REG - Tern PLC - Results for the year ended 31 December 2024

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RNS Number : 5563L  Tern PLC  05 June 2025

5 June 2025

Tern Plc

("Tern" or the "Company")

Audited results for the year ended 31 December 2024

Tern Plc (AIM: TERN), the investment company specialising in supporting high
growth, early-stage, disruptive Internet of Things ("IoT") technology
businesses, announces its audited results for the year ended 31 December 2024.

Chairman's Statement

 

While market conditions remained challenging, I am pleased to report that 2024
was a year of meaningful progress for Tern. Our core portfolio continues to
mature and demonstrate strength, and we remain firmly committed to delivering
long-term value to our shareholders.

 

Tern offers investors a rare opportunity: the ability to hold shares in an
AIM-quoted venture capital company focused on early-stage, high-growth
technology businesses -companies typically inaccessible to most AIM retail
investors. In many ways, our shareholders operate as Limited Partners in a
traditional venture capital fund, but with the added advantage of daily
liquidity and no obligation to contribute additional capital.

 

We have built a focused, high-potential portfolio operating in sectors poised
for substantial growth. The Tern team actively works with our portfolio
companies to drive value through hands-on support, strategic development, and,
at the appropriate stage, targeted exits aimed at maximising shareholder
returns.

 

In addition to the intrinsic value of the portfolio, our strategy is built
around delivering shareholder returns through three core pillars:

 

·    Capital Distribution via an appropriate method, when exits deliver
sufficient proceeds.

·    Capital growth through the successful commercial execution of our
portfolio companies.

·    Diversification by providing exposure to a wide array of
transformative technology businesses typically out of reach for individual
investors.

 

Portfolio Review

 

Device Authority ("DA")

 

In December 2024 DA received the second fundraising tranche from industry
specialist investor, Ten Eleven Ventures, of US$3.3m, at the same price as the
first tranche provided in December 2023. The funds are being used by DA to
advance product development, expanding its North American footprint and
enhancing its Identity and Access Management (IAM) solutions for the Internet
of Things (IoT).

 

DA's KeyScaler® platform, focused on automotive, medical and industrial
sectors enabling 'zero trust' security for the IoT, has been selected by
several major enterprises. DA acquired new customers in 2024, with existing
key clients gearing up for mass production, utilising the platform.

 

With a strong presence in the UK, DA also has a successful 'go to market' in
the US which has delivered three major customer wins in 2025. The total
addressable market is large and growing, with cybercrime estimated by
Cybersecurity Ventures to be the third largest economy in the world, with a
fragmented industry. DA's annual recurring revenue (ARR) rose 10% year over
year.

 

In March 2025 DA announced its that it had joined forces with Microsoft and
CyberArk to deliver a secure IoT solution for manufacturing based on the
National Institute of Standards and Technology's (NIST) latest framework. DA
now plays a crucial role as a Microsoft IoT and Operational Technology (OT)
security partner for Microsoft's Manufacturing Industry Reference
Architecture.

 

Initial client wins are expanding into further orders leveraging KeyScaler®.
One of DA's existing clients, a global leading automotive components provider,
is scaling production to more factories as part of its Identity management
process.

DA's modularised licence platform KSaaS (KeyScaler Software as a Service) has
achieved over 16 million machine identity authentications worldwide,
demonstrating the platform's scalability and its ability to secure IoT devices
across diverse industries.

 

FundamentalVR ("FVR")

 

FVR provide a software simulation environment that allows surgeons' accuracy
to be measured objectively for the first time, with a mission to revolutionise
surgical education globally.

 

Despite 2024 being tough in terms of macro conditions and customer
restructuring, FVR expanded its relationships with existing logos. Customer
growth was strong, including very important strategic alliances with Apple,
Meta and Logitech, with Artificial Intelligence (AI) being used in different
ways.

 

Apple's and Meta's continued expansion of activity in the metaverse space
provide significant interest and opportunities for the company.

 

A significant milestone in Q4 2024 was the launch of The American Academy of
Ophthalmology VR Education programme on the platform.

 

In December 2024, the company was named 'Best Surgery Training VR Technology
Company 2024' in the Global Excellence Awards by GHP Magazine, and the
technology is vendor/hardware agnostic.

 

FVR was recognised as one of Fast Company's 'Most Innovative Companies of
2025'. This honour highlights their groundbreaking work in virtual reality,
artificial intelligence, and haptic technology, which is transforming surgical
training and medical education.

 

Talking Medicines ("TM")

 

TM's revenues and annual recurring revenues both grew year on year, and with
much improved gross margins. Operating expenses fell sharply in the year. TM
has secured partnerships and signed contracts with multiple US based
healthcare advertising agencies that serve pharmaceutical companies.

 

2024 was a breakthrough year, and the Board sees significant potential in TM's
next phase of growth, with its customers entrusting over 2.9 million pieces of
data to TM to date. Already at the forefront of AI, the company's Drug-GPT
stands apart as a specialised 'Curated Large Language Model'.

 

The prescription drug market in the US alone is huge, and the cost of poor
medical adherence is estimated by the PAN Foundation to be US$525bn, with
US$30bn spent on marketing to address this. TM is well established in an AI
category that is operating in a fast growing and large market, operating in
Machine Learning and Natural Language Processing.

 

Sure Valley Ventures Enterprise Capital LP (SVV2)

 

Tern continues to fulfil its commitment to invest up to £5m in SVV2 over the
10-year life of SVV2, entered into in March 2022. During 2024, Tern invested a
further £0.5m in SVV2 to support their five further investments.

 

In addition, we added a modest investment in Sure Ventures plc to our
portfolio post the year end, in January 2025, which has a 25.9% interest in
Sure Valley Ventures Fund ("SVV1") and an approximate 6% interest in SVV2,
providing exposure and potential upside to additional exciting technology
businesses.

 

This 'fund of funds' approach, in addition to our direct investments is, I
believe, important for a number of reasons. Crucially it reduces the inherent
risk associated with a concentrated portfolio and the uncertainty as to when
value will be realised. Additionally, it allows our operating costs to be
spread across a wider portfolio, we have the potential to recoup some costs
through providing assistance to the companies held by these funds, we have the
potential to receive exit proceeds earlier and there is the potential for
synergy benefits for our direct portfolio companies from working with the
fund's underlying investee companies.

 

Wyld Networks ("Wyld")

 

In 2024, Wyld faced financial difficulties and raised capital via a rights
issue on terms we believe were detrimental to existing shareholders. Tern did
not participate in the rights issue, resulting in significant dilution. As a
result of Wyld's IPO in 2021, Tern no longer plays a day-to-day role in Wyld's
governance and had no influence over the fundraising process. Nevertheless, of
the total capital Tern invested in Wyld, a substantial portion has been
returned. We continue to monitor developments closely.

 

InVMA Limited ("Konektio")

 

It was disappointing that in March 2024 Konektio entered administration. Tern
had previously announced on 8 November 2023 that the Company had decided not
to invest further in Konektio and following this decision, 75% of Tern's
holding in Konektio was transferred into a valueless class of Konektio
deferred shares, as announced on 29 November 2023. Tern held approximately
8.8% of Konektio's equity at the time of administration and this holding had
an unaudited book valuation of £222,624 as at 31 December 2023. Following
Konektio entering administration, the Tern Directors concluded that it is
unlikely that any value will be realisable from Tern's holding in Konektio and
Tern's holding in Konektio is therefore now be held at zero value.

 

Outlook

 

Our core portfolio companies, Device Authority, FundamentalVR and Talking
Medicines are thriving - despite a difficult environment for early-stage
technology funding. They are delivering strong commercial traction, attracting
global partners and investors, and we believe maturing into leaders in their
respective markets.

 

Continued progress will require ongoing investment. To preserve our influence
and potential return at exit, we must be in a position to support our
portfolio through growth funding rounds - particularly against a backdrop of
almost abundant private capital. As such, Tern having access to capital and
flexibility to issue new shares remain strategically important.

 

Our model - focusing on seed to Series B rounds - positions us to benefit from
significant upside potential as companies enter Series C and beyond. But this
value can only be realised if we retain sufficient equity, which requires
sustained support through follow-on funding.

 

Tern is also exceptionally well placed to benefit from growing interest in
early-stage software and the generative AI space. Unlike passive capital, we
invest time, expertise, and strategic insight into our portfolio companies.
This approach has been critical in helping our portfolio companies raise
growth capital and scale operations, particularly in the United States, the
world's most dynamic technology market.

 

We continue to operate with a lean structure. Administration costs were
reduced by 40% following the board and management restructuring in August
2023, and further reduced by 30% in 2024 year over year. We charge nominal
management fees to our core portfolio companies, choosing instead to focus all
resources on building long-term value.

 

In 2024, our management team, including Bruce Leith and Al Sisto, have once
again proven the value of their deep experience and entrepreneurial track
record. Our involvement with SVV2 also continues to open new avenues for
income and value creation, such as the appointment of Bruce Leith as Executive
Chairman of Purple Transform, with Tern receiving the related service fees.

 

We also welcomed two new non-executive directors, Jane McCracken and Iain
Ross, whose contributions are already shaping Tern's strategic direction. I
would like to thank our retiring directors, Alan Howarth and Sarah Payne, for
their wisdom and service during their tenure.

 

An investment in Tern is a gateway to early-stage technology investing,
offering access to what we believe are exceptional companies often beyond the
reach of private investors. Our mission is clear: to support these businesses
through their most critical stages, build them into market leaders, and
deliver long-term capital gains for our shareholders.

 

We thank shareholders for their continued trust and support and remain focused
on achieving the best possible return on their investment.

 

Ian Ritchie CBE, FREng, FRSE

Chairman

 

Financial Review

2024 has been a dynamic and promising year for the portfolio as we continue to
invest in the rapidly evolving Internet of Things ("IoT") and artificial
intelligence ("AI") sectors. Driven by increasing enterprise adoption,
advancements in machine learning, and the growing need for automation, our
portfolio companies and holdings are transforming industries at an
unprecedented pace. Market trends indicate sustained growth, with AI- powered
solutions enhancing efficiency across healthcare, finance, and manufacturing,
while IoT adoption fuels smarter infrastructure and connected ecosystems. We
believe that our strategic investments have positioned us at the forefront of
this innovation wave, reinforcing our commitment to unlock the potential of
leading-edge private UK tech companies in order to deliver strong returns to
our valuable shareholders.

Statement of Financial Position

Net assets at 31 December 2024 were £10.7m, a reduction of £1.6m from the
net assets of £12.3m at 31 December 2023. This is principally due to
movements in investments held at fair value through the profit or loss
("FVTPL") and the significant ongoing costs of operating as an AIM-quoted
company. As noted in the Chairman's Statement, the Company has implemented
measures to reduce administration costs by 30% this year compared to 2023.
However, the unavoidable expenses associated with maintaining Tern's quoted
status will inevitably impact the Company's net assets on an ongoing basis.

The decline in the market price of Wyld Networks was the primary driver of the
£2.1m decrease in the fair value of the investment portfolio.

The Company's cash balance was slightly higher as at 31 December 2024 (£0.4m)
compared to 31 December 2023 (£0.3m). Administration and other operating
expenses decreased by £0.5m year-on-year, largely as a result of the board
reorganisation.

Liabilities were £0.25m lower at 31 December 2024 than at the same date in
2023, primarily due to the partial repayment of the short-term loan. In August
2024, the Company agreed to an amendment to the short term loan agreement in
which the security requirement attached to the short-term loan facility was
removed, and the repayment period was extended by 12 months to September 2025.

Investments held at FVTPL amounted to £10.7m and represent the Company's
portfolio of high-growth technology companies. During the year, the fair value
of the portfolio declined by £2.1m, a significantly smaller decrease compared
to the £11.1m reduction recorded in 2023.

Income Statement and Statement of Comprehensive Income

The total comprehensive loss for the year was £3.8m (2023: loss of £12.6m),
primarily due to a negative movement in the fair value of investments held at
FVTPL of £2.5m and the £1.2m of operating expenses incurred during the year.

The Company seeks to keep its fees charged to portfolio companies at modest
levels, as the Company's preference is for capital to instead be reinvested in
the portfolio to drive value creation.

Administration costs decreased to £1.2m in 2024 (2023: £1.7m) as a result of
the board reorganisation which was fully implemented in 2024. Other expenses
decreased to £0.05m in 2024 (2023: £0.2m).

Statement of Cash Flows

During the year, £1.1m was used in the Company's operations, and £0.8m was
deployed within our existing portfolio, via equity and loan investments.

In 2024, £0.3m of the short term loan provided to the Company was repaid
(2023: £0.1m).

Key performance indicators

The Company's financial Key Performance Indicators ("KPIs") are centred on
increasing net asset value, enhancing net asset value per share, and achieving
consistent revenue growth across our portfolio. In addition to financial
metrics, the Company closely monitors non-financial KPIs, with a primary focus
on the growth in employee numbers and annual recurring revenue per
employee-both key indicators of sustainable commercial success. These
performance metrics are tracked by the Board, with detailed results outlined
below.

The return on investments

Unrealised fair value:

Wyld Networks: £3k valuation (31 December 2023: £2.4m): The equity valuation
has decreased by £2.4m solely due to the reduction in Wyld Networks' market
capitalisation to £2.4m at 31 December 2024 (a reduction in share price of
99% since 31 December 2023). Wyld Networks valuation is determined by
reference to the appropriate quoted market price at the reporting date.

Device Authority: £4.3m valuation (31 December 2023: £4.4m): The valuation
has decreased due to the sale of £0.2m of assets held in Device Authority
during the year combined with a small foreign exchange movement.

Konektio: Nil valuation (31 December 2023: Nil): The equity value of Konektio
was written off due to the company entering into administration in March 2024.

FundamentalVR: £3.6m valuation (31 December 2023: £3.6m): The valuation has
remained static.

Talking Medicines: £2.1m valuation (31 December 2023: £2.0m): The valuation
has increased due to additional funding provided to the company of £0.1m via
CLN which was outstanding at the year end.

DiffusionData: £0.02m valuation (31 December 2023: £0.02m): The investment
is valued at fair value with the price of the most recent valuation taken into
account;

SVV2: £0.7m valuation (31 December 2023: £0.3m): The investment is valued at
fair value at the value provided by the SVVUK fund. The fair value increase of
£0.4m was made up of £0.5m of additional investment, offset by £0.1m
decrease in fair value as provided by the fund.

The global downturn in technology company valuations and multiples applied to
early-stage businesses was taken into consideration when assessing the fair
value of the portfolio.

The net assets of the Company at 31 December 2024 showed a reduction of £1.6m
to £10.7m (31 December 2023:

£12.3m). The net asset value per ordinary share as at 31 December 2024
decreased by 1.2p to 2.0p (31 December 2023: 3.2p).

The year-on-year unaudited annual recurring revenue ("ARR") of our key
portfolio companies (excluding Konektio) decreased by 7% from 2023 to 2024
(increase of 33% from 2022 to 2023 (excluding Konektio)). This was primarily
as a result of a number of expected revenue opportunities moving from 2024
into 2025.

The Company regularly monitors non-financial Key Performance Indicators (KPIs)
as part of its strategic oversight. These KPIs primarily focus on the growth
in employee numbers within our portfolio and annual recurring revenue (ARR)
per employee. We believe these metrics serve as key leading indicators of
future performance and reflect our broader impact on stakeholders.

Employees in our key portfolio companies (excluding Konektio) decreased by 45%
from 2023 to 2024 (decrease of 11% from 2022 to 2023 (excluding Konektio)),
however this decrease was greater than the decrease in the ARR such that the
ARR per employee increased by 69% from 2023 to 2024 (increase of 50% from 2022
to 2023 (excluding Konektio)).  The decrease in aggregate employee numbers
was primarily as a result of the reduction in headcount at FundamentalVR as
they utilised third party tools, reducing the need for inhouse capability. The
Device Authority and Talking Medicines teams were stable during the year.

Investing Policy

Tern's investment policy is to invest principally, but not exclusively, in the
information technology sector within Europe. The Directors believe that the
Company can invest in and acquire information technology businesses, improve
them by a combination of new management and investment, and realise the value
created which will be returned to shareholders. The Company may be either an
active investor and acquire control of a single company or it may acquire
non-controlling shareholdings. Once a target has been identified, additional
funds may need to be raised by the Company to complete a transaction.

 

The Directors see IT as having considerable growth potential for the
foreseeable future and many of the prospects they have identified are in this
sector. The Company has invested in six investee companies, four of which
comprise the principal portfolio companies and the Directors believe there are
further opportunities to invest in and acquire established IT businesses which
have good technology, marquee customers and could better exploit their assets
with the injection of experienced management and new funds with the intention
of creating value for shareholders.

 

Although the main focus of the investment policy has been on the exploitation
of IT businesses, which the Directors intend to continue; this will not
preclude the Company from considering an investment in suitable projects in
other sectors where the Directors believe that there are high-growth
opportunities.

 

The Directors believe the main driver of success for the Company is the
expertise that can be provided by the Directors to the management involved in
its investee companies and the value creation that the team of people is
capable of realising. The Company is, and intends to continue to be, an active
investor. Accordingly, it has sought and may seek in future investments,
representation on the board of investee companies.

 

The new capital available to the Company will be used to support and assist
its investee companies to grow, where appropriate, and used to locate,
evaluate and select investment opportunities that offer satisfactory potential
capital returns for shareholders. The Company may require further funds in
order to invest further in its principal portfolio companies and take up these
opportunities. It is the intention of the Directors to undertake further
fundraising if such an opportunity should arise. The Company's investments may
take the form of equity, debt, or convertible instruments. Investments may be
made in all types of assets falling within the remit of the Investing Policy
and there will be no investment restrictions.

 

The Directors may consider it appropriate to take an equity interest in any
proposed investment which may range from a minority position to 100 percent
ownership. Proposed investments may be made in either quoted or unquoted
companies and structured as a direct acquisition, joint venture or as a direct
interest in a project.

The Company has made investments and will seek further investment
opportunities that can be developed through the investment of capital or where
part of or all of the consideration could be satisfied by the issue of new
Ordinary Shares or other securities in the Company. The investments the
Company has made and any new opportunities have, or would generally have, some
or all of the following characteristics, namely:

·      a majority of their revenue derived from IT or the use of IT, and
strongly positioned to benefit from market growth;

·      a trading history which reflects past profitability or potential
for significant capital growth going forward; and

·      where all or part of the consideration could be satisfied by the
issue of new Ordinary Shares or other securities in the Company.

 

The Company will identify and assess potential investment targets and where it
believes further investigation is required, intends to appoint appropriately
qualified advisers to assist.

 

The Company proposes to carry out a comprehensive and thorough project review
process in which all material aspects of any potential investment will be
subject to rigorous due diligence, as appropriate. It is likely that the
Company's financial resources will be invested in a small number of projects
or investments.

 

The Tern's investing policy is also available on the Company's website.

 

Portfolio Companies and Holdings as at 31 December 2024

Device Authority Limited ("DA" or "Device Authority")

Valuation: £4.3m (31 December 2023: £4.4m)

Equity ownership: 25.3% (before any dilution on exercise of share options)

Device Authority, a recognised global leader in Identity and Access Management
(IAM) for the Internet of Things (IoT), has continued to build strong business
momentum in 2024.

At the core of its success are the company's flagship solutions-KeyScaler®
and KeyScaler Edge®-which provide comprehensive, end-to-end security
lifecycle management across the Edge-to-Enterprise continuum. These solutions
integrate seamlessly with leading IoT cloud platforms including Microsoft
Azure, Avnet IoTConnect, AWS, PTC ThingWorx, and Google Cloud, enabling
robust, scalable security for both new and legacy IoT deployments.

Device Authority is seeking to shape the future of connected systems through
automated Zero Trust security at scale. As a global IAM leader for Enterprise
IoT, the company serves critical industries such as Industrial, Automotive,
Healthcare, and Critical Infrastructure.

The company's KeyScaler-as-a-Service (KSaaS®) platform empowers organisations
to minimise risk, reduce human error, and accelerate incident response,
allowing organisations to establish trust in every device and data
transaction. With the addition of KeyScaler AI, Device Authority now also
enables secure and trusted AI in any connected environment.

This cloud-first, automation-driven approach has fuelled a strong start to the
year, with new blue-chip customers onboarded and multiple enterprise-level
Proof of Concept and pilot initiatives underway. Enterprises are increasingly
choosing Device Authority for its cost-effective scalability and rapid
automation-capable of authenticating, certifying, and registering devices in
under 10 seconds, 60 times faster than manual methods.

Device Authority's expanding partner ecosystem remains a strategic focus, with
new collaborations including PlaxidityX (formerly Argus) and CyberArk,
alongside a deepening partnership with Microsoft, which named Device Authority
as a key component of its next-generation automotive and mobility security
initiative.

The company's innovation and leadership have earned widespread industry
recognition, including:

·      IoThinkTank's IoT Security Product of the Year

·      IoT HealthTech Innovation Award

·      IoTSF's IoT Security Champion Award

Additionally, Device Authority has been named a Leader in the Quadrant
Knowledge Solutions Spark Matrix for IoT IAM for the fifth consecutive year,
achieving the highest ranking in Technology Excellence.

FVRVS Limited ("FundamentalVR")

Valuation: £3.6m (31 December 2023: £3.6m)

Equity ownership: 10.3% (before any dilution on exercise of share options)

FundamentalVR is a pioneering platform at the intersection of virtual reality,
haptics, and data analytics, led by surgical education experts and top
technologists. With a mission to revolutionise global surgical education, the
company is making high-fidelity simulation both accessible and affordable,
equipping medical professionals worldwide with state-of-the-art training
tools.

The platform utilises widely available VR hardware-such as Meta's Oculus
Quest-and integrates advanced haptics technology to deliver a highly
realistic, tactile simulation experience. Designed to operate seamlessly on
standard computing systems, FundamentalVR provides surgeons with immersive,
hands-on practice that closely mirrors real-life procedures, significantly
enhancing preparedness and patient outcomes.

The platform's impact is supported by recent findings published in the Journal
of Robotic Surgery, which highlighted the benefits of immersive VR training.
The study reported positive outcomes when trainees used the FVR's system in an
operating room setting with CMR Surgical's Versius robot-a long-standing
FundamentalVR partner.

In 2024, FundamentalVR expanded its influence in the medical device sector
through strategic partnerships and product innovation. The integration of the
platform with Apple Vision Pro and Logitech's Stylus MX INK has further
strengthened its leadership in immersive training and spatial computing. These
advancements have not only enhanced the realism of the simulation experience
but also solidified the platform's position as an industry frontrunner.

Continuing its commitment to innovation, the company is also investing in
Generative AI. It recently introduced Maia, a virtual AI-powered tutor
embedded in the Fundamental Surgery Immersive VR Platform, designed to guide
and support learners throughout their training journey. Maia marks a
significant leap forward in personalised, adaptive surgical education.

With its award-winning technology, growing recognition, and focus on
cutting-edge innovation, FundamentalVR is setting a new standard in surgical
training for the digital age.

Talking Medicines Limited ("Talking Medicines")

Valuation: £2.1m (31 December 2023: £2.0m)

Equity ownership: 23.8% (before any dilution on exercise of share options)

Talking Medicines, a pioneering force in healthcare intelligence powered by
Advanced Data Science and Artificial Intelligence, demonstrated significant
progress in the first half of 2024 through the growing success of its flagship
interface, Drug-GPT. Headquartered in Glasgow, the company continues to expand
its commercial footprint in the U.S., with a growing presence across New
Jersey, New York, and Philadelphia.

Drug-GPT has attracted considerable attention and revenue from leading global
healthcare advertising agencies, which recognise its potential to
revolutionise pharmaceutical marketing strategies. With U.S. pharmaceutical
companies spending more than $30 billion annually on drug marketing, the
appetite for transformative tools is strong-particularly amid 2024's trends,
including the industry shifting toward personalised medicine and the rapid
adoption of Generative AI. These changes are driving a departure from outdated
insight methods, such as focus groups, toward AI-powered platforms capable of
delivering targeted, high-quality intelligence at scale.

Offering a validated 80% uplift in productivity, Drug-GPT significantly
enhances efficiency in data curation and strategic insight generation. By
aggregating and interpreting conversations from patients and healthcare
professionals, the platform unlocks previously inaccessible data insights,
enabling pharmaceutical clients to make better-informed, data-driven
decisions.

Talking Medicines works with some of the world's largest healthcare ad agency
networks, underscoring the value and credibility of Drug-GPT. The company
continues to both onboard new clients and expand its footprint within existing
partnerships, fueling the steady growth of its U.S. client base, with further
expansion anticipated through the remainder of 2025.

Strategic partnerships remain central to Talking Medicines' success-both in
sourcing raw data from health data communities and in deepening collaboration
with clients seeking competitive advantages in an evolving landscape. Drug-GPT
is continuously evolving, guided by the company's in-house data science team.

As part of its commitment to advancing industry understanding, Talking
Medicines continues to contribute to academic discourse, most recently
publishing a comparative study on patient language across therapeutic domains.
These ongoing R&D efforts not only enrich the company's scientific
credibility but also strengthen the intellectual property moat around its
proprietary use of AI and data science in healthcare.

Looking ahead, Talking Medicines remains focused on expanding its customer
base and U.S. market leadership, with ambitions to become the go-to partner
for patient and healthcare practitioner intelligence. The company's management
believes upcoming enhancements to Drug-GPT will continue to excite and engage
clients, reinforcing its position as a preferred provider for AI-powered
healthcare marketing intelligence.

Sure Valley Ventures Enterprise Capital LP ("SVV2")

Valuation: £0.3m (31 December 2023: £0.1m)

Equity ownership: 6.1%

SVV2 is a leading venture capital fund investing in a diverse range of private
UK software companies, with a strong focus on the rapidly growing immersive
technology and metaverse sectors. Its portfolio includes ventures specialising
in augmented and virtual reality, artificial intelligence, and cybersecurity.

SVV2's investment journey began with a £1m investment in RETìníZE Limited
in March 2022, followed by a £500k follow-on investment in this company in
2024. In November 2022, the Fund invested £1.05m in Jaid (Opsmatix Limited),
later adding £800k in tranches. September 2023 saw a £1.5m investment in
Captur, an AI-driven workflow automation firm. In 2024, SVV2 made five new
investments: £750k in Vortex IQ (June), £650k in Ittybit (June),

£1m in Phinxt Robotics (July), £1.5m in Purple Transform and £500k in
Stylus Education (both August), and £1m in Vizgard (December), with £500k
funded upfront and an option for another £500k investment.

Looking ahead, 2025 is set to be SVV2's largest deployment year yet, targeting
6-8 new investments and further portfolio expansions, with drawdowns of 15-20%
of SVV2.

 

Diffusiondata (previously Push Technology)

Valuation: £0.02m (31 December 2023: £0.02m)

Equity ownership: <1%

DiffusionData enhances organisations' ability to facilitate real-time
communication, extending beyond direct interactions to include automatic data
updates across various channels. Its technology ensures that displayed
information refreshes instantly-without user intervention-enabling seamless,
dynamic experiences.

 

This real-time responsiveness is crucial for interactive applications, making
them more engaging and efficient as they automatically adapt to new data the
moment it becomes available.

 

 

Wyld Networks AB (publ) ("Wyld Networks" or "Wyld")

Valuation: £0.003m (31 December 2023: £2.4m)

Holding: 0.6%

Wyld Networks, listed on the NASDAQ First North Growth Market in Stockholm, is
seeking to transform global connectivity by delivering affordable wireless
solutions in regions where conventional coverage is unavailable or congested.
Specialising in satellite-based IoT communications, the company's flagship
solution, Wyld Connect, enables seamless data transmission between IoT sensors
and low Earth orbit (LEO) satellites via compact terminals and modules.

Wyld Networks achieved continued customer acquisition growth and marked a
significant milestone with the commercial launch of its L-Band product. This
development is key to delivering truly global IoT connectivity, expanding the
company's service capabilities to even more remote and underserved locations.

Wyld successfully launched a satellite-enabled IoT tracker, aimed initially at
tracking moving assets-a valuable solution for sectors such as logistics,
agriculture, and conservation.

Wyld also secured several strategic partnerships and deployments:

·    In Brazil, the company partnered with GeoApis to monitor bee colonies
using LEO satellite connectivity, aiming to enhance pollination efficiency,
sustainability, and crop yields.

·    With SugaROx, a UK-based innovator in biostimulants, Wyld is
supporting agricultural productivity and climate resilience in Brazil through
enhanced field monitoring.

·    In the UK, Wyld entered into a collaboration with Harper Adams
University, a leading institution in agriculture and environmental sciences,
to deliver soil moisture data for cabbage crops across its 550-hectare
research facility in Shropshire.

Additionally, Wyld forged a key partnership with Actility, a global leader in
IoT connectivity platforms. This collaboration integrates Wyld's satellite
capabilities with ThingPark Exchange, Actility's premier LoRaWAN® peering
hub, enabling broader interoperability and global scalability for IoT
applications.

From a commercial standpoint, Wyld Networks has concentrated efforts in South
America, North America, Africa, and the Middle East, and has recently
initiated expansion into the Asia-Pacific region, starting with Australia.

Wyld experienced financial difficulties during the year and was forced to
raise additional funds, via a rights issue, under what the Board considered to
be unfavorable terms. This rights issue involved issuing a large number of new
shares at a low price, which significantly diluted the value of existing
shares. Tern chose not to participate in the funding rights issue, which led
to a substantial reduction in its ownership stake. The highly dilutive nature
of the equity issue caused Wyld's share price to fall sharply, and it has
remained depressed since.

Availability of Annual Report

 

The annual report for the year ended 31 December 2024 will shortly be
available from the Company's website https://www.ternplc.com/investors
(https://www.ternplc.com/investors)  and will shortly be posted to
shareholders.

 

Details of the Company's 2025 Annual General Meeting will be announced
separately.

Enquiries

 Tern Plc                                                       via IFC Advisory

 Ian Ritchie (Chairman)

 Allenby Capital Limited                                        Tel: 0203 328 5656

 (Nominated Adviser and Broker)

 Alex Brearley / Dan Dearden-Williams (Corporate Finance)

 Kelly Gardiner / Guy McDougall (Sales and Corporate Broking)

 IFC Advisory                                                   Tel: 0203 934 6630

 (Financial PR and IR)                                          tern@investor-focus.co.uk

 Tim Metcalfe

 Graham Herring

 Florence Chandler

 

 

Income Statement and Statement of Comprehensive Income

For the year ended 31 December 2024

                                                              2024         2023

                                                              £            £
 Fee income                                                   17,402       199,233
 Movement in fair value of investments                        (2,459,981)  (11,046,575)

 Profit on disposal                                           (13,374)     28,589
 Total investment loss                                        (2,455,953)  (10,818,753)
 Administration costs                                         (1,197,146)  (1,711,892)
 Other expenses                                               (65,932)     (194,317)
 Movement in fair value of derivative financial instrument    (83,270)     35,749
 Operating loss                                               (3,802,301)  (12,689,213)
 Finance income                                               30,281       81,083
 Loss before tax                                              (3,772,020)  (12,608,130)
 Tax                                                          -            -
 Loss and total comprehensive income for the period           (3,772,020)  (12,608,130)

 

Since there is no other comprehensive income, the loss for the year is the
same as the total comprehensive income for the year.

 

LOSS PER SHARE:

 Basic loss per share    (0.86) pence  (3.24) pence
 Diluted loss per share  (0.86) pence  (3.24) pence

 

Statement of Financial Position

As at 31 December 2024

 ASSETS                              2024          2023

 NON--CURRENT ASSETS                 £             £

 Investments                         10,739,631    12,778,617
  TOTAL NON--CURRENT ASSETS          10,739,631    12,778,617

 CURRENT ASSETS
 Trade and other receivables         184,908       73,533
 Cash and cash equivalents           382,213       297,565
  TOTAL CURRENT ASSETS               567,121       371,098
 TOTAL ASSETS                        11,306,752    13,149,715
 EQUITY AND LIABILITIES
 Share capital                       1,406,566     1,379,503
 Share premium                       35,540,884    33,390,997
 Retained earnings                   (26,238,315)  (22,469,224)
  TOTAL EQUITY                       10,709,135    12,301,276
 CURRENT LIABILITIES
 Trade and other payables            436,503       325,379
 Short Term Loan                     161,114       418,205
 Derivative Financial Instruments    -             104,855
 TOTAL CURRENT LIABILITIES           597,617       848,439
 TOTAL LIABILITIES                   597,617       848,439
 TOTAL EQUITY AND LIABILITIES        11,306,752    13,149,715

 

 

Statement of Changes in Equity

For the year ended 31 December 2024

 

 For the year ended 31 December 2020  Share capital                   Share premium  Retained earnings  Total equity

                                      £                               £              £                  £
 Balance at 31 December 2022          1,379,282                       33,341,218     (9,868,199)        25,852,301
 Total comprehensive income                                -          -              (12,608,130)       (12,608,130)
 Transactions with owners
 Issue of share capital                                    221        49,779         -                  50,000
 Share based payment charge (options)                      -          -              7,105              7,105
 Balance at 31 December 2023                               1,379,503  33,390,997     (22,469,224)       12,301,276
 Total comprehensive income                                -          -              (3,772,020)        (3,772,020)
 Transactions with owners
 Issue of share capital                                    27,063     2,260,587      -                  2,287,650
 Share issue costs                                         -          (110,700)      -                  (110,700)
 Share based payment charge (options)                      -          -              2,929              2,929
 Balance at 31 December 2024                               1,406,566  35,540,884     (26,238,315)       10,709,135

 

Statement of Cash Flows

For the year ended 31 December 2024

 

 
                                                   2024         2023

                                                   £            £
 OPERATING ACTIVITIES
 Net cash used in operations                       (1,068,970)  (1,372,647)
 Purchase of investments                           (656,815)    (1,382,994)
 Cash received from sale of investments            250,429      1,534,913
 Loans to portfolio companies                      (95,000)     136,389
 Interest received                                 26           18,600
 Net cash used in operating activities             (1,570,330)  (1,065,739)
 FINANCING ACTIVITIES
 Proceeds on issues of shares                      2,099,524    -
 Share issue expenses                              (110,700)    -
 Loan receipt                                      -            500,000
 Loan repayment                                    (333,846)    (68,461)
 Net cash from financing activities                1,654,978    431,539
 (Decrease) in cash and cash equivalents           (84,648)     (634,200)
 Cash and cash equivalents at beginning of year    297,565      931,765
 Cash and cash equivalents at end of year          382,213      297,565

 

 

Notes

1. BASIS OF PREPARATION

 

The financial information set out in the announcement does not constitute the
Company's statutory accounts for the years ended 31 December 2024 or 2023.
The financial information for the year ended 31 December 2023 is derived from
the statutory accounts for that year, which were prepared under UK adopted
international financial reporting standards, and which have been delivered to
the Registrar of Companies.  The auditor's report on those accounts was
unqualified, did not contain a statement under either Section 498(2) or
Section 498(3) of the Companies Act 2006.

 

The financial information for the year ended 31 December 2024 is derived from
the audited statutory accounts for the year ended 31 December 2024 on which
the auditors have given an unqualified report, that did not contain a
statement under section 498(2) or 498(3) of the Companies Act 2006 and drew
attention, by way of emphasis, to the material uncertainty related to going
concern described in note 1.1 below. The statutory accounts will be delivered
to the Registrar of Companies following the Company's annual general meeting.

 

The financial statements of the Company have been prepared in accordance with
UK-adopted international accounting standards.  The financial statements have
been prepared on the basis of the recognition and measurement principles of
the UK adopted international financial reporting standards that were
applicable at 31 December 2024. The accounting policies are consistent with
those applied in the preparation of the interim results for the period ended
30 June 2024. The accounting policies are also consistent with the statutory
accounts for the year ended 31 December 2023.

 

The preparation of financial statements in conformity with generally accepted
accounting principles requires the use of estimates and assumptions that
affect the reported amounts of assets and liabilities at the date of the
financial statements and the reported amounts of revenues and expenses during
the reporting period. Although these estimates are based on management's best
knowledge of the amount, event or actions, actual results may ultimately
differ from those estimates.

 

In accordance with IFRS 10, para 4 the Directors consider the Company to be an
investment company and has taken the exemption not to present consolidated
financial statements or apply IFRS3 when it obtains control of another entity
as it is an investing company that measures all of its investments at fair
value through the income statement in accordance with IFRS 9.

1.1 GOING CONCERN

 

The Company's financial statements have been prepared on a going concern
basis, with the Board assessing its cash flow, liquidity, and prospects. The
Directors believe this is appropriate based on four key factors: anticipated
shareholder support for future equity raises, confidence in generating cash
through asset sales (as demonstrated in 2024), potential access to additional
debt funding, and expected dividend income from Sure Ventures plc.

 

However, the Directors acknowledge material uncertainty remains, as continued
operations depend on successful fundraising, asset realisations, and income
from investments, or a combination of all three -factors that are partly
beyond the Company's control. If these efforts are unsuccessful, the Company
may be forced to sell assets at reduced values or accept unfavourable loan
terms. There is no certainty that such funding will be available and/or the
terms of such funding. These conditions are necessarily considered to
represent a material uncertainty which may cast significant doubt over the
Company's ability to continue as a going concern. Whilst acknowledging this
uncertainty, the Directors remain confident that the Company will be able to
generate sufficient cash flow within a reasonable time when required,
therefore the Directors consider it appropriate to prepare the financial
statements on a going concern basis. The financial statements do not include
the adjustments that would result if the Company was unable to continue as a
going concern. A detailed explanation of the factors determining the
appropriateness of the preparation of the financial statements on the going
concern basis is detailed in the Directors Report in the annual report for the
year ended 31 December 2024.

 

2.    FAIR VALUE MEASUREMENT

 

For Level 1 investments; publicly traded portfolio companies, the fair value
was determined by reference to the appropriate quoted market price at the
reporting date.

 

For Level 2 investments; private company portfolio companies, the fair value
assessment was made by the directors using the price of the shares in the most
recent fundraise, where this was available, as well as an assessment of market
valuations placed on comparable businesses, a review of the underlying asset
values and a review of the sales pipeline and forecast to support any
valuation applied.

 

For Level 3 investments; private company portfolio companies without a recent
fundraise, the fair value assessment was made by directors using a variety of
unobservable inputs to estimate the fair value at the reporting date.

 

NON-CURRENT ASSETS

INVESTMENTS

                                            2024         2023

                                            £            £
 Fair value of investments brought forward  12,778,617   23,881,769
 Interest accrued on convertible loan note  27,952       66,754
 Additions                                  656,846      1,382,994
 Disposals                                  (263,803)    (1,506,325)
 Fair value of investments carried forward  13,199,612   23,825,192
 Fair value adjustment to investments       (2,459,981)  (11,046,575)
 Fair value of investments carried forward  10,739,631   12,778,617

 

 

                                             Cost    Valuation  Equity ownership
                                             £000    £000       %
 Device Authority Limited                    9,305   4,276      25.3
 FVRVS Limited (FundamentalVR)               2,928   3,630      10.3
 Talking Medicines Limited                   1,547   2,120      23.8
 Sure Valley Ventures Enterprise Capital LP  996     688        6.1
 Diffusiondata Limited                       120     23         <1
 Wyld Networks AB                            2,332   3          <1
 InVMA Limited (Konektio)                    2,267   -          8.8
                                             19,495  10,740

 

The convertible loan facility issued to Talking Medicines is a financial asset
with multiple derivatives and the entire contract has been designated at
FVTPL, with any movement in fair value taken to profit or loss for the year.
As at 31 December 2024, the principal of the convertible loan outstanding was
£287,500 (2023: £187,500).

3. LOSS PER SHARE

                                                                    2020          2019

                                                                    £             £
                                                                    2024          2023

                                                                    £             £
 Loss for the purposes of basic and fully diluted profit per share  (3,772,020)   (12,608,130)
                                                                    2024          2023
                                                                    Number        Number
 Weighted average number of ordinary shares:
 For calculation of basic earnings per share                        437,148,474   389,182,934
 For calculation of fully diluted earnings per share                437,148,474   389,182,934
                                                                    2024          2023
 Loss per share:
 Basic loss per share                                               (0.86) pence  (3.24) pence

 Diluted loss per share                                             (0.86) pence  (3.24) pence

In 2024 and 2023 the fully diluted loss per share is the same as the basic
loss per share as the share options were underwater which would have an
anti-dilutive effect on loss per share.

4. POSTING OF ANNUAL REPORT

 

The annual report for the year ended 31 December 2024 will shortly be
available from the Company's website (https://www.ternplc.com/investors
(https://www.ternplc.com/investors) ) and will be posted to shareholders.

 

 

 

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