Belluscura
plc
("Belluscura" or the
"Company" or "Group")
Unaudited Interim Results
for the six months to 30 June 2024
LONDON, U.K. AND PLANO, TX, U.S. (26 September
2024). Belluscura plc (AIM:BELL), a
leading medical device developer focused on lightweight and
portable oxygen enrichment technology, announces its Unaudited
Interim Results for the six months to 30 June 2024.
Financial Headlines
· Revenue of $1.35 million up 264% (2023 H1: $0.37m; 2023:
$0.83m)
· Product Gross Profit of $0.51m (2023 H1: Loss $0.06m; 2023:
Loss $0.07m)
· Adjusted EBITDA** Loss of $3.5m (2023 H1: $2.9m; 2023:
$6.3m)
· Loss
before tax of $6.5m (2023 H1: $6.4m; 2023: $18.5m)
· Basic loss per share of $0.041 (2023 H1: $0.052; 2023:
$0.142)
· Net
Cash as at 30 June 2024 of $0.9m (31 December 2023:
$0.9m)
· Convertible Loan Note and Share issues raised £1.92m post 30
June 2024
· Completed the acquisition of TMT Acquisition plc
Current trading and outlook:
· Sales continue to grow and with (unaudited) Q3 sales of
$1.6m, 20% up on H1 2024 and 40% up on Q2 2024.
· Strong sales to continue with the broader market acceptance
of the X-PLOR® and the upcoming full release of its new patented
DISCOV-R™ device.
· Demand for the new DISCOV-R™ portable oxygen concentrator,
introduced to US market via a soft launch in June 2024, has
been strong with every DISCOV-R™ unit manufactured in Q3 being
sold. Full commercial launch of the DISCOV-R™ remains planned for
the middle of Q4.
· Q4
sales target of $4.0m subject to timely receipt of Pricing Data
Analysis and Coding (PDAC) codes to enable Durable Medical
Equipment (DME) distributers to claim reimbursement from Medicare
for sales of DISCOV-R and for the Company to finalise appropriate
debt-based funding and invoice discounting to meet increasing
working capital requirement arising from sales growth.
Robert Rauker, CEO, Belluscura plc,
commented:
"We are delighted with the growth
in sales and distribution over the past nine months for both the
X-PLOR® and DISCOV-R™ portable oxygen concentrators. Whilst it has
taken time to bring both products to market, and we are grateful
for the patience of our shareholders, we now have two leading
lightweight portable oxygen enrichment concentrators that meet the
stringent requirements of the FDA, with the full commercial launch
of DISCOV-R™ coming later in the year. We look forward to the
remainder of 2024 and into 2025 with a real sense of
confidence."
**Adjusted EBITDA excludes;
Foreign exchange translation differences along with unrealised and
unrealised foreign exchange movements, depreciation and
amortisation of product development, costs relating to fundraising
activities, surrendered share options and share option taxes,
minimum royalties in excess of sales royalties, share based
payments, obsolete 1st generation X-PLOR inventory adjustments and
contract manufacturer capacity costs.
For further information please
contact:
|
Belluscura plc
|
Tel: +44
(0)20 3128 8100
|
|
Adam Reynolds, Chairman
|
|
|
Robert Rauker, Chief Executive
Officer
|
|
|
Simon Neicheril, Chief Financial
Officer
|
|
|
|
|
|
|
|
|
SPARK Advisory Partners
Limited - Nominated Adviser
|
Tel: +44
(0)20 3368 3550
|
|
Neil Baldwin / Jade
Bayat
|
|
|
|
|
|
|
|
|
Dowgate Capital Limited -
Broker
|
Tel: +44
(0)20 3903 7715
|
|
Russell Cook / Nicholas
Chambers
|
|
|
|
|
|
|
|
|
MHP Group - Financial PR
& Investor Relations
|
Tel: +44
(0)20 3128 8100
|
|
Katie Hunt / Matthew
Taylor
|
email: Belluscura@mhpgroup.com
|
CHAIRMAN & CHIEF EXECTUTIVE'S
STATEMENT
We are pleased to present our
Interim Results covering a period in which Belluscura has made
significant progress.
Sales continue to grow with Q3
sales of $1.6m, 20% up on H1 2024 and 40% up on Q2 2024.
The Company expects strong sales
to continue with the broader market acceptance of the X-PLOR® and
the upcoming full release of its new patented DISCOV-R™
device.
Demand for the new DISCOV-R™
portable oxygen concentrator, which was introduced to the US market
via a soft launch in June 2024, has been strong, with every
unit manufactured in Q3 being sold.
The DISCOV-R™ weighs a little over
6 pounds (2.75kg), provides fifty percent (50%) more oxygen than
the leading oxygen concentrator and produces more oxygen by weight
than any portable oxygen concentrator on the market. The full
commercial launch of the DISCOV-R™ remains planned for the middle
of Q4.
Financial Review
Revenue for the period was $1.35 m
(2023 H1: $0.37m; FY 2023: $0.83m), an increase of 264% on the same
period last year. The Group made a Product Gross Profit in the
period $0.51m (2023 H1: Loss $0.05m; FY 2023: Loss:
$0.07m).
We saw operating cost increases in
staffing, up from $1.6m to $1.8m, marketing spend, up from $0.3m to
$0.8m in Direct to Consumer advertising and other admin expenses up
from $0.9m to $1.1m. This was largely counteracted by a positive FX
benefit of $350k (previously loss $2.2m).
Non-recurring items include
restricting costs of $120k and impairment charge of $1.5m on the
TMT acquisition.
Operating Loss for the period was
$6.0m (2023 H1: $6.2m; FY2023: $17.7m). Total Comprehensive Loss
was $6.8m (2023 H1: $4.4m; FY 2023: $16.3m).
Adjusted EBITDA Loss of $3.5m
(2023 H1: $2.9m; FY 2023: $6.3m), (See note 16). The Board considers
that Adjusted EBITDA to be an important key performance indicator,
reflecting underlying business performance.
The basic and diluted loss per
share was $0.041 (2023 H1: $0.052; FY 2023: $0.142).
The Group net assets at the end of
the period were $18.6m (2023 H1: $25.2m; FY 2023: $17.7m). This
comprised total assets of $21.2m (2023 H1: $27.2m; FY 2023: $0.8m)
and total liabilities of $2.6m (2023 H1: $2.0m; FY 2023:
$3.1m).
The total assets included
intangible assets (capitalised research and development costs),
property, plant and equipment and right-of-use assets of $12.0m
(2023 H1: $10.6m; FY 2023: $12.3m).
At the end of the period the Group
had net cash of $0.9m (2023 H1: $3.8m; FY 2023: $0.9m). Post period
end, £1.92m was raised via a CLN/share issue.
During the period:
· Net
cash inflow from funds raised in the period was $5.6m (2023 H1:
$7.1m; FY 2023: $12.5m).
· Net
cash outflow from operating activities was $4.1m (2023 H1: $4.9m;
FY 2023: $9.1m).
· Net
cash used in investing activities was $1.6m (2023 H1: $2.2m; FY
2023: $4.5m).
Outlook
We are delighted with the growth
in sales and distribution over the past nine months for both the
X-PLOR® and DISCOV-R™ portable oxygen concentrators.
Furthermore, we are thankful for
our shareholders' understanding during the
development process for both products, which has taken time.
Following this, we now have two premier lightweight portable oxygen
enrichment concentrators that satisfy the strict criteria of the
FDA and are excited about the forthcoming full commercial launch of
DISCOV-R™ in Q4.
Q4 sales are expected to be not
less than $4M. However, delivery of these sales will be
dependent upon two key factors:
· Timely receipt of Pricing Data Analysis and Coding (PDAC)
codes that allow Durable Medical Equipment (DME) distributers to
claim reimbursement from Medicare for sales of DISCOV-R to
patients.
· Finalising further funding facilities to meet the significant
increase in working capital requirements resulting from the
anticipated strong Q4 sales demand in order for DISCOV-R. The
Company has received several debt proposals and is evaluating and
in discussion with prospective lenders to arrive at the optimal
funding instruments, which are expected to be a combination of debt
and invoice discounting.
We look forward to the remainder
of 2024 and into 2025 with a real sense of
confidence."
Adam
Reynolds
Robert Rauker
Chairman
Chief Executive Officer
26 September 2024
CONDENSED CONSOLIDATED STATEMENT OF PROFIT & LOSS AND OTHER
COMPREHENSIVE INCOME
|
Group
|
|
|
Unaudited 6 months to
30/06/2024
|
Unaudited 6 months to 30/06/2023
|
Audited
12 months to 31/12/2023
|
|
|
|
Note
|
|
US $
|
US
$
|
US
$
|
|
|
Continuing Operations
|
|
|
|
|
|
|
|
Revenue
|
5
|
|
1,345,757
|
366,221
|
825,409
|
|
|
Cost of sales
|
|
|
(839,064)
|
(421,994)
|
(890,497)
|
|
|
Product Gross Profit/(Loss)
|
|
|
506,693
|
(55,773)
|
(65,088)
|
|
|
|
|
|
|
|
|
|
|
Inventory Impairments and
Adjustments
|
|
|
(33,787)
|
(109,185)
|
(4,138,030)
|
|
|
Gross Profit (Loss)
|
|
|
472,906
|
(164,958)
|
(4,203,118)
|
|
|
|
|
|
|
|
|
|
|
Other operating income
|
6.1
|
|
15,335
|
9,864
|
33,942
|
|
|
Other direct costs
|
6.2
|
|
(163,188)
|
(66,503)
|
(103,991)
|
|
|
Administrative expenses
|
6.3
|
|
(6,352,277)
|
(5,971,272)
|
(13,418,554)
|
|
|
Operating Loss
|
|
|
(6,027,224)
|
(6,192,869)
|
(17,691,721)
|
|
|
|
|
|
|
|
|
|
|
Finance income
|
7
|
|
396
|
28
|
2,127
|
|
|
Finance Costs
|
|
|
(478,827)
|
(226,291)
|
(828,025)
|
|
|
Loss before income tax
|
|
|
(6,505,655)
|
(6,419,132)
|
(18,517,619)
|
|
|
|
|
|
|
|
|
|
|
Income tax expense
|
8
|
|
-
|
-
|
-
|
|
|
Loss after tax for the period
|
|
|
(6,505,655)
|
(6,419,132)
|
(18,517,619)
|
|
|
|
|
|
|
|
|
|
|
Other comprehensive income
|
|
|
|
|
|
|
|
Items that are or may be reclassified subsequently to profit
or loss:
|
|
|
|
|
|
|
|
Foreign currency translation
differences - foreign operations
|
|
(279,816)
|
2,040,395
|
2,248,588
|
|
|
|
Total other comprehensive income
|
|
|
(279,816)
|
2,040,395
|
2,248,588
|
|
|
|
|
|
|
|
|
|
|
Total comprehensive loss for the period attributable to the
equity holders
|
(6,785,471)
|
(4,378,737)
|
(16,269,031)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Earnings per share
|
|
|
|
Basic: Loss per share
|
9
|
(0.041)
|
(0.052)
|
(0.142)
|
|
Diluted: Loss per share
|
9
|
(0.041)
|
(0.052)
|
(0.142)
|
|
|
|
|
|
|
|
Adjusted
EBITDA1
|
Group
|
|
|
Unaudited 6 months to
30/06/2024
|
Unaudited 6months to 30/06/2023
|
Audited
12 months to 31/12/2023
|
|
|
|
|
|
US $
|
US
$
|
US
$
|
|
|
Total comprehensive loss for the period
|
|
|
(6,785,471)
|
(4,378,737)
|
(16,269,031)
|
|
|
Add back:
|
|
|
|
|
|
|
|
Administrative expenses Realised
& unrealised FX movements in
|
|
|
(361,575)
|
2,185,856
|
2,424,237
|
|
|
Other comprehensive income FX
currency translation differences
|
|
|
282,621
|
(2,040,395)
|
(2,248,588)
|
|
|
Net foreign exchange movement2
|
|
|
(78,954)
|
145,461
|
175,649
|
|
|
|
|
|
|
|
|
|
|
Finance Income and
Costs
|
|
|
6,624
|
11,770
|
19,337
|
|
|
Accrued interest on Convertible
Loan Notes
|
|
|
471,808
|
214,493
|
806,561
|
|
|
Product development
amortisation
|
|
|
798,526
|
580,142
|
3,293,232
|
|
|
Impairment of acquisition
goodwill
|
|
|
1,478,968
|
-
|
-
|
|
|
Costs relating to fundraising
activities
|
|
|
-
|
13,567
|
92,536
|
|
|
Former CFO compensation
|
|
|
120,179
|
-
|
96,393
|
|
|
Minimum royalties in excess of
sales royalties
|
|
|
354,804
|
250,211
|
792,818
|
|
|
Contract Manufacturer Capacity
Costs
|
|
|
-
|
-
|
86,440
|
|
|
Inventory Impairment and
Adjustments
|
|
|
33,787
|
109,185
|
4,138,030
|
|
|
Accrued Bonus
|
|
|
-
|
-
|
315,000
|
|
|
Issue of share based
payments
|
|
|
104,029
|
103,948
|
163,061
|
|
|
Adjusted EBITDA
|
(3,495,700)
|
(2,949,960)
|
(6,289,974)
|
|
|
1 Reconciliation to Adjusted EBITDA
measure
Adjusted EBITDA is the Group's key adjusted profit measure.
Total comprehensive loss for the period is adjusted to exclude;
Foreign exchange translation differences along with unrealised and
unrealised foreign exchange movements, depreciation and
amortisation of product development, costs relating to fundraising
activities, surrendered share options and share option taxes,
minimum royalties in excess of sales royalties, share based
payments, obsolete 1st generation X-PLOR inventory adjustments and
contract manufacturer capacity costs.
2 Net foreign exchange
movements
£Sterling to US$ stayed broadly the same during the
period (1 January 2024 - $1.27:£1.00; 30 June
2024 - $1.27:£1.00). Due to the size of the Intercompany
Loan from the PLC to the US subsidiary which is fixed in £Sterling,
this creates an accounting presentational impact between
Administration Expenses and Other Comprehensive Income, which to a
large extent can be netted off against one another.
·
Realised FX
movements in administrative expenses arise from the revaluation of
£Sterling cash balances into US$
·
Unrealised FX
movements in administrative expenses arise from the revaluation of
the Intercompany Loan fixed in £Sterling into US$
·
Foreign
currency translation differences in Other Comprehensive Income
arise from the revaluation of the PLC balance sheet into
US$
CONDENSED CONSOLIDATED BALANCE SHEET
|
Group
|
|
Unaudited
30/06/2024
|
Unaudited
30/06/2023
|
Audited
31/12/2023
|
|
|
Note
|
US $
|
US
$
|
US
$
|
|
Assets
|
|
|
|
|
|
Non-current assets
|
|
|
|
|
|
Tangible assets
|
10
|
180,787
|
135,593
|
186,928
|
|
Product development
|
11
|
10,850,316
|
10,263,039
|
9,987,516
|
|
Other long-term
receivable
|
|
976,324
|
-
|
1,952,649
|
|
Right of use asset
|
10
|
79,762
|
193,550
|
136,887
|
|
Non-current assets
|
|
12,087,189
|
10,592,182
|
12,263,980
|
|
|
|
|
|
|
|
Current assets
|
|
|
|
|
|
Inventory
|
12
|
3,365,107
|
8,803,762
|
3,320,652
|
|
Trade and other
receivables
|
|
5,166,562
|
3,957,967
|
4,306,492
|
|
Cash and cash
equivalents
|
|
875,670
|
3,825,391
|
932,926
|
|
Current assets
|
|
9,407,339
|
16,587,120
|
8,560,070
|
|
|
|
|
|
|
|
Total assets
|
|
21,494,528
|
27,179,302
|
20,824,050
|
|
|
|
|
|
|
|
Current liabilities
|
|
|
|
|
|
Trade and other
payables
|
|
(2,891,747)
|
(1,866,633)
|
(3,070,621)
|
|
Current liabilities
|
|
(2,891,747)
|
(1,866,633)
|
(3,070,621)
|
|
|
|
|
|
|
|
Non-current liabilities
|
|
|
|
|
|
Trade and other
payables
|
|
(34,906)
|
(111,377)
|
(61,267)
|
|
Non-current liabilities
|
|
(34,906)
|
(111,377)
|
(61,267)
|
|
|
|
|
|
|
|
Total liabilities
|
|
(2,926,653)
|
(1,978,010)
|
(3,131,888)
|
|
|
|
|
|
|
|
Net assets
|
|
18,567,875
|
25,201,292
|
17,692,162
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Equity attributable to the owners of the
parent
|
|
|
|
|
|
Share capital
|
13
|
2,205,182
|
1,809,806
|
1,845,523
|
|
Share premium
|
13
|
44,250,622
|
36,859,049
|
37,494,672
|
|
Other equity
instruments
|
13
|
9,628,626
|
5,497,236
|
9,167,689
|
|
Capital contribution
|
14
|
165,000
|
165,000
|
165,000
|
|
Retained earnings
|
14
|
(35,081,567)
|
(16,625,857)
|
(28,614,934)
|
|
Share option reserve
|
14
|
(20,180)
|
-
|
(20,180)
|
|
Translation reserve
|
14
|
(2,579,808)
|
(2,503,942)
|
(2,345,608)
|
|
Total equity
|
|
18,567,875
|
25,201,292
|
17,692,162
|
NOTES TO THE INTERIM CONSOLIDATED FINANCIAL
STATEMENTS
For the period ended 30 June
2024.
1. General
Information
Belluscura plc is a public company
limited by shares incorporated in England and Wales and domiciled
in the UK. Company No. 09910883. On 28 November 2017 the Company
changed its name from Belluscura Limited to Belluscura
plc.
The principal accounting policies
applied in the preparation of these condensed interim consolidated
financial statements are set out below. These policies have been
consistently applied, unless otherwise stated.
2. Electronic
communications
Copies of this Interim Report for
the six months ended 30 June 2024 will not be sent to shareholders
unless specifically requested by individual shareholders. The Board
believes that by utilising electronic communication it delivers
savings to the Company in terms of administration, printing and
postage, and environmental benefits through reduced consumption of
paper and inks, as well as speeding up the provision of information
to shareholders.
News updates, Regulatory News and
Financial statements can be viewed and downloaded from the Group's
website,
www.belluscura.com. Copies can
also be requested from; Company Secretary, Belluscura plc, 15
Fetter Lane, London EC4A 1BW or by email:
tony.dyer@belluscura.com.
3. Accounting
Policies
These condensed consolidated
financial statements are prepared in accordance with United Kingdom
adopted International Financial Reporting Standards (IFRS) and
issued by the International Accounting Standards Board (IASB). The
consolidated financial statements are presented in US Dollars, the
Group's functional currency. The preparation of this financial
information in conformity with IFRS requires the use of certain
critical accounting estimates and consistent with the accounting
policies used in the Financial Statements for the year ended 31
December 2023.
The condensed consolidated interim
financial information for the six months ended 30 June 2024 has
been prepared in accordance with International Accounting Standard
No. 34, 'Interim Financial Reporting'. They do not include all of
the information required for full annual financial statements and
should be read in conjunction with the consolidated financial
statements of Belluscura plc "the Company" as at and for the year
ended 31 December 2023. These condensed interim financial
statements for the six months ended 30 June 2024 and 30 June 2023
are unaudited and do not constitute full accounts. The comparative
figures for the period ended 31 December 2023 are extracted from
the 2023 audited financial statements.
The independent auditor's report
on page 12 of the 2023 financial statements noted a Material
uncertainty related to going concern:
"We draw attention to note 2.1.1
of the financial statements which notes the uncertainty in the
Group's and Company's level of projected production of DISCOV-R
products and financial returns thereon following the expected
launch of the new product in Summer 2024 and the potential
consequential impact on the Group's ability to secure additional
funding. As stated in note 2.1.1, these conditions are necessarily
considered to represent a material uncertainty that may cast
significant doubt over the Group's and the Company's ability to
continue as a going concern.
Our opinion is not modified in
respect of this matter. In auditing the financial statements, we
have concluded that the Directors use of the going concern basis of
accounting in the preparation of the financial statements is
appropriate."
4. Going
concern
Commercial Background
US FDA 510(k) clearance of the
Group's X-PLOR was received on 2 March 2021 and was launched in the
US in September 2021. The Group launched the next generation X-PLOR
in October 2022 and released the DISCOV-R for Pre-Market Evaluation
in June 2023.
In March 2022, the Group
signed a manufacturing Master Supply Agreement ("MSA")
with InnoMax Medical Technology, Ltd ("InnoMax") to
manufacture our devices in China alongside US
manufacturing.
In April 2022, the Group took the
decision to transfer its US manufacturing in-house, to increase
production output at high quality standards, and achieve a
significant reduction in production costs. This was successfully
completed at the end of July 2022. The decision to bring our
US manufacturing in-house from our contract manufacturer along
with the initial support of the set-up of InnoMax manufacturing in
China, resulted in significant investment in Raw Material Inventory
and Deposits which at 31 December 2022 stood at $10.8m. The Group
has transferred Raw Materials to InnoMax for utilisation in China
manufacturing and alongside this, as anticipated, InnoMax is
beginning to directly source most of their own components, which
will progressively result in a significant margin improvement
through lower unit cost of sales and has resulted in a reduction in
the Company's inventory levels of components.
Cash at 30 June 2024 was $0.9m (30
June 2023: $3.8m; 31 December 2023: $0.9m).
Prospects and Forecasts
The Board is confident the full
commercial launch of the award winning DISCOV-R product in Q4
2024 will be transformational for the Group. Demand is
expected to be very strong because a major competitor has left the
market, the two others have larger, more bulky products, and the
small size of our product is very appealing to the customer
base. Additionally, most of the development and capital costs
for DISCOV-R have already been incurred.
At 30 June 2024 the Group had
$0.9m in cash (30 June 2023: $3.8m; 31 December 2023: $0.9m), $3.1m
in Finished Goods & Raw Material inventory and £5.2m in Current
Debtors and other Receivables.
Strong sales of X-PLOR and the
expected significant demand for the DISCOV-R, alongside the release
of working capital through the sale of goods from its existing
inventory, and capital raise in July, indicate that the Group has
sufficient cash reserves to operate within the level of its current
facilities for a period of 12 months from the date of approval of
the financial statements.
Given that projected sales and
prices may not materialize as anticipated in the Group's forecasts,
the Board continues to actively consider further fundraising and
other mitigating actions.
These conditions are necessarily
considered to represent a material uncertainty that may cast
significant doubt over the Group's and the Company's ability to
continue as a going concern.
The Group's forecasts, taking
account of reasonably possible downsides in trading performance and
development costs/timelines, and the risks to these projections
have been considered by the Board in its assessment of these
forecasts.
Based on the above, the Directors
believe it remains appropriate to prepare the financial statements
on a going concern basis.
5. Segmental
reporting
The chief operating decision makers
consider that in the period to 30 June 2024 there is only one
operating segment, being the sale of oxygen concentrators in the
United States.
The Group generated gross revenue
of $1,345,757 in the period (2023 H1: $366,221; 2023: $825,409).
All sales were in the United States.
6. Other
operating income and administrative expenses
6.1 Inventory impairments
and adjustments
|
|
Group
|
Unaudited
6 months
to
30/06/2024
US $
|
Unaudited
6 months
to
30/06/2023
US
$
|
Audited
12
months to
31/12/2023
US
$
|
|
|
Obsolete raw material inventory
and inventory adjustments
|
33,787
|
109,185
|
845,827
|
|
|
|
Impairment of Batteries
|
-
|
-
|
1,077,626
|
|
|
|
Impairment of Finished Goods
Value
|
-
|
-
|
1,888,122
|
|
|
|
Provision for 2024 RMA's ("Return
to Manufacturer Authorizations")
|
-
|
-
|
326,455
|
|
|
|
Total
|
33,787
|
109,185
|
4,138,030
|
|
|
|
|
|
|
|
|
6.1 Other operating
income
|
|
Group
|
Unaudited
6 months
to
30/06/2024
US $
|
Unaudited
6 months
to
30/06/2023
US
$
|
Audited
12
months to
31/12/2023
US
$
|
|
|
Freight Charged
|
7,308
|
9,758
|
14,795
|
|
|
|
Rent charged
|
4,300
|
-
|
19,147
|
|
|
|
Other Direct Income
|
3,727
|
106
|
-
|
|
|
|
Total
|
15,335
|
9,864
|
33,942
|
|
|
|
|
|
|
|
|
6.2 Other direct
costs
|
|
Group
|
|
Unaudited
6 months
to
30/06/2024
US $
|
Unaudited
6 months
to
30/06/2023
US
$
|
Audited
12
months to
31/12/2023
US
$
|
|
|
Sales Royalties
|
|
56,196
|
27,690
|
40,884
|
|
|
Freight Costs
|
|
106,992
|
38,813
|
63,107
|
|
|
Total
|
|
163,188
|
66,503
|
103,991
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
6.3 Expenses by
nature
|
Group
|
Unaudited
6 months
to
30/06/2024
US $
|
Unaudited
6 months
to
30/06/2023
US
$
|
Audited
12
months to
31/12/2023
US
$
|
|
|
Operating Expenses
|
|
|
|
|
|
Employee Benefit
expense
|
1,803,228
|
1,624,637
|
3,433,042
|
|
|
Sales & Marketing
|
828,919
|
274,871
|
655,229
|
|
|
Other administration
expenses
|
1,122,386
|
857,207
|
1,903,776
|
|
|
|
3,754,533
|
2,756,715
|
5,992,047
|
|
|
Depreciation & Amortisation
|
|
|
|
|
|
Depreciation of property plant and
equipment
|
32,933
|
24,281
|
49,559
|
|
|
Depreciation of right of use
asset
|
56,745
|
56,552
|
113,231
|
|
|
Amortisation of product
development
|
798,526
|
580,142
|
3,293,232
|
|
|
Impairment of TMT Goodwill (see
Note 19 below)
|
1,478,968
|
-
|
-
|
|
|
|
2,367,172
|
660,975
|
3,456,022
|
|
|
Staff Related Exceptional Costs
|
|
|
|
|
|
IFRS2 Share-based Payment
Charge
|
104,029
|
103,948
|
163,061
|
|
|
Accrued Bonus
|
-
|
-
|
315,000
|
|
|
Former CFO Compensation
|
120,179
|
-
|
96,393
|
|
|
|
224,208
|
103,948
|
574,454
|
|
|
Foreign Exchange movements in Administration
Expenses
|
|
|
|
|
|
Realised and Unrealised foreign
exchange movements
|
(348,440)
|
2,185,856
|
2,424,237
|
|
|
|
|
|
|
|
|
Other
|
|
|
|
|
|
Minimum Royalties in excess of
Sales Royalties
|
354,804
|
250,211
|
792,818
|
|
|
Costs related to fundraising
activities
|
-
|
13,567
|
92,536
|
|
|
Contract Manufacturer Capacity
Costs
|
-
|
-
|
86,440
|
|
|
|
354,804
|
263,778
|
971,794
|
|
|
Administration expenses
|
6,352,277
|
5,971,272
|
13,418,554
|
|
7.
Finance income and costs
|
Group
|
Unaudited
6 months
to
30/06/2024
US $
|
Unaudited
6 months
to
30/06/2023
US
$
|
Audited
12
months to
31/12/2023
US
$
|
|
|
Income:
|
Interest Income
|
(396)
|
(28)
|
(2,127)
|
|
|
Costs:
|
Interest cost on Right of Use
Asset
|
6,033
|
10,668
|
19,256
|
|
|
|
Accrued Interest Other Equity
Instruments
|
471,808
|
214,493
|
806,561
|
|
|
|
Other Interest Income and
Costs
|
986
|
1,130
|
2,208
|
|
|
Finance Cost
|
478,431
|
226,263
|
825,898
|
|
|
|
|
|
|
|
|
|
|
|
8. Income tax
expense
Due to the Group still being loss
making there is no tax charge in the period or previous
periods.
9 Loss
per share
|
Group
|
Unaudited
6 months
to
30/06/2024
US $
|
Unaudited
6 months
to
30/06/2023
US
$
|
Audited
12
months to
31/12/2023
US
$
|
|
|
Loss for the period
|
(6,505,655)
|
(6,419,132)
|
(8,152,985)
|
|
|
|
|
|
|
|
|
Weighted Average Shares in
Issue
|
158,709,628
|
124,216,681
|
130,395,343
|
|
|
Basic Loss per Share
US$
|
(0.041)
|
(0.052)
|
(0.142)
|
|
|
|
|
|
|
|
|
Weighted Average Shares, Warrants
and Options in Issue
|
171,328,554
|
136,357,669
|
131,949,445
|
|
|
Diluted Loss per Share
US$
|
(0.041)
|
(0.052)
|
(0.142)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Potentially dilutive items are
disregarded when calculating diluted earnings per share as they are
considered antidilutive.
10. Property, plant and
equipment
|
Group
Cost
|
Land &
buildings
(Right of Use
Asset)
US$
|
Furniture and
Equipment
US $
|
Computer
Equipment
US $
|
Production
Equipment
US $
|
Leased
Units
US$
|
Vehicles
US $
|
Total
US $
|
|
At 1 January 2023
|
645,788
|
47,821
|
84,308
|
65,025
|
-
|
33,173
|
876,115
|
|
Additions during the
period
|
-
|
-
|
-
|
6,841
|
-
|
-
|
6,841
|
|
FX revaluation
|
-
|
-
|
-
|
-
|
-
|
-
|
-
|
|
At 30 June 2023
|
645,788
|
47,821
|
84,308
|
71,866
|
-
|
33,173
|
882,956
|
|
|
|
|
|
|
|
|
|
|
Additions during the
period
|
-
|
7,687
|
6,393
|
-
|
65,104
|
-
|
79,184
|
|
FX revaluation
|
3,918
|
184
|
353
|
-
|
-
|
-
|
4,455
|
|
At 31 December 2023
|
649,706
|
55,692
|
91,054
|
71,866
|
65,104
|
33,173
|
966,595
|
|
|
|
|
|
|
|
|
|
|
Additions during the
period
|
-
|
6,523
|
-
|
-
|
21,701
|
-
|
28,224
|
|
FX revaluation
|
(534)
|
-
|
(48)
|
-
|
-
|
-
|
(582)
|
|
At 30 June 2024
|
649,172
|
62,215
|
91,006
|
71,866
|
86,805
|
33,173
|
994,237
|
|
|
|
|
|
|
|
|
|
|
Accumulated depreciation
|
|
|
|
|
|
|
|
|
At 1 January 2023
|
(398,864)
|
(39,385)
|
(26,571)
|
(10,272)
|
-
|
(1,382)
|
(476,474)
|
|
Depreciation charge for the
period
|
(53,374)
|
(1,073)
|
(13,468)
|
(6,659)
|
-
|
(2,765)
|
(77,339)
|
|
At 30 June 2023
|
(452,238)
|
(40,458)
|
(40,039)
|
(16,931)
|
-
|
(4,147)
|
(553,813)
|
|
|
|
|
|
|
|
|
|
|
Depreciation charge for the
period
|
(60,581)
|
(2,008)
|
(14,440)
|
(7,230)
|
(1,944)
|
(2,764)
|
(88,967)
|
|
At 31 December 2023
|
(512,819)
|
(42,466)
|
(54,479)
|
(24,161)
|
(1,944)
|
(6,911)
|
(642,780)
|
|
|
|
|
|
|
|
|
|
|
Depreciation charge for the
period
|
(56,591)
|
(2,626)
|
(14,100)
|
(7,230)
|
(7,596)
|
(2,765)
|
(90,908)
|
|
At 30 June 2024
|
(569,410)
|
(45,092)
|
(68,579)
|
(31,391)
|
(9,540)
|
(9,676)
|
(733,688)
|
|
|
|
|
|
|
|
|
|
|
Net book value
|
|
|
|
|
|
|
|
|
At 30 June 2023
|
193,550
|
7,363
|
44,269
|
54,935
|
-
|
29,026
|
329,143
|
|
At 31 December 2023
|
136,887
|
13,226
|
36,575
|
47,705
|
63,160
|
26,262
|
323,815
|
|
At 30 June 2024
|
79,762
|
17,123
|
22,427
|
40,475
|
77,265
|
23,497
|
260,549
|
11. Intangible
assets
|
Group
Cost
|
|
|
Product
Development
US$
|
Total
US$
|
|
|
At 1 January 2023
|
|
|
11,737,503
|
11,737,503
|
|
|
Additions during the
period
|
|
|
2,174,449
|
2,174,449
|
|
|
At 30 June 2023
|
|
|
13,911,952
|
13,911,952
|
|
|
|
|
|
|
|
|
|
Additions during the
period
|
|
|
2,272,833
|
2,272,833
|
|
|
At 31 December 2023
|
|
|
16,184,785
|
16,184,785
|
|
|
|
|
|
|
|
|
|
Additions during the
period
|
|
|
1,661,326
|
1,661,326
|
|
|
At 30 June 2024
|
|
|
17,846,111
|
17,846,111
|
|
|
|
|
|
|
|
|
|
Accumulated amortisation and impairment
|
|
|
|
|
|
|
At 1 January 2023
|
|
|
(3,068,771)
|
(3,068,771)
|
|
|
Amortisation during the
period
|
|
|
(580,142)
|
(580,142)
|
|
|
At 30 June 2023
|
|
|
(3,648,913)
|
(3,648,913)
|
|
|
|
|
|
|
|
|
|
Amortisation during the
period
|
|
|
(2,548,356)
|
(2,548,356)
|
|
|
At 31 December 2023
|
|
|
(6,197,269)
|
(6,197,269)
|
|
|
|
|
|
|
|
|
|
Amortisation during the
period
|
|
|
(798,526)
|
(798,526)
|
|
|
At 30 June 2024
|
|
|
(6,995,795)
|
(6,995,795)
|
|
|
|
|
|
|
|
|
|
Net book value
|
|
|
|
|
|
|
At 30 June 2023
|
|
|
10,263,039
|
10,263,039
|
|
|
At 31 December 2023
|
|
|
9,987,516
|
9,987,516
|
|
|
At 30 June 2024
|
|
|
10,850,316
|
10,850,316
|
|
|
|
|
|
|
|
|
|
|
|
|
12. Inventory
|
Group
|
Unaudited
6 months
to
30/06/2024
US $
|
Unaudited
6 months
to
30/06/2023
US
$
|
Audited
12
months to
31/12/2023
US
$
|
|
|
Finished goods
|
1,536,672
|
1,721,612
|
1,426,357
|
|
|
Raw Materials
|
1,828,435
|
7,082,150
|
1,894,295
|
|
|
Total inventory
|
3,365,107
|
8,803,762
|
3,320,652
|
|
13. Share capital and
premium
Share
capital
|
Group
|
No of shares of £0.01
each
|
Total
US $
|
|
Issued and fully paid up
|
|
|
|
At 1 January
2023
|
123,017,161
|
1,662,185
|
|
Shares issued for cash
|
12,652,906
|
147,621
|
|
At 30 June
2023
|
135,670,067
|
1,809,806
|
|
|
|
|
|
Shares issued for cash
|
1,862,500
|
35,717
|
|
At 31 December 2023
|
137,532,567
|
1,845,523
|
|
Shares issued for cash
|
21,177,061
|
359,659
|
|
At 30 June
2024
|
158,709,628
|
2,205,182
|
Share premium
|
Group
|
|
Ordinary Shares US
$
|
Total
US $
|
|
Allotted and fully paid up
|
|
|
|
|
At 1 January 2023
|
|
33,379,947
|
33,379,947
|
|
Premium on shares
issued
Cost of issue of shares
|
|
3,819,878
(340,776)
|
3,819,878
(340,776)
|
|
At 30 June
2023
|
|
36,859,049
|
36,859,049
|
|
|
|
|
|
|
Premium on shares
issued
|
|
753,746
|
753,746
|
|
Cost of issue of shares
|
|
(118,123)
|
(118,123)
|
|
At 31 December 2023
|
|
37,494,672
|
37,494,672
|
|
Premium on shares
issued
|
|
7,252,330
|
7,252,330
|
|
|
Cost of issue of shares
|
|
(496,380)
|
(496,380)
|
|
|
At 30 June
2024
|
|
44,250,622
|
44,250,622
|
|
Other equity instruments
|
Group
|
|
|
Total
US $
|
|
At 1 January 2023
|
|
|
-
|
|
Convertible loan notes
issued
|
|
|
5,854,754
|
|
Costs related to
issuance
|
|
|
(578,590)
|
|
10% coupon accrual
|
|
|
221,072
|
|
At 30 June
2023
|
|
|
5,497,236
|
|
|
|
|
|
|
Convertible loan notes
issued
|
|
|
3,334,773
|
|
Costs related to
issuance
|
|
|
(249,809)
|
|
10% coupon accrual
|
|
|
585,489
|
|
At 31 December 2023
|
|
|
9,167,689
|
|
10% coupon accrual
|
|
|
460,937
|
|
At 30 June
2024
|
|
|
9,628,626
|
14.
Reserves
|
Retained earnings
|
|
|
Group
US $
|
|
At 1 January 2023
|
|
|
(10,310,673)
|
|
Loss for the period
|
|
|
(6,419,132)
|
|
Share based payments
charge
|
|
|
103,948
|
|
At 30 June 2023
|
|
|
(16,625,857)
|
|
|
|
|
|
|
Loss for the period
|
|
|
(12,078,307)
|
|
Share based payments
charge
|
|
|
89,230
|
|
At 31 December 2023
|
|
|
(28,614,934)
|
|
Loss for the period
|
|
|
|
(6,477,499)
|
|
Share based payments
charge
|
|
|
|
10,866
|
|
At 30 June 2024
|
|
|
|
(35,081,567)
|
|
Capital Contribution
|
|
|
Group
US $
|
|
At 1 January 2023
|
|
|
165,000
|
|
Capital contribution
received
|
|
|
-
|
|
At 30 June 2023
|
|
|
165,000
|
|
|
|
|
|
|
Capital contribution
received
|
|
|
-
|
|
At 31 December 2023
|
|
|
165,000
|
|
|
|
|
|
|
Capital contribution
received
|
|
|
-
|
|
At 30 June 2024
|
|
|
165,000
|
|
|
|
|
|
The Capital Contribution relates
to the acquisition of intangible product licences.
|
Share option reserve
|
|
|
|
Company
US $
|
|
At 1 January 2023
|
|
|
|
-
|
|
Lapsed share options
|
|
|
|
-
|
|
At 30 June 2023
|
|
|
|
-
|
|
|
|
|
|
|
|
Lapsed share options
|
|
|
|
(20,180)
|
|
At 31 December 2023
|
|
|
|
(20,180)
|
|
Lapsed share options
|
|
|
|
-
|
|
At 30 June 2024
|
|
|
|
(20,180)
|
|
Translation reserve
|
|
|
|
Company
US $
|
|
At 1 January 2023
|
|
|
|
(4,544,337)
|
|
Foreign exchange
gain/(loss)
|
|
|
|
2,040,395
|
|
At 30 June 2023
|
|
|
|
(2,503,942)
|
|
|
|
|
|
|
|
Foreign exchange
gain/(loss)
|
|
|
|
158,334
|
|
At 31 December 2023
|
|
|
|
(2,345,608)
|
|
Foreign exchange
(loss)/gain
|
|
|
|
(234,200)
|
|
At 30 June 2024
|
|
|
|
(2,579,808)
|
The translation reserve comprises
all foreign exchange differences arising from the translation of
the financial statements of foreign operations, primarily relating
to the statement of financial position at the reporting
dates.
15. Cash generated from
operating activities
|
Group
|
|
Unaudited
6 months
to
30/06/2024
US $
|
Unaudited
6 months
to
30/06/2023
US
$
|
Audited
12
months to
31/12/2023
US
$
|
|
Loss before income tax
|
|
(6,505,655)
|
(6,419,132)
|
(18,497,540)
|
|
Adjustments for
|
|
|
|
|
|
- Depreciation
|
|
34,389
|
24,282
|
51,503
|
|
- ROU Depreciation
|
|
56,745
|
56,552
|
122,517
|
|
- Amortisation and impairment
|
|
798,526
|
580,142
|
3,128,499
|
|
- No cash interest expense
|
|
475,493
|
222,941
|
813,041
|
|
- Movement in foreign exchange
|
|
370,513
|
602,454
|
(620,714)
|
|
- Issue of share based payments
|
|
35,998
|
103,948
|
142,981
|
|
Movement in trade and other
receivables
|
|
(471,512)
|
48,079
|
(1,502,346)
|
|
Inventory movement
|
|
(44,460)
|
(372,731)
|
5,109,920
|
|
Movement in trade and other
payables
|
|
(220,427)
|
263,516
|
2,120,568
|
|
Cash generated from operating activities
|
|
(5,470,390)
|
(4,889,949)
|
(9,131,571)
|
|
|
|
|
|
|
16. Alternative Performance
Measures
|
Adjusted EBITDA
|
|
|
Unaudited 6 months to
30/06/2024
|
Unaudited 6months to 30/06/2023
|
Audited
12 months to 31/12/2023
|
|
|
|
|
|
US $
|
US
$
|
US
$
|
|
|
Total comprehensive loss for the period
|
|
|
(6,785,471)
|
(4,378,737)
|
(16,269,031)
|
|
|
Add back:
|
|
|
|
|
|
|
|
Administrative expenses: Realised
& unrealised FX movements
|
|
|
(361,575)
|
2,185,856
|
2,424,237
|
|
|
Other comprehensive income: FX
translation differences
|
|
|
282,621
|
(2,040,395)
|
(2,248,588)
|
|
|
Net foreign exchange movement2
|
|
|
(78,954)
|
145,461
|
175,649
|
|
|
|
|
|
|
|
|
|
|
Finance Income and
Costs
|
|
|
6,624
|
11,770
|
19,337
|
|
|
Accrued interest on Convertible
Loan Notes
|
|
|
471,808
|
214,493
|
806,561
|
|
|
Product development
amortisation
|
|
|
798,526
|
580,142
|
3,293,232
|
|
|
Impairment of acquisition
goodwill
|
|
|
1,478,968
|
-
|
-
|
|
|
Costs relating to fundraising
activities
|
|
|
-
|
13,567
|
92,536
|
|
|
Former CFO compensation
|
|
|
120,179
|
-
|
96,393
|
|
|
Minimum royalties in excess of
sales royalties
|
|
|
354,804
|
250,211
|
792,818
|
|
|
Contract Manufacturer Capacity
Costs
|
|
|
-
|
-
|
86,440
|
|
|
Inventory Impairment and
Adjustments
|
|
|
33,787
|
109,185
|
4,138,030
|
|
|
Accrued Bonus
|
|
|
-
|
-
|
315,000
|
|
|
Issue of share based
payments
|
|
|
104,029
|
103,948
|
163,061
|
|
|
Adjusted EBITDA
|
(3,495,700)
|
(2,949,960)
|
(6,289,974)
|
|
|
1 Reconciliation to Adjusted EBITDA
measure
Adjusted EBITDA is the Group's key adjusted profit measure.
Total comprehensive loss for the period is adjusted to exclude;
Foreign exchange translation differences along with unrealised and
unrealised foreign exchange movements, depreciation and
amortisation of product development, costs relating to fundraising
activities, surrendered share options and share option taxes,
minimum royalties in excess of sales royalties, share based
payments, obsolete 1st generation X-PLOR inventory adjustments and
contract manufacturer capacity costs.
2 Net foreign exchange
movements
£Sterling to US$ stayed broadly the same during the
period (1 January 2024 - $1.27:£1.00; 30 June
2024 - $1.27:£1.00). Due to the size of the Intercompany
Loan from the PLC to the US subsidiary which is fixed in £Sterling,
this creates an accounting presentational impact between
Administration Expenses and Other Comprehensive Income, which to a
large extent can be netted off against one
another.
o Realised FX movements in
administrative expenses arise from the revaluation of £Sterling
cash balances into US$
o Unrealised FX movements in
administrative expenses arise from the revaluation of the
Intercompany Loan fixed in £Sterling into US$
o Foreign currency
translation differences in Other Comprehensive Income arise from
the revaluation of the PLC balance sheet into US$
17. Related party
transactions
As disclosed in the Admission
Document, prior to Robert Rauker joining the Company, he undertook
independent patent work for Separation Design Group IP Holdings LLC
("SDG"). Pursuant to a Patent Broker Agreement dated 22 October
2015 SDG entered into an agreement with Medicinus IP LLC
("Medicinus"), of which Robert Rauker is the sole shareholder,
under which Medicinus has agreed to facilitate the sale and/or
licence of intellectual property owned by SDG which includes
soliciting potential buyers and licencees of such intellectual
property. In consideration for the provision of these services,
Medicinus receives a fee of 12.5 per cent. of the licence fees,
sales price and/or royalties received by SDG which will include
12.5 per cent. of the royalties the Company will pay to SDG in
relation to sales of the X-PLOR and DISCOV-R, pursuant to the
agreement entered into between SDG and the Company. The agreement
can be terminated by either party by written notice.
The non-executive fees paid to
Adam Reynolds were paid through his company Reyco
Limited.
In the period the Company paid
$0.31m (2023 H1: $0.58m; FY 2023: $0.44m) to Dowgate Capital
Limited in relation to brokerage fees, research and fundraising
activities. David Poutney is the Chief Executive Officer of Dowgate
Capital Limited
In 2023, Robert Rauker was awarded
a bonus program worth $625,000 based on milestones on commercial
progress with InnoMax. To date $312,000 has been earned,
although payment of $157,000 of the earned amount has been deferred
until 2025 at the Company's election.
18. Contingent
Liability
SDG Licence
On 24 February 2017, the Company
entered into a co-exclusive licence and development agreement with
Separation Design Group, LLC and SDG (together the "SDG Parties")
("SDG Licence") which was subsequently amended by an amendment
agreement dated 19 March 2023. Pursuant to the SDG Licence: if by 3
September 2025, cumulative sales of the X-PLOR and DISCOV-R have
not exceeded $20 million dollars, Belluscura must make a one-time
payment of $3 million to the SDG Parties to maintain the exclusive
SDG licence. By 30 June 2024 cumulative sales of X-PLOR were $3.2
million.
The Directors assess that the
Group will meet the minimum obligations and therefore no provision
has been made in these Financial Statements.
Supplier Claim 1
During 2023 the Company received a
claim from a supplier regarding alleged default by the Company
under an ongoing contract. The Company has subsequently
counter-claimed against the supplier for alleged poor service The
supplier has subsequently filed a lawsuit in the United
States.
The Company has received an
independent legal opinion and believes that any claim against the
Company is lower than the claim made by the Company.
Accordingly, no provision has been
made as at 30 June 2024. The Directors believe that based on
their current assessment of the facts the current $nil provision is
appropriate. However, the final amount is dependent upon the
outcome of the agreements between the two parties and/or the
lawsuit.
Supplier Claim 2
During 2024 the Company received a
claim from a supplier regarding alleged default by the Company
under an ongoing contract. The Company has subsequently
counter-claimed against the supplier for alleged poor service The
supplier has subsequently filed a lawsuit in the United
States.
The Company has received an
independent legal opinion and believes that any claim against the
Company is lower than the claim made by the Company.
Accordingly, no provision has been
made as at 30 June 2024. The Directors believe that based on
their current assessment of the facts the current $nil provision is
appropriate. However, the final amount is dependent upon the
outcome of the agreements between the two parties and/or the
lawsuit.
19. Acquisition of TMT
Acquisition plc
On 31 October 2023, Belluscura
announced a recommended all share offer for TMT Acquisition plc,
which operated as a cash shell. The offer became wholly
unconditional on 9 February 2024 and the acquisition completed in
March 2024.
TMT Acquisition plc held assets of
approximately $5.8m in cash. Based on the Closing Price per
Belluscura Share of 21.0 pence on 9 February 2024 (being the latest
practicable date prior to the Offer going unconditional), the value
of TMT Acquisition plc was approximately $7.3m. Due to the
Company's working capital needs, the directors believed that the
premium represented reasonable value. The $1.5m of goodwill this
created has been fully impaired in the period.
20. Events after the reporting
period
The Group announced on 2 July 2024
that it has raised gross proceeds of £1.9 million (before
expenses) through (i) the conditional issue of £1.7
million of 7% unsecured convertible loan notes 2029 and (ii)
the issue of 1,375,665 new ordinary shares of 1 penny each at the
price of 15 pence per share.