TIDMFIPP
RNS Number : 2591T
Frontier IP Group plc
24 March 2021
24 March 2021
Frontier IP Group plc
("Frontier IP" or the "Group")
UNAUDITED HALF YEAR RESULTS FOR THE SIX MONTHS TO 31 DECEMBER
2020
Frontier IP, a specialist in commercialising intellectual
property, is pleased to announce its unaudited interim results for
the six month period ended 31 December 2020.
KEY POINTS
-- Fair value of portfolio rose by 21 per cent to GBP23.4
million at 31 December 2020 (30 June 2020: GBP19.4 million)
-- Unrealised profit on the revaluation of investments rose by
33 per cent to GBP4.0 million (31 December 2019: GBP3.0
million)
-- Pre-tax profits rose by 45 per cent to GBP3.0 million (31 December 2019: GBP2.1 million)
-- Oversubscribed equity placing and PrimaryBid offer raised
GBP2.2 million (net of expenses) in July 2020
Frontier IP made strong progress during the first half of the
year despite the COVID-19 pandemic. Fundraising activity stepped
up, reflecting the growing maturity of the portfolio with several
companies now approaching significant inflection points. Cambridge
Raman Imaging, Elute Intelligence and Fieldwork Robotics raised
equity funding during the period.
Post period end, Exscientia completed a $100 million Series C
funding round with backing from global asset manager BlackRock.
Pulsiv raised GBP880,000 from new and existing equity
investors.
Industry collaborations are a central part of our business model
and three were announced with our portfolio companies.
There has also been evidence of increasing traction in Portugal
before and after the period end with a first investment into one of
our Portuguese portfolio companies, involvement with a United
Nationals Development Programme project and an industry
collaboration announced.
Frontier IP strengthened its team during the period with the
appointment of a Software Commercialisation Director and a Director
of Corporate Relationships. Both have extensive experience.
The oversubscribed placing and PrimaryBid offer meant the Group
was able to flex its business model to include increased bridge
funding and support investment in portfolio companies.
FINANCIAL HIGHLIGHTS
-- Fair value of the portfolio of equity investments increased
by 21 per cent. to GBP23,449,000 at 31 December 2020 (30 June 2020:
GBP19,444,000), an increase of 43 per cent. year on year (31
December 2019: GBP16,351,000)
-- Unrealised profit on the revaluation of investments increased
33 per cent. to GBP4,009,000 (31 December 2019: GBP3,024,000)
-- Revenue from services increased 8 per cent. to GBP184,000 (31 December 2019: GBP170,000)
-- Profit before tax increased 45 per cent. to GBP3,033,000 (31
December 2019: GBP2,088,000) - the increase reflecting the higher
gain on revaluation of investments
-- Basic earnings per share increased by 19 per cent. to 5.56p (31 December 2019: 4.66p)
-- Net assets per share increased to 56.8p as at 31 December
2020 (30 June 2020: 51.0p; 31 December 2019: 46.6p)
-- Cash balances stood at GBP3,818,000 as at 31 December 2020
(30 June 2020: GBP2,968,000; 31 December 2019: GBP4,022,000)
following an equity placing which completed in July 2020 and which
raised GBP2,178,000 million (net of expenses) for the Group.
PORTFOLIO AND OPERATIONAL HIGHLIGHTS
The six months to 31 December 2020 saw encouraging progress with
the strong momentum continuing after the period end.
-- Three industry collaborations announced: Fieldwork Robotics
announced separate partnerships with Bosch and Bonduelle, a leading
multinational vegetable producer, and The Vaccine Group with ECO
Animal Health Group plc and The Pirbright Institute
-- First equity funding round raised GBP250,000 for Elute
Intelligence, which was announced post period end, to accelerate
development of its Patent Reader product for searching patent
databases more efficiently and to develop an enterprise search
tool
-- First equity funding round raised GBP250,000 for Cambridge
Raman Imaging to support development of its graphene-based
ultrafast laser technology for use in medical devices. The company
also announced its participation in a EUR5 million pan-European
project to develop bio-photonic cell and tissue imaging
technology
-- Fieldwork Robotics raised a total of GBP675,000, which was
announced post period end. The proceeds will be used to accelerate
development of the company's raspberry harvesting robot to bring it
to market and to embark on development of a cauliflower harvesting
robot in collaboration with Bonduelle, one of the world's largest
vegetable producers
-- Three portfolio companies benefited from convertible loans
from the UK government's Future Fund with matched funding from
Frontier IP and other investors. Nandi Proteins raised a total of
GBP720,000; Pulsiv a total of GBP500,000; and Alusid a total of
GBP250,000. The loan to Pulsiv has been converted in conjunction
with a subsequent equity fund raise post period end
-- Innovate UK awarded Fieldwork Robotics an GBP84,000
continuity grant and a further GBP145,000 grant from its
Sustainable Innovation Fund
-- Our Portuguese business is showing encouraging development.
AquaInSilico awarded EUR60,000 EIT RawMaterials grant
-- Software Commercialisation Director Mark Rosten appointed in
a non-board role to identify opportunities and drive forward
software developments and projects across the portfolio and for the
Group. Director of Corporate Relationships Darren Winter appointed
to support portfolio companies with their fundraising
requirements.
Post period end:
-- Exscientia completed its Series C financing round at $100
million with BlackRock funds joining Novo Holdings, Evotec, Bristol
Myers Squibb and GT Healthcare Capital as an investor in the
fundraise. This followed another period of strong progress for
Exscientia both in terms of industry collaborations and in building
its team, and we look forward to reporting on further
developments
-- Pulsiv raised GBP880,000 through an equity funding round
ahead of a planned acceleration of its business as it hits key
inflection points
-- Further developments in Portugal included:
-- AquaInSilico announced it is to receive $250,000 from the
United Nations Development Programme to support work to protect one
of the world's most diverse marine environments around the Cape
Verde archipelago
-- Leading Portuguese venture capital firm Portugal Ventures
invested EUR100,000 in inSignals Neurotech
-- World's leading producer of cork products, Corticeira Amorim,
announced the launch of a breakthrough technology to remove major
cause of cork taint in wine from natural corks. The technology
originated from the Group's Portuguese partner university NOVA
University of Lisbon - NOVA School of Science Technology. Frontier
IP engaged with Amorim in supporting the technology's
commercialisation.
Chief Executive Neil Crabb said: "The first half of the year and
beyond was a story of strong growth and gathering momentum against
the backdrop of the COVID-19 pandemic. Our portfolio is maturing,
with several companies approaching inflection points which mark
significant and material changes in their progress. This is
reflected by an increased pace in fundraising, strengthening of
management teams, and the deepening and extending of industrial
relationships within the portfolio.
The continued growth of fair value of our portfolio and increase
in profit is evidence our different approach to building businesses
and generating value from intellectual property is working.
During the period, three portfolio companies completed equity
funding rounds and a further two completed post period end. Of the
latter, we were delighted to see BlackRock, one of the world's
biggest asset managers, become the latest blue-chip investor to
back Exscientia, joining Novo Holdings, Evotec, Bristol Myers
Squibb and GT Healthcare Capital as the company completed a $100
million Series C financing round.
We have been shareholders in Exscientia since its incorporation
in 2012. The company is now an established world leader in using
artificial intelligence ("AI") to drive the discovery of novel
drugs to overcome conventional drug discovery limitations several
years faster than industry benchmarks. Its technology platform
created the first AI-designed drug to enter human clinical trials
and a number of other drug candidates are now undergoing
pre-clinical testing. Exscientia's industry partners include
Bristol Myers Squibb, Sanofi, Bayer, Roche and Sumitomo Dainippon
Pharma.
I am also excited by the potential and the current progress of
Pulsiv, a green technology company. This is now poised to scale up
having achieved significant industrial traction. It is focused on
improving the efficiency of power conversion from mains to devices,
or vice versa, reducing energy consumption, and enabling improved
product design. The technology has a range of other in-application
benefits. Potential uses include mains-powered electronic systems,
battery charging, lighting and motor control. Bosch is working with
the company to develop a solar microinverter, and a major
multinational is funding work to design the technology into a new
consumer product line. Pulsiv completed an equity funding round
after the period end.
Three further companies raised equity funding during the half
year.
Elute Intelligence is developing novel technology, based on
forensic linguistics, to speed searches through unstructured
document datasets. It raised equity during the period to support
its recently launched Patent Reader product and development of an
enterprise search tool.
Cambridge Raman Imaging is using its funding to support the
development of new medical imaging devices using its
graphene-enabled ultrafast laser technology.
Fieldwork Robotics raised GBP675,000 to support development of
its soft fruit and vegetable harvesting robot technology. During
the period, the company also entered a collaboration with
Bonduelle, a multinational vegetable producer.
Our innovative business model means we take founding equity
stakes in companies as they are incorporated and provide direct,
hands-on support from their very earliest stages, through
technology validation and forging industrial partnerships.
Industrial traction and partnerships are a vital part of our
business model. They are crucial for validating the commercial
viability of our portfolio companies' technologies, understanding
how and where they might be applied and what market needs or
demands they can meet. Our relationship with Bosch strengthened
over the period- already working with Pulsiv, they entered a second
portfolio collaboration with Fieldwork Robotics in July 2020.
Additionally, The Vaccine Group entered into partnership with ECO
Animal Health. The pipeline of further industrial collaborations
across the portfolio is strong.
The increased industrial traction further signifies how our
portfolio is maturing. As our portfolio companies mature, reach and
pass their inflection points, it's vital they have their own strong
management teams to guide their growth. Several of our portfolio
companies are in the process of finalising key senior
appointments.
Frontier IP has also taken steps to strengthen its team in
non-board roles. In September, we announced Mark Rosten as Software
Commercialisation Director. He has wide experience in leading
software and product development across Healthcare, FinTech and
Transport, including the delivery of the largest product innovation
project for Bango, the mobile payments specialist. We also
appointed Darren Winter as Director of Corporate Relationships to
support portfolio companies with their fundraising requirements.
His previous experience includes a variety of senior roles within
leading City firms.
Mark's appointment highlights another point of difference in the
way we commercialise intellectual property. His experience is very
much from within industry, tackling and solving the problems of
developing new products and bringing them to market. He is now
working with several of our portfolio companies.
We also raised money in July through an oversubscribed placing
and PrimaryBid offer, which gives us the firepower and nimbleness
to invest in the Group and increase our capacity to back our
portfolio companies.
This financial nimbleness was demonstrated as part of our
response to the challenges posed by COVID-19. Pulsiv, Nandi
Proteins and Alusid were able to take advantage of convertible
loans offered by the UK government's Future Fund to support
companies through COVID-19 because we and our partners were able to
provide the necessary matched funding.
I spoke in depth at the time of our annual results announcement
in November about the impact of COVID-19, both positive and
negative. Although some portfolio companies have experienced delays
to their technical or commercial development, this has not affected
the fundamental value of what they are doing; others, such as The
Vaccine Group, stand to benefit from the increased awareness of
scientific innovation in tackling global problems. As a Group, we
have been able to transition smoothly to remote working, and I
would very much like to thank our teams for their flexibility and
hard work.
I would also like to touch on our work in Portugal, where we
have four spin out companies making good progress. During the
period AquaInSilico, which is developing digital tools to improve
wastewater treatment, won a European Union EIT RawMaterials grant
and post-period end announced it was to receive $250,000 from the
United Nations Development Programme to support work to protect one
of the world's most diverse marine environments around the Cape
Verde archipelago. One of Portugal's leading venture capitalists
has also invested in inSignals Neurotech, a company developing
tools to support doctors conducting deep brain surgery. We also
supported our partner university, NOVA University of Lisbon, NOVA
School of Science and Technology with the commercialisation of its
technology with Corticeira Amorim, one of the world's largest
producers of cork products, to remove cork taint from natural
corks.
Frontier IP is in a strong position: we have strengthened our
team and are strengthening management across the portfolio as
several companies approach significant commercial, technical, and
industrial inflection points. We are confident of the Group's
prospects for the remainder of the year."
Enquiries
Frontier IP Group plc 0207 332 2338
Neil Crabb, Chief Executive
Andrew Johnson, Communications & Investor
Relations 07464 546 025
www.frontierip.co.uk
Allenby Capital Limited (Nominated Adviser) 0203 328 5656
Nick Athanas / George Payne
N+1 Singer (Broker) 0207 496 3000
Sandy Fraser / Harry Gooden / George
Tzimas
ABout frontier IP
Frontier IP unites science and commerce by identifying strong
intellectual property and accelerating its development through a
range of hands-on commercialisation services. A critical part of
the Group's work is involving relevant industry partners at an
early stage of development to ensure technology is validated and
meets real world demands and needs.
The Group looks to build and grow a portfolio of equity stakes
and licence income by taking an active involvement in spin-out
companies, including support for fund raising and collaboration
with relevant industry partners at an early stage of
development.
Interim Management Statement
Summary
Frontier IP made strong progress during the period in developing
portfolio companies and creating value for shareholders by:
-- Strengthening its team with the appointment of a Software
Commercialisation Director in a non-board role to drive forward
software development and projects within the Group and its
portfolio companies and a Director of Corporate Relationships
appointed to support portfolio companies with their fundraising
requirements
-- Developing industry partnerships to validate technology and
scale up portfolio companies: Fieldwork Robotics with Bosch and
Bonduelle, and The Vaccine Group with ECO Animal Health Group plc
and The Pirbright Institute
-- Supporting fund raising for further development - equity
fundraisings completed for Cambridge Raman Imaging, Fieldwork
Robotics and Elute Intelligence; convertible loans from the UK
government Future Fund matched by Frontier IP and other investors
for Nandi Proteins, Pulsiv and Alusid; grants for Fieldwork and
AquaInSilico
-- Increasing portfolio value: fair value of the portfolio of
equity investments increased by 21 per cent. to GBP23,449,000 at 31
December 2020, an increase of 43 per cent. year on year.
Operational Review
The Group and its portfolio companies made strong financial,
commercial and technical progress during the half year to 31
December 2020 against the backdrop of the COVID-19 pandemic. Our
portfolio continues to grow in value and mature with several
companies now approaching important inflection points. We further
developed our relationships with university, government and
industry partners, and strengthened our team. Much of the work
undertaken during the half year resulted in strong positive news
flow post period end.
Portfolio developments included:
Alusid: Frontier IP stake 35.6 per cent
Alusid creates beautiful, premium quality tiles and
architectural surfaces from recycled ceramic, glass and other
industrial waste. Distributors include Parkside Architectural
Tiles, the commercial arm of Topps Tiles plc and Panaz, while
customers include COS, H&M, Harrods, Selfridges, Nando's and
Pret-a-Manger. The company has shown the technology can be scaled
up for manufacture on industry-standard mass production equipment.
During the first half, the company raised GBP250,000 via a
convertible loan, including a GBP125,000 investment from the UK
government's Future Fund. The investment was matched by GBP100,000
from Frontier IP and GBP25,000 from a private investor.
AquaInSilico: Frontier IP stake 29 per cent
AquaInSilico is developing digital tools to optimise wastewater
treatment by removing phosphorus in a more environmentally friendly
and effective way than existing methods. The software uses a
mathematically-modelled biological approach based on understanding
the operating variables that result from biological and chemical
processes. The result is reduced use of chemicals and energy, and
reduced risk of harm from phosphorus leaching into waterways. The
company announced a EUR60,000 EIT RawMaterials' grant from the
European Union to support technology commercialisation in July.
Post period end, AquaInSilico announced it had been selected to
receive $250,000 as an Ocean Innovator through the United Nations
Development Programme's Ocean Innovation Challenge. This will see
the company supporting work to protect one of the world's most
diverse marine environments around Cape Verde.
Cambridge Raman Imaging: Frontier IP stake 25.8 per cent
Cambridge Raman Imaging is developing graphene-enabled ultrafast
lasers and other technologies for use in medical imaging devices to
diagnose and track tumours, and other detection applications. The
company announced its first equity funding round in July, raising
GBP250,000 from private investors. In December, Cambridge Raman
unveiled its participation in a EUR5 million pan-European project
looking to develop breakthrough medical imaging technology to
understand in greater depth the cellular origins of disease. The
technology will combine advanced laser techniques and artificial
intelligence to show how diseases unfold in cells and tissue at a
molecular level in near real time. Initial applications include a
microscope with work first focused on cancer.
Elute Intelligence Holdings: Frontier IP stake 41.2 per cent
Elute Intelligence's novel software tools mimics the way people
read to intelligently search and compare unstructured text-based
data. Its algorithms are based on forensic linguistics. Users can
use any text as a basis for search, including whole documents, to
identify the most relevant information within a library, whether it
is a collection of patents or unstructured enterprise documents -
an approach that is very different to conventional keyword or
Boolean search technologies. The company launched Patent Reader
during the period to search and compare patents. During the period,
it raised GBP250,000 through its first equity funding round which
was announced post period end. The funds are being used to support
Patent Reader and develop a new enterprise search tool.
Fieldwork Robotics: Frontier IP stake 23.4 per cent
Fieldwork Robotics is developing flexible robot technology to
harvest soft fruit and vegetables to help growers worldwide address
human labour shortages. The company announced two industrial
collaborations during the period. The first with Bosch is aimed at
optimising the raspberry harvesting robot's arms and software
development to reduce cost and increase speed as part of a drive
towards full-scale commercial production. The second with Bonduelle
Group, one of the world's leading vegetable producers, will see
Fieldwork develop a cauliflower-harvesting application of the
technology. Fieldwork was also awarded two grants via Innovate UK
totalling GBP229,000 to support work and mitigate the impact of
COVID-19. The company raised equity funding totalling GBP675,000
which was announced post period end.
Nandi Proteins: Frontier IP stake 20.1 per cent
Nandi Proteins develops processes and process control technology
to create new ingredients from whey, collagen and vegetable
proteins to replace E-number additives, fat and gluten in processed
food. During the period, the company raised GBP720,000 through a
convertible loan backed by the UK government's Future Fund, whose
GBP360,000 investment was matched by GBP320,000 from Frontier IP
and GBP40,000 from Shackleton Finance, another existing
shareholder.
Pulsiv: Frontier IP stake 18.9 per cent
Pulsiv is developing technology to improve the efficiency of
power conversion between mains and devices, or vice versa. It has
the potential to enable innovative industrial design, support
efforts to meet efficiency directives, reduce cost and enhance
product reliability. Applications include most mains powered
electronic systems, battery charging, lighting and motor control.
Industrial collaborators include Bosch, which is working with the
company to improve the energy efficiency of photovoltaic solar
cells. During the period, Pulsiv announced it had started work with
a major multinational, which is funding the company to design its
technology into a consumer product line, and had raised GBP500,000
via convertible loan, including GBP250,000 from the UK government's
Future Fund. This was matched by GBP50,000 from Frontier IP and
GBP200,000 from University of Plymouth Enterprise Limited, the
University of Plymouth's commercial consultancy. Post period end,
the company raised GBP880,000 through an equity funding round
supported by new and existing investors. As part of fund raising, a
total of GBP665,000 of debt was converted, including the Future
Fund loan.
The Vaccine Group: Frontier IP stake 17 per cent
The Vaccine Group ("TVG") is developing a novel vaccine platform
technology based on benign forms of herpesvirus, a group of viruses
found in all animals, including humans. The company is developing a
number of vaccines based on the technology, initially for use in
animals, to combat zoonotic and economically damaging diseases.
Work is underway on vaccines for SARS-CoV-2, the virus causing
COVID-19, Lassa fever, Ebola, bovine mastitis, bovine tuberculosis,
and streptococcus suis, a disease in pigs that can cause meningitis
in humans. TVG and its international partners have so far received
more than GBP9 million in grant funding and the company announced
it had raised GBP680,000 in equity funding in January 2020. During
the period, TVG announced a commercial collaboration with The
Pirbright Institute and ECO Animal Health Group to develop a
vaccine to combat porcine respiratory and reproductive syndrome
virus, one of the most economically damaging diseases to the global
pig industry.
Other post period end portfolio developments
Exscientia: Frontier IP stake 2.27 per cent
Exscientia, a clinical stage pharmaceutical company pioneering
the use of artificial intelligence to design new drugs, announced
that funds managed by BlackRock joined the company's Series C
funding round. Including existing Series C investors Novo Holdings,
Evotec, Bristol Myers Squibb and GT Healthcare Capital, the round
totalled $100 million in funding. This new capital will be used to
support Exscientia's platform development towards autonomous drug
design. In addition, the company will extend its proprietary
pipeline into clinical trials and expand existing capabilities in
biological analytics that support target selection and portfolio
development.
inSignals Neurotech: Frontier IP stake 33 per cent
InSignals Neurotech is developing technology to aid deep brain
simulation surgery on patients suffering Parkinson's disease. It is
also exploring potential use for other applications in neurology.
The company announced a EUR100,000 investment from leading
Portuguese venture capital firm Portugal Ventures.
Corporate developments
Having raised GBP2.2 million (net of expenses) through an equity
placing and PrimaryBid offer, Frontier IP strengthened its team.
Mark Rosten was appointed as Software Commercialisation Director, a
non-board role. Mark is the former Senior Vice President
Development for mobile payments specialist Bango plc. We also
appointed Darren Winter, a former senior sales director with more
than 30 years' city experience as Director of Corporate
Relationships, a non-board role. He has held a number of senior
roles in the City, including Head of Capital Markets, Sales, for
Collins Stewart Wealth Management, and will support portfolio
companies with their fundraising requirements.
Throughout the COVID-19 crisis, Frontier IP has taken the
necessary steps to understand and mitigate the risks. This includes
tailoring dedicated support packages for portfolio companies and
using the extensive government support packages, including the
Future Fund scheme, where appropriate.
Frontier IP continues to manage the risks associated with the
COVID-19 pandemic. All employees continue to work from home.
Post period end corporate developments
The Group announced it had supported partner university NOVA
University of Lisbon - NOVA School of Science Technology in
engaging with Corticeira Amorim, the world's leading producer of
cork products, to commercialise a technology to remove the major
cause of cork taint in wine from natural corks.
Outlook
Frontier IP looks to the future with confidence. Several
portfolio companies are now on the cusp of important inflection
points marking the significant commercial, technical and industrial
progress they made during the first half of the year and
beyond.
The involvement of BlackRock in Exscientia's $100 million Series
C is a further sign the company is gaining global recognition as a
world leader in using artificial intelligence to discover new
drugs. Interest in its technology is high and we believe Exscientia
will continue to enjoy strong progress.
Pulsiv, focused on how energy can be converted more efficiently
from the grid to devices and vice versa, raised funds and has the
potential to be a significant green technology company. The Vaccine
Group is moving forward well with its novel vaccine platform
technology to combat zoonotic and economically damaging diseases,
including COVID-19.
Our Portuguese business is showing encouraging development.
The GBP2.2 million (net of expenses) raised during the period
provides the Group with firepower to take advantage of the
increasing number of opportunities we are seeing across the
portfolio. We are strengthening our own team and the teams of our
portfolio companies, to ensure we have the capacity to do so. We
look forward to further positive developments during the rest of
the year.
Neil Crabb
Chief Executive Officer
Results Summary
Financial assets at fair value through profit and loss at 31
December 2020 increased to GBP25,093,000 (30 June 2020:
GBP20,307,000; 31 December 2019: GBP17,141,000). Unrealised profit
on the revaluation of investments over the first half increased by
33 per cent. to GBP4,009,000 (2019: GBP3,024,000) while revenue
from services increased to GBP184,000 (2019: GBP170,000). The
profit before tax increased by 45 per cent. to GBP3,033,000 (2019:
GBP2,088,000) reflecting the higher investment revaluations.
Administrative expenses increased marginally by 1 per cent. to
GBP1,049,000 (2019: GBP1,035,000) while the share-based payment
charge increased by 86% to GBP160,000 (2019: GBP86,000). Basic
earnings per share was 5.56p (2019: 4.66p).
Cash balances stood at GBP3,818,000 as at 31 December 2020 (30
June 2020: GBP2,968,000; 31 December 2019: GBP4,022,000) following
a placing which completed in July 2020 which raised GBP2,178,000
net of expenses. Net assets per share as at 31 December 2020 were
56.8p (30 June 2020: 51.0p; 31 December 2019: 46.6p). Debt
investments reflecting loans made to portfolio companies stood at
GBP1,644,000 as at 31 December 2020 (30 June 2020: GBP863,000; 31
December 2019: GBP790,000).
CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
For the six months ended 31 December 2020
Six months Six months Year ended
ended 31 ended 31 30 June
December December 2020 (audited)
Notes 2020 (unaudited) 2019 (unaudited)
GBP'000 GBP'000 GBP'000
Revenue
Revenue from services 184 170 404
Other operating income
Unrealised profit on the revaluation
of
investments 7 4,009 3,024 5,973
4,193 3,194 6,377
Administrative expenses (1,049) (1,035) (2,011)
Share based payments (160) (86) (230)
Other income 25 5 27
Profit from operations 3,009 2,078 4,163
Interest income on short-term
bank deposits 24 10 21
Profit from operations and before
tax 3,033 2,088 4,184
Taxation 5 - - -
Profit and total comprehensive
income attributable to the equity
holders of the Company 3,033 2,088 4,184
================== =================== ================
Profit per share attributable
to the equity
holders of the parent
Basic earnings per share 6 5.56p 4.66p 8.76p
Diluted earnings per share 6 5.31p 4.47p 8.41p
All the Group's activities are classed as continuing and there
were no comprehensive gains or losses in any period other than
those included in the statement of comprehensive income.
CONSOLIDATED STATEMENT OF FINANCIAL POSITION
At 31 December 2020
As at 31 As at 31 As at
December December 30 June
2020 (unaudited) 2019 (unaudited) 2020 (audited)
GBP'000 GBP'000 GBP'000
ASSETS Notes
Non-current assets
Tangible fixed assets 8 6 5
Goodwill 1,966 1,966 1,966
Financial assets at fair value
through profit and loss
Equity investments 7 23,449 16,351 19,444
Debt investments 7 1,644 40 863
Trade receivables and other
non-current assets 9 153 -
------------------- ------------------- ----------------
27,076 18,516 22,278
------------------- ------------------- ----------------
Current assets
Financial assets at fair value
through profit and loss
Debt investments 7 - 750 -
Trade receivables and other
current assets 506 505 830
Cash and cash equivalents 3,818 4,022 2,968
------------------- ------------------- ----------------
4,324 5,277 3,798
Total assets 31,400 23,793 26,076
LIABILITIES
Current liabilities
Trade and other payables (159) (192) (210)
------------------- ------------------- ----------------
(159) (192) (210)
------------------- ------------------- ----------------
Net assets 31,241 23,601 25,866
=================== =================== ================
EQUITY
Called up share capital 5,501 5,068 5,076
Share premium account 14,576 12,828 12,819
Reverse acquisition reserve (1,667) (1,667) (1,667)
Share based payment reserve 637 353 477
Retained earnings 12,194 7,019 9,161
------------------- ------------------- ----------------
Total equity 31,241 23,601 25,866
=================== =================== ================
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
For the six-months ended 31 December 2020
Share-
Share Reverse based Profit
Share premium acquisition payment and loss
capital account reserve reserve account Total
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
At 1st July 2019 4,243 9,791 (1,667) 293 4,931 17,591
Issue of shares 825 3,011 - (26) 26 3,836
Share-based payments - - - 86 - 86
Profit/comprehensive
income for the
period - - - - 2,088 2,088
At 31 December
2019 5,068 12,802 (1,667) 353 7,045 23,601
---------- ---------- -------------- --------- ----------- --------
Issue of shares 8 17 - (20) 20 25
Share-based payments - - - 144 - 144
Profit/comprehensive
income for the
period - - - - 2,096 2,096
---------- ---------- -------------- --------- ----------- --------
At 30 June 2020 5,076 12,819 (1,667) 477 9,161 25,866
---------- ---------- -------------- --------- ----------- --------
Issue of shares 425 1,757 - - - 2,182
Share-based payments - - - 160 - 160
Profit/comprehensive
income for the
period - - - - 3,033 3,033
At 31 December
2020 5,501 14,576 (1,667) 637 12,194 31,241
========== ========== ============== ========= =========== ========
CONSOLIDATED STATEMENT OF CASH FLOWS
For the six months ended 31 December 2020
Six months Six months Year ended
ended 31 ended 31 30 June
December December 2020 (audited)
2020 (unaudited) 2019 (unaudited) GBP'000
GBP'000 GBP'000
Cash flows from operating activities
Cash used in operations (573) (859) (1,758)
Taxation paid - - -
------------------ ------------------ ----------------
Net cash used in operating activities (573) (859) (1,758)
------------------ ------------------ ----------------
Cash flows from investing activities
Purchase of tangible fixed assets (6) (2) (3)
Purchase equity investments (52) (75) (97)
Purchase of debt investments (725) (353) (588)
Disposal of debt investments - - 40
Interest received 24 10 21
Other income - - 27
------------------ ------------------ ----------------
Net cash used in investing activities (759) (420) (600)
------------------ ------------------
Cash flows from financing activities
Proceeds from issue of equity shares 2,334 4,125 4,175
Costs of share issue (152) (290) (315)
------------------ ------------------ ----------------
Net cash generated from financing
activities 2,182 3,835 3,860
------------------ ------------------ ----------------
Net increase in cash and cash equivalents 850 2,556 1,502
Cash and cash equivalents at beginning
of period 2,968 1,466 1,466
------------------ ------------------ ----------------
Cash and cash equivalents at end
of period 3,818 4,022 2,968
================== ================== ================
Cash used in operations
Profit before tax 3,033 2,088 4,184
Adjustments for:
Share-based payments 160 86 230
Depreciation 3 3 6
Interest received (24) (10) (21)
Other income - - (27)
Fair value (gain) on financial assets
at fair value through profit or loss (4,009) (3,024) (5,973)
Changes in working capital:
Trade and other receivables 315 (55) (228)
Trade and other payables (51) 53 71
(573) (859) (1,758)
================== ================== ================
NOTES
1. General information
The Company is a limited liability company incorporated in
England and with its registered office at c/o CMS Cameron McKenna
Nabarro Olswang LLP, 78 Cannon Street, London EC4N 6AF. The
Company's main trading office is situated at 93 George Street,
Edinburgh, EH2 3ES.
The Company is quoted on the AIM market.
This condensed consolidated interim financial information was
approved and authorised for issue by a duly appointed and
authorised committee of the Board of Directors on 23(rd) March
2021.
This condensed interim financial information has not been
audited or reviewed by the Company's auditor.
2. Basis of preparation
This condensed consolidated interim financial information for
the six months ended 31 December 2020 has been prepared in
accordance with International Accounting Standard 34 "Interim
Financial Reporting". The condensed consolidated interim financial
information should be read in conjunction with the annual financial
statements for the year ended 30 June 2020, which have been
prepared in accordance with International Financial Reporting
Standards (IFRS) as adopted by the EU.
This condensed consolidated interim financial information does
not constitute statutory accounts within the meaning of section 434
of the Companies Act 2006. The comparatives for the full year ended
30 June 2020 are not the Company's full statutory accounts for that
year. A copy of the statutory accounts for that year has been
delivered to the Registrar of Companies. The auditor's report on
those accounts was unqualified and did not contain a statement
under sections 498(2) or 498(3) of the Companies Act 2006.
3. Accounting policies
The accounting policies applied by the Group in these unaudited
half year results are consistent with those applied in the annual
financial statements for the year ended 30 June 2020 as described
in the Group's Annual Report for that year and as available on our
website www.frontierip.co.uk . No new standards that have become
effective in the period have had a material effect on the Group's
financial statements.
Taxes on income in the interim periods are accrued using the tax
rate that would be applicable to expected total annual
earnings.
4. Segmental information
The chief operating decision-maker has been identified as the
Group's board of directors. The board reviews the Group's internal
reporting to assess performance and allocate resources. Currently
the board considers that the Group has one operating activity, the
commercialisation of intellectual property. The Group's revenue and
profit before taxation were derived almost entirely from its
principal activities within the UK. Though the Group has a
Portuguese subsidiary as well as partnerships and spin outs in
Portugal the associated revenues and costs are currently immaterial
and, accordingly, no additional geographical disclosures are
given.
5. Taxation
The taxation expense is recognised based on management's best
estimate of the weighted average annual tax rate expected for the
full financial year. The taxation expense for the six months to 31
December 2020 of nil (31 December 2019: nil) represents the
recognition of a deferred tax liability on unrealised fair value
gains less the recognition of available tax losses.
A deferred tax asset has not been recognised in respect of
trading losses in view of the uncertainty as to the level of future
taxable profits.
6. Earnings per share
The calculation of the basic earnings per share for the six
months ended 31 December 2020 and 31 December 2019 and for the year
ended 30 June 2020 is based on the earnings attributable to the
shareholders of Frontier IP Group Plc in each period divided by the
weighted average number of shares in issue during the period.
Basic earnings per share Weighted
Earnings average
attributable number of Basic earnings
to shareholders shares per share
GBP'000 Number Pence
Six months ended 31 December
2020 3,033 54,521,275 5.56
Six months ended 31 December
2019 2,088 44,843,057 4.66
Year ended 30 June 2020 4,184 47,753,569 8.76
Weighted
Diluted earnings per share Earnings average Diluted
attributable number of earnings
to shareholders shares per share
GBP'000 Number Pence
Six months ended 31 December
2020 3,033 57,119,246 5.31
Six months ended 31 December
2019 2,088 46,662,897 4.47
Year ended 30 June 2020 4,184 49,775,053 8.41
7. Financial assets at fair value through profit and loss
Financial assets at fair value through profit and loss comprise
the following:
Unquoted Unquoted Total
Equity Investments Debt Instruments
GBP'000 GBP'000 GBP'000
At 1(st) July 2019 13,252 437 13,689
Additions 75 353 428
Fair value increases 3,024 - 3,024
Fair value decreases - - -
-------------------- ------------------ --------
At 31(st) December 2019 16,351 790 17,141
-------------------- ------------------ --------
Additions
Fair value increases 22 235 257
Disposals - (40) (40)
Conversion of debt investments 82 (82) -
Fair value increases 4,040 - 4,040
Fair value decreases (1,051) (40) (1,091)
-------------------- ------------------ --------
At 30(th) June 2020 19,444 863 20,307
-------------------- ------------------ --------
Additions 52 725 777
Fair value increases 4,512 136 4,648
Fair value decreases (559) (80) (639)
-------------------- ------------------ --------
At 31(st) December 2020 23,449 1,644 25,093
==================== ================== ========
The most significant fair value increases for the six months
ended 31 December 2020 were from Exscientia (GBP1,869,000) and
Camgraphic (GBP1,125,000).
Debt investments are loans to portfolio companies to fund
early-stage costs, provide funding alongside grants and bridge to
an equity fundraise. Non-current and current debt investments are
set out below:
As at 31 As at 31 As at
December December 30 June
2020 2019 2020
GBP'000 GBP'000 GBP'000
Non-current 1,644 40 863
Current - 750 -
1,644 790 863
----------- ----------- ---------
The most significant loans made during the six months to 31
December 2020 were to Nandi Proteins (GBP350,000) and Alusid
(GBP195,000). The majority of the debt investments at 31 December
2020 were loans to Nandi Proteins GBP509,000, Alusid GBP331,000 and
Pulsiv GBP276,000. Post the period end the Group has converted
loans of GBP215,000 in Pulsiv as announced on 22 February 2021.
8. Copies of Half Yearly Report
Copies of the Half Yearly Report will be available on the
Company's website, www.frontierip.co.uk , and on request from the
Company's offices at 93 George Street, Edinburgh EH2 3ES no later
than 26(th) March 2021.
9. Equity holdings
All Group equity holdings in portfolio companies in the interim
management statement are as at 31 December 2020.
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END
IR FFFSFVRIVFIL
(END) Dow Jones Newswires
March 24, 2021 03:00 ET (07:00 GMT)
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