TIDMMDST
RNS Number : 5616Q
Medicsight Plc
05 August 2010
+-------------------------------+-------------------------------+
| Press release | 5 August 2010 |
+-------------------------------+-------------------------------+
Medicsight PLC
("Medicsight" or "the Company")
Interim Results for the six months ended 30 June 2010
Medicsight PLC ("Medicsight PLC" or "the Group"), industry leader in the
development of Computer-Aided Detection (CAD) and image analysis software to
assist in the early detection and diagnosis of disease, is pleased to announce
its interim results for the six months ended 30 June 2010.
Highlights
+------+-----------------------------------------------------+
| · | Responded to the US Food & Drug Administration's |
| | (FDA) second Additional Information request letter |
| | on 2 June 2010 |
+------+-----------------------------------------------------+
| · | Signed global distribution agreement for the new |
| | MedicCO2LON Insufflator product with MEDRAD Inc |
+------+-----------------------------------------------------+
| · | Revenue increased to GBP215,000 (2009: GBP67,000) |
| | with significant contribution from the MedicCO2LON |
| | Insufflator |
+------+-----------------------------------------------------+
| · | Operating costs reduced to GBP2,622,000 (2009: |
| | GBP4,913,000) |
+------+-----------------------------------------------------+
| · | Group cash balance at 30 June 2010 of GBP8,282,000 |
| | (2009: GBP13,746,000) |
+------+-----------------------------------------------------+
Allan Rowley, Chief Executive of Medicsight PLC commented:
"Medicsight has made good progress during the period - in particular -
increasing sales with the launch of our new MedicCO2LON Insuffulator, the first
"hardware" product Medicsight has developed to complement its software. ColonCAD
sales increased marginally and are in line with expectations in territories
where we have regulatory approval.
"Operating expenses are lower than prior year, due to the benefit of the 2009
cost reduction program.
"We remain in a healthy cash position with a cash balance of GBP8,282,000. With
growing revenues, we look to the future with confidence as we await decisions
from the US and Japanese regulatory authorities."
- Ends -
For further information, please contact:
+------------------------------------+-------------------------+
| Medicsight plc | |
+------------------------------------+-------------------------+
| Allan Rowley, CEO | Tel: +44 (0)207 605 |
| | 7950 |
+------------------------------------+-------------------------+
| | www.medicsight.com |
+------------------------------------+-------------------------+
| Daniel Stewart & Co | |
+------------------------------------+-------------------------+
| Emma Earl / Oliver Rigby | Tel: +44 (0) 207 776 |
| | 6550 |
+------------------------------------+-------------------------+
| | www.danielstewart.co.uk |
+------------------------------------+-------------------------+
Media enquiries:
+-------------------------------------+-------------------------+
| | |
+-------------------------------------+-------------------------+
| Abchurch | |
+-------------------------------------+-------------------------+
| Heather Salmond | Tel: +44 (0) 207 398 |
| | 7704 |
+-------------------------------------+-------------------------+
| heather.salmond@abchurch-group.com | www.abchurch-group.com |
+-------------------------------------+-------------------------+
| | |
+-------------------------------------+-------------------------+
| Simone Elviss | Tel: +44 (0) 207 398 |
| | 7728 |
+-------------------------------------+-------------------------+
| simone.elviss@abchurch-group.com | |
+-------------------------------------+-------------------------+
| | |
+-------------------------------------+-------------------------+
| Quincy Allan | Tel: +44 (0) 207 398 |
| | 7710 |
+-------------------------------------+-------------------------+
| quincy.allan@abchurch-group.com | |
+-------------------------------------+-------------------------+
Chief Executive's Review
I am pleased to report Medicsight's interim results for the six months ended 30
June 2010.
Regulatory Approvals & Product Development
FDA update
Following initial submission in November 2008 of a 510(k) premarket notification
to the US Food & Drug Administration (FDA) for ColonCAD 3.1, Medicsight received
a second Additional Information request from the FDA in January 2010.
After working closely with clinical, statistical and legal advisors, the Company
sent a comprehensive response to the FDA on 2 June 2010. We are currently
awaiting formal feedback from the FDA on the status of our application.
Japan - MHLW update
In November 2007 the Company submitted an application for our CTC workstation,
MedicRead to the Ministry of Health, Labour and Welfare (MHLW) of Japan. The
MHLW expert panel has reviewed our application. The MHLW team completed its
Quality Audit in March 2010 and is now in the process of completing the
Reliability Audit phase of the submission.
We continue to work closely with the MHLW authorities and await their feedback.
Product development
Medicsight continues product development - the latest version of the Medicsight
ColonCAD software version 4.0 has been integrated as an upgrade to a number of
our partners' products. This latest version marks a significant increase in
performance with a 50% reduction in false positives.
Commercial update
In the six months to 30 June 2010 Medicsight recorded revenues of GBP215,000,
which included GBP74,000 (2009: GBP67,000) from ColonCAD sales and GBP141,000
(GBP2009: Nil) from MedicCO2LON Insufflator sales.
The Company's ColonCAD and Insufflator sales came from partner sales in Europe
and other approved territories.
MedicCO2LONInsufflator
In January, Medicsight entered into a worldwide distribution agreement for
MedicCO2LON with MEDRAD Inc. under which MEDRAD is granted exclusive
distribution rights of the MedicCO2LON insufflator and associated consumables.
Automated CO2 insufflators, which inflate the colon with CO2 gas prior to CT
colonography, have been shown in clinical studies to significantly improve
colonic distension compared with manual insufflation. Clinical evidence also
shows reduced patient discomfort with automated CO2 insufflation.
The first sales of MedicCO2LON took place during the six months ended 30 June
2010. The product has been well received in Europe with sales of GBP141,000.
Medicsight expects MediCO2LON to be submitted for regulatory approval in Japan
and other territories in due course.
ESGAR update
The 2010 European Society of Gastrointestinal and Abdominal Radiology (ESGAR)
annual meeting took place in Dresden, Germany on 2 - 5 June. Medicsight, as a
corporate member of ESGAR, hosted a keynote educational symposium to profile the
added value of ColonCAD to radiologists in clinical practice.
Professor Steve Halligan from University College Hospital, London opened the
session with an overview of Colon CAD and methods for its evaluation, followed
by Professor Perry Pickhardt presenting results of research undertaken at the
University of Wisconsin.
Professor Pickhardt's results demonstrated the impressive diagnostic performance
of Medicsight's ColonCAD(TM) version 4.0 - which reported greater than 96%
sensitivity for the detection of clinically significant colon polyps in a
colorectal screening population of over 3,000 patients.
Full results of this research study are to be published in Radiology journal in
August 2010.
The symposium concluded with an interactive review of CT colonography cases to
provide visual examples of the positive benefit of ColonCAD(TM) for radiologists
in their clinical practice.
Financial review
Revenue for the six months ended 30 June 2010 increased to GBP215,000, which
included GBP74,000 (2009: GBP67,000) from ColonCAD and GBP141,000 (GBP2009: Nil)
from MedicCO2LON Insufflator sales.
In line with management's expectations, the Company reduced its total operating
costs to GBP2,622,000 in the six months to June 30, (2009: GBP4,913,000). This
was a result of proactive cost reduction and the restructuring programme the
Board undertook in 2009.
Medicsight remains in a strong financial position with cash of GBP8,282,000 at
30 June 2010.
Outlook
In light of increased sales of both our core ColonCAD product and also our new
MedicCO2LON insufflator launched in January, I am pleased with the progress
Medicsight has made during the period.
I am delighted that performance consistently exceeds radiologists' expectations
and that we have world renowned experts endorsing and using our products and
presenting at major events and conferences.
The interest in and demand for our products gives the Board confidence as we
eagerly await decisions from the US and Japanese regulatory authorities.
Allan Rowley
Chief Executive Officer
CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
FOR THE SIX MONTHS ENDED 30 JUNE 2010
+-----------------------------+--+-------------+-------------+------------+
| | | 6 months | 6 months | Year ended |
| | | ended | ended | 31 |
| | | 30 June | 30 June | December |
| | | 2010 | 2009 | 2009 |
+-----------------------------+--+-------------+-------------+------------+
| | | (unaudited) | (unaudited) | (audited) |
+-----------------------------+--+-------------+-------------+------------+
| | | GBP000 | GBP000 | GBP000 |
+-----------------------------+--+-------------+-------------+------------+
| | | | | |
+-----------------------------+--+-------------+-------------+------------+
| Revenue | | | | |
+-----------------------------+--+-------------+-------------+------------+
| Licence and support fees | | 215 | 67 | 115 |
+-----------------------------+--+-------------+-------------+------------+
| Cost of sales | | (75) | - | - |
+-----------------------------+--+-------------+-------------+------------+
| | | | | |
+-----------------------------+--+-------------+-------------+------------+
| Gross profit | | 140 | 67 | 115 |
+-----------------------------+--+-------------+-------------+------------+
| | | | | |
+-----------------------------+--+-------------+-------------+------------+
| | | | | |
+-----------------------------+--+-------------+-------------+------------+
| Sales and marketing expense | | (421) | (724) | (1,830) |
+-----------------------------+--+-------------+-------------+------------+
| Administrative expenses | | (1,460) | (2,970) | (1,255) |
+-----------------------------+--+-------------+-------------+------------+
| Research and development | | (597) | (860) | (4,324) |
+-----------------------------+--+-------------+-------------+------------+
| Share-based expense | | (144) | (359) | (569) |
+-----------------------------+--+-------------+-------------+------------+
| | | | | |
+-----------------------------+--+-------------+-------------+------------+
| Operating loss | | (2,482) | (4,846) | (7,863) |
+-----------------------------+--+-------------+-------------+------------+
| | | | | |
+-----------------------------+--+-------------+-------------+------------+
| | | | | |
+-----------------------------+--+-------------+-------------+------------+
| Finance revenue | | 23 | 37 | 245 |
+-----------------------------+--+-------------+-------------+------------+
| | | | | |
+-----------------------------+--+-------------+-------------+------------+
| Loss before taxation | | (2,459) | (4,809) | (7,618) |
+-----------------------------+--+-------------+-------------+------------+
| | | | | |
+-----------------------------+--+-------------+-------------+------------+
| Income tax expense | | - | - | - |
+-----------------------------+--+-------------+-------------+------------+
| | | | | |
+-----------------------------+--+-------------+-------------+------------+
| Loss for the period and | | (2,459) | (4,809) | (7,618) |
| Total comprehensive income | | | | |
| attributable to owners of | | | | |
| the parent | | | | |
+-----------------------------+--+-------------+-------------+------------+
| | | | | |
+-----------------------------+--+-------------+-------------+------------+
| | | | | |
+-----------------------------+--+-------------+-------------+------------+
| Loss per share - basic and | | (2p) | (3p) | (5p) |
| diluted | | | | |
+-----------------------------+--+-------------+-------------+------------+
| | | | | |
+-----------------------------+--+-------------+-------------+------------+
FOR THE SIX MONTHS ENDED 30 JUNE 2010
CONSOLIDATED STATEMENT OF FINANCIAL POSITION
+----------------------------+--+-------------+-------------+------------+
| | | 30 June | 30 June | 31 |
| | | 2010 | 2009 | December |
| | | | | 2009 |
+----------------------------+--+-------------+-------------+------------+
| | | (unaudited) | (unaudited) | (audited) |
+----------------------------+--+-------------+-------------+------------+
| | | GBP000 | GBP000 | GBP000 |
+----------------------------+--+-------------+-------------+------------+
| | | | | |
+----------------------------+--+-------------+-------------+------------+
| ASSETS | | | | |
+----------------------------+--+-------------+-------------+------------+
| Current assets | | | | |
+----------------------------+--+-------------+-------------+------------+
| Trade and other | | 315 | 890 | 354 |
| receivables | | | | |
+----------------------------+--+-------------+-------------+------------+
| Cash and cash equivalents | | 8,282 | 13,746 | 10,708 |
+----------------------------+--+-------------+-------------+------------+
| | | | | |
+----------------------------+--+-------------+-------------+------------+
| | | 8,597 | 14,636 | 11,062 |
+----------------------------+--+-------------+-------------+------------+
| | | | | |
+----------------------------+--+-------------+-------------+------------+
| | | | | |
+----------------------------+--+-------------+-------------+------------+
| Non-current assets | | | | |
+----------------------------+--+-------------+-------------+------------+
| Property, plant and | | 70 | 180 | 58 |
| equipment | | | | |
+----------------------------+--+-------------+-------------+------------+
| | | | | |
+----------------------------+--+-------------+-------------+------------+
| | | 70 | 180 | 58 |
+----------------------------+--+-------------+-------------+------------+
| | | | | |
+----------------------------+--+-------------+-------------+------------+
| | | | | |
+----------------------------+--+-------------+-------------+------------+
| Total assets | | 8,667 | 14,816 | 11,120 |
+----------------------------+--+-------------+-------------+------------+
| | | | | |
+----------------------------+--+-------------+-------------+------------+
| | | | | |
+----------------------------+--+-------------+-------------+------------+
| LIABILITIES | | | | |
+----------------------------+--+-------------+-------------+------------+
| Current liabilities | | | | |
+----------------------------+--+-------------+-------------+------------+
| Trade and other payables | | (556) | (1,791) | (694) |
+----------------------------+--+-------------+-------------+------------+
| | | | | |
+----------------------------+--+-------------+-------------+------------+
| Total liabilities | | (556) | (1,791) | (694) |
+----------------------------+--+-------------+-------------+------------+
| | | | | |
+----------------------------+--+-------------+-------------+------------+
| | | | | |
+----------------------------+--+-------------+-------------+------------+
| Net assets | | 8,111 | 13,025 | 10,426 |
+----------------------------+--+-------------+-------------+------------+
| | | | | |
+----------------------------+--+-------------+-------------+------------+
| | | | | |
+----------------------------+--+-------------+-------------+------------+
| SHAREHOLDERS EQUITY | | | | |
+----------------------------+--+-------------+-------------+------------+
| Issued share capital | | 7,776 | 7,776 | 7,776 |
+----------------------------+--+-------------+-------------+------------+
| Share premium | | 57,306 | 57,306 | 57,306 |
+----------------------------+--+-------------+-------------+------------+
| Share-based expense | | 3,202 | 2,848 | 3,058 |
| reserve | | | | |
+----------------------------+--+-------------+-------------+------------+
| Retained earnings | | (60,173) | (54,905) | (57,714) |
+----------------------------+--+-------------+-------------+------------+
| | | | | |
+----------------------------+--+-------------+-------------+------------+
| Equity attributable to | | 8,111 | 13,025 | 10,426 |
| owners of the parent | | | | |
+----------------------------+--+-------------+-------------+------------+
| | | | | |
+----------------------------+--+-------------+-------------+------------+
| | | | | |
+----------------------------+--+-------------+-------------+------------+
| | | | | |
+----------------------------+--+-------------+-------------+------------+
CONSOLIDATED STATEMENT OF CASH FLOW
FOR THE SIX MONTHS ENDED 30 JUNE 2010
+----------------------------+--+--------------+-------------+-------------+
| | | 6 months | 6 months | Year ended |
| | | ended | ended | 31 December |
| | | 30 June 2010 | 30 June | 2009 |
| | | | 2009 | |
+----------------------------+--+--------------+-------------+-------------+
| | | (unaudited) | (unaudited) | (audited) |
+----------------------------+--+--------------+-------------+-------------+
| | | GBP000 | GBP000 | GBP000 |
+----------------------------+--+--------------+-------------+-------------+
| | | | | |
+----------------------------+--+--------------+-------------+-------------+
| Cash flows from operating | | | | |
| activities | | | | |
+----------------------------+--+--------------+-------------+-------------+
| Cash used in operations | | (2,416) | (4,700) | (7,850) |
+----------------------------+--+--------------+-------------+-------------+
| | | | | |
+----------------------------+--+--------------+-------------+-------------+
| Net cash from operating | | (2,416) | (4,700) | (7,850) |
| activities | | | | |
+----------------------------+--+--------------+-------------+-------------+
| | | | | |
+----------------------------+--+--------------+-------------+-------------+
| | | | | |
+----------------------------+--+--------------+-------------+-------------+
| Cash flows from investing | | | | |
| activities | | | | |
+----------------------------+--+--------------+-------------+-------------+
| Purchase of equipment | | (30) | (7) | (11) |
+----------------------------+--+--------------+-------------+-------------+
| Interest received | | 24 | 37 | 245 |
+----------------------------+--+--------------+-------------+-------------+
| | | | | |
+----------------------------+--+--------------+-------------+-------------+
| Net cash used in investing | | (6) | 30 | 234 |
| activities | | | | |
+----------------------------+--+--------------+-------------+-------------+
| | | | | |
+----------------------------+--+--------------+-------------+-------------+
| | | | | |
+----------------------------+--+--------------+-------------+-------------+
| Effects of exchange rate | | (4) | 29 | (63) |
| changes | | | | |
+----------------------------+--+--------------+-------------+-------------+
| | | | | |
+----------------------------+--+--------------+-------------+-------------+
| Net decrease in cash and | | | | |
+----------------------------+--+--------------+-------------+-------------+
| cash equivalents | | (2,426) | (4,641) | (7,679) |
+----------------------------+--+--------------+-------------+-------------+
| | | | | |
+----------------------------+--+--------------+-------------+-------------+
| Cash and cash equivalents | | 10,708 | 18,387 | 18,387 |
| at 1 January | | | | |
+----------------------------+--+--------------+-------------+-------------+
| | | | | |
+----------------------------+--+--------------+-------------+-------------+
| Cash and cash equivalents | | | | |
+----------------------------+--+--------------+-------------+-------------+
| at period end | | 8,282 | 13,746 | 10,708 |
+----------------------------+--+--------------+-------------+-------------+
| | | | | |
+----------------------------+--+--------------+-------------+-------------+
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
FOR THE SIX MONTHS ENDED 30 JUNE 2010
+---------------------+---------+---------+-------------+-------------+----------+---------+
| | Share | Share | Share-based | Currency | Retained | Total |
| | Capital | Premium | payment | translation | earnings | Equity |
| | | | reserve | reserve | | |
+---------------------+---------+---------+-------------+-------------+----------+---------+
| | GBP000 | GBP000 | GBP000 | GBP000 | GBP000 | GBP000 |
+---------------------+---------+---------+-------------+-------------+----------+---------+
| | | | | | | |
+---------------------+---------+---------+-------------+-------------+----------+---------+
| At 1 January 2009 | 7,776 | 57,306 | 2,489 | - | (50,096) | 17,475 |
+---------------------+---------+---------+-------------+-------------+----------+---------+
| Loss for the period | - | - | - | - | (4,809) | (4,809) |
+---------------------+---------+---------+-------------+-------------+----------+---------+
| | | | | | | |
+---------------------+---------+---------+-------------+-------------+----------+---------+
| Total comprehensive | - | - | - | - | (4,809) | (4,809) |
| income | | | | | | |
+---------------------+---------+---------+-------------+-------------+----------+---------+
| | | | | | | |
+---------------------+---------+---------+-------------+-------------+----------+---------+
| Transactions with | - | - | 359 | - | - | 359 |
| owners - equity | | | | | | |
| settled Share-based | | | | | | |
| expense | | | | | | |
+---------------------+---------+---------+-------------+-------------+----------+---------+
| | | | | | | |
+---------------------+---------+---------+-------------+-------------+----------+---------+
| At 30 June 2009 | 7,776 | 57,306 | 2,848 | - | (54,905) | 13,025 |
+---------------------+---------+---------+-------------+-------------+----------+---------+
| Loss for the period | - | - | - | - | (2,809) | (2,809) |
+---------------------+---------+---------+-------------+-------------+----------+---------+
| Net exchange | - | - | - | - | - | - |
| adjustments | | | | | | |
+---------------------+---------+---------+-------------+-------------+----------+---------+
| | | | | | | |
+---------------------+---------+---------+-------------+-------------+----------+---------+
| Total comprehensive | - | - | - | - | (2,809) | (2,809) |
| income | | | | | | |
+---------------------+---------+---------+-------------+-------------+----------+---------+
| | | | | | | |
+---------------------+---------+---------+-------------+-------------+----------+---------+
| Transactions with | - | - | 210 | - | - | 210 |
| owners - equity | | | | | | |
| settled Share-based | | | | | | |
| expense | | | | | | |
+---------------------+---------+---------+-------------+-------------+----------+---------+
| | | | | | | |
+---------------------+---------+---------+-------------+-------------+----------+---------+
| At 31 December 2009 | 7,776 | 57,306 | 3,058 | - | (57,714) | 10,426 |
+---------------------+---------+---------+-------------+-------------+----------+---------+
| Loss for the period | - | - | - | - | (2,459) | (2,459) |
+---------------------+---------+---------+-------------+-------------+----------+---------+
| Net exchange | - | - | - | - | - | - |
| adjustments | | | | | | |
+---------------------+---------+---------+-------------+-------------+----------+---------+
| | | | | | | |
+---------------------+---------+---------+-------------+-------------+----------+---------+
| Total comprehensive | - | - | - | - | (2,459) | (2,459) |
| income | | | | | | |
+---------------------+---------+---------+-------------+-------------+----------+---------+
| | | | | | | |
+---------------------+---------+---------+-------------+-------------+----------+---------+
| Transactions with | - | - | 144 | - | - | 144 |
| owners - equity | | | | | | |
| settled Share-based | | | | | | |
| expense | | | | | | |
+---------------------+---------+---------+-------------+-------------+----------+---------+
| | | | | | | |
+---------------------+---------+---------+-------------+-------------+----------+---------+
| | | | | | | |
+---------------------+---------+---------+-------------+-------------+----------+---------+
| At 30 June 2010 | 7,776 | 57,306 | 3,202 | - | (60,173) | 8,111 |
+---------------------+---------+---------+-------------+-------------+----------+---------+
| | | | | | | |
+---------------------+---------+---------+-------------+-------------+----------+---------+
| | | | | | | |
+---------------------+---------+---------+-------------+-------------+----------+---------+
NOTES TO INTERIM FINANCIAL STATEMENTS
FOR THE SIX MONTHS ENDED 30 JUNE 2010
1. Basis of preparation of interim financial information
These interim consolidated financial statements are for the six months ended 30
June 2010. The interim financial report, which is unaudited, has been prepared
in accordance with the recognition and measurement criteria of International
Financial Reporting Standards and IFRIC interpretations adopted for use in the
European Union (IFRS). The accounting policies and methods of computation used
are consistent with those used in the Group annual report for the year ended 31
December 2009 and are expected to be used in the Group Annual Report for the
year ended 31 December 2010.
In the period, MedicCO2LON Limited, a subsidiary of the group, made the first
sales of its CO2 insufflation device. The revenue from the device is recognised
as goods and orders are satisfied, and goods are delivered.
The financial information for the year ended 31 December 2009 does not
constitute statutory information. A copy of the statutory accounts for that year
has been delivered to the Registrar of Companies. The auditors' report on these
accounts was not qualified and did not contain statements under section 498(2)
and (3) of the Companies Act 2006.
The interim consolidated financial statements are presented in pounds sterling
because that is the currency of the primary economic environment in which the
group operates. All values are rounded to the nearest thousand pounds (GBP000)
except when otherwise stated.
2. Segment Reporting
The Group operates in two business areas. Our primary business is the
development and commercialisation of medical imaging software. To complement
this business the Group has launched the MedicCO2LON Insufflator, a hardware
product that is used to introduce carbon dioxide gas to distend the colon when
patients are undergoing a CT colonography examination. This results in improved
image quality and supports diagnostic interpretation.
Operating results are reported to the Group's chief operating decision maker on
a geographical basis. As a new business our MedicCO2LON business operates
through a new subsidiary in the UAE. The following reports financial information
on a geographical basis and reconciles it to the Group's results.
+---------------+-+---------+--------+--------+----------+---------+
| | | UK & | Japan | US | All | Total |
| | | Europe | GBP000 | GBP000 | other | GBP000 |
| | | GBP000 | | | segments | |
| | | | | | GBP000 | |
+---------------+-+---------+--------+--------+----------+---------+
| | | | | | | |
+---------------+-+---------+--------+--------+----------+---------+
| 6 months | | | | | | |
| ended | | | | | | |
| 30 June 2010 | | | | | | |
+---------------+-+---------+--------+--------+----------+---------+
| Revenue | | 74 | - | - | 141 | 215 |
+---------------+-+---------+--------+--------+----------+---------+
| Gross Profit | | 74 | - | - | 66 | 140 |
+---------------+-+---------+--------+--------+----------+---------+
| Depreciation | | 8 | 8 | - | 1 | 17 |
+---------------+-+---------+--------+--------+----------+---------+
| Interest | | 23 | - | - | - | 23 |
| receivable | | | | | | |
+---------------+-+---------+--------+--------+----------+---------+
| Share-based | | 135 | 9 | - | - | 144 |
| expense | | | | | | |
+---------------+-+---------+--------+--------+----------+---------+
| Loss before | | (1,757) | (433) | - | (269) | (2,459) |
| tax | | | | | | |
+---------------+-+---------+--------+--------+----------+---------+
| Non-current | | 8 | 60 | - | 2 | 70 |
| assets | | | | | | |
+---------------+-+---------+--------+--------+----------+---------+
| Segment | | 8,337 | 282 | - | 48 | 8,667 |
| assets | | | | | | |
+---------------+-+---------+--------+--------+----------+---------+
| Segment | | (477) | (38) | - | (41) | (556) |
| liabilities | | | | | | |
+---------------+-+---------+--------+--------+----------+---------+
| | | | | | | |
+---------------+-+---------+--------+--------+----------+---------+
+----------------+-+---------+---------+--------+----------+---------+
| | | UK & | Japan | USA | All | Total |
| | | Europe | GBP000 | GBP000 | other | GBP000 |
| | | GBP000 | | | segments | |
| | | | | | GBP000 | |
+----------------+-+---------+---------+--------+----------+---------+
| | | | | | | |
+----------------+-+---------+---------+--------+----------+---------+
| 6 months ended | | | | | | |
| 30 June 2009 | | | | | | |
+----------------+-+---------+---------+--------+----------+---------+
| Revenue | | 67 | - | - | - | 67 |
+----------------+-+---------+---------+--------+----------+---------+
| Depreciation | | 34 | 37 | - | - | 71 |
+----------------+-+---------+---------+--------+----------+---------+
| Interest | | 37 | - | - | - | 37 |
| receivable | | | | | | |
+----------------+-+---------+---------+--------+----------+---------+
| Share-based | | 312 | 15 | 32 | - | 359 |
| expense | | | | | | |
+----------------+-+---------+---------+--------+----------+---------+
| Loss before | | (3,886) | (687) | (10) | (226) | (4,809) |
| tax | | | | | | |
+----------------+-+---------+---------+--------+----------+---------+
| Non-current | | 47 | 133 | - | - | 180 |
| assets | | | | | | |
+----------------+-+---------+---------+--------+----------+---------+
| Segment assets | | 14,388 | 369 | - | 59 | 14,816 |
+----------------+-+---------+---------+--------+----------+---------+
| Segment | | (1,627) | (25) | (59) | (80) | (1,791) |
| liabilities | | | | | | |
+----------------+-+---------+---------+--------+----------+---------+
| | | | | | | |
+----------------+-+---------+---------+--------+----------+---------+
| | | | | | | |
+----------------+-+---------+---------+--------+----------+---------+
| | | | | | | |
+----------------+-+---------+---------+--------+----------+---------+
| | | UK & | Japan | USA | All | Total |
| | | Europe | GBP000 | GBP000 | other | GBP000 |
| | | GBP000 | | | segments | |
| | | | | | GBP000 | |
+----------------+-+---------+---------+--------+----------+---------+
| | | | | | | |
+----------------+-+---------+---------+--------+----------+---------+
| 12 months | | | | | | |
| ended | | | | | | |
| 31 December | | | | | | |
| 2009 | | | | | | |
+----------------+-+---------+---------+--------+----------+---------+
| Revenue | | 115 | - | - | - | 115 |
+----------------+-+---------+---------+--------+----------+---------+
| Depreciation | | 58 | 73 | - | - | 131 |
+----------------+-+---------+---------+--------+----------+---------+
| Interest | | 245 | - | - | - | 245 |
| receivable | | | | | | |
+----------------+-+---------+---------+--------+----------+---------+
| Share-based | | 512 | 32 | 25 | - | 569 |
| expense | | | | | | |
+----------------+-+---------+---------+--------+----------+---------+
| Loss before | | (5,964) | (1,242) | (110) | (302) | (7,618) |
| tax | | | | | | |
+----------------+-+---------+---------+--------+----------+---------+
| Non-current | | 13 | 45 | - | - | 58 |
| assets | | | | | | |
+----------------+-+---------+---------+--------+----------+---------+
| Segment assets | | 10,839 | 233 | - | 48 | 11,120 |
+----------------+-+---------+---------+--------+----------+---------+
| Segment | | (664) | (22) | - | (8) | (694) |
| liabilities | | | | | | |
+----------------+-+---------+---------+--------+----------+---------+
| | | | | | | |
+----------------+-+---------+---------+--------+----------+---------+
3. Earnings per share
+----------------------+--+--------------+-------------+--------------+
| | | 6 months | 6 months | Year ended |
| | | ended | ended | 31 December |
| | | 30 June 2010 | 30 June | 2009 |
| | | | 2009 | |
+----------------------+--+--------------+-------------+--------------+
| | | (unaudited) | (unaudited) | (audited) |
+----------------------+--+--------------+-------------+--------------+
| | | | | |
+----------------------+--+--------------+-------------+--------------+
| | | | | |
+----------------------+--+--------------+-------------+--------------+
| | | | | |
+----------------------+--+--------------+-------------+--------------+
| Loss for the period | | (2,459) | (4,809) | (7,618) |
| (GBP000) | | | | |
+----------------------+--+--------------+-------------+--------------+
| Weighted average | | | | |
| number | | | | |
+----------------------+--+--------------+-------------+--------------+
| of ordinary shares | | 155,525 | 155,525 | 155,525 |
| (000) | | | | |
+----------------------+--+--------------+-------------+--------------+
| Loss per ordinary | | | | |
| share | | | | |
+----------------------+--+--------------+-------------+--------------+
| - basic and diluted | | (2p) | (3p) | (5p) |
+----------------------+--+--------------+-------------+--------------+
| | | | | |
+----------------------+--+--------------+-------------+--------------+
The loss per share is based on the weighted average number of ordinary shares in
issue during the year. The Group has recorded a loss in all periods. No
adjustment has been made to the basic loss per share, as the exercise of the
share options would have the effect of reducing the loss per ordinary share and
is anti-dilutive.
4. Share options
The Group has granted share options to eligible employees since 2003.
A summary of the movement on the Group's share option plans is:
+------------------+-----------+------------+--+--------------+-----------+
| | 30 June 2010 | | 31 December 2009 |
+------------------+------------------------+--+--------------------------+
| | | | | | |
+------------------+-----------+------------+--+--------------+-----------+
| | Number of | Weighted | | Number of | Weighted |
| | Shares | Average | | Shares | Average |
| | | Exercise | | | Exercise |
| | | Price | | | Price |
+------------------+-----------+------------+--+--------------+-----------+
| | | | | | |
+------------------+-----------+------------+--+--------------+-----------+
| | | | | | |
+------------------+-----------+------------+--+--------------+-----------+
| Start of period | 9,128,359 | GBP0.20 | | 13,312,500 | GBP0.69 |
+------------------+-----------+------------+--+--------------+-----------+
| Granted | 100,000 | GBP0.09 | | 8,148,750 | GBP0.09 |
+------------------+-----------+------------+--+--------------+-----------+
| Forfeited | (451,460) | GBP0.64 | | (12,332,891) | GBP0.65 |
+------------------+-----------+------------+--+--------------+-----------+
| Exercised | - | - | | - | - |
+------------------+-----------+------------+--+--------------+-----------+
| | | | | | |
+------------------+-----------+------------+--+--------------+-----------+
| At period end | 8,776,899 | 0.17 | | 9,128,359 | GBP0.20 |
+------------------+-----------+------------+--+--------------+-----------+
| | | | | | |
+------------------+-----------+------------+--+--------------+-----------+
| | | | | | |
+------------------+-----------+------------+--+--------------+-----------+
| Exercisable at | 3,976,249 | 0.27 | | 2,939,217 | GBP0.37 |
| period end | | | | | |
+------------------+-----------+------------+--+--------------+-----------+
| | | | | | |
+------------------+-----------+------------+--+--------------+-----------+
| | | | | | |
+------------------+-----------+------------+--+--------------+-----------+
On 26 January 2010 the Group introduced a new share option plan L. 100,000
options were issued at an exercise price of 8.5p. Under this plan, one sixth of
the options vest every six months.
The following data summarises the status of the share options outstanding at 30
June 2010:
+----------------+-----------------+--------------------+
| | | Remaining |
| | | contractual |
+----------------+-----------------+--------------------+
| Share Option | Number | life (years) |
| Plan | | |
+----------------+-----------------+--------------------+
| | | |
+----------------+-----------------+--------------------+
| | | |
+----------------+-----------------+--------------------+
| A | 28,500 | 2.5 |
+----------------+-----------------+--------------------+
| B | 156,500 | 4.2 |
+----------------+-----------------+--------------------+
| C | 85,000 | 5.6 |
+----------------+-----------------+--------------------+
| D | - | 6.0 |
+----------------+-----------------+--------------------+
| E | 800,000 | 6.6 |
+----------------+-----------------+--------------------+
| F | 50,000 | 6.9 |
+----------------+-----------------+--------------------+
| G | 150,000 | 7.5 |
+----------------+-----------------+--------------------+
| H | - | 7.9 |
+----------------+-----------------+--------------------+
| I | 108,333 | 8.5 |
+----------------+-----------------+--------------------+
| J | 6,998,566 | 8.9 |
+----------------+-----------------+--------------------+
| K | 300,000 | 8.9 |
+----------------+-----------------+--------------------+
| L | 100,000 | 9.5 |
+----------------+-----------------+--------------------+
| | | |
+----------------+-----------------+--------------------+
| | | |
+----------------+-----------------+--------------------+
| | 8,776,899 | |
+----------------+-----------------+--------------------+
| | | |
+----------------+-----------------+--------------------+
| | | |
+----------------+-----------------+--------------------+
Options are fair valued using the Black-Scholes option pricing model. No
performance conditions were included in the fair value calculations. The
following weighted average assumptions were used to estimate the fair value of
stock options granted in the period:
+--------------------+---+------------+
| Dividend yield | | Nil |
+--------------------+---+------------+
| Expected | | 87.7% |
| volatility | | |
+--------------------+---+------------+
| Risk free rates | | 3.96 % |
+--------------------+---+------------+
| Expected term | | 5.9 years |
+--------------------+---+------------+
Expected volatility is based on historical volatility over the last three years
of MGT Capital Investments, Inc (the parent company). The expected life is the
average expected period to exercise. The risk free rate of return is the yield
on zero-coupon UK government bonds of a term consistent with the assumed option
life.
In the period ending 30 June 2010 the Group recorded a share option charge of
GBP144,000 (30 June 2009: GBP359,000).
5. Related Parties
The Group has related party relationships with its subsidiaries, its parent
company (MGT Capital Investments, Inc.), directors, employees and subsidiary
companies of its parent Group.
Other subsidiary companies of the parent also operate from 66 Hammersmith Road,
London and some establishment, finance, IT and administration costs are charged
to, and from, these companies. In the six months to 30 June 2010 MGT Capital
Investments (UK) Ltd. charged the Group GBP345,000 (30 June 2009: GBP384,000).
At 30 June 2010, the balance outstanding was GBP2,678 (30 June 2009: GBP17,852).
In this period the Group charged MGT Capital Investments (UK) Ltd GBP14,000 (30
June 2009: GBP13,000) for facility related costs.
6. Reconciliation of net cash flows from operating activities
+------------------------+----------+-------------+-------------+-------------+
| | | 6 months | 6 months | Year ended |
| | | ended | ended | 31 December |
| | | 30 June | 30 June | 2009 |
| | | 2010 | 2009 | |
+------------------------+----------+-------------+-------------+-------------+
| | | (unaudited) | (unaudited) | (audited) |
+------------------------+----------+-------------+-------------+-------------+
| | | GBP000 | GBP000 | GBP000 |
+------------------------+----------+-------------+-------------+-------------+
| | | | | |
+------------------------+----------+-------------+-------------+-------------+
| | | | | |
+------------------------+----------+-------------+-------------+-------------+
| Loss for the period | | (2,459) | (4,809) | (7,618) |
+------------------------+----------+-------------+-------------+-------------+
| Adjustments for: | | - | | |
+------------------------+----------+-------------+-------------+-------------+
| Depreciation | | 17 | 71 | 131 |
+------------------------+----------+-------------+-------------+-------------+
| Loss on disposal of | | | - | 72 |
| equipment | | | | |
+------------------------+----------+-------------+-------------+-------------+
| Loss on sale of | | - | - | 86 |
| investments | | | | |
+------------------------+----------+-------------+-------------+-------------+
| Forgiveness/impairment | | - | - | (153) |
| of trading balances of | | | | |
| related entities | | | | |
+------------------------+----------+-------------+-------------+-------------+
| Interest income | | (23) | (37) | (245) |
+------------------------+----------+-------------+-------------+-------------+
| Interest expense | | - | - | - |
+------------------------+----------+-------------+-------------+-------------+
| Foreign currency | | - | - | - |
| finance cost | | | | |
+------------------------+----------+-------------+-------------+-------------+
| Share options | | 144 | 359 | 569 |
+------------------------+----------+-------------+-------------+-------------+
| Changes in working | | - | | |
| capital | | | | |
+------------------------+----------+-------------+-------------+-------------+
| Trade and other | | 39 | 408 | 446 |
| receivables | | | | |
+------------------------+----------+-------------+-------------+-------------+
| Trade and other | | (134) | (692) | (1,138) |
| payables | | | | |
+------------------------+----------+-------------+-------------+-------------+
| | | | | |
+------------------------+----------+-------------+-------------+-------------+
| Cash spent in | | (2,416) | (4,700) | (7,850) |
| operations | | | | |
+------------------------+----------+-------------+-------------+-------------+
| | | | | |
+------------------------+----------+-------------+-------------+-------------+
This information is provided by RNS
The company news service from the London Stock Exchange
END
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