REG - OptiBiotix Health - Final Results <Origin Href="QuoteRef">OPTIO.L</Origin>

OptiBiotix HealthAnnouncement

26/04/2016 16:40

RNS Number : 1228V
OptiBiotix Health PLC
14 April 2016
14 April 2016
OptiBiotix Health Plc
("OptiBiotix" or"the Company")
Final Results 
Notice of AGM 
OptiBiotix Health plc (AIM: OPTI), a Life Sciences business developing compounds to tackle obesity, high cholesterol and diabetes, announces its audited results for the year ended 30 November 2015. 
OptiBiotix continues to make progress on its strategy of developing compounds which modify the human microbiome and commercialising these through partnering with food, health & wellbeing and pharmaceutical companies.
Highlights:
 Raised 1.5m from placing of 2 million shares at 75p
 Substantive increase in the IP portfolio
- five to eleven patents
- three to eight strain registrations
- three to seven trademarks
 Human and manufacturing studies on the cholesterol supplement successfully completed 
 Formation of a Scientific Advisory Group composed of international key opinion leaders
 Strengthened the Board with the appointment of Peter Wennstrm 
 Signed four commercial agreements with Nizo, Venture Life, CSL and a large US multinational 
Post-period end highlights:
 Appointment of Professor Tim Spector to the Scientific Advisory Group
 Further placing to raise 1 million at 78p
 Commercial agreement signed withKSF Acquisition UK Limited (Slimfast)
 Joint venture agreement signed for SkinBiotix with the University of Manchester
 Second contractsigned for the development ofSweetBiotix
 Joint product development agreement signed with Royal DSMProduct Development 
Stephen O'Hara, CEO of OptiBiotix, commented: "I am delighted with the strong progress OptiBiotix has made in our first full year of trading on AIM. In a short space of time we have built operational capability, progressed our development programmes, built on our IP portfolio, and signed multiple commercial agreements. These agreements provide industry validation of OptiBiotix's technology platforms, make a significant financial contribution to running costs, and provide a route to market with established brand suppliers with the potential to generate multiple future revenue streams. Having validated our technology platforms during 2015 we are now extending their scope into new product and application areas to ensure a constant supply of new products entering the market and build the revenue streams of the future. On behalf of the Board, I would like to thank our investors for their support in 2015, and look forward to an exciting and rewarding 2016."
For further information:
OptiBiotix Health plc
www.optibiotix.com
Stephen O'Hara, Chief Executive Officer
Contact via Walbrook below


Cairn Financial Advisers LLP
Tel: 020 7148 7900
Liam Murray 



Hybridan LLP (Joint Broker)
Claire Louise Noyce
Tel: 020 3713 4581


Peterhouse Corporate Finance Ltd (Joint Broker)
Tel: 020 7469 0936
Lucy Williams / Duncan Vasey



Walbrook PR Ltd
Tel: 0207 933 8780 or optibiotix@walbrookpr.com
Anna Dunphy
Mob: 07876 741 001
Mike Wort
Mob: 07900 608 002
About OptiBiotix Health PLC - www.optibiotix.com 
OptiBiotix was formed in March 2012 to develop compounds which modify the human microbiome - the collective genome of the microbes in the body - to prevent and manage human disease.The aim of OptiBiotix is to discover and develop microbial strains, compounds and formulations, which modulate the human microbiome and can be used as food ingredients and supplements or active compounds for the prevention and management of human metabolic diseases, examples of which include obesity, cholesterol and lipid distribution and diabetes. 
OptiBiotix has established a pipeline of microbiome modulators that can impact on lipid and cholesterol management, energy harvest and appetite suppression. The development pipeline is fuelled by its proprietary OptiScreen and OptiBiotic platform technologies designed to identify metabolic pathways and compounds that impact on human physiology and bring potential health benefits. These platforms are applicable across a wider range of other human diseases. 
Chairman's and CEO's Report
We are pleased to present OptiBiotix Health plc's annual report and accounts for the year ended 30 November 2015. 
Research and Development (R&D) strategy
OptiBiotix's R&D strategy has been designed to create technology platforms which provide multiple product and partnering opportunities both within each platform, and by combining platforms. For example, by combining the oligosaccharides (carbohydrates that consist of a small number of sugars) produced by our OptiBiotix platform with the microbes identified in our Optiscreen platform, we can create a new product concept, called an OptiBiotic. This means that for a limited amount of extra cost we can potentially create large amounts of additional value. Whilst this approach has complexity, it has been designed to mitigate development risk in an evolving scientific field and provide a cost effective way to exploit the many opportunities offered by the microbiome.
Development programmes within this strategy are based around contracting in international experts to carry out research in high value areas. This provides a low fixed cost approach to carrying out high risk research with the flexibility to upscale or downscale programmes linked to success. Having validated our technology platforms, the risk reward ratio changes and in 2016 we will commence the process of moving our core technology platforms in-house. This builds up internal capability and expertise and allows us to enhance our partner offering and build shareholder value. 
Development programmes
All of OptiBiotix's development programmes remain on budget and on target with significant progress having been made in validating our OptiBioticand OptiScreen technology platforms. This has allowed us to extend technology platforms into other product and application areas, broadening the product pipeline, and creating new partnership opportunities. We currently have four ongoing R&D programmes (1 x cholesterol, 3 x sugar) with early commercial deals (cost sharing, joint development) across all platforms. We anticipate adding to these development programmes throughout 2016 which will open up new opportunities. 
SlimBiome
OptiBiotix's weight management formulation, branded as SlimBiome was developed as a low risk product by experts in the weight management field to give early market access. The constituent ingredients are established, with a substantial scientific evidence base, and the requisite regulatory approvals. The novelty is in the formulation and delivery allowing SlimBiome to be used as a supplement or a food ingredient in cereal bars or dairy products.
In January 2016, we established an early commercial partnership with KSF who own the rights to Slimfast. This provides an early route to market with an existing and well established brand. We continue to work with a number of manufacturers and distributors and hope to see SlimBiome in a growing number of products in the future.
OptiScreen
OptiBiotix's first product, developed using its OptiScreen platform, is a bacterial strain targeting cholesterol reduction. The product, provided as a supplement, successfully completed human studies in September 2015. There were no safety, compliance, or tolerance issues reported by volunteers during the study. When compared to a placebo the results demonstrated a 7.2% reduction in LDL cholesterol (bad cholesterol) across the test group with a 12.4% reduction seen in females, and a 15% reduction in the 50-55 age groups. Volunteers with totalcholesterol levels higher than6.0mmol/L grouphad even higher reductions of LDL cholesterol (36.7%), an efficacy more in-line with pharmaceutical treatments such as statins. In addition, high efficacy pilot scale manufacturing studieshave demonstrated high production yields leading to a low cost of production and very high freeze drying survival.
A statistically significant reduction in systolic blood pressure of 6mmHg (5.1%) was seen across the test group when compared to placebo. These results open up opportunities for asingle product for both conditions, high cholesterol and high blood pressure, or two differentproductstargeting separate conditions. 
The results of this study provide early evidence that our strain has commercial potential as a safe, easy to use, low cost, cholesterol reducing supplement. These results, suggest efficacy across all volunteers similar or greater to 1.5 - 2.4 g plant sterols/stanols per day but at a much lower dose (0.1g). Even more exciting is the observation that efficacy is similar to pharmaceuticals in volunteers with higher cholesterol levels. Given the market opportunity and limitations of existing products such as statins the commercial potential for this product looks promising.Commercial discussions are progressing with potential partners best positioned to fully exploit the opportunity as a cholesterol and/or hypertension supplement, in isolation, or in combination with existing approaches (e.g. statins). 
OptiBiotic
OptiBiotix's sugar development platform has progressed rapidly under the leadership of Dr Sofia Kolida. Whilst early development was focused on creating prebiotic sugars with functional properties, development programmes have been extended to include:-
 A new product concept called SweetBiotix, a sweet natural healthy sugar not digested in the human gut and hence calorie free 
 A new product concept called OptiBiotic, a combination of a targeted probiotic and prebiotic which selectively enhances the in vivo growth of the probiotic, accentuating its functional properties and health benefits
The SweetBiotix concept is an innovative concept with the potential to address a global requirement. It could address the international concerns over the impact of sugar on obesity, with the prospect of replacing 'unhealthy' sugars in existing products with non-digestible, low calorie, healthy, SweetBiotix. As the food and beverage industry responds to growing public and political concerns over traditional sugars and artificial sweeteners, we expect growing interest in safer, healthy alternatives such as our SweetBiotix. 
The OptiBiotic concept, is similarly innovative, and directed at companies in the probiotics functional food market who have benefited from the global trend for fortified and functional foods. This market is expected to be worth $46.55bn by 2020 (MarketsandMarkets). 
In November 2015, we contracted the Spanish National Research Council,Consejo Superior de Investigaciones Cientficas, ("CSIC") based in Madrid to support the development of these new product concepts. Rapid scientific progress has been rewarded with an early commercial deal withCentro Sperimentale Del Latte ("CSL"), based in Italy. CSL develops, manufactures and distributes probiotics, starter cultures, moulds and yeasts for the pharmaceutical, nutraceutical, dairy, food and agricultural sectors all over the world. We believe these innovative product concepts provide significant growth opportunities and will lead to further deals in 2016.
The aim of all these development programmes is to establish a scientific evidence base for mechanism of action, proof of safety and human efficacy and low cost manufacturability. As products move through the development process risk is reduced and this leads to a corresponding increase in value and greater interest from corporate partners. As our development programmes progress and OptiBiotix is able to demonstrate product safety and efficacy, we anticipate increasing partner interest.
Board and Management 
We believe that we have a well-balanced Board with a focus on the domain expertise in the founder and Chief Executive Stephen OHara, Commercial Director Jim Laird, Non-Executive Director Dr Gareth Barker and Dr Sofia Kolida as Director of Research and Development. This was supplemented in November 2015 with the appointment of Peter Wennstrm, as one of the world's leading experts in functional food innovation and marketing, as a Non-Executive Director. Peter replaced Dr Mark Wyatt, his appointment reflecting the growing focus on commercialising products. They are complemented by the CFO Mark Collingbourne, Adam Reynolds and David Evans as Chairman.
We expect the Board to continue to evolve in line with the continued growth and development of the Company.
Outlook 
OptiBiotix is continuing its strategy of developing microbiome modulators for large markets (>100m), where there are high growth opportunities (CAGR >10%), and a large unmet need. The Board is building a company which anticipates a future where microbiome products will make a significant contribution to the prevention, management, and treatment of disease. That future is unfolding as expected with microbiome treatments using faecal microbial transplants (FMTs) now common place in over 500 US and 10 UK hospitals. With a growing number of research publications showing the potential of the human microbiome in a broad range of health areas, we anticipate microbiome therapies will be a large part of modern healthcare in the years to come. 
During the last 12 months, there has been a general increasing interest, both from industry and the general public in the microbiome, and this has correlated with four commercial agreements for OptiBiotix. Commercial progress has benefited from the appointment of Jim Laird from Premier Foods, who brings considerable sector expertise and capability. 
Current deals are largely joint development, cost sharing, or option agreements where the partner contributes funding in return for certain future rights to commercialise. We anticipate a number of these agreements will migrate into revenue bearing deals. The January 2016 announcement of a commercial agreement with KSF, who own the rights to the Slimfast brand, is such an example. Whilst not so well known in the UK, CSL are a large well established European manufacturer and supplier of probiotics, starter cultures, moulds and yeasts for the pharmaceutical, nutraceutical, who bring access to dairy, food and agricultural sectors all over the world.These commercial agreements demonstrate industry interest and confidence in OptiBiotix's technology platforms and make a significant financial contribution to running costs. More importantly they create a route to market with established brand suppliers with the potential to generate multiple future revenue streams. Discussions with partners suggest there is growing interest in the microbiome and we anticipate further commercial partnerships throughout 2016.
We have de-risked a significant number of the technical challenges in our development programmes and validated their commercial potential. This has led us to extend the scope of these platforms into other product and application areas. This will help build the product pipeline to ensure a constant supply of new products entering the market to build the revenue streams of the future. As these platforms build and start making a significant contribution to group earnings we will consider creating new divisions with the potential to form new legal entities. The Board believe our portfolio approach to product development reduces shareholder risk, creates multiple opportunities to build multiple revenues streams, which will make a significant contribution to building future shareholder value and a sustainable business. 
In the last 12 months we have added significantly to our IP portfolio and anticipate making further patent filings and strain registrations where we feel there is commercial value. We will continue to explore opportunities to in license or acquire new technologies or IP to support our continued growth. 
The Board believes OptiBiotix is at the leading edge of an emerging market forecast to become one of the world's fastest growth areas. We have made strong progress in the last 12 months and now look to build on this solid foundation to grow a microbiome business with significant value for shareholders. 
On behalf of everyone at OptiBiotix Health plc we thank you for your support and look forward to an exciting future. 
David Evans
Chairman
14 April 2016
Stephen O'Hara
Chief Executive Officer
14 April 2016
Results
OptiBiotix results for the 12 months ended 30 November 2015 are set out in the Consolidated Statement of Comprehensive Income. It shows a loss after tax for the period of 1.28m (2014: 0.81m). The loss after tax and after adding back the non-cash items, depreciation and amortisation charge and share based payment expense was 0.874 million (2014: loss 0.747m). Cash flow remains tightly controlled with a focus on building shareholder value through investment in R&D and IP. The Groups cash position at today's date remains strong at c.4million which is sufficient to fund its existing research and development programmes and extend technology platforms into other product and application areas.
Consolidated Statement of Comprehensive Income
For the year ended 30 November 2015



Year ended 
30 November 
2015
Year ended 
30 November 
2014











Revenue


28,200
-







Cost of sales


-
-





Gross Profit


28,200
-







Administrative expenses


(1,451,451)
(489,015)





Operating loss


(1,423,251)
(489,015)







Non-Operating Items











Admission expenses


-
(365,038)








(1,423,251)
(854,053)

Finance income / (costs)


28
93





Loss before Income tax


(1,423,223)
(853,960)







Income tax


142,594
43,254





Loss for the period


(1,280,629)
(810,706)







Other Comprehensive Income


-
-





Total comprehensive income for the period


(1,280,629)
(810,706)











Total comprehensive income attributable to the owners of the company


(1,280,629)
(810,706)











Loss per share





Basic & Diluted loss per share - pence


1.75p
3.03p





Consolidated Statement of Financial Position
As at 30 November 2015



As at
30 November 2015
As at
30 November 2014
ASSETS


Non-current assets




Intangibles


2,146,401
2,259,369
Property, plant & equipment


2,012
855






2,148,413
2,260,224



CURRENT ASSETS




Trade and other receivables


62,597
4,651
Current tax asset


120,000
43,254
Cash and cash equivalents


2,040,888
2,870,442






2,223,485
2,918,347



TOTAL ASSETS


4,371,898
5,178,571



EQUITY




Shareholders' Equity




Called up share capital


7,117,315
7,078,346
Share premium


3,863,687
3,746,781
Share based payment reserve


383,435
90,970
Merger relief reserve


1,500,000
1,500,000
Accumulated deficit


(9,047,642)
(7,767,013)



Total Equity


3,816,795
4,649,084



LIABILITIES




Current liabilities




Trade and other payables


125,823
77,613






125,823
77,613



Non - current liabilities




Deferred tax liability


429,280
451,874






429,280
451,874



TOTAL LIABILITIES


555,103
529,487








TOTAL EQUITY AND LIABILITIES


4,371,898
5,178,571



Consolidated Statement of Changes in Equity
For the year ended 30 November 2015

Called up
Share capital
Accumulated deficit
Share
Premium
Merger Relief Reserve
Share-based
Payment reserve
Total
equity

Balance at 30 November 2013
5,722,248
(6,956,307)
1,302,811
-
27,200
95,952







Loss for the year
-
(810,706)
-
-
-
(810,706)







Issue of consideration shares to acquire subsidiary
500,000
-
-
1,500,000
-
2,000,000







Issues of shares during the year
845,567
-
2,536,700
-
-
3,382,267







Share issue expenses


(124,323)


(124,323)







Exercise of warrants
10,531
-
31,593
-
-
42,124







Share options and warrants
-
-
-
-
63,770
63,770

Balance at 30 November 2014
7,078,346
(7,767,013)
3,746,781
1,500,000
90,970
4,649,084







Loss for the year
-
(1,280,629)
-
-
-
(1,280,629)







Exercise of warrants
38,969
-
116,906
-
-
155,875







Share options and warrants
-
-
-
-
292,465
292,465

Balance at 30 November 2015
7,117,315
(9,047,642)
3,863,687
1,500,000
383,435
3,816,795








Share capital is the amount subscribed for shares at nominal value. Share premium represents amounts subscribed for share capital in excess of nominal value.
Merger relief reserve arises from the 100% acquisition of OptiBiotix Limited on 5 August 2014 whereby the excess of the fair value of the issued ordinary share capital issued over the nominal value of these shares is transferred to this reserve in accordance with section 612 of the Companies Act 2006.
Accumulated deficit represents the cumulative losses of the group attributable to the owners of the company.
Share based payment reserve represents the cumulative amounts charged in respect of unsettled warrants and options issued.
Consolidated Statement of Cash Flows
For the year ended 30 November 2015


Year ended
30 November 2015
Year ended
30 November 2014






Cash flows from operating activities 









Cash utilised by operations 


(1,026,746)
(706,336)
Interest paid


-
-
Interest received


28
93



Net cash outflow from operating activities


(1,026,718)
(706,243)















Cash flows from investing activities




Purchases of property, plant and equipment


(1,965)
(1,099)
Net cash from acquisition of subsidiary


-
251,834



Net cash inflow from investing activities


(1,965)
250,735



Cash flows from financing activities




Share issues


155,875
3,300,068



Net cash inflow from financing activities


155,875
3,300,068








Taxation


43,254
25,732





Increase/(decrease) in cash and equivalents


(829,554)
2,870,292





Cash and cash equivalents at beginning of year


2,870,442
150



Cash and cash equivalents at end of year


2,040,888
2,870,442








Notes to the Consolidated Statement of Cash Flows
For the year ended 30 November 2015
1. Reconciliation of loss before income tax to cash outflow from operations
 

Year ended 
30 November
2015
Year ended 
30 November 
2014




Operating loss
(1,423,251)
(854,053)
(Increase)/decrease in trade and other receivables
(57,946)
296,616
(Decrease)/increase in trade and other payables
48,210
(212,913)
Depreciation charge
808
244
Share Option expense
292,465
63,770
Amortisation of patents
112,968
-

Net cash outflow from operations
(1,026,746)
(706,336)

2. Cash and Cash Equivalents

Year ended 
30 November
2015
Year ended 
30 November 2014

 
  
Cash and cash equivalents
2,040,888
2,870,442







Earnings per Share
 Basic earnings per share is calculated by dividing the earnings attributable shareholders by the weighted average number of ordinary shares outstanding during the period.
 Reconciliations are set out below:
 

Earnings
2015
Weighted average
Number of shares
Loss per-share

Pence




Basic and diluted EPS



Earnings attributable to ordinary shareholders
(1,280,629)
73,167,562
1.75






Earnings
2014
Weighted average
Number of shares
Loss per-share

Pence
Basic and diluted EPS



Earnings attributable to ordinary shareholders
(810,706)
26,751,262
3.03





 Basic and diluted earnings per share are the same, since where a loss is incurred the effect of outstanding share options and warrants is considered anti-dilutive and is ignored for the purpose of the loss per share calculation. As at 30 November 2015 there were 10,345,237 (2014: 8,627,693) outstanding share options and 2,631,125 (2014: 4,579,560) outstanding share warrants, both are potentially dilutive.
Notice of AGM 
The Company's AGM will be held at the London Capital Club, 15 Abchurch Lane, London EC4N 7BW at 12.00 noon on 10 May 2016. A copy of the Notice of AGM may be downloaded from the Company's website.
Posting of Accounts
The Accounts have today been posted to shareholders and are available for download from the Company's website, www.optibiotix.com.

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