REG - Sareum Holdings PLC - Final Results for the Year Ended 30 June 2024
29/10/2024 07:00
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RNS Number : 9329J Sareum Holdings PLC 29 October 2024
Sareum Holdings PLC
("Sareum" or the "Company")
Final Results for the Year Ended 30 June 2024
Cambridge, UK, 29 October 2024 - Sareum Holdings plc (AIM: SAR), a
biotechnology company developing next generation kinase inhibitors for
autoimmune disease and cancer, announces its audited financial results for the
year ended 30 June 2024.
Sareum also provides a broader update on operational activities and pipeline
progress, highlighting the successful completion of the Phase 1 clinical trial
for SDC-1801, a TYK2/JAK1 inhibitor being developed for a range of autoimmune
diseases with an initial focus on psoriasis, several successful fundraises,
providing sufficient cash runway to advance the development of SDC-1801,
including longer-term toxicology studies, to prepare the asset for Phase 2
clinical trials.
Sareum announces that the Annual Report detailing these financial results will
be made available and posted in the coming weeks.
OPERATIONAL HIGHLIGHTS - INCLUDING POST-PERIOD UPDATES
SDC-1801 (autoimmune disease)
· After the period end, Sareum announced the successful completion of
its Phase 1 clinical trial for SDC-1801, including both single ascending dose
("SAD") and multiple ascending dose ("MAD") stages.
· Positive topline data revealed that blood plasma levels of SDC-1801
significantly exceeded the predicted therapeutic exposure, with a half-life of
17-20 hours, suggesting once-daily dosing will be possible.
· No deaths or serious adverse events due to SDC-1801 were reported and
the frequency of adverse events (all mild or moderate) were similar in the
active and placebo groups.
· Post-period, the Company secured funding of £3.4 million through
share subscriptions and received a A$1.9 million (c. £1 million) Australian
R&D tax credit. This funding will enable further development of SDC-1801,
including required longer term toxicology studies, to prepare the asset for
Phase 2 clinical trials and undertake further translation and preclinical
development on its SDC-1802 cancer immunotherapy programme.
· IP position has been strengthened with patent allowances in China for
certain crystalline forms of SDC-1801 and in the US for the chemical
structure, for the use in treating inflammatory diseases, and for certain
methods of chemical synthesis.
SDC-1802 (cancer immunotherapy)
SDC-1802 is a TYK2/JAK1 inhibitor being developed for cancer immunotherapy.
Funds from the recent share subscriptions will accelerate the translational
studies needed to support development of SDC-1802, defining the optimal cancer
application before completing toxicology and manufacturing studies
FINANCIAL HIGHLIGHTS
• Cash at 30 June 2024 of £1.5 million (£1.0 million as of 30 June
2023).
• Loss on ordinary activities after taxation for the year ended 30
June 2024 of £3.4 million (£3.2 million loss for the year ended 30 June
2023), which reflects the increased R&D investment required for the
conduct of the clinical trial and higher level of activity.
• R&D tax credits of £0.8 million received in the year.
• Funding facility provided by RiverFort Global Opportunities PCC
Ltd ("Riverfort") was fully settled in April 2024. The Company raised net
funds of £4.4 million via share issues during the period.
• Post period end, the Company completed fundraises totalling £3.4
million (before expenses), from certain high net worth individuals, corporates
and institutions, via subscriptions for a total of 16,264,444 new ordinary
shares of 1.25 pence each in the capital of the Company ("Ordinary Shares") at
an aggregate price of 20.7 pence per new Ordinary Share. An Australian R&D
tax credit of AS1.9 million (c£1.0 million) was also received in October
2024.
Dr Stephen Parker, Executive Chairman of Sareum, commented:
"2024 has been an important year for Sareum. We have reported positive topline
data from our completed Phase 1 trial of SDC-1801, which demonstrated a
favourable safety profile and achieved blood plasma levels significantly
exceeding the predicted therapeutic exposure. These results, along with our
strengthened financial position and IP portfolio, position us well to advance
SDC-1801 towards Phase 2 clinical trials and accelerate the preclinical
development of SDC-1802. The Clinical Study Report from the Phase 1 trial is
expected to be available later in 2024. We look forward to building on this
momentum in the coming year."
For further information, please contact:
Sareum Holdings plc
Stephen Parker, Executive Chairman 01223 497700
ir@sareum.co.uk
Strand Hanson Limited (Nominated Adviser)
James Dance / James Bellman 020 7409 3494
Hybridan LLP (Corporate Broker)
Claire Noyce 020 3764 2341
ICR Healthcare (Financial PR)
Jessica Hodgson / Davide Salvi / Kumail Waljee 020 3709 5700
About Sareum
Sareum (AIM: SAR) is a biotechnology company developing next generation kinase
inhibitors for autoimmune disease and cancer.
The Company is focused on developing next generation small molecules which
modify the activity of the JAK kinase family and have best-in-class potential.
Its lead candidate, SDC-1801, simultaneously inhibits TYK2 and JAK1. SDC-1801
is a potential treatment for a range of autoimmune diseases, including
psoriasis, and has completed Phase 1 clinical development.
Sareum is also developing SDC-1802, a TYK2/JAK1 inhibitor with a potential
application for cancer immunotherapy.
Sareum Holdings plc is based in Cambridge, UK, and is quoted on the AIM market
of the London Stock Exchange, trading under the ticker SAR. For further
information, please visit the Company's website at www.sareum.com
(https://sareum.com/) .
CHAIRMAN'S STATEMENT
Sareum has made excellent progress during and after this period, successfully
completing the Phase 1 clinical trial of our lead asset, SDC-1801. We are
delighted to report positive topline data from this study, which demonstrated
that SDC-1801 achieved blood plasma levels well above the predicted
therapeutic exposure, with a long half life indicating that once-daily dosing
can be possible. Importantly, no deaths or serious adverse events due to
SDC-1801 were reported.
The success of this trial highlights that high blood levels of our dual
TYK2/JAK1 kinase inhibitor can be achieved without serious side effects.
Moreover, based on the unblinded data now available, we are pleased to note
that the frequency of adverse events (all mild or moderate) was similar in the
active and placebo groups. No clinically significant effects on any component
of blood, which have been affected by earlier generation JAK inhibitors, were
observed. The observed favourable safety and pharmacokinetic profiles may give
SDC-1801 significant advantage over competitors.
The TYK2/JAK1 inhibitor class is increasingly proving its promise for the
treatment of autoimmune disease, and we believe SDC-1801 has the potential to
be a best-in-class. The positive Phase 1 results have reinforced our
confidence as we look to advance SDC-1801 further through clinical
development.
In addition, post the financial year end, we secured £3.4 million before
expenses in funding through subscriptions, and received a A$1.9 million (c.
£1 million) Australian tax credit . These funds will enable us to conduct
further development of SDC-1801, including longer-term toxicology studies, to
prepare the asset for Phase 2 clinical trials and also undertake further
translation and preclinical development of the SDC-1802 cancer immunotherapy
programme, thereby enhancing their potential values.
Our intellectual property position for SDC-1801 has also been strengthened.
We've received patent allowances in China for certain crystalline forms and in
the US for the chemical structure, its use in treating inflammatory diseases,
and certain methods of chemical synthesis. These complement existing approvals
in other major territories.
After the period end, we announced some management changes. Dr. Tim Mitchell,
co-founder and CEO, has transitioned to the part-time role of Chief Operating
Officer while remaining on the Board. I have assumed the position of Executive
Chairman, and we intend to appoint a new CEO at the appropriate time as the
Company progresses with its strategy.
We're excited about the future of SDC-1801 and are committed to building a
strong data package to advance to the next stage of its development and will
be presenting the clinical data at upcoming partnering and scientific
conferences, with the aim of further engaging with potential licensing and
commercialisation partners. We look forward to sharing further updates in due
course.
PROGRAMME UPDATES
SDC-1801
SDC-1801 is a TYK2/JAK1 inhibitor being developed as a potential new
therapeutic for a range of autoimmune diseases with an initial focus on
psoriasis, an autoimmune condition affecting the skin.
Sareum has successfully completed the Phase 1 trial of SDC-1801 (trial ID
ACTRN12623000416695p), including both single ascending dose (SAD) and multiple
ascending dose (MAD) stages. This was a randomised, placebo-controlled trial
investigating the safety, tolerability, pharmacokinetics and pharmacodynamics
of an oral formulation of SDC-1801 in healthy subjects, conducted at a
clinical unit in Melbourne, Australia.
The trial demonstrated that SDC-1801 achieved blood plasma levels well above
the predicted therapeutic exposure, with a half-life of 17-20 hours,
suggesting that once-daily dosing will be possible. Importantly, no deaths or
serious adverse events due to SDC-1801 were reported, and the frequency of
adverse events (all mild or moderate) was similar in the active and placebo
groups. No clinically significant effects were observed on any component of
blood (including red blood cells, haemoglobin, reticulocytes, platelets or
neutrophils) which have been affected by earlier generation JAK inhibitors.
Analysis of blood samples from trial participants who received SDC-1801 for 10
days in the MAD cohorts demonstrated clear, dose-responsive reductions in
three biomarkers of JAK1 and/or TYK2 activity. This provides strong evidence
that safe blood levels of SDC-1801 were able to significantly inhibit major
inflammatory pathways.
The additional funding of £3.4 million through share subscriptions and
receipt of a A$1.9 million (c. £1 million) Australian tax credit will enable
further development of SDC-1801 to prepare the asset for Phase 2 clinical
trials. This will include additional drug product synthesis and toxicology
studies, of up to four months and in two species, which are required to match
the intended duration of the dosing of patients in these Phase 2 studies. It
is the intention to complete these preclinical studies by mid-2025.
SDC-1802
SDC-1802 is a TYK2/JAK1 inhibitor being developed for cancer and cancer
immunotherapy applications.
The funding received from the October 2024 share subscriptions will enable
further translational and preclinical development studies on SDC-1802, which
we look forward to reporting in the current period.
SRA737 (cancer)
SRA737 is a clinical-stage oral, selective Checkpoint kinase 1 inhibitor that
targets cancer cell replication and DNA damage repair mechanisms.
· On 2 January 2024, Sareum announced the Company's co-development
partner, the CRT Pioneer Fund ("CPF"), entered into a development and
commercialisation licence agreement for SRA737 with a private biopharma
company (the "Licensee Company") based in the United States.
· Sareum received US$137,500 from the upfront fee payable under the
Licensing Agreement,
· An additional fee made up of up to US$1.0 million cash and 500,000
shares in the Licensee Company may be payable to CPF, of which Sareum is
entitled to a 27.5% share, upon the sooner of 12 months following the signing
of the Licensing Agreement, or the event of the Licensee Company achieving
certain commercial and material financing objectives.
· Sareum is also entitled to 27.5% of any future payments payable by
the Licensee Company , under the terms of Sareum's co-development agreements
with CPF and Cancer Research Technology Ltd.
FINANCIAL REVIEW
At 30 June 2024, Sareum had cash of £1.5 million (£1.0 million as of 30 June
2023).
The loss on ordinary activities after taxation for the year ended 30 June 2024
was £3.4 million (£3.2 million loss for the year ended 30 June 2023), which
reflects the increased R&D investment required for the conduct of the
clinical trial. R&D tax credits of £0.8m were received in the year.
During the year, Sareum made use of a funding facility provided by RiverFort
Global Opportunities PCC Ltd ("Riverfort") which was fully settled in April
2024. The Company raised net funds of £4.4 million via share issues.
Subsequent to the year end, in October 2024, the Company completed two
fundraises totalling £3.4million (before expenses), from certain high net
worth individuals and institutions, via subscriptions for a total of
11,820,000 new Ordinary Shares at a price of 20 pence per new Ordinary Share
and subscriptions for a total of 4,444,444 new Ordinary Shares at a price of
22.5 pence per new Ordinary Share. An Australian R&D tax credit of AS1.9
million (c£1.0 million) was also received in October 2024.
OUTLOOK
Sareum has successfully completed its Phase 1 clinical trial for SDC-1801,
including both single ascending dose (SAD) and multiple ascending dose (MAD)
stages. The positive topline data from this trial have significantly bolstered
the Company's confidence in SDC-1801's potential as a best-in-class TYK2/JAK1
inhibitor for autoimmune diseases.
The Clinical Study Report from the Phase 1 trial is expected to be available
later in 2024. Sareum plans to conduct the preparatory work required to obtain
regulatory approval for a Phase 2 clinical trial. We look forward to
presenting this data at upcoming partnering and scientific conferences,
including discussing the data with potential licensing and commercialisation
partners.
The recent funding, will enable the Group to conduct further development of
SDC-1801, including the longer-term toxicology studies required to prepare the
asset for Phase 2 clinical trials and also undertake further translational and
preclinical development on its SDC-1802 cancer immunotherapy programme thereby
enhancing their potential values.
The Board of Sareum continues to apply a rigorous approach to capital
allocation in the development of the Company's assets. The Company maintains a
clear focus on advancing these potential medicines to patients as efficiently
as possible while maximizing value for shareholders.
With the recent management changes, including Dr. Stephen Parker's transition
to Executive Chairman and Dr. Tim Mitchell's move to a part-time Chief
Operating Officer role, Sareum is well-positioned to navigate through this
exciting phase of development.
CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
FOR THE YEAR ENDED 30 JUNE 2024
Note 2024 2023
£'000 £'000
CONTINUING OPERATIONS
Revenue - -
Administrative expenses (4,596) (4,048)
Share of loss of associates (60) (18)
Other operating income 22 -
-------------- --------------
OPERATING LOSS (4,634) (4,066)
Finance income 4 32 41
LOSS BEFORE TAXATION 5 (4,602) (4,025)
Taxation 6 1,182 833
LOSS FOR THE YEAR (3,420) (3,192)
TOTAL COMPREHENSIVE EXPENSE FOR THE YEAR (3,420) (3,192)
Loss attributable to owners of the parent (3,420) (3,192)
Total comprehensive income attributable to owners of the parent (3,420) (3,192)
Basic and diluted loss per share (pence per share) 7 (4.2) (4.7)
The accompanying notes form part of these financial statements.
CONSOLIDATED BALANCE SHEET
30 JUNE 2024
Note 2024 2023
£'000 £'000
ASSETS
NON-CURRENT ASSETS
Property, plant and equipment 8 - 1
Investment in associate 9 9 46
9 47
CURRENT ASSETS
Trade and other receivables 10 1,299 979
Cash and cash equivalents 11 1,459 994
2,758 1,973
CURRENT LIABILITIES
Trade and other payables 12 (653) (867)
NET CURRENT ASSETS 2,105 1,106
NET ASSETS 2,114 1,153
SHAREHOLDERS' EQUITY
Called up share capital 15 1,349 851
Share premium 17 24,802 20,925
Share-based compensation reserve 17 312 325
Foreign exchange reserve 17 20 14
Retained earnings 17 (24,369) (20,962)
TOTAL EQUITY 2,114 1,153
The accompanying notes form part of these financial statements.
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 30 JUNE 2024
Called up share capital Share premium Share-based compensation reserve
£'000 £'000 £'000
Balance at 1 July 2022 851 20,925 325
Issue of share capital - - -
Transfer for options exercised / expired - - -
Total comprehensive income - - -
Balance at 30 June 2023 851 20,925 325
Issue of share capital 498 3,877 -
Total comprehensive income - - -
Transfer for options exercised / expired - - (13)
Balance at 30 June 2024 1,349 24,802 312
Foreign exchange reserve Retained earnings Total equity
£'000 £'000 £'000
Balance at 1 July 2022 - (17,770) 4,331
Issue of share capital - - -
Transfer for options exercised / expired - - -
Arising on consolidation 14 - 14
Total comprehensive income - (3,192) (3,192)
Balance at 30 June 2023 14 (20,962) 1,153
Issue of share capital - - 4,375
Transfer for options exercised / expired - 13 -
Arising on consolidation 6 - 6
Total comprehensive income - (3,420) (3,420)
Balance at 30 June 2024 20 (24,369) 2,114
The accompanying notes form part of these financial statements.
CONSOLIDATED CASH FLOW STATEMENT
FOR THE YEAR ENDED 30 JUNE 2024
Note 2024 2023
£'000 £'000
Cash flows from operating activities
Cash used in operations 19 (4,739) (3,676)
Tax received 820 409
Net cash outflow from operating activities (3,919) (3,267)
Cash flows from investing activities
Purchase of tangible fixed assets - -
Investment in associate (23) (41)
Interest received 32 41
Net cash inflow from investing activities 9 -
Cash flows from financing activities
Share issues 4,375 -
Net cash inflow from financing activities 4,375 -
------------- -------------
(Decrease)/increase in cash and cash equivalents 465 (3,267)
Cash and cash equivalents at beginning of year 994 4,261
------------ ------------
Cash and cash equivalents at end of year 1,459 994
======= =======
The accompanying notes form part of these financial statements.
1. BASIS OF PREPARATION
The financial statements of Sareum Holdings plc (the "Company") have been
prepared in accordance with UK-adopted international accounting standards, and
in accordance with international accounting standards in conformity with the
requirements of the Companies Act 2006, with IFRIC interpretations.
The financial statements have been prepared under the historical cost
convention.
Going concern
The Group made a loss after tax of £3.4 million (2022: £3.2 million), as it
continued to progress research and development activities. These activities,
and the related expenditure, are in line with the budgets previously set and
are funded by regular cash fundraises.
The Directors consider that the cash held at the year-end, together with that
received after the year end and projected to be received, will be sufficient
for the Group to meet its forecast expenditure for at least one year from the
date of signing the financial statements. If there is a shortfall the
Directors will implement cost savings to ensure that the cash resources last
for this period of time.
For these reasons the financial statements have been prepared on a going
concern basis.
Basis of consolidation
The consolidated financial statements incorporate the financial statements of
the Company and entities controlled by the Company (its subsidiaries and an
associate, together, the "Group") made up to 30 June each year. Control is
achieved where the Company has the power to govern the financial and operating
policies of another entity or business, so as to obtain benefits from its
activities. The consolidated financial statements present the results of the
Company and its subsidiary as if they formed a single entity. Inter-company
transactions and balances between group companies are eliminated on
consolidation.
2. ACCOUNTING POLICIES
The principal accounting policies applied are set out below.
Property, plant and equipment
Depreciation is provided on a straight-line basis over three years in order to
write off each asset over its estimated useful life.
Financial instruments
Financial instruments are classified and accounted for, according to the
substance of the contractual arrangement, as either financial assets,
financial liabilities or equity instruments. An equity instrument is any
contract that evidences a residual interest in the assets of the Company after
deducting all of its liabilities.
Cash and cash equivalents
Cash and cash equivalents comprise cash in hand and demand deposits and other
short term highly liquid investments that are readily convertible to a known
amount of cash and are subject to insignificant risk of change in value.
Pension contributions
The Group does not operate a pension scheme for the benefit of its employees
but instead makes contributions to their personal pension plans. The
contributions due for the period are charged to the profit and loss account.
Employee share schemes
The Group has in place a share option scheme for employees, which allows them
to acquire shares in the Company. Equity settled share-based payments are
measured at fair value at the date of grant. The fair value of options granted
is recognised as an expense spread over the estimated vesting period of the
options granted. Fair value is measured using the Black-Scholes model, taking
into account the terms and conditions upon which the options were granted.
Research and development
Expenditure on research and development is written off in the year in which it
is incurred. Research expenditure is written off in the period in which it is
incurred. Development expenditure incurred is capitalised as an intangible
asset only when all of the following criteria are met:
- It is technically feasible to complete the intangible asset so that
it will be available for use or sale;
- There is the intention to complete the intangible asset and use or
sell it;
- There is the ability to use or sell the intangible asset;
- The use or sale of the intangible asset will generate probable
future economic benefits;
- There are adequate technical, financial and other resources
available to complete the development and to use or sell the intangible asset;
and
- The expenditure attributable to the intangible asset during its
development can be measured reliably.
Expenditure that does not meet the above criteria is expensed as incurred.
Taxation
Current taxes are based on the results shown in the financial statements and
are calculated according to local tax rules, using tax rates enacted or
substantially enacted by the balance sheet date.
Deferred tax is recognised in respect of all timing differences that have
originated but not reversed at the balance sheet date where transactions or
events have occurred at that date that will result in an obligation to pay
more, or a right to pay less or to receive more tax, with the following
exception:
Deferred tax is measured on an undiscounted basis at the tax rates that are
expected to apply in the periods in which timing differences reverse, based on
the tax rates and laws enacted or substantively enacted at the balance sheet
date. Deferred tax assets are recognised only to the extent that the Directors
consider that it is more likely than not that there will be suitable taxable
profits from which the future reversal of the underlying timing differences
can be deducted.
Revenue recognition
Revenue is measured as the fair value of the consideration received or
receivable in the normal course of business, net of discounts, VAT and other
sales related taxes and is recognised to the extent that it is probable that
the economic benefits associated with the transaction will flow to the Group.
Revenues from licensing agreements are recognised in line with the performance
obligations being met, as outlined in the terms of the agreement. Grant income
is recognised as earned based on contractual conditions, generally as expenses
are incurred. Such income is recognised as Other Operating Income.
Critical accounting estimates and areas of judgement
Estimates and judgements are continually evaluated and are based on historical
experience and other factors, including expectations of future events that are
believed to be reasonable under the circumstances. Actual results may differ
from these estimates. The estimates and assumptions that have the most
significant effects on the carrying amounts of the assets and liabilities in
the financial information are considered to be research and development costs
and equity settled share-based payments.
Investment in associates
An associate is an entity over which the Company has significant influence.
Significant influence is the power to participate in the financial and
operating policy decisions of the Investee but is not control or joint control
over those policies. Investments in associates are accounted for using the
equity method, whereby the investment is initially recognised at cost and
adjusted thereafter for the post-acquisition change in the associate's net
assets with recognition in the profit and loss of the share of the associate's
profit or loss.
Impairment of assets
At the date of the statement of financial position, the Group reviews the
carrying amounts of its non-current assets to determine whether there is any
indication that those assets have suffered an impairment loss. If any such
indication exists, the recoverable amount of the asset is estimated in order
to determine the extent of the impairment loss (if any).
Recoverable amount is the higher of fair value less cost to sell and value in
use. In assessing value in use, the estimated future cash flows are discounted
to their present value using a pre-tax discount rate that reflects current
market assessments of the time value of money and the risks specific to the
asset for which the estimates of future cash flows have not been adjusted. If
the recoverable amount of an asset is estimated to be less than its carrying
amount, the carrying amount of the asset is reduced to its recoverable amount.
An impairment loss is recognised as an expense immediately, unless the
relevant asset is carried at a revalued amount, in which case the impairment
loss is treated as a revaluation decrease.
New or revised accounting standards
Certain new accounting standards and interpretations have been published that
are not mandatory for 30 June 2024 reporting periods and have not been early
adopted by the Company or the Group. These standards are not expected to have
a material impact on the entity in the current or future reporting periods and
on foreseeable future transactions.
3. EMPLOYEES AND DIRECTORS
2024 2023
£'000 £'000
Directors' remuneration
Directors' emoluments 530 523
Directors' pension contributions to money purchase schemes 28 29
£'000 £'000
Remuneration of the highest paid Director
Directors' emoluments 193 193
Director's pension contributions to money purchase schemes 14 15
There are two (2022: two) Directors who are members of third party held money
purchase retirement benefit schemes.
Average monthly number of persons employed Number Number
Office and management 4 4
Research 1 1
5 5
£'000 £'000
Staff costs during the year
Wages and salaries 530 523
Social security costs 59 58
Pension costs 28 29
617 610
4. NET FINANCE INCOME
2024 2023
£'000 £'000
Deposit account interest 32 41
5. LOSS BEFORE INCOME TAX
The loss before income tax is stated after charging: 2024 2023
£'000 £'000
Depreciation - owned assets 1 1
Research and development 3,591 2,909
Other operating leases 21 21
Foreign exchange differences (37) 24
Auditor's remuneration 17 16
6. INCOME TAX
2024 2023
£'000 £'000
Current tax
Adjustment to prior years (3) -
Overseas taxation credit 1,031 395
UK corporation tax credit on losses for the period 154 438
------------ ------------
1,182 833
The credit for the year can be reconciled to the accounting loss as follows: 2024 2023
£'000 £'000
Loss before tax (3,420) (4,025)
Notional tax credit at average rate of 20.5% (2022: 19%) 1,150 825
Effects of:
Expenses not deductible for tax purposes (44) -
Adjustment to tax charge in respect of prior periods (3) -
Other timing differences (629) (234)
Unutilised tax losses (271) (293)
Losses surrendered for research and development tax credits (206) (298)
Research and development tax credits claimed 1,185 833
Actual current tax credit in the year 1,182 833
The tax rate of 25% used above is the average corporation tax rate applicable
in the United Kingdom.
A potential deferred tax asset as at 30 June 2024 of £3.2 million (2023:
£2.8 million) calculated using the expected corporation tax rate of 25%
(2022: 25%), has not been recognised, as there remains a significant degree of
uncertainty that the Group will make sufficient profits in the foreseeable
future to justify recognition.
7 EARNINGS PER SHARE
The calculation of loss per share is based on the following data: 2024 2023
Loss on ordinary activities after tax £3,420,000 £3,192,000
Weighted average number of shares in issue 80,992,566 68,069,416
Basic and diluted loss per share (pence) (4.2) (4.7)
As the Group has generated a loss for the period, there is no dilutive effect
in respect of share options.
8. PROPERTY PLANT & EQUIPMENT
Fixtures and computers
£'000
Cost
At 1 July 2023 and 30 June 2024 13
Depreciation
At 1 July 2023 12
Charge for the year 1
At 30 June 2024 13
Carrying amount
At 30 June 2023 1
=======
At 30 June 2024 -
9. INVESTMENTS
Interest in associate
£'000
Cost
At 1 July 2023 1,217
Additions 23
At 30 June 2024 1,240
Provision for impairment
At 1 July 2023 1,171
Impairment for year 60
At 30 June 2024 1,231
Net book value
At 30 June 2023 46
At 30 June 2024 23
The investment in associate represents the investment by the Group in the
partnership with the Cancer Research Technology Pioneer Fund to advance the
SRA737 programme and has been accounted for using the equity method. Sareum's
interest in the associate partnership is 27.5%. As at 30 June 2024 the
partnership had net assets of £34,000 (2023: £83,000) and had incurred
cumulative losses of £0.8 million (2023: £0.7 million).
10. TRADE AND OTHER RECEIVABLES
2024 2023
£'000 £'000
Amounts falling due within one year:
Corporation tax 1,180 823
Other taxation receivable 41 75
Prepayments and accrued income 78 81
1,299 979
11. CASH AND CASH EQUIVALENTS
2024 2023
£'000 £'000
Bank deposit accounts 1,459 994
12. TRADE AND OTHER PAYABLES
2024 2023
£'000 £'000
Amounts falling due within one year:
Trade creditors 542 694
Social security and other taxes 19 22
Other creditors 35 5
Accrued expenses 57 146
653 867
Trade payables and accruals principally comprise amounts outstanding for trade
purchases and ongoing costs. The average credit term agreed with suppliers is
30 days and payment is generally made within the agreed terms.
13. LEASING AGREEMENTS
The Group has not applied IFRS 16 as the lease on the only office occupied by
the Group is of low value, expiring in December 2026 and the rent payments in
the year are also not material to the financial statements.
14. FINANCIAL INSTRUMENTS
The Group's principal financial instruments are trade and other receivables,
trade and other payables and cash. The main purpose of these financial
instruments is to finance the Group's ongoing operational requirements. The
Group does not trade in derivative financial instruments.
The major financial risks faced by the Group, which remained unchanged
throughout the year, are interest rate risk, foreign exchange risk and
liquidity risk. Policies for the management of these risks are shown below and
have been consistently applied.
MARKET RISKS
Interest rate risk
The Group is exposed to interest rate risk as cash balances in excess of
immediate needs are placed on short term deposit. The Group seeks to optimise
the interest rates received by continuously monitoring those available. The
value of the Group's financial instruments is not considered to be materially
sensitive to these risks and therefore no sensitivity analysis has been
provided.
Foreign exchange risk
The Group's activities expose it to fluctuations in the exchange rate for the
Euro and the US dollar. Funds are maintained in sterling and foreign currency
is acquired on the basis of committed expenditure. The value of the Group's
financial instruments is not considered to be materially sensitive to these
risks and therefore no sensitivity analysis has been provided.
NON-MARKET RISKS
Liquidity risk
The Board has responsibility for reducing exposure to liquidity risk and
ensures that adequate funds are available to meet anticipated requirements
from existing operations by a process of continual monitoring. The value of
the Group's financial instruments is not considered to be materially sensitive
to these risks and therefore no sensitivity analysis has been provided.
15. SHARE CAPITAL
Called up, allotted and fully paid 2024 2023
£'000 £'000
107,945,783 (2022: 68,069,416) Ordinary Shares of 1.25p each 1,349 851
The Ordinary Shares carry equal rights in respect of voting at a general
meeting of shareholders, payment of dividends and return of assets in the
event of a winding up.
During the year the following share issues took place
(i) On 8 August 2023, 1,953,543 Ordinary Shares were issued at 9.98
pence per Ordinary Share in respect of a financing arrangement with Riverfort.
A further 48,839 Ordinary Shares were issued at £1.02 per Ordinary Share to
Riverfort at the same time. Together these raised £2 million before expenses.
(ii) On 30 October 2023, 190,080 Ordinary Shares were issued at 30 pence
per Ordinary Share in respect of the exercise of share options by certain
Directors that raised, in aggregate, £57,024 before expenses.
(iii) 12,660,488 Ordinary Shares were issued to Riverfort on various dates
between 12 March 2024 and 26 April 2024 which in aggregate raised £300,000.
(iv) On 5 April 2024 23,339,733 Ordinary Shares were issued at 10 pence per
Ordinary Share to individual investors as part of a placing and WRAP exercise,
which in aggregate raised £2,333,973 before expenses.
(v) On 5 April 2024 576,698 Ordinary Shares were issued at 10 pence per
Ordinary Share to certain Directors in lieu of salary payments owed to them,
which in aggregate raised £57,670 before expenses.
(vi) On 13 May 2024, 1,106,986 Ordinary Shares were issued at 10 pence per
Ordinary Share to Riverfort in respect of their exercise of certain warrants,
which in aggregate raised £110,699.
16. PENSION COMMITMENTS
The Group makes contributions to its employees' own personal pension schemes.
The contributions for the period of £28,000 (2023: £29,000) were charged to
the profit and loss account. At the balance sheet date contributions of
£4,000 (2023: £5,000) were owed and are included in creditors.
17. RESERVES
Reserve Description and purpose
Share capital Amount of the contributions made by shareholders in return for the issue of
shares.
Share premium Amount subscribed for share capital in excess of nominal value.
Retained earnings Cumulative net gains and losses recognised in the consolidated and the Company
Balance Sheet.
Foreign exchange reserve Arising on consolidation of the overseas subsidiary
Share-based compensation reserve Cumulative fair value of share options granted and recognised as an expense in
the Income Statement.
Details of movements in each reserve are set out in the Consolidated Statement
of Changes in Equity.
18. CONTINGENT LIABILITIES
There are no contingent liabilities (2023: £nil).
19. RECONCILIATION OF LOSS BEFORE INCOME TAX TO CASH GENERATED FROM OPERATIONS
2024 2023
£'000 £'000
Operating loss from continuing operations (4,602) (4,024)
Adjustments for:
Depreciation 1 1
Share of loss of associate 60 18
Foreign exchange differences 5 24
Finance income (32) (41)
Operating cash flows before movements in working capital (4,568) (4,022)
Decrease/(increase) in receivables 42 (65)
Increase in payables (213) 411
Cash used in operations (4,739) (3,676)
======= =======
20. POST BALANCE SHEET EVENTS
With effect from 10 July 2024 Tim Mitchell, co-founder and Chief Executive
Officer (CEO), transitioned to the part-time role of Chief Operating Officer
(COO) and Stephen Parker, previously Non-Executive Chairman, assumed the
position of Executive Chairman. Additionally at that time, Clive Birch was
appointed as Senior Independent Director.
In October 2024, the Company completed fundraises as follows:
(i) £2.4 million (before expenses), from certain high
net worth individuals, corporates and an institution, via a subscription for a
total of 11,820,000 new Ordinary Shares at a price of 20 pence per new
Ordinary Share; and
(ii) £1.0 million (before expenses), from certain
investors including the institution that participated in the above fundraise,
via a subscription for a total of 4,444,444 new Ordinary Shares at a price of
22.5 pence per new Ordinary Share.
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