MPM.L Regulatory News (MPM)

8 Dec 2005 07:00

MINSTER PHARMACEUTICALS plc INTERIM REPORT FOR THE SIX MONTHS ENDED 30 SEPTEMBER 2005 Cambridge, UK, 8 December 2005 Minster Pharmaceuticals, the AIM-listed (AIM:MPM) drug development company focused on psychiatric and neurologicaldisorders, announces its interim report for the six months ended 30th September2005.Highlights of the six months ended 30 September 2005 * Cash of ‚£2.4m, which the Board considers adequate to fund the current development programme * A pre-tax loss of ‚£704,833 in line with management expectations * Strengthening of the Board via the appointment of John Russell as Non-Executive Director * Since the end of the period under review, Minster's pipeline has made good progress CHAIRMAN AND CHIEF EXECUTIVE'S REVIEWI am pleased to announce the unaudited results of the Group for the six monthsended 30 September 2005, and to report on the progress made during this period.Minster Pharmaceuticals is a drug development company specialising in compoundsfor the treatment of neurological and psychiatric conditions. It has a licencefrom GlaxoSmithKline for the worldwide development rights for two compounds,tonabersat for migraine and sabcomeline primarily for schizophrenia. The Groupcontinues to invest in the development of these compounds and, in the sixmonths to 30 September 2005, incurred a loss of ‚£394,889 before amortisation ofgoodwill of ‚£309,944. Consequently, the loss for the period, both before andafter taxation, was ‚£704,833. As the Group was formed on 25 February 2005, thefigures in the preceding profit and loss account cover the period of 35 days to31 March 2005. The cash balance at 30 September 2005 was ‚£2,410,255 which theBoard considers adequate to fund the current development programme. No dividendis recommended.In April 2005 John Russell was welcomed to the Board as a Non-executiveDirector. He has over 20 years of international investment banking experienceand, in addition, has worked extensively as a consultant and corporate financeadviser to biotechnology companies.Since the end of this financial period, good progress has been made with bothcompounds. The Phase IIb programme for the development of tonabersat for theindication of prophylaxis (prevention) of migraine has been progressed.Following the appointment of Quintiles, the contract research organisation, inOctober 2005, it is planned that clinical evaluation will commence in February2006 and that results will be available in early 2007.Sabcomeline is being targeted primarily at the treatment of cognitive declinein patients with chronic schizophrenia; planning is underway for the next stageof development. In addition, I am pleased to report that we have also recentlyinitiated a collaborative deal with the University of Buckingham to investigatethe potential use of sabcomeline in the treatment of Type 2 diabetes.This continuing progress with both compounds allows the Group to look to thefuture with confidence.Paul SharpeChairman and Chief Executive8 December 2005Consolidated Summarised Profit and Loss AccountSix months ending 30 September 2005 6 months to 35 days to 30 September 31 March 2005 2005 unaudited audited ‚£ ‚£ Turnover - - Research expenses (117,973) (15,026) Administrative expenses (645,295) (262,356) ------------ ------------ Operating loss (763,268) (277,382) Interest payable - - Interest receivable 58,435 29,579 Loss on ordinary activities --------- ---------before taxation (704,833) (247,803) Taxation on the results for the period - - Loss on ordinary activities --------- ---------after taxation (704,833) (247,803) ------------ ------------ Loss per share p Basic per share (0.05) (0.09) Fully diluted per share (0.03) (0.03)Consolidated Summarised Balance SheetAt 30 September 2005 30 Sept 2005 31 Mar 2005 unaudited audited ‚£ ‚£ Fixed assets Intangible asset 12,030,107 12,340,051 Tangible assets 2,308 1,060 ------------ ----------- 12,032,415 12,341,111 ------------ ----------- Current assets Debtors 193,963 245,403 Bank and cash 2,410,255 2,791,710 ------------ ----------- 2,604,218 3,037,113 Creditors: amounts falling due within one year (85,802) (122,559) ------------ ----------- Net current assets 2,518,416 2,914,554 ------------ ----------- Total assets less current liabilities 14,550,831 15,255,665 Creditors: amounts falling due after one year (90,000) (90,000) ------------ ----------- Net assets 14,460,831 15,165,665 ------------ ----------- Capital and reserves Share capital 1,563,286 1,563,286 Share premium 10,797,155 10,797,155 Capital reserve 4,837,500 4,837,500 Special reserve 41,237 41,237 Profit and loss account (2,778,347) (2,073,513) ------------ ----------- Shareholders' funds 14,460,831 15,165,665 ------------ -----------Consolidated Summarised Cash Flow StatementSix months ending 30 September 2005 6 months to 35 days to 30 September 31 March 2005 2005 unaudited audited ‚£ ‚£ Reconciliation of operating loss to net cash outflow from operating activities Operating loss (763,268) (277,382) Professional fees settled by issue of - 180,000ordinary shares Professional fees written off against share - (429,683)premium Depreciation charges 361 76 Amortisation of goodwill 309,944 57,703 Charges to profit and loss account in respect of the granting of warrants below market - 48,100value Potential national insurance liability on warrants and share options granted in schemes not subject to HM Revenue & Customs approval - 18,665 National insurance liability crystallised from the above on exercise of warrants - (1,478) Change in debtors 51,440 (215,231) Change in creditors (36,757) 107,756 ------------ ------------ Net cash outflow from operating activities (438,280) (511,474) ------------ ------------ Cash flow statement Net cash outflow from operating activities (438,280) (511,474) Purchase of tangible fixed assets (1,610) - Returns on investments - interest received 58,435 29,579 Taxation - - Acquisition of net liabilities of Minster - (301,390)Research Limited ------------ ------------ (381,455) (783,285) Issues of share capital for cash - 3,098,450 Issue of convertible unsecured loan stock - 355,000for cash ------------ ------------ (Decrease)/Increase in cash (381,455) 2,670,165 Reconciliation of net cashflow to movement in net debt (Decrease)/Increase in liquid resources (381,455) 2,670,165 ------------ ------------ Change in net debt (381,455) 2,670,165 Net funds at 1 April 2005 in the Group 2,791,710 121,545(2004- Company) ------------ ------------ Net funds at 30 September 2005 in the Group 2,410,255 2,791,710 ------------ ------------Notes to the Interim Report1. Publication of non-statutory accountsi) The interim financial information for the six months ended 30 September 2005includes the results of Minster Pharmaceuticals plc and its subsidiary, MinsterResearch Limited. The unaudited results for the period have been prepared onthe basis of the accounting policies adopted in the audited accounts for theyear ended 31 March 2005.ii) The unaudited profit and loss account for six month period to 30 September2005 and the unaudited balance sheet as at 30 September 2005 do not amount tofull accounts within the meaning of Section 240 of the Companies Act 1985 andhave not been delivered to the Registrar of Companies. The Interim Report isunaudited and does not constitute Statutory Accounts.iii) The results for the period ended 31 March 2005, which includes only 35days trading since the group was formed on 25 February 2005, have beenextracted from the statutory accounts of the Company for that year, which havebeen filed with the Registrar of Companies. The auditors' report on theseaccounts was unqualified and did not contain any statement under Section 237 ofthe Companies Act 1985.2. Loss per shareThe calculation of loss per share is based on the following information: 6 months to 30 35 days to 31 September 2005 March 2005 unaudited audited Loss attributable to shareholders ‚£704,833 ‚£247,803 Average number of shares (basic) 1,563,286,348 283,799,992 Average number of shares (diluted) 2,238,958,713 967,326,822The calculation of the loss per share is based on the loss after taxation andthe average of the ordinary shares of 0.1p in issue during the period. Noshares have been issued in the six months to 30September 2005.For the diluted loss per share, the average number of ordinary shares in issueis adjusted to assume conversion of all dilutive potential ordinary shares. TheGroup has share options, warrants, convertible loan notes and shares to beissued as secondary consideration in respect of the subsidiary acquired duringthe period ended 31 March 2005 as potentially dilutive.3. Dividend No dividend is proposed to be paid in respect of the period (period to 31 March2005 - Nil).4. Interim StatementCopies of the Interim Statement are available from the Company's RegisteredOffice at 56 Queen Anne Street, London W1G 8LA.Independent Review Report to Minster Pharmaceuticals PLCIntroductionWe have been instructed by the company to review the financial information forthe six months ended 30 September 2005, which comprises the consolidatedsummarised profit and loss account, the consolidated summarised balance sheet,the consolidated summarised cash flow statement and notes 1 to 4. We have readthe other information contained in the interim report, which comprises only thechairman's statement and considered whether it contains any apparentmisstatements or material inconsistencies with the financial information. Ourresponsibilities do not extend to any other information.This report is made solely to the company, in accordance with guidancecontained in APB bulletin 1999/4 "Review of Interim Financial Information". Ourreview work has been undertaken so that we might state to the company thosematters we are required to state to it in a review report and for no otherpurpose. To the fullest extent permitted by law, we do not accept or assumeresponsibility to anyone other than the company, for our review work, for thisreport or for the conclusions we have formed.Directors' responsibilitiesThe interim report, including the financial information contained therein, isthe responsibility of, and has been approved by the directors. They areresponsible for preparing the interim report and ensuring that the accountingpolicies and presentation applied to the interim figures are consistent withthose applied in preparing the preceding annual accounts except where anychanges, and the reasons for them, are disclosed.Review work performedWe conducted our review in accordance with guidance contained in Bulletin 1999/4 "Review of Interim Financial Information" issued by the Auditing PracticesBoard for use in the United Kingdom. A review consists principally of makingenquiries of management and applying analytical procedures to the financialinformation and underlying financial data and, based thereon, assessing whetherthe accounting policies and presentation have been consistently applied unlessotherwise disclosed. A review excludes audit procedures such as tests ofcontrols and verification of assets, liabilities and transactions. It issubstantially less in scope than an audit performed in accordance with UnitedKingdom auditing standards and therefore provides a lower level of assurancethan an audit. Accordingly, we do not express an audit opinion on the financialinformation.Review conclusionOn the basis of our review we are not aware of any material modifications thatshould be made to the financial information as presented for the six monthsended 30 September 2005.Peters Elworthy & MooreChartered Accountants8 December 2005 --ENDS-- For further information, please contact:Minster Pharmaceuticals plc Dr Paul Sharpe, CEO +44 (0)1799 506623 Northbank Communications +44 (0)207 886 8150 Emma Palmer (financial enquiries) Rowan Minnion (media enquiries) About Minster PharmaceuticalsMinster Pharmaceuticals is an AIM-listed (AIM:MPM) drug development companyspecialising in compounds for the treatment of neurological and psychiatricconditions. The Company was established as BioPartners Ltd in 2001 when itacquired from GlaxoSmithKline the worldwide development rights for twocompounds, tonabersat and sabcomeline, which have benefited from GSK'ssubstantial investment. Tonabersat, a novel compound for the treatment andprevention of migraine, completed a Phase II programme in over 1000 patients inthe late 1990s, and is being developed further in this indication by MinsterPharmaceuticals. Sabcomeline has completed clinical trials in over 2,500patients, and has been identified as a potential treatment for chronicschizophrenia. It is now in Phase II trials. Development work is carried out byservice providers such as contract research organisations, and at theappropriate time Minster plans to license its pharmaceutical products topharmaceutical companies in order to complete development, register and marketthe drugs. As well as the development of sabcomeline and tonabersat, thecompany is looking to take on the development of further compounds by way ofacquisition or in-licensing. For more information, please go to www.minsterpharma.com.ENDMINSTER PHARMACEUTICALS PLC