BYOT.L Regulatory News (BYOT)

20 Jun 2007 07:01

Byotrol PLC20 June 2007 For release at 07.00 hours 20 June 2007 BYOTROL PLC PRELIMINARY RESULTS FOR THE YEAR ENDED 31 MARCH 2007 Byotrol plc ("Byotrol" or the "Company"), the anti-microbial technology company,announces its preliminary results for the year ended 31 March 2007. Highlights: • Environmental Protection Agency (EPA) registration successfully gained in USA• Fundraising completed in November 2006 - raising £4.6m net of expenses• Significant licensing deal signed with Synergy Healthcare plc in November 2006• Product ranges launched over target markets Financials: • Turnover increased to £673,542 (2006: £90,014)• Year end cash balance £3.55m (2006: £1.21m)• Pre-tax loss of £1.74m (2006: Loss of £1.99m)• Loss per share reduced to 4.56 pence (2006: Loss per share 8.59p) Chairman of Byotrol, Wesley Devoto, said: "We are optimistic that thefoundations created in the last 20 months since flotation have provided thebedrock for the successful development and growth of the Company. Initialtrading this year supports that assertion and we are confident that the Groupwill continue its growth pattern in the current financial year. We will continueto drive forward in our six target markets, increasing our use of resources toachieve our objectives." ...Ends... For further information, please contact: Byotrol plc Tel: 0161 277 9518Stephen Falder, Deputy Chairman www.byotrol.comDavid McRobbie, Chief ExecutiveRichard Bell, Finance Director Rawlings Financial PR Limited Tel: 01756 770 376Catriona Valentine catriona@rawlingsfinancial.co.uk www.rawlingsfinancial.co.uk Charles Stanley Securities Tel: 020 7149 6457Philip Davies / Anthony Noakes CHAIRMAN AND CHIEF EXECUTIVE'S REVIEW It gives us great pleasure to announce the results for the year ended 31 March2007 - the first full year's trading for Byotrol plc. The Group has continued to make progress throughout the year and we are pleasedto report broadening and growing interest in our patented anti microbialtechnology amongst significant global businesses. In addition to progress in theCompany's original target markets, further recognition of the benefits ofByotrol's technology was generated in other key market sectors. This initiatedthe Board's decision in November 2006 to seek further resources from investorsvia a Placing, that raised £4.6 million net of expenses, to ensure that theopportunities in these markets could be captured. It also broadened ourinstitutional shareholder base, bringing new investors to the Company. TheBoard has used and continues to use the new money carefully and judiciously tosecure further patent protections and prepare the Group for expansion into newmarkets. Financial Results The Group turnover for the year was £673,542 (2006: £90,014)(, which was in linewith our expectations). The loss after taxation for the year was £1,743,904(2006: £1,983,750), which was slightly more than that anticipated at the time ofthe Placing due to the accelerated incurral of certain patent and marketingcosts and an FRS 20 charge of £94,231 on the granting of share options tocertain directors and staff. Turnover is divided into three forms of sale:product sales, licence fees and royalties. Product sales were £471,025 (2006:£90,014) and licence fees £202,517 (2006: £Nil). Cash inflow was £2,339,985(2006: £1,254,150) and the balance sheet showed a net worth of £4,157,720 (2006:£1,043,837). The year end cash balance was £3,553,038 (2006: £1,213,053). Strategy Byotrol is a combination of polymers and biocides which increases theeffectiveness of the biocides and gives significant residual efficacy. It wasoriginally developed in the research for an anti-microbial paint but was foundto have a myriad of other applications. The Company's strategy is to build Byotrol into a globally recognised brandassociated with the highest standards of safe, effective and long lastingmicrobial control. Originally three market sectors were identified and pursued -Healthcare, Food & Beverage and Industrial & Technical. However, progress hasbeen made in three other major markets - Consumer Products, Hospitality &Leisure and Agriculture. We intend to move at an accelerating rate into thesekey markets through the development of strategic partnerships with major globalplayers. Our aim is to partner, rather than compete, with organisations whosefinancial and marketing muscle and global reach will enable Byotrol, as aningredient brand, to achieve worldwide presence rapidly. We will pursue a variety of partnership styles, as appropriate, either makingdirect product sales or licensing the use of Byotrol to generate licence feesand royalties or through joint ventures. Healthcare A major concern, as widely reported in the media, is the risk in hospitals ofpatients getting Hospital Acquired Infections. A significant efficacy study,conducted over a six month period in the Glasgow Royal Infirmary ("GRI"), showedreductions of over 50 per cent in environmental MRSA in a working test ward whenByotrol wipes were used once daily on a fraction of the surfaces. The Companywas delighted with the results of this important study, which were presented toan international professional audience in Holland in October 2006. A study was also completed by recently opened Monroe Hospital in Indiana, USA,producing similar results to the GRI study. Monroe is part of a significanthospital group, so the success of the study bodes well for our US healthcaredevelopment. They are now using Byotrol products as part of their regularcleaning regime. A significant licensing deal was completed with Synergy Healthcare plc inNovember 2006, which initially granted exclusivity for certain healthcaremarkets in the UK. However, this is scalable into global markets subject toadditional licence fees. The arrangement with Synergy healthcare is a clearexample of how we intend to expand the reach of Byotrol's technology quicklythrough partnerships with existing successful businesses. Food and Beverage A principal issue on production lines is hygiene and the control of diseases,such as listeria, salmonella and e-coli, against which Byotrol's efficacy isalready proven. A complete suite of products, the Nanosphere range, has beenlaunched in the UK for commercial food and drink businesses. This sector has aneed for both bespoke and stocked items which the Nanosphere range providesdirectly and through our growing network of distribution partners. In the USA, following Environmental Protection Agency registration in 2006, inorder to capitalise on this progress our sales and marketing team has beenstrengthened by the appointment of an experienced industry expert from a majorcompany within the market place. Industrial and Technical We launched products into a number of niche markets in this sector during theyear. Byotrol's technology is principally presented to customers in thesemarkets as an ingredient brand, which adds value to existing products or createsnew product opportunities. An example includes the Pets at Home grooming anddeodorising range of products, which gained the Pets at Home new product of theyear award. We concluded very successful trials with one of the world's leading securityprinters, giving rise to the availability of anti-microbial currency notes inthe future. Widespread concern over avian flu resulted in the sale of 20,000 emergency kitsfor use in strategic office environments in the last quarter of the financialyear. Since the year end, Fellowes Inc, a worldwide provider of accessories andbusiness machines, has announced the launch of Virashield including Byotrol in arange of wipes and disinfectants for the office workplace. Consumer Products Public awareness and concern about the potential threats from micro organismsprovide a strong stimulus for development in this very significant marketsector. The consumer is very concerned about domestic hygiene and this providesa significant market opportunity. By ensuring that Byotrol's technology has been carefully positioned into thepioneer markets, the Board believes that important value can be added to theByotrol brand. As this market is vast and contains very material players, theBoard has decided that the optimum solution is to seek an arrangement with anorganisation with specialist expertise in accessing the global leaders inconsumer products. The team is working hard to ensure that, as soon as ispracticable, Byotrol will achieve an association with a major internationalconsumer brands company to bring the Group's technology within the reach of asignificant mass of the global population. Hospitality and Leisure Considerable potential exists in this very large market, which includes hotelsand restaurants as well as cruise ships and sports facilities. On cruise ships,there have been significant outbreaks of Norovirus and in sports centres avariety of microbial related infections have been reported. A very successfulfield trial on a working German-based cruise ship, part of one of the largestfleets of international cruise lines, has initiated a focused programme oftesting and product refinement that is on course to produce a range of Byotrolsolutions to combat serious microbial outbreaks that occur in the cruise shipenvironment, as well as public transport systems and hotels. Contec Inc., in the USA, continues to enjoy success with its Athletix range ofwipes products with Byotrol, developed for the hygienic maintenance of gymnasiumand sports equipment. Agriculture This is one of the world's largest markets for anti-microbial agents, from fruitand crop protection to animal welfare and poultry hygiene. The Company believesthat this market will be most effectively satisfied by an existing player inthis sector, using Byotrol's technology where safety, residual efficacy andbroad spectrum action are a highly attractive combination of features. Early progress has been made to demonstrate the significant advantages of usingByotrol and, following highly encouraging scoping tests, an eight month croptrial commenced in February 2007 under the supervision of the Plant Medicineprogramme of the University of Florida, headed by Professor Robert J McGovern. During the year we launched the Agrisphere range, which includes teat wipes, forfarmers in the UK. These wipes improve quality in milk production and results todate have been encouraging. Another key benefit of the Agrisphere wipes, unlikeother traditional products which are iodine based, is that they do not causeirritation when used on dairy cows. Also in the USA, excellent results have been seen in studies supervised by theUnited States Department of Agriculture regarding the control of salmonella infertilised eggs through the use of Byotrol in the egg washing process. Intellectual Property and Quality Management The Company continued its policy of taking active steps to protect itsintellectual property. This important work resulted in the filing of six newinventions, including two devices and three important use patents. The Companyobtained ISO 13485 approval, which is the medical device quality managementstandard. This is expected to expedite the supply of Byotrol products tohealthcare and medical customers worldwide. During the year, we were also awarded the CE Mark for medical and disinfectantproducts and achieved USA Environmental Protection Agency approval. The Byotrol Team We have developed our team significantly through the addition of experiencedpersonnel in the key fields of sales and marketing, research and development,regulatory approvals and product development. Our UK operation has grown fasterthan the US but we expect this trend to change as our US business starts toincrease in size. We also appointed Richard Bell, who joined us as FinanceDirector having previously acted as a financial consultant for the Company.Richard brings solid plc and City experience to the Board. We would like to express our thanks to all our staff for their hard work andcommitment, which have enabled us to achieve significant goals this year. Current Trading and Outlook We are optimistic that the foundations created in the last 20 months sinceflotation have provided the bedrock for the successful development and growth ofthe Company. Initial trading this year supports that assertion and we areconfident that the Group will continue its growth pattern in the currentfinancial year. We will continue to drive forward in our six target markets,increasing our use of resources to achieve our objectives. Finally, we would like to thank all our shareholders for their support andenthusiasm. Wesley Devoto David McRobbieChairman Chief Executive 20 June 2007 Unaudited Consolidated Profit and Loss AccountFor the year ended 31 March 2007 Year ended Period ended 31 March 31 March 2007 2006 (Restated) Notes £ £ Group turnover 2Product sales 471,025 90,014Licence fees & royalties 202,517 - --------- -------- 673,542 90,014Cost of sales (194,703) (47,902) --------- --------Gross profit 478,839 42,112Administrative expenses (2,215,041) (1,424,793)Share based payment charge (94,231) (652,774) --------- --------Operating loss on ordinary activities before interest and taxation (1,830,433) (2,035,455)Net interest receivable 86,293 50,215 --------- --------Loss on ordinary activities before taxation (1,744,140) (1,985,240)Taxation 3 - - --------- --------Loss on ordinary activities after taxation (1,744,140) (1,985,240)Minority interest 236 1,490 --------- --------Loss for the period for the Group (1,743,904) (1,983,750) --------- --------Loss per ordinary shareBasic and diluted (p) 4 (4.56) (8.59) --------- -------- The loss for the period arises from the Group's continuing operations. Unaudited Consolidated Statement of Total Recognised Gains and Lossesfor the year ended 31 March 2007 Year ended Period ended 31 March 31 March 2007 2006 (Restated) £ £ Loss for the financial period (1,743,904) (1,983,750)Currency translation differences on foreign currency net investments 46,678 (42,184) ------------ -----------Total recognised losses relating to the financial year (1,697,226) (2,025,934) ----------- Prior year adjustment (652,774) ------------ Total recognised losses since last annual report (2,350,000) ------------ Unaudited Consolidated Balance Sheetat 31 March 2007 2007 2006 (Restated) Notes £ £ £ £Fixed assetsIntangible assets 39,083 9,583Tangible assets 69,909 50,645Investments - 5,000 --------------- --------------- 108,992 65,228Current assetsStocks 46,173 21,180Debtors 727,065 118,177Cash at bank and in hand 3,553,038 1,213,053 --------------- --------------- 4,326,276 1,352,410CreditorsAmounts falling due within one year (277,548) (373,801) --------------- ---------------Net current assets 4,048,728 978,609 --------------- ---------------Total assets less current liabilities 4,157,720 1,043,837 --------------- --------------- Capital and reservesCalled up share capital - equity 5 109,073 87,182Share premium account 6 7,640,752 2,945,529Merger reserve 6 1,064,712 1,064,712Profit and loss account 6 (4,657,964) (3,054,969) --------------- ---------------Equity shareholders' funds 4,156,573 1,042,454 Minority interest 6 1,147 1,383 --------------- ---------------Total capital employed 4,157,720 1,043,837 --------------- --------------- Unaudited Consolidated Statement of Cash Flowsfor the year ended 31 March 2007 Year ended Period ended 31 March 31 March 2007 2006 (Restated) Notes £ £ Net cash (outflow) from operating activities 7(a) (2,387,969) (1,335,945) ----------- -----------Returns on investments and servicing of financeInterest paid (1,572) (2,983)Interest received 87,865 53,198 ----------- -----------Net cash inflow from returns on investments andservicing of finance 86,293 50,215 ----------- ----------- Capital expenditure and financial investmentPayment to acquire tangible fixed assets (45,456) (54,691)Payment to acquire intangible fixed assets (30,000) - ----------- -----------Net cash outflow from capital expenditure (75,456) (54,691) ----------- -----------Acquisitions and disposalsPurchase of investments - - ----------- -----------Net cash outflow from acquisitions and disposals - - ----------- -----------Net cash (outflow) before use of liquid resources and financing (2,377,132) (1,340,421) ----------- -----------FinancingIssue of ordinary share capital 5,107,428 3,119,360Share issue costs (390,314) (533,875)Increase in directors' loans - 24,537Repayment of other loans - (15,451) ----------- -----------Net cash inflow from financing 4,717,114 2,594,571 ----------- -----------Movement in cash 7(b) 2,339,982 1,254,150 ----------- -----------Reconciliation of net cash flow to movement in net fundsMovement in cash 7(b) 2,339,985 1,254,150Cash inflow from decrease/(increase) in debt 7(b) 152,262 (9,086) ----------- -----------Change in Net Debt resulting from cash flows 7(b) 2,492,247 1,245,064Loans converted into shares 7(b) - 488,811 ----------- -----------Movement in net funds in the period 2,492,247 1,733,875Net funds/(debt) at 1 April 2006/1 January 2005 1,060,791 (673,084) ----------- -----------Net funds at 31 March 2007/31 March 2006 7(b) 3,553,038 1,060,791 ----------- ----------- Notes to the Preliminary Resultsfor the year ended 31 March 2007 1. BASIS OF THE ANNOUNCEMENT The preliminary financial statements for the year ended 31 March 2007 wereapproved by the Board of Directors on 20 June 2007. The financial informationset out above does not constitute the Company's statutory accounts for thefinancial year ended 31 March 2007 or the financial period ended 31 March 2006but is derived from those accounts (subject to restatement for the effect of FRS20). Statutory accounts for the financial period ended 31 March 2006 have beenfiled with the Registrar of Companies. The auditors have reported on thoseaccounts; their report was unqualified and did not contain statements undersection 237(2) or (3) ot the Companies Act 1985. The statutory accounts for thefinancial year ended 31 March 2007 will be delivered to the Registrar ofCompanies following the Company's Annual General Meeting. Basis of preparation The preliminary financial statements are prepared under the historical costconvention in accordance with applicable accounting standards. Basis of consolidation The preliminary group financial statements consolidate the financial statementsof Byotrol plc and all its subsidiary undertakings drawn up to 31 March 2007.No profit and loss account is presented for Byotrol plc as permitted by section230 of the Companies Act 1985. 2. TURNOVER AND SEGMENTAL ANALYSIS The total turnover of the group for the period has been derived from itsprincipal continuing activity. Year ended Period ended 31 March 31 March 2007 2006 £ £Analysis by geographical area The analysis by geographical area of the turnover by destination is set out as below: United Kingdom 206,157 34,906Rest of the World 434,712 16,082North America 32,673 39,026 ----------- ----------Group turnover 673,542 90,014 ----------- ---------- The directors consider that the business generates revenues from three distinctsources: product sales, licence fees and royalties. These revenue streams aredisclosed on the face of the consolidated profit and loss account. The threerevenue streams have a shared, and largely inseparable, cost base and thus thedirectors consider that there is only one business segment. 3. TAXATION a) Tax on loss on ordinary activities There is no tax charge as the Group has made losses in both the current periodand the previous year. b) Factors affecting current tax charge There is no deferred tax charge or credit in either the current or prior year. The differences between tax on the Group's loss at the standard rate ofcorporation tax and the actual charge are reconciled below: Year ended Period ended 31 March 31 March 2007 2006 (Restated) £ £Loss on ordinary activities before tax (1,744,140) (1,985,240) --------------- ---------------Loss on ordinary activities multiplied by standard rate of corporation taxin the UK of 30% (2004: 30%) (523,242) (595,572)Effect of:Expenses not deductible for tax purposes 44,746 204,069Capital allowance (less than)/in excess of depreciation (8,963) 1,829Unrelieved tax losses 487,459 389,674 --------------- ---------------Total current tax - - --------------- --------------- c) Deferred taxation and factors that may affect future tax charges There is no provision for deferred taxation. At 31 March 2007 the Group had unutilised trading losses and other timingdifferences of £879,133 (2006: £389,674). The deferred tax impact of these losses has not been recognised in the financialstatements on the basis that there is insufficient evidence at the current timethat the assets will be recoverable. Trading losses and other timing differences will only be available to offsetagainst future interest income, income from activities as a holding Company andtrading profits of Byotrol Technology Limited. 4. LOSS PER ORDINARY SHARE The loss per ordinary share is based on the losses for the period of £1,743,904(2006: losses of £1,983,750). The loss per share is calculated by reference tothe average number of ordinary shares in issue of 38,242,833 (2006: 23,090,464). There is no difference between basic and diluted loss per share, as theoutstanding warrants would have had the effect of reducing the loss per ordinaryshare and would therefore not be dilutive under the terms of FRS22. 5. SHARE CAPITAL Authorised Year ended Period ended Year ended Period ended 31 March 31 March 31 March 31 March 2007 2006 2007 2006 No. No. £ £ Ordinary shares of 0.25p each 50,000,000 50,000,000 125,000 125,000 Allotted, called up and fully paid Year ended Period ended Year ended Period ended 31 March 31 March 31 March 31 March 2007 2006 2007 2006 No. No. £ £ Ordinary shares of 0.25p each 43,629,277 34,872,849 109,073 87,182 On 6 November 2006 the Company issued 8,340,000 ordinary shares by way of aplacing in the market at 60p per share. On 9 January 2007 the Company issued17,000 shares to consultants in lieu of fees. During the period 1 January 2007to 31 March 2007, warrant holders subscribed for 399,428 shares at 23p pershare. At 31 March there were 5,012,633 warrants, each convertible into oneordinary share at an exercise price of 23p, still outstanding. 6. SHARE CAPITAL AND RESERVES Share Share Merger Minority Profit & Share- capital premium reserve interest loss holders account account funds £ £ £ £ £ £At 31 March 2006 87,182 2,945,529 1,064,712 1,383 (3,054,969) 1,043,837Issue of shares in placing 20,850 4,983,150 - - - 5,004,000Placing costs - (390,314) - - - (390,314)Conversion of warrants 1,041 102,387 - - - 103,428Loss for the period - - - - (1,743,904) (1,743,904)Share based payment credit - - - - 94,231 94,231Exchange difference - - - - 46,678 46,678Minority interest - - - (236) - (236) _______ _______ _______ _______ _______ _______At 31 March 2007 109,073 7,640,752 1,064,712 1,147 (4,657,964) 4,157,720 _______ _______ _______ _______ _______ _______ 7. CASH FLOW STATEMENT NOTES (a) Reconciliation of operating loss to net cash outflow from operatingactivities before exceptional items: Year ended Period ended 31 March 31 March 2007 2006 (Restated) £ £ Group operating loss (1,830,433) (2,035,455)Share based payment charge 94,231 652,744Depreciation 26,192 6,217Amortisation 500 417(Increase)/decrease in stocks (24,993) 14,338(Increase) in debtors (608,888) (102,424)(Decrease)/increase in creditors and provisions (96,253) 170,372Provision against investment 5,000 -Exchange gain or loss 46,678 (42,184) ___________ ___________ Net cash outflow from operating activities (2,387,966) (1,335,945) ___________ ___________ (b) Analysis of net funds Period ended Year ended 31 March Non-cash 31 March 2006 Cash flow movement 2007 £ £ £ £ Cash at bank and in hand 1,213,053 2,339,985 - 3,553,038Debts less than 1 year (152,262) 152,262 - - --------- --------- --------- --------- Net cash 1,060,791 2,492,247 - 3,553,038 --------- --------- --------- --------- 8. REPORT AND FINANCIAL INFORMATION Copies of the financial statements for the Group for the year ended 31 March2007 will be available from the Company's registered office and will be postedto shareholders in due course. This information is provided by RNS The company news service from the London Stock Exchange