TIDMTEK
RNS Number : 4704I
Tekcapital plc
31 August 2016
Dissemination of a Regulatory Announcement that contains inside
information according to REGULATION (EU) No 596/2014 (MAR).
TEKCAPITAL Plc
("Tekcapital", the "Company" or the "Group")
Unaudited Half Year Results
Tekcapital plc (AIM: TEK), an international provider of
technology and intellectual property services, announces its
unaudited half year results for the six months ended 31 May
2016.
Financial Highlights
-- Half year revenues were $247,262 (H1 2015: $287,488)
-- Net loss increased to $997,174 (H1 2015: $659,936), due
mainly to the expenses involved with the establishment and launch
of Belluscura Ltd ("Belluscura")
-- Cash and cash equivalents at period end of $1,937,595 (31 May 2015: $3,786,424)
-- Net assets at period end of $3,157,254 (31 May 2015: $4,313,490)
Operational Highlights
The establishment of Belluscura:
-- The Group successfully established a new trading company,
Belluscura, hired an experienced medical device team and acquired
the exclusive licenses to manufacture and sell three proprietary
medical devices.
-- The acquired devices have been developed by and exclusively
licensed from Stryker Corporation, a leading medical technology
company. The devices have previously received US 510(k) regulatory
clearance where necessary and achieved commercial sales prior to
acquisition. The Group has also transferred its exclusive licence
for a saliva glucose test, acquired from Arizona State University,
which was previously in its out-licensing portfolio, to
Belluscura.
-- Post period end, Belluscura completed a private placement
raising $1.5 million and issuing 2,500,000 shares. Tekcapital now
owns 74.44% of the share capital of Belluscura. On the basis of
this placement, the value of Tekcapital's equity in Belluscura is
approximately $3.3 million. The Group's strategy is to rapidly grow
Belluscura and explore further investment.
Acquisition of Vortechs Group:
-- On 28 April 2016, the Group acquired certain assets and
business from Vortechs Group, a leading technology transfer
placement company in North America. This acquisition expands the
range of the Group's business offerings and enables the sourcing of
technology transfer professionals as well as new technologies for
both corporate clients and university suppliers. The results for
the period under review do not reflect any significant impact of
the Vortechs Group business, as this acquisition occurred close to
the end of the interim accounting period.
Further strengthening of the Group's portfolio of technologies
for out-licensing, the Group acquired the exclusive license to, or
acquisition of the following intellectual properties:
-- The exclusive license to a patent application, entitled
"Energy Harvesting from Constrained Buckling of Piezoelectric
Beams" from the University of Michigan. After a successful pilot
study conducted by the inventors the Group is moving forward with
the fabrication and testing of prototype energy harvesting footwear
for subsequent out-licensing.
-- The exclusively licensed US patent application entitled
"Saliva glucose measurement devices and methods" describes a safe,
fast and non-invasive method and device to collect and sample
glucose in saliva for both human and companion animals. The
biosensor device allows trace saliva fluid samples from a
biological surface to be obtained for electrochemical analysis and
the subsequent detection of analytes using disposable biosensor
strips. This commercialisation of this intellectual property patent
is currently being progressed by Belluscura.
-- The exclusive licences to manufacture and sell three
proprietary medical devices, with the commercial exploitation of
these licences currently being progressed by Belluscura. The
devices have been developed by and exclusively licensed from a
leading medical technology company. These devices have received US
510(k) regulatory clearance where necessary and have previously
achieved commercial sales prior to acquisition. The devices
are:
o "SlydeTM", a non-ambulatory patient evacuation sled;
o "Passport(R)", a trocar for use with the Da Vinci(R) Surgical
System (keyhole surgery); and
o "SNAP II", a level of consciousness monitor for use during
surgical procedures requiring general anesthesia.
o These licensed products are protected by a portfolio of 19
issued and pending patents and industrial designs.
-- The acquisition of the patent for uSalt(TM) a new process
technology for reducing the surface sodium content in a wide
variety of foods, consistent with current U.S. Food and Drug
Administration guidelines. The Group is currently manufacturing and
testing this new salt technology on snack foods for a major food
company.
These 22 intellectual property acquisitions during the reporting
period have added to the Group's existing portfolio, which
currently numbers 51 patents and applications that the Group has
either exclusively licensed or acquired since January 2015.
Commenting on the results, Dr. Clifford Gross, Executive
Chairman of Tekcapital plc, said: "We have made significant
progress towards achieving the objectives that we set out last year
and have established a strong foundation for future revenue growth
with our numerous technology acquisitions. When combined with the
establishment and launch of Belluscura Ltd, the acquisition of the
Vortechs Group to expand our service offerings, the recent
acquisition of the uSalt(TM) patent for reducing the surface salt
content in a variety of foods and our progress with in-shoe energy
harvesting technology for empowering a new generation of footwear
that can recharge mobile devices, we believe these achievements
provide significant upside potential for our shareholders.
We are excited and confident in the progress we have made
towards creating marketplace and shareholder value from university
and corporate intellectual capital."
For further information, please contact:
Tekcapital Plc +1 305 200 3450 Ext 305 info@tekcapital.com
Clifford M. Gross, Ph. D., Executive Chairman
Allenby Capital Limited (NOMAD & Broker) +44 (0) 20 3394 2972
Jeremy Porter / Alex Brearley / Richard Short
Optiva Securities Limited (Joint-Broker) +44 (0) 20 3137 1904
Jeremy King / Vishal Balasingham jeremy.king@optivasecurities.com
Walbrook PR Limited +44 (0) 20 7933 8780
Paul Cornelius / Paul McManus / Helen Cresswell tekcapital@walbrookpr.com
About Tekcapital plc - The World's Largest University Network
for Open Innovation
Tekcapital helps clients profit from new, university-developed
intellectual properties. With our proprietary discovery search
engine, linked to 4,000+ universities in 160 countries, coupled
with expert scientific review, we provide a turn-key service to
makes it easy for clients to find and acquire university IP,
analyse the market potential and engage the technology transfer
professionals they need to create a competitive advantage.
Tekcapital plc is listed on the AIM market of the London Stock
Exchange (AIM: symbol TEK) and is headquartered in Oxford, in the
UK. For more information, please visit www.tekcapital.com
Chairman's Statement
Our strategy is to scale Tekcapital's business to a position
that enables us to provide our service offerings to a wide range of
clients around the world, with an initial concentration on the US
and UK markets.
We have also focused on adding additional services, either
organically or through acquisitions, with the aim of enabling the
Group to assist its clients in further determining and realising
value from IP through the transformative innovations that they
represent.
We have successfully expanded our service offerings with the
acquisition of certain of the assets and the business of the
Vortechs Group that is also expected to contribute to growth in
subsequent periods.
Our technology acquisition and out licensing services leverage
our core competencies and have enabled Tekcapital to acquire the
rights to an additional 22 intellectual properties during the
period under review resulting in a total of 51 exclusive
intellectual property licenses or acquisitions since January 2015.
These acquisitions have been across a diverse range of application
areas including:
-- wearable optical displays;
-- non-invasive glucose monitoring for diabetics;
-- improved food processes to enhance the nutritional content of widely-consumed foods;
-- portable energy harvesting to power mobile electronics from everyday human movement;
-- improved air conditioning efficiency using advanced aeronautical designs; and
-- proprietary medical devices.
All of these technology rights have been acquired for either
cash or equity in Tekcapital and potentially present significant
up-side potential to shareholder value if successfully
commercialised. The goal of the Group is to out-license this IP
portfolio to major manufacturers, to empower clients to create a
competitive advantage from the advancement these technologies can
deliver.
Financial Review
Revenue for the period was approximately $247,000 (H1 2015:
approximately $287,000).
Administrative expenses have increased by approximately $256,000
from the prior, year largely as a result of the non-recurring costs
involved with the establishment of Belluscura. This new subsidiary,
which has its own management team, acquired three exclusive
licenses for proprietary medical devices and commenced operations
towards the end of the period.
Our start-up investment related to the establishment and
launching of Belluscura has resulted in the majority of the
increase in the net loss for the period compared to the same period
in the prior year. However, based on our recently completed private
placement in Belluscura, we believe this investment should lead to
a significant increase in the Group's net assets in 2017.
Cash and cash equivalents at the end of the period stood at
$1.94 million (FY 2015: $3.14 million), with net assets of the
expanded Group at $3.18 million (FY 2015: $3.72 million).
Current trading and outlook
As an entrepreneurial Group, Tekcapital's year to date has been
focused on the establishment of Belluscura and the acquisition of
the Vortechs Group business, along with the other progress
described in this report. By the end of the year (November 2016) we
expect to make significant out-license progress, recognise the
benefits of the integration of the Vortechs Group business and
report progress from our Belluscura investment. We are dedicated
and excited to continue the development and commercialization of
our IP portfolio investments as well as with the expansion of our
market footprint over the coming months. In a market place of such
huge unrealised potential, we will remain focused on making prudent
investments in intellectual properties for mid and long-term
harvest.
Dr. Clifford Gross
Executive Chairman
Unaudited condensed consolidated income statement for the six
month period ended 31 May 2016
Notes Six months Six months Year ended
ended ended 30 November
31 May 31 May 2015
2016 2015
Unaudited Unaudited Audited
$ $ $
Revenue 247,262 287,488 407,420
Cost of sales - - -
------------ ----------- -------------
Gross profit 247,262 287,488 407,420
Foreign exchange - (95) -
movements
Other administrative
expenses (1,244,749) (947,352) (1,868,124)
Operating loss (997,487) (659,959) (1,460,704)
Finance income 313 23 709
Loss before taxation (997,174) (659,936) (1,459,995)
Income tax expense 3 - - (820)
------------ -----------
Loss after taxation (997,174) (659,936) (1,460,815)
============ =========== =============
Attributable to :
Equity holders of
the parent (990,204) (659,936) (1,460,815)
Non-controlling (6,970) - -
interests
------------ ----------- -------------
(997,174) (659,936) (1,460,815)
============ =========== =============
All amounts relate to continuing operations.
Unaudited consolidated statement of comprehensive income for the
six month period ended 31 May 2016
Notes Six months Six months Year ended
ended ended 30 November
31 May 31 May 2015
2016 2015
Unaudited Unaudited Audited
$ $ $
Loss for the year (997,174) (659,936) (1,460,815)
Other comprehensive
income
Currency translation
difference (4,966) (37,290) 47,851
============ =========== =============
Other comprehensive
income (4,966) (37,290) 47,851
Total comprehensive
income (1,002,140) (697,226) (1,412,964)
============ =========== =============
Attributable to :
Equity holders of
the parent (995,170) (697,226) (1,412,964)
Non-controlling (6,970) - -
interests
(1,002,140) (697,226) (1,412,964)
============ =========== ===============
Basic and diluted
loss per share ($): 4 (0.028) (0.03) (0.049)
Unaudited condensed consolidated statement of financial position
as at 31 May 2016
Notes As at 31 May 2016 As at 31 May 2015 As at 30 November 2015
Unaudited Unaudited Audited
US$ US$ US$
Assets
Non-current assets
Intangible assets 5 1,387,470 523,244 708,577
Property, plant and equipment 60,475 4,130 7,920
------------------ ------------------ -----------------------
1,447,945 527,374 716,497
Current assets
Trade and other receivables 134,138 188,717 105,955
Cash and cash equivalents 1,937,595 3,786,424 3,139,246
------------------ ------------------ -----------------------
2,071,733 3,975,141 3,245,201
Total assets 3,519,678 4,502,515 3,961,698
================== ================== =======================
Equity and liabilities
Current liabilities
Trade and other payables 361,924 189,025 241,181
Current income tax liabilities 500 - 1,300
Loans and borrowings - - -
------------------ ------------------ -----------------------
Total liabilities 362,424 189,025 242,481
Capital and reserves
Share capital 6 228,052 223,677 224,684
Share premium 6,377,383 5,896,007 5,980,751
Retained earnings (3,421,560) (1,734,025) (2,461,900)
Translation reserve 42,885 - 47,851
Merger reserve (72,169) (72,169) (72,169)
Total equity attributable to equity holders
of the parent 3,154,591 4,313,490 3,719,217
Non-controlling interests 2,663 - -
Total equity and liabilities 3,519,678 4,502,515 3,961,698
================== ================== =======================
Unaudited condensed consolidated statement of cash flows for the
six month period ended 31 May 2016
Notes Six months ended 31 May Six months ended 31 May Year ended 30 November
2016 2015 2015
Unaudited Unaudited Audited
US$ US$ US$
Cash flows from operating
activities
Loss before income tax (997,174) (659,936) (1,459,995)
Adjustments for:
Depreciation 2,071 1,870 3,057
Amortisation 19,781 6,803 23,087
Share based payment expense 36,577 2,779 38,493
Finance costs (net) (313) (23) (709)
Net foreign exchange difference (4,966) (47,488) 47,851
Operating profit before working
capital changes (944,024) (695,995) (1,348,216)
Changes in working
capital:
Increase in trade and other
receivables (28,183) (98,150) (15,387)
Increase in trade and other
payables 120,750 88,973 141,129
Tax paid (800) (1,300) (820)
Net cash used in operating
activities (852,257) (706,472) (1,223,294)
Cash flows from investing
activities
Acquisition of property, plant and
equipment (54,632) (55) (4,349)
Disposals of property, - 419 -
plant and equipment
Acquisition of intangible assets (295,075) - (162,080)
Interest received 313 23 709
------------------------- -------------------------- --------------------------
Net cash (used in)/from investing
activities (349,394) 387 (165,720)
Cash flows from financing
activities
Proceeds from issuance of Ordinary
Shares - 3,286,060 3,286,060
Costs of raising finance - (164,456) (164,456)
Proceeds from the exercise of
warrants - - 35,751
------------------------- -------------------------- --------------------------
Net cash from financing activities - 3,121,604 3,157,355
Net increase in cash and cash
equivalents (1,201,651) 2,415,519 1,768,341
Cash and cash equivalents at the
beginning of the period 3,139,246 1,370,905 1,370,905
Cash and cash equivalents at the
end of the period 1,937,595 3,786,424 3,139,246
========================= ========================== ==========================
During the period ended 31 May 2016 the Company's material
non-cash transactions consisted of shares issued on acquisition of
licences, as disclosed in note 5.
Unaudited condensed consolidated statement of changes in equity
for the six month period ended 31 May 2016
Attributable to equity holders of the parent
---------------------------------------------
Share Share Translation Merger Retained Total Non-controlling Total
capital Premium Reserve Reserve Earnings interest Equity
US$ US$ US$ US$ US$ US$ US$ US$
Unaudited
Balance at 1
December 2015 224,684 5,980,751 47,851 (72,169) (2,461,900) 3,719,217 - 3,719,217
Comprehensive
income
Loss for the
period - - - - (990,204) (990,204) (6,970) (997,174)
Other
comprehensive
income - - (4,966) - - (4,966) - (4,966)
Total
comprehensive
income for the
period - - (4,966) - (990,204) (995,170) (6,970) (1,002,140)
Share based
payments - - - - 36,577 36,577 - 36,577
Issue of ordinary
shares 3,368 396,632 - - - 400,000 - 400,000
New funds into
non-controlling
interest - - - - - - 3,600 3,600
(Loss)/Gain
arising from
change in
non-controlling
interest - - - - (6,033) (6,033) 6,033 -
Balance at 31 May
2016 228,052 6,377,383 42,885 (72,169) (3,421,560) 3,154,591 2,663 3,157,254
======== ========== ============ ========= ============ ============ ================ ============
Unaudited
Balance at 1
December 2014 154,842 2,673,905 - (72,169) (1,039,578) 1,717,000 - 1,717,000
Issue of Ordinary
Shares, net of
issue costs 68,835 3,222,102 - - - 3,290,937 - 3,290,937
Share based
payments - - - - 2,779 2,779 - 2,779
Comprehensive
income
Loss for the
period - - - - (659,936) (659,936) - (659,936)
Other
comprehensive
expense
Currency
translation
differences - - - - (37,290) (37,290) - (37,290)
-------- ---------- ------------ --------- ------------ ------------ ---------------- ------------
Total
comprehensive
expense - - - - (697,226) (697,226) - (697,226)
Balance at 31 May
2015 223,677 5,896,007 - (72,169) (1,734,025) 4,313,490 - 4,313,490
======== ========== ============ ========= ============ ============ ================ ============
Audited
Balance at 1
December 2014 154,842 2,673,905 - (72,169) (1,039,578) 1,717,000 - 1,717,000
Comprehensive
income
Loss for the
period - - - - (1,460,815) (1,460,815) - (1,460,815)
Other
comprehensive
income - - 47,851 - - 47,851 - 47,851
Total
comprehensive
income for the
period - - 47,851 - (1,460,815) (1,412,964) - (1,412,964)
Share based
payments - - - - 38,493 38,493 - 38,493
Issue of ordinary
shares 69,270 3,436,126 - - - 3,505,396 - 3,505396
Costs of share
issue - (164,456) - - - (164,456) - (164,456)
Warrants
exercised 572 35,176 - - - 35,748 - 35,748
-------- ---------- ------------ --------- ------------ ------------ ---------------- ------------
Balance at 30
November 2015 224,684 5,980,751 47,851 (72,169) (2,461,900) 3,719,217 - 3,719,217
======== ========== ============ ========= ============ ============ ================ ============
Share capital represents the amount subscribed for share capital
at nominal value.
Share premium represents the amount subscribed for share capital
in excess of nominal value and net of any issue costs.
The merger reverse relates to the share for share exchange
undertaken by the Company with Tekcapital Europe Limited on 18
February 2014.
Accumulated losses represent all other net gains and losses and
transactions with owners not recognised elsewhere.
Notes to the financial information
1. General information
Tekcapital PLC is a company incorporated in England and Wales
and domiciled in the UK. The Company's registered office is at 5
Fleet Place, London, EC4M 7RD. The nature of the Company's
operations and its principal activities are to act as the holding
company of a group of companies engaged in international technology
and intellectual property services provider.
2. Basis of preparation
The financial information for the six months ended 31 May 2016
set out in this interim financial information is unaudited and does
not constitute statutory financial statements.
The interim condensed financial information has been presented
in US Dollars ("$").
The principal accounting policies used in preparing the interim
results are those the Group expects to apply in its financial
statements for the year ending 30 November 2016.
3. Taxation
No charge to taxation has arisen in the six month period ended
31 May 2016 (31 May 2015: $nil).
4. Loss per share
Basic earnings per share is calculated by dividing the earnings
attributable to ordinary shareholders by the weighted average
number of Ordinary Shares outstanding during the period.
In calculating the weighted average number of Ordinary Shares
outstanding (the denominator of the earnings per share calculation)
during the period in which the share transaction occurs:
-- The number of Ordinary Shares outstanding from the beginning
of that period to the acquisition date shall be computed on the
basis of the weighted average number of Ordinary Shares of the
legal acquiree (accounting acquirer) outstanding during the period
multiplied by the exchange ratio established in the merger
agreement; and
-- The number of Ordinary Shares outstanding from the
acquisition date to the end of that period shall be the actual
number of Ordinary Shares of the legal acquirer (the accounting
acquiree) outstanding during the period.
The basic earnings per share for each comparative period before
the acquisition date presented in the consolidated financial
information following a share for share exchange shall be
calculated by dividing:
-- The profit or loss of the legal acquiree attributable to
ordinary shareholders in each of those periods; by
-- The legal acquiree's historical weighted average number of
ordinary shares outstanding multiplied by the exchange ratio
established in the acquisition agreement.
Six months ended 31 May Six months ended 31 May Year ended 30 November 2015
2016 2015
US$ US$ US$
Losses attributable to
equity holders of the
Company ($) (997,174) (659,936) (1,460,815)
Weighted average number of
Ordinary Shares in issue:
Basic 34,948,117 25,032,898 29,901,585
Diluted 34,948,117 25,032,898 29,901,585
Basic loss per share ($) (0.028) (0.03) (0.049)
Diluted loss per share ($) (0.028) (0.03) (0.049)
At 31 May 2016 and 31 May 2015 the Company had no dilutive
financial instruments in place and therefore diluted earnings per
share is the same as basic earnings per share.
5. Intangible assets
Purchased intangible assets
-------------------------------------------------
Website Vortechs Invention
Licenses development US $ Evaluator Total
US $ US $ US $ US $
-------------------------- ----------- ------------- --------- ----------- ----------
Costs
At 1 December
2014 - 33,306 - 320,550 353,856
Additions during
the period 179,796 - - - 179,796
At 31 May 2015 179,796 33,306 - 320,550 533,652
-------------------------- ----------- ------------- --------- ----------- ----------
At 1 December
2014 - 33,306 - 320,550 353,856
Additions during
the period 378,228 - - 3,185 381,413
At 30 November
2015 378,228 33,306 - 323,735 735,269
-------------------------- ----------- ------------- --------- ----------- ----------
At 1 December
2015 378,228 33,306 - 323,735 735,269
Additions during
the period 190,800 - 500,000 7,875 698,675
At 31 May 2016 569,028 33,306 500,000 331,610 1,433,944
-------------------------- ----------- ------------- --------- ----------- ----------
Accumulated amortisation
and impairment
As 1 December
2014 - (3,605) - - (3,605)
Amortisation for
the period (1,493) (5,310) - - (6,803)
At 31 May 2015 (1,493) (8,915) - - (10,408)
-------------------------- ----------- ------------- --------- ----------- ----------
As 1 December
2014 - (3,605) - - (3,605)
Amortisation for
the period (12,467) (10,620) - - (23,087)
At 30 November
2015 (12,467) (14,225) - - (26,692)
-------------------------- ----------- ------------- --------- ----------- ----------
At 1 December
2015 (12,467) (14,225) - - (26,692)
Amortisation for
the period (14,790) (4,992) - - (4,992)
At 31 May 2016 (27,257) (19,217) - - (31,684)
-------------------------- ----------- ------------- --------- ----------- ----------
Net book value
At 31 May 2015 178,303 24,391 - 320,550 523,244
-------------------------- ----------- ------------- --------- ----------- ----------
At 30 November
2015 365,761 19,081 - 323,735 708,577
-------------------------- ----------- ------------- --------- ----------- ----------
At 31 May 2016 541,771 14,089 500,000 331,610 1,387,470
-------------------------- ----------- ------------- --------- ----------- ----------
During the period the Group acquired certain assets and business
for Vortechs Group Inc, a leading technology transfer executive
search firm. The Company issued 577,868 new ordinary shares of 0.4
pence at an issue price of 47.5 pence and paid $100,000 cash as
consideration for this acquisition.
6. Share capital
The Company's ordinary shares are of GBP0.004 par value.
Issued and fully paid Shares Share capital Share premium
Number US$ US$
Ordinary shares of GBP0.004 each
At 1 December 2014 23,383,747 154,842 2,673,905
Shares issued for the acquisition of Licenses 544,792 3,114 166,219
Shares issued in further public offering 10,750,000 65,721 3,055,883
As at 31 May 2015 34,678,539 223,677 5,896,007
=========== ============== ==============
At 1 December 2014 23,383,747 154,842 2,673,905
Shares issued for the acquisition of Licenses 614,592 3,549 215,784
Shares issued in further public offering 10,750,000 65,721 3,055,883
Shares issued on exercise of warrants 95,000 572 35,179
As at 30 November 2015 34,843,339 224,684 5,980,751
=========== ============== ==============
At 1 December 2015 34,843,339 224,684 5,980,751
Share issue (28 April 2016) 577,868 3,368 396,632
As at 31 May 2016 35,421,207 228,052 6,377,383
=========== ============== ==============
All of the Company's issued ordinary shares have full voting,
dividend and capital distribution (including winding up) rights;
they do not confer any rights of redemption. The Company does not
hold any ordinary shares in treasury.
On 28 April 2016 the Company issued 577,868 Ordinary Shares for
$400,000 on acquisition of certain assets and business of the
Vortechs Group.
7. Related party transactions
During the period the Company employed the services of MMM
Consulting Ltd, a company of which Tekcapital's Finance Director
Malcolm Groat is a director and minority shareholder. The fees paid
were $10,444 (31 May 2015: $12,196). The balance outstanding at the
end of period was $10,552 (31 May 2015: $Nil)
8. Events after the reporting period
On 16 June 2016 Belluscura, a then 95% owned subsidiary of the
Company, completed a private placement raising $1.5 million and
issuing 2,500,000 shares. This placement has resulted in a dilution
of the Group's ownership interest to 74.44%.
9. Interim Results
The interim results for the six months ended 31 May 2016 will be
available on the Company's website at
http://tekcapital.com/investors/.
- Ends -
This information is provided by RNS
The company news service from the London Stock Exchange
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