receives a profit share on the difference between the initial selling price to
their partner and the final selling price to the consumer less allowable
costs.
Once sold through to the end customer, the Group receives monthly subscription
revenues from the ultimate purchaser. The final sale was completed in the
period and launch did not take place until March 2022, the Group generated
revenue on the initial sale but did not generate revenue from the sell through
to the consumer.
6. Other Operating Income
30-Jun 30-Jun
2022 2021
€'000 €'000
Other Operating Income 66 -
During the financial period ended 30 June 2022, HealthBeacon recognised
Government grant income totaling €66,000 (2021: Nil).
As part of the Group's R&D it is eligible for grants and tax credits from
Government bodies. The grants received relate to eligible expenditure that
involves the Group receiving income for expenses such as staff costs incurred
in the development of Intellectual Property and other Intangible Assets.
7. Loss from Operating Activities
Operating loss has been arrived at after charging:
30-Jun 30-Jun
2022 2021
€'000 €'000
Cost of Sales Analysis:
Amortisation 83 59
Depreciation 62 82
Data Connectivity & Services 204 76
Direct-to-Consumer Units 426 -
Other 4 15
780 232
The Group recognised an inventory expense of €425,923 in cost of sales
during the period (2021: Nil).
30-Jun 30-Jun
2022 2021
€'000 €'000
Operating Costs Analysis
Accounting and Auditing 94 60
Marketing Costs 111 4
Development Costs 84 77
Other Operating Expenses 598 181
Office Costs 204 81
Depreciation & Amortisation 416 337
Staff and Consultancy Costs 4,749 2,055
Distribution costs 48 24
6,304 2,819
Auditors Remuneration 23 15
Other Services - -
Tax Advisory Services 71 8
94 23
Staff Costs
30-Jun 30-Jun
2022 2021
€'000 €'000
Wages and Salaries 4,081 1,591
Pension Costs 54 17
4,135 1,608
€423,737 of staff costs were capitalised during the financial period 2022
(2021: €Nil). Staff costs increased in the period due to increased
employment levels.
Recognised within staff costs in the financial period is a share based payment
expense of €998,563 (2021: €Nil) in relation to the 2021 long term
incentive plan (Note 19).
8. Net Finance Costs
30-Jun 30-Jun
2022 2021
€'000 €'000
Finance (Income)/Expense
Bank Charges 3 -
Interest Expense 108 -
Interest Expense on Leases 4 5
Foreign Exchange (Gain)/Loss (67) 3
48 8
9. Taxation
30-Jun 30-Jun
2022 2021
€'000 €'000
a) Analysis of tax (expense)/income for the year
Current tax income:
Current year - -
Deferred tax - origination and reversal of temporary differences
Current year - -
Tax income - -
b) Factors affecting the tax (charge)/income for the year
Loss before tax at 12.5% (2021: 12.5%) (6,199) (2,514)
Tax on Loss at 12.5% (2021: 12.5%) 775 314
Adjustment to loss brought forward (775) (314)
Tax on Income - -
HealthBeacon has unrecognised deferred tax assets at the end of the reporting
period of €3.2m (2021: €2.4m).
10. Earnings per Share
Both the basic and diluted earnings per share have been calculated using the
loss attributable to shareholders of the parent company as the numerator, i.e.
no adjustment to the loss was necessary in 2022 or 2021
The reconciliation of the weighted average number of shares for the purpose of
diluted earnings per share to the weighted average number of ordinary shares
used in the calculation of basic earnings per share is as follows
30-Jun 30-Jun
2022 2021
'000 '000
Weighted average number of shares used in basic EPS 16,890 10,040
Weighted average number of shares used in diluted EPS 16,890 10,040
The Group and Company have updated the comparative EPS calculation for 2021
due to a share re- organisation that took place in November 2021. The
re-organisation was necessary to re-register the Company from a Limited
Company to a Public Limited Company with the Irish Companies Registration
Office. The Company was required to have a minimum issued and paid up Ordinary
Share Capital of €25,000. The Company issued bonus shares to existing
Ordinary and Preference holders from existing reserves to achieve this.
11. Intangible Assets
Group and Company at 30 June 2022
Prototype & Patents,
Software trademarks
Development & licences Total
€'000 €'000 €'000
Cost
Opening Cost 3,791 248 4,039
Additions 437 9 446
Closing Cost 4,228 257 4,485
Amortisation
Opening Accumulated Amortisation 1,372 15 1,387
Amortisation for the period 290 5 295
Closing Accumulated Amortisation 1,662 20 1,682
Closing Net Book Value 2,566 237 2,803
Opening Net Book Value 2,419 233 2,651
Group and Company at 31 December 2021
Prototype & Patents,
Software trademarks
Development & licences Total
€'000 €'000 €'000
Cost
Opening Cost 3,226 236 3,462
Additions 565 12 577
Closing Cost 3,791 248 4,039
Amortisation
Opening Accumulated Amortisation 880 8 888
Amortisation for the financial year 492 7 499
Closing Accumulated Amortisation 1,372 15 1,387
Closing Net Book Value 2,419 233 2,651
Opening Net Book Value 2,346 228 2,574
12. Property and Equipment
Group at 30 June 2022
Fixtures, Right
Development HealthBeacon Fittings of Use Production
Units Devices Equipment Asset Equipment Total
€'000 €'000 €'000 €'000 €'000 €'000
Cost
Opening 209 1,979 245 845 142 3,420
Additions - - 180 - - 180
Closing 209 1,979 425 845 142 3,600
Depreciation & Impairment
Opening 209 1,218 129 614 47 2,217
Depreciation - 144 44 72 7 266
Closing 209 1,362 173 686 54 2,483
NBV Closing - 617 252 159 88 1,116
NBV Opening - 761 116 231 95 1,203
Group at 31 December 2021
Fixtures, Right
Development HealthBeacon Fittings of Use Production
Units Devices Equipment Asset Equipment Total
€'000 €'000 €'000 €'000 €'000 €'000
Cost
Opening 209 1,857 176 586 141 2,969
Additions - - 69 - 1 451
Closing 209 1,979 245 845 142 3,420
Depreciation & Impairment
Opening 186 934 111 467 32 1,730
Depreciation 23 284 18 147 15 487
Closing 209 1,218 129 614 47 2,217
NBV Closing 0 761 116 231 95 1,203
NBV Opening 23 923 65 119 109 1,239
Company at 30 June 2022
Fixtures, Right
Development HealthBeacon Fittings of Use Production
Units Devices Equipment Asset Equipment Total
€'000 €'000 €'000 €'000 €'000 €'000
Cost
Opening 209 1,979 245 333 142 2,908
Additions - - 180 - - 180
Closing 209 1,979 425 333 142 3,088
Depreciation & Impairment
Opening 209 1,218 129 294 47 1,897
Depreciation - 144 44 28 7 222
Closing 209 1,362 173 322 54 2,118
NBV Closing - 617 252 10 88 970
NBV Opening - 761 116 40 95 1,011
Company at 31 December 2021
Fixtures, Right
Development HealthBeacon Fittings of Use Production
Units Devices Equipment Asset Equipment Total
€'000 €'000 €'000 €'000 €'000 €'000
Cost
Opening 209 1,857 176 333 141 2,716
Additions - - 69 - 1 191
Closing 209 1,979 245 333 142 2,908
Depreciation & Impairment
Opening 186 934 111 225 32 1,488
Depreciation 23 284 18 68 15 408
Closing 209 1,218 129 294 47 1,896
NBV Closing 0 761 116 40 95 1,012
NBV Opening 23 923 65 108 109 1,228
During the financial period, no assets owned by the Group or the Company were
subject to impairment (2021: Nil).
13. Investment in Subsidiaries
30-Jun 31-Dec
2022 2021
€'000 €'000
At Cost - -
The principal subsidiary undertakings, the capital of which consists of
ordinary shares
Owned by the Company Principal Activities Incorporated
HealthBeacon US Inc. (1) Operations USA
Health Beacon Canada Inc. (2) Operations Canada
Registered addresses of entities above, denoted by reference attached to each
entity
1. 251 Little Falls Drive, New Castle, Wilmington, Delaware, 19808.
2. 7100-380 rue Saint-Antoine O, Montréal (Québec) H2Y3X7
14. Inventories
Group Group Company Company
30-Jun 31-Dec 30-Jun 31-Dec
2022 2021 2022 2021
€'000 €'000 €'000 €'000
Parts 227 127 227 127
Finished Goods 17 17
Total Inventory 244 127 244 127
15. Financial Instruments
The Group's financial instruments that are not carried at fair value and for
which fair value is disclosed are categorised by the level of fair value
hierarchy. The different levels are based on the degree to which the inputs to
the fair value measurements are observable and the significance of the inputs
to the fair value measurement. The levels have been defined as follows:
Level 1 Quoted prices (unadjusted) in active markets for identical assets or
liabilities that the entity can access at the measurement date.
Level 2 Inputs other than quoted prices included within Level 1 that are observable
for the asset or liability, either directly or indirectly.
Level 3 Unobservable inputs for the asset or liability
The Group's financial assets and liabilities measured at amortised cost all
fall within Level 2. Fair values are estimated on the basis that the carrying
value has been determined to be a good approximation of fair value.
16. Trade and Other Receivables
Group Group Company Company
30-Jun 31-Dec 30-Jun 31-Dec
2022 2021 2022 2021
€'000 €'000 €'000 €'000
Trade Debtors - net 697 1,213 775 1,291
VAT Receivable 98 492 98 492
Other Debtors 1,194 446 1,152 404
Employee Loans 192 197 192 197
2,181 2,348 2,217 2,384
Age analysis of net trade debtors:
Less than one month 576 1,099 576 1,099
One to two months 38 66 38 66
More than two months 83 48 161 126
697 1,213 775 1,291
All of the Group and Company's trade and other receivables in the comparative
periods have been reviewed for indicators of impairment. The impaired trade
receivables are from a customer in the Irish patient services market.
The Group has recognised an expected credit loss of €9,009 in the period to
30 June 2022 (2021: €464).
The Company has recognised an expected credit loss of €8,992 in the period
to 30 June 2022 (2021: €464)
Note 21 includes disclosures relating to the credit risk exposures and
analysis of the allowance for expected credit losses. Both the current and
comparative impairment provision apply the IFRS 9 expected loss model.
Outstanding customer balances are regularly monitored for evidence of customer
financial difficulties including payment default, breach of contract etc.
Significant balances are reviewed individually while smaller balances are
grouped and assessed collectively. Receivable balances are in general
unsecured and non-interest bearing.
Due to the global financial uncertainty arising from the COVID-19 pandemic,
consideration has been given as to whether or not the future credit risk on
trade and other receivables has
been elevated for the period ended 30 June 2022.
There have been no other significant changes to the Company's credit risk
parameters or to the composition of the Company's trade receivables portfolio
during the financial period.
Trade receivables are written off when there is no reasonable expectation of
recovery. Where recoveries are made, these are recognised in the consolidated
statement of profit or
loss and other comprehensive income.
17. Cash and Cash Equivalents
Group Group Company Company
30-Jun 31-Dec 30-Jun 31-Dec
2022 2021 2022 2021
€'000 €'000 €'000 €'000
Cash at Bank 20,028 26,613 19,985 26,587
18. Trade and Other Payables
Group Group Company Company
30-Jun 31-Dec 30-Jun 31-Dec
2022 2021 2022 2021
€'000 €'000 €'000 €'000
Trade Creditors 790 1,309 738 1,257
Employee Tax Payable 244 1,186 244 1,186
Other Creditors 81 49 81 49
Accruals 893 769 893 769
Deferred Income 75 90 75 90
Directors Loan 8 10 8 10
Lease Liabilities 213 264 15 49
2,305 3,678 2,055 3,410
Analysed as:
Non-Current 127 112 - -
Current 2,178 3,565 2,055 3,410
2,305 3,677 2,055 3,410
The Group and Company recognised a warranty of €11,692 in relation to units
sales for its Direct-to-Consumer channel (2021: € 26,260).
Non-current trade and other payables consists of operating lease liabilities
(under IFRS 16). All other trade and other payables are due within 12 months.
19. Equity
Share Capital
The share capital of the Group and the Company consists only of fully paid
ordinary shares with nominal (par) value of €0.0025 per share.
Group Group Company Company
30-Jun 31-Dec 30-Jun 31-Dec
2022 2021 2022 2021
€'000 €'000 €'000 €'000
Ordinary Share Capital 42 42 42 42
42 42 42 42
Share capital in each period as presented are fully allotted, called up and
paid. Preference share capital is preferred on liquidation.
Group Group Company Company
30-Jun 31-Dec 30-Jun 31-Dec
2022 2021 2022 2021
Shares Issued and Fully Paid
- Beginning of the year 15,816,251 2,456,800 15,816,251 2,456,800
- Issued on exercise of share options - 286,070 - 286,070
- Issued on conversion of Convertible Loan Note - 1,116,631 - 1,116,631
- Bonus issue as part of share reorganisation - 7,555,246 - 7,555,246
- Issued on Admission to Euronext Growth Market - 4,373,504 - 4,373,504
- Issued on Private Placement - 28,000 - 28,000
Shares Issued and Fully Paid 15,816,251 15,816,251 15,816,251 15,816,251
Shares Authorised for Share Based Payments 1,173,375 1,173,375 1,173,375 1,173,375
Total Shares outstanding at 31 December 16,989,626 16,989,626 16,989,626 16,989,626
The share capital of HealthBeacon consists only of fully paid ordinary shares
with a nominal (par) value of €0.0025 per share. All shares are equally
eligible to receive dividends and the repayment of capital and represent one
vote at shareholders' meetings of HealthBeacon plc.
Additional shares were issued during 2021 relating to share-based payments.
The Group issued 4,273,504 shares on 15 December 2021, corresponding to 33% of
total shares issued. Each share has the same right to receive dividends and
the repayment of capital and represents one vote at shareholders' meetings of
HealthBeacon plc
Movement in the financial year ended 31 December 2021
Total consideration received for the allotment of both ordinary and preference
shares during the financial year was €31.4m (2020: €5.3m). The shares were
issued in accordance
with planned funding requirements. The new shares have been presented as share
capital and share premium. Each share carrys one vote per share.
The Company was admitted to trading on the Growth Market in Euronext Dublin in
December 2021 raising €25 million gross of transaction costs. As part of its
funding plan the Group raised an additional €5.7m in a convertible loan
note. The value of the convertible loan note on conversion was €6.5m. There
were additional options exercised of €0.4m and the remainder of the 2020
Series A of €0.4m.
Equity settled share based payments
On 1 April 2015, share options were granted over 353,952 ordinary shares to
five individuals 3,233 of these share options were granted at an exercise
price of€1.16 and the remaining were granted at an exercise price of€1.55.
The options vested immediately and were originally due to expire on 1 January
2020 however during the financial year 2019 this was extended to the option
price was in excess of the market value for all parties, therefore no expense
has been recognised in respect of this.160,006 options were issued during year
ended 31 December 2020
127,682 share options were granted to Oyster at an exercise price of €3.25
and vest immediately. 32,324 were allocated to two individuals at the same
exercise price and vested immediately.
The share options were issued at current valuation with no discount therefore
no expense has been recognised in respect of this.
The fair value of the options granted in 2015 during the start up phase of the
company were granted at a value in excess of the latest fundraising performed
by the Group. The Group was unable to reliably estimate the fair value of the
equity instruments granted at the measurement date due to the uncertainty
surrounding the future value of the company over the vesting period. The Group
measured the value of the options at their intrinsic value.
The 2020 options granted were granted at the latest fundraising price which
took place during December 2020.
In November 2021 the Company entered into a Long Term Incentive Plan with key
management, staff and contractors. This is the only share based payment scheme
in place within the Group. The programme is equity settled. The award vests if
the participant remains within the Groups service over the agreed vesting
period. The maximum term of the awards granted under the scheme is 4 years.
The shares were granted for Nil consideration, the awards were granted when
the Company was a private limited company pre-IPO filing. The fair value of
the awards granted were determined on this basis taking account of the private
market value of the shares being the difference in marketability and the
liquidity of the shares. The fair value of the shares were determined to be
€3.47 per share at the grant date.
No. of Shares Weighted average
exercise price (€)
Outstanding at 31 December 2020 513,958 2.08
Forfeited 227,888 2.46
Exercised 286,070 1.54
Outstanding at 31 December 2021 - -
Outstanding at 30 June 2022 - -
Exercisable at 31 December 2021 - -
Exercisable at 30 June 2022 - -
Share premium account
The share premium account includes any premiums received on the issue of share
capital, less any transaction costs associated with the issuing of shares.
Accumulated Deficit
The profit and loss account includes all current and prior period retained
profits and losses. Adjustments regarding prior period errors are also
included here.
During the prior financial year there was €18.3m transferred from share
premium to the accumulated deficit as part of the shareholder reorganisation.
Other Reserves
Other reserves comprises of the share based payment expense as part of the
Long Term Incentive Plan.
20. Related Party Transactions Group and Company
All transactions were made on terms equivalent to an arm's length
transactions. Balances are included within Trade & Other Payables (Note
18)
Group Group Company Company
30-Jun 30-Jun 30-Jun 30-Jun
2022 2021 2022 2021
€'000 €'000 €'000 €'000
Jim Joyce Charged - - - -
(CEO) Balance(s) (Note 18) 10 - 10 -
Payment for services provided to the Company
John Armstrong Charged 42 42 42 42
Oncology Limited Balance(s) (Note 18) 42 49 42 49
Consultancy Fees paid to John Armstrong who was a director in 2021 and
resigned in November 2021
KeePointe Charged 88 75 88 75
Marketing LLC Balance(s) (Note 18) - 25 - 25
Payment to Keeshia Muhammad who was a director in 2021 and resigned in
November 2021
BVP Investments Charged - 13 - 13
Limited Balance(s) (Note 18) - - - -
Payment to BVP which is controlled by Elliot Griffin who was a director in
2021 and resigned in November 2021
During the period Directors of the Group acquired shareholdings through
options exercised and participation in the Convertible Loan Note entered into.
Rob Garber and Rebecca Shanahan contributed €100,000 each to the total
borrowing of €5.65m.
Mary Harney exercised options granted during 2020 which were at the current
market value at the grant date.
Unless otherwise stated, none of the transactions incorporate special terms
and conditions and no guarantees were given or received. Outstanding balances
are usually settled in cash.
21. Financial Risk Management
The Group is exposed to various risks in relation to financial instruments.
The Group's financial assets and liabilities by category are summarised in
Note 15. The main types of risks are market risk (currency risk), credit risk
and liquidity risk.
The Group's risk management is coordinated at its headquarters, in close
cooperation with the board of Directors, and focuses on actively securing the
Group's short to medium-term cash flows by minimising the exposure to volatile
financial markets. Long-term financial investments are managed to generate
lasting returns.
The Group does not actively engage in the trading of financial assets for
speculative purposes nor does it write options. The most significant financial
risks to which the Group is exposed to are described below.
The Group has no borrowings and is not subject to interest rate risk.
a. Currency Risk
Currency risk is the risk that the fair value or future cash flows of a
financial instrument will fluctuate because of changes in foreign exchange
rates.
The Group has operations located in the United States where revenue and
expenses incurred are primarily denominated in United States Dollars. To
mitigate the Group's exposure to foreign currency risk to the extent that it
is possible the Group will seek to keep transactions involving foreign
currency to a minimum and will seek wherever possible to have transactions
conducted in Euro rather than an alternative foreign currency. The Group will
match payments received in a foreign currency with expenses in the same
currency where possible. Total revenue for the period to 30 June 2022
from activities in North America was €369,653 (2021: €41,951).
For the reporting period if the Euro had been 5% stronger/weaker the
underlying loss would have been €15,614 higher/lower (2021: €3,249).
Currency risk is not material to the current operations of the Group.
Through expansion the Group will evaluate and implement risk management
procedures to minimise and mitigate the Group's exposure to fluctuations in
foreign exchange rates.
b. Credit Risk
Credit risk is the risk that a counterparty fails to discharge an obligation
to the Group. The Group is exposed to credit risk from financial assets
including cash and cash equivalents held at banks, trade and other
receivables.
Credit risk management
The credit risk is managed on a group basis based on the Group's credit risk
management policies and procedures.
The credit risk in respect of cash balances held with banks and deposits with
banks are managed via diversification of bank deposits and are only with major
reputable financial institutions.
Trade receivables
The Group applies the IFRS 9 simplified model of recognising lifetime expected
credit losses for all trade receivables as these items do not have a
significant financing component.
In measuring the expected credit losses, the trade receivables have been
assessed on
collective basis as they possess shared credit risk characteristics. They have
been grouped based on the days past due and also according to the geographical
location of the customer.
Group Group Company Company
30-Jun-22 31-Dec-21 30-Jun-22 31-Dec-21
ECL Carrying Carrying Carrying Carrying
Provision Amount ECL Amount ECL Amount ECL Amount ECL
€'000 €'000 €'000 €'000 €'000 €'000 €'000 €'000
Cat 1 0.00% - - - - - - - -
Cat 2 0.12% 20,858 24 28,450 36 20,815 24 28,423 36
Cat 3 2.78% 1,385 39 643 18 1,385 39 643 18
Cat 4 25-100% 28 28 28 28 28 28 28 28
22,271 91 29,121 82 22,228 91 29,094 82
Group
Loss allowances as at 31 December 2020 38
Loss allowance recognised during the financial year 44
Loss allowances as at 31 December 2021 82
Loss allowance recognised during the financial year 9
Loss allowances as at 30 June 2022 91
Company
Loss allowances as at 31 December 2020 38
Loss allowance recognised during the financial year 44
Loss allowances as at 31 December 2021 82
Loss allowance recognised during the financial year 9
Loss allowances as at 30 June 2022 91
c. Liquidity Risk
Liquidity risk is that the Group might be unable to meet its obligations as
they fall due. The Group manages its liquidity needs by monitoring forecast
cash inflows and outflows due in day-to-day business.
The Group's objective is to maintain cash to meet its liquidity requirements
for 30-day periods at a minimum. This objective was met for the reporting
period. Funding for long-term liquidity needs is additionally secured through
fundraising from external parties and existing shareholders.
The Group considers expected cashflows from financial assets in assessing and
managing liquidity risk, in particular its cash resources and trade
receivables. The Groups existing cash resources and trade receivables
significantly exceed the current cash outflow requirements when compared to
trade and other payables. Cashflows from trade and other receivables are all
contractually due within six months.
Group Group Company Company
30-Jun-22 31-Dec-21 30-Jun-22 31-Dec-21
Carrying Contract Carrying Contract Carrying Contract Carrying Contract
Value Outflow Value Outflow Value Outflow Value Outflow
€'000 €'000 €'000 €'000 €'000 €'000 €'000 €'000
Trade creditors 790 790 1,309 1,309 738 738 1,257 1,257
Other Creditors 81 81 49 49 81 81 49 49
Accruals 893 893 769 769 893 893 769 769
Directors Loan 8 8 10 10 8 8 10 10
Lease Liabilities 213 223 264 278 15 15 47 49
1,986 1,995 2,401 2,415 1,735 1,735 2,132 2,134
Group Group Company Company
30-Jun-22 31-Dec-21 30-Jun-22 31-Dec-21
Due Due Due Due Due Due Due Due
< 1 year > 1 year < 1 year > 1 year < 1 year > 1 year < 1 year > 1 year
€'000 €'000 €'000 €'000 €'000 €'000 €'000 €'000
Trade creditors 790 - 1,309 - 738 - 1,257 -
Other Creditors 81 - 49 - 81 - 49 -
Accruals 893 - 769 - 893 - 769 -
Directors Loan 8 - 10 - 8 - 10 -
Lease Liabilities 90 133 171 107 15 - 49 -
1,863 133 2,308 107 1,735 - 2,134 -
d. Capital Management
The Group is not regulated but it aims to maintain capital resources
commensurate with the nature, scale and risk profile of its business. It
regards its capital as the total equity as shown on the consolidated statement
of financial position.
22. Leases
Lease liabilities are presented in the consolidated statement of financial
positions as follows:
Group Group Company Company
30-Jun 31-Dec 30-Jun 31-Dec
2022 2021 2022 2021
€'000 €'000 €'000 €'000
Current 86 164 15 47
Non-Current 127 100 - -
213 264 15 47
Minimum lease payments due
Group
30 June 2022
< 1 year 1-2 years 2-3 years 3-4 years 4-5 years > 5 years Total
Lease Payments 90 39 40 41 12 - 223
Finance Charges (5) (3) (2) (0) (0) - (9)
86 37 39 41 12 - 213
31 December 2021
< 1 year 1-2 years 2-3 years 3-4 years 4-5 years > 5 years Total
Lease Payments 171 49 - - - - 278
Finance Charges (7) (3) -- -- -- - (14)
164 46 - - -- - 264
Company
30 June 2022
< 1 year 1-2 years 2-3 years 3-4 years 4-5 years > 5 years Total
Lease Payments 15 - - - - - 15
Finance Charges - - - - - - -
15 - - - - - 15
31 December 2021
< 1 year 1-2 years 2-3 years 3-4 years 4-5 years > 5 years Total
Lease Payments 49 - - - - - 49
Finance Charges (2) - - - - - (2)
47 - - - - - 47
Reconciliation of Liabilities arising from financing activities
Group Company
Lease Lease
Liabilities Liabilities
€'000 €'000
31 December 2020 138 127
Cash flows
-Repayments (160) (84)
Non-Cash
- Finance Expenses 26 4
- Addition 259 -
31 December 2021 264 47
Cash flows
- Repayments (82) (35)
Non-Cash
- Finance Expenses 32 3
30 June 2022 213 15
The future minimum lease payments receivable under non-cancellable operating
leases are as follows:
30-Jun 30-Jun
2022 2021
€'000 €'000
Within one year 208 316
In the second year - -
In the third year - -
In the fourth year - -
In the fifth year - -
After five years - -
208 316
The 30 June 2022 and 30 June 2021 lease receivable due within one year is an
estimate. The Groups leases do not include a required or minimum number of
units subject to lease charges. An expectation of the amounts receivable for
future years has not been included on this basis.
The Group has 3 right-of-use asset leases in place as at 30 June 2022. These
relate to 1 office and 2 warehouse leases. The average remaining lease term on
the office buildings is 1 year and the warehouse is 4 years. The leases do not
contain variable lease payments, extension options, purchase options, or
termination options.
23. Capital Commitments
The Group has no capital commitments at the reporting period end (31 December
2021: Nil)
24. Contingent Liabilities
The Group has no contingent liability at the reporting period end (31 December
2021: Nil)
25. Subsequent Events
The Group Directors continue to monitor and assess the impact of Covid-19 and
the situation in Ukraine.
26. Approval of Financial Statements
The Directors approved these financial statements on 29 September 2022.
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