Cizzle Biotechnology Holdings PLC
(formerly Bould Opportunities PLC)
Annual Report for the year ended 31 December 2021
Company registered number: 06133765
Cizzle Biotechnology Holdings PLC (formerly Bould Opportunities PLC)
Annual Report for the year ended 31 December 2021
Contents
Page
Company Information ............................................................................................................ 1
Chair’s Statement ................................................................................................................... 2
Board of Directors .................................................................................................................. 5
Strategic Report ..................................................................................................................... 6
Directors' Report ...................................................................................................................11
Statement of Directors’ responsibilities .................................................................................. 14
Corporate Governance Statement ........................................................................................ 15
Directors’ Remuneration Report ............................................................................................ 21
Independent Auditor’s report to the members of Cizzle Biotechnology Holdings PLC ........... 27
Consolidated Statement of Comprehensive Income .............................................................. 32
Consolidated Statement of Financial Position........................................................................ 33
Company Statement of Financial Position ............................................................................. 34
Consolidated Statement of Cash Flows................................................................................. 35
Company Statement of Cash Flows ...................................................................................... 36
Consolidated Statement of Changes in Equity....................................................................... 37
Company Statement of Changes in Equity ............................................................................ 38
Notes to the Financial Statements ........................................................................................ 39
Cizzle Biotechnology Holdings PLC (formerly Bould Opportunities PLC)
1
Company Information
Directors
Allan Syms
Nigel Lee
Prof. Dawn Coverley
John Treacy
Martin Lampshire
Executive Chair
Finance Director (appointed 14 May 2021)
Non-Executive (appointed 14 May 2021)
Non- Executive
Non-Executive (resigned 14 May 2021)
Company Secretary
SGH Company Secretaries Limited
CFO Solutions Limited
Appointed 14 May 2021
Resigned 14 May 2021
Registered Number
06133765
Registered Office
6th floor, 60 Gracechurch Street
London
EC3V 0HR
Financial Public Relations
IFC Advisory Limited
cizzle@investor-focus.co.uk
Birchin Court, 20 Birchin Lane
London
EC3V 9DU
Financial Adviser
Allenby Capital Limited
5 St. Helen’s Place
London,
EC3A 6AB
Broker
Novum Securities Limited
2nd floor, Lansdowne House
57 Berkeley Square
London
W1J 6ER
Solicitors
Cooley (UK) LLP
22 Bishopsgate
London
EC2N 4BQ
Auditor
PKF Littlejohn LLP
Statutory Auditor
15 Westferry Circus
London
E14 4HD
Registrar
Neville Registrars
Neville House
Steelpark Road
Halesowen
B62 8HD
Shakespeare Martineau
No 1 Colmore Square
Birmingham
B4 6AA
Cizzle Biotechnology Holdings PLC (formerly Bould Opportunities PLC)
2
Chair’s Statement
I am pleased to report on the Group’s activities and results for 2021 during which we announced the
acquisition of Cizzle Biotechnology Limited (“CBL”) on 14 May 2021 and admission to trading on the
London Stock Exchange by way of a Standard Listing, raising proceeds of £2,200,000 before expenses
from the issue of new shares. We changed the company name from Bould Opportunities plc to Cizzle
Biotechnology Holdings plc to better reflect the Group’s ambitions to become a leading biotechnology
business focussed on early-stage cancer detection through the commercialisation of its proprietary
CIZ1B biomarker technology developed by Professor Dawn Coverley and her team at the University of
York for the early detection of lung cancer.
The Group has made significant progress during 2021 and so far in 2022. In addition to implementing
our strategy to develop a regulatory approved commercial, diagnostic laboratory immunoassay for
early-stage lung cancer, we have broadened our interests in the detection of a range of other early-
stage cancers, expanded our potential customer base to include the pharmaceutical industry through
diagnostic tests that can help in the development of personalised medicines, so called “companion
diagnostics” and secured royalty bearing rights to the sale of such drugs in the longer term.
To achieve this we have entered into a number of strategic supply agreements, extended our research
and development programme with the University of York, secured an important companion diagnostic
development project for autoimmune diseases worth up to £1m with St George Street Capital (“SGSC”)
and invested in royalty arrangements for their therapeutic asset (AZD1656) for the potential treatment
of inflammatory diseases, including those linked with COVID 19.
The Group has also begun the process of selecting appropriate industrial development and distribution
partners that will facilitate access to major markets globally and we are pleased to announce a royalty
bearing strategic partnership in China to help address the country’s challenge of reducing nearly
715,000 deaths caused by lung cancer in 2020.
(Source: https://www.statista.com/statistics/1053667/china-cancer-death-number-by-type/ ).
Research and Development
The Group is developing a blood test for the early detection of lung cancer. Its proof of concept prototype
test is based on the ability to detect a stable plasma biomarker, a variant of CIZ1 known as CIZ1B. CIZ1
is a naturally occurring cell nuclear protein involved in DNA replication, and the targeted CIZ1B variant
is highly correlated with early stage lung cancer. Currently the laboratory test developed by Professor
Dawn Coverley at The University of York, has been used to validate the use of CIZ1B to detect lung
cancer, and a proof of concept prototype test developed, which is compatible with potential use within a
hospital laboratory setting.
In June 2021 we entered into a Collaboration Agreement with FairJourney Biologics to develop
proprietary antibodies. Along with other key suppliers the Group expects to create a range of monoclonal
antibodies and reagents that are the foundation for developing immunoassays, and in the future point
of care tests not only for early-stage lung cancer but potentially also for other cancers with unmet clinical
need.
In September 2021 we announced a new research agreement with The University of York for developing
our blood test for the early detection of lung cancer, and potentially other forms of cancer. A further new
agreement was announced in April 2022 that extended this work until June 2022.
A research and development agreement was finalised in October 2021 with “SGSC”, the UK based
biomedical charity to develop a companion diagnostic test for autoimmune disease. Its aim is to develop
tests that will operate alongside SGSC’s programme for the development of therapeutic assets licensed
to SGSC from one of the world’s largest pharmaceutical companies, Astra Zeneca. This seeks to
address unmet clinical needs in a variety of autoimmune diseases which will significantly broaden the
Company’s product pipeline for which SGSC will pay the Group £200,000 upfront on commencement of
the project and then further milestone payments totalling £1m.
Cizzle Biotechnology Holdings PLC (formerly Bould Opportunities PLC)
3
Chair’s Statement (continued)
China
One of the target markets identified for the Group is in China where we are aware there are serious
challenges in being able to detect cancer early, and there is a great need for screening and diagnosing
cancers among the Chinese population. Targeted testing can improve timely access to cancer care and
save lives. The Group entered into a Memorandum of Understanding (“MOU”) with the International Co-
innovation Centre for Advanced Medical Technology (“iCCAMT”) and Shenzhen Intelliphecy Life.
Technologies Co. Ltd (“Intelliphecy”) to develop and market the Group’s proprietary early lung cancer
diagnostic tests based on the CIZ1B biomarker in China.
In February 2022 a full commercial agreement was executed to develop and market early lung cancer
diagnostic tests in China. This agreement will generate future revenues for the Group via a 10% royalty
on the sales of all products and services using its proprietary CIZ1B technology and from payment for
monoclonal antibodies and reagents.
iCCAMT, founded with German Medical Valley, Robert Bosch GmbH and Sinopharm Group, aims to
accelerate global med-tech innovation in the Chinese market, by bringing together world leading
expertise. Intelliphecy is aiming to innovate technologies in the hope to win the war against cancer.
USA
On 6 May 2022 the Group announced that it had signed a heads of terms to partner with CorePath
Laboratories (CorePath), a full service cancer reference laboratory, to develop and offer its proprietary
early-stage lung cancer test throughout the USA. The proposal is that the Group would receive a 15%
royalty and royalty sharing arrangements overall offering of products and services using CIZ1B via
CorePath in the USA.
Lung cancer is the leading cause of cancer death in the USA, making up almost 25% of all cancer
deaths. The American Cancer Society’s estimates for lung cancer in the USA for 2022 are:
- About 236,740 new cases of lung cancer annually and about 130,180 deaths from lung cancer
each year ( Source: https://www.cancer.org/cancer/lung-cancer/about/key-statistics.html) ; and
- Currently, there are no simple specific blood tests to detect lung cancer early when targeted
interventions can improve timely access to cancer care and save lives. Yet it is estimated that
about 8 million Americans qualify as high risk of lung cancer and are recommended to receive
annual screening with low-dose CT scans and if half of these high risk individuals were
screened, over 12,000 lung cancer deaths could be prevented (Source: Cheung LC, Katki HA,
Charurvedi AK, Jemal A, Berg CD. Preventing Lung Cancer Mortality by Computed Tomography
Screening: The Effect of Risk-Based Versus U.S. Preventative Services Task Force Eligibility
Criteria, 2005-2015. Anals of Internal Medicine. 2018; 168(3):229-32. Doi: 10.7326/M17-2067).
Royalty Investment in AZD1656
In September 2021 the Group entered into a royalty sharing agreement with SGSC to grant the Group
potential royalty payments from the commercialisation of SGSC’s therapeutic asset AZD1656 of up to
£5m, plus potentially further payments from the use of a companion diagnostic. During the year the
Group paid a total of £0.2m for this investment.
This supports the strategy of building a portfolio of early cancer detection tests, companion diagnostics
and royalty bearing stakes in significant drug assets. SGSC has reported positive results from its
ARCADIA clinical trial for diabetes patients with COVID19 and have indicated this may be through the
regulation of the patients’ immune system (via controlling Regulatory T Cells or “Tregs”). Tregs act to
suppress immune response and combat damaging cells potentially reducing serious cardiovascular
disease, and also lung diseases that are linked with the development of lung cancer.
Cizzle Biotechnology Holdings PLC (formerly Bould Opportunities PLC)
4
Chair’s Statement (continued)
In February 2022 the Group announced a further royalty deal in Inflammatory Pulmonary and
Cardiovascular diseases with Conduit Pharmaceuticals Ltd (“Conduit”) and SGSC to acquire an
additional 5% economic interest in the commercialisation of the AZD 1656 asset or such other assets
being developed by Conduit or SGSC to treat inflammatory pulmonary and cardiovascular disease.
Under the agreement the Group will receive 5% of all sums received by SGSC pursuant to any
AstraZeneca (“AZ”) commercialisation or sub-licence commercialisation of the AZD 1656 asset in
inflammatory pulmonary and cardiovascular diseases, after the deduction of certain sums. The
consideration due to SGSC is £1.88m with the initial consideration of £1m being settled through the
issue of 25,000,000 new ordinary shares at a price of 4.0p per share, which was a premium of 56.9% to
the Company’s closing mid-market price of 2.55p on 11 February 2022. The remaining consideration of
£0.88m will be payable in new ordinary shares at 4.0p per share, on the earlier of receiving shareholder
approval to issue the shares or the first anniversary of completion.
Financial overview
Due to reverse acquisition accounting principles, which are explained in more detail in Note 3 to the
financial statements, these consolidated financial statements represent a continuation of the
consolidated statements of Cizzle Biotechnology Holdings PLC (“the Company”) and its subsidiaries
(together referred to as “the Group”) and include:
- The assets and liabilities of CBL at their pre-acquisition carrying value amounts and the results
for all periods reported: and
- The assets and liabilities of the Company as at 14 May 2021 and its results from the date of
reverse acquisition on 14 May 2021 to 31 December 2021.
As the new Group was not in existence in 2020 the comparative results under reverse acquisition rules
are those of the existing company, CBL, that effectively completed the acquisition. The financial results
for the period to 31 December 2021 are summarized below:
- Corporate expenses, before share option charge and exceptional items: £552,000 (2020 CBL:
£14,000);
- Share option charge: £299,000 (2020 CBL: £Nil)
- Exceptional corporate expenses relating to the acquisition: £3,117,000 (2020 CBL: £Nil) which
include transaction costs of £303,000 and a non-cash share-based expense of £2,804,000
(explained in Notes 3 and 5);
- Total comprehensive loss: £ 3,921,000 (2020 CBL Loss £ 14,000); and
-
Loss per share 2.4 p (2020 CBL Loss 2.8 p).
Allan Syms
Executive Chair
30 May 2022
Cizzle Biotechnology Holdings PLC (formerly Bould Opportunities PLC)
5
Board of directors
Dr Allan Syms (Executive Chair), appointed 21 May 2019
Allan is an experienced international life sciences and technology senior executive, with over 30 years of
experience at Board level often as founder or chief executive officer in creating, funding and building
emerging technology businesses through to trade sale and IPO. After gaining a PhD in cancer biology at
the Tenovus Institute of Cancer Research and postdoctoral fellowships at Baylor College of Medicine in
Houston and Oxford University, he began his corporate career at GE Healthcare (formerly Amersham
International PLC) to develop novel diagnostic detection systems. He then worked with a number of UK
leading universities to spin out and develop technology businesses. Allan has extensive experience in
M&A, licensing and managing strategic change becoming corporate marketing director at Integra
Biosciences AG a leading Swiss laboratory and diagnostics supplies company. He was previously a
specialist adviser on China to the Department of International Trade.
Allan was appointed Non-Executive Chair on 21 May 2019 and was appointed Executive Chair with
effect from Admission on 14 May 2021.
John Treacy (Non-Executive Director), appointed 29 January 2019
John is a London-based experienced financier who specialises in working with growing companies. He
qualified as a solicitor in the London office of a major international law firm where he specialised in Capital
Markets and Mergers & Acquisitions. From there he moved to practice corporate finance in the advisory
teams of several prominent UK brokerages where he acted as an adviser to a number of AIM companies
and advised on numerous IPOs, acquisitions, debt restructurings and placings.
John is also the Chair of the Audit and Risk Committee and the Chair of the Remuneration Committee.
Professor Dawn Coverley (Non-Executive Director), appointed 14 May 2021
Dawn is a cell biologist with over 20 years’ experience in cancer-related research. After a first degree in
Genetics (Leicester), and a PhD in biochemistry (Cancer Research UK), she completed postdoctoral
training at the University of Cambridge, then moved to the University of York to establish an independent
research group in 2002, supported by the Lister Institute of Preventive Medicine. Her research exploits
experimental systems that reconstitute fundamental process associated with genome and epigenome
stability, and their contribution to the earliest stages of human cancers. She founded Cizzle Biotechnology
Limited and raised early stage funding in 2006 to begin development of her research findings into clinically
useful products, focused on CIZ1B and the early detection of lung cancer. She is currently principal
investigator of an academic research laboratory at the University of York and Scientific Director of Cizzle
Biotechnology.
Dawn is also a member of the Audit and Risk Committee and Remuneration Committee.
Nigel Lee (Finance Director), appointed 14 May 2021
Nigel has been a director of CFO Solutions Limited since 2003 which has provided financial advisory
services to the Group since 2010, as well as company secretarial services since 2012. CFO Solutions
Limited ceased providing these services to the Group on 14 May 2021. He is also a part-time Finance
Director of Kent Surrey Sussex AHSN Limited. He was financial director/controller in two IT services and
software companies between 1999 to 2003 and prior to that had 11 years of audit and business advisory
experience at PricewaterhouseCoopers, including six years as a senior manager. Nigel qualified as a
Chartered Accountant in 1988.
Cizzle Biotechnology Holdings PLC (formerly Bould Opportunities PLC)
6
Strategic Report for the year ended 31 December 2021 (continued)
The directors present their strategic report for the year ended 31 December 2021.
Business review
The review of the Company is detailed in the Chair’s Statement on pages 2 to 4.
Principal risks and uncertainties
The principal risks and uncertainties of the Group are as follows:
Pre-revenue business
The Group is still at an early stage of its development and there is no guarantee that the Group will
generate significant revenues. For the foreseeable future, the Group will have significant reliance upon
the success of the CIZ1B biomarker in the detection of lung cancer and there is no guarantee that CBL’s
intellectual property will result in a commercially viable test. It is also possible that technical and/or
regulatory hurdles could lengthen the time required for the delivery of such a testing product. The Enlarged
Group’s future growth and prospects will also depend on its ability to secure commercialisation
partnerships.
Regulatory environment and the process for obtaining a CE marking or a 510(k) clearance
The Group’s future products will be subject to various laws, regulations and standards in each of the
jurisdictions in which products are to be manufactured and distributed. There can be no guarantee that
the Group’s future products will ultimately obtain CE marking or FDA 510(k) clearance or that clearance
can be obtained within the timescales or the budgets anticipated. The UK’s exit from the EU may yet lead
to a more complicated and uncertain process for obtaining regulatory clearance to market the Enlarged
Group’s future products in the UK and the EU.
Competition and the pace of development in the healthcare industry
Certain competitors already have CE marking for lung cancer detection products. Existing or new
competitors may have larger resources, greater market presence, economies of scale or a lower cost
base than the Enlarged Group. Rapid scientific and technological change within the biotechnology sector
could lead to other market participants creating approaches, products and services equivalent or superior
to the diagnostic testing products and services than those to be offered by the Group, which could
adversely affect the Group’s performance and success.
Attraction and retention of key management and employees
The successful operation of the Group will depend partly upon the performance and expertise of its current
and future management and employees. The loss of the services of certain of these members of the
Group’s key management, or the inability to attract and retain a sufficient number of suitably qualified
employees may have a material adverse effect on the Group.
Complex research and development processes
Certain elements of the reagents and other components which are planned to be used in CBL’s test for
lung cancer are bespoke in their nature and may be difficult to reproduce in an optimised manner. Any
unexpected delays or issues with this process may have an impact on the Group’s anticipated
development and commercialisation strategy and its timeline.
Ownership and protection of intellectual property rights
The Group’s ability to compete will depend in part upon the protection of its intellectual property (“IP”).
Filing, prosecuting and defending patents in all countries throughout the world would be prohibitively
expensive so it is possible that competitors will use the technologies in jurisdictions where the Group has
not yet obtained patent protection in order to develop a competing product. In the event that litigation is
necessary to defend the Group’s IP, it could require the Group to commit significant resources. There is
no guarantee that the result of such litigation would result in a favourable outcome to the Group. Any of
these events may have a material adverse effect on the Group’s business, financial condition, capital
resources, results and/or future operations.
Cizzle Biotechnology Holdings PLC (formerly Bould Opportunities PLC)
7
Strategic Report for the year ended 31 December 2021 (continued)
Future funding requirements
In the longer term, the Group will need to raise additional funding should it wish to undertake development
of additional future products. If the Group is unable to obtain financing on terms acceptable to it then it
may be forced to curtail its activities. If additional funds are raised through the issue of new equity or
equity-linked securities of the Group other than on a pro-rata basis to existing Shareholders, the
percentage ownership in the Group of such Shareholders may be substantially diluted. There is no
guarantee that the then prevailing market conditions will allow for such a fundraising or that new investors
will be prepared to subscribe for New Ordinary Shares at the same price as the Issue Price or higher.
Covid-19 Pandemic risk
Apart from managing the corporate affairs of the business the main area of activity is in research and
development which usually needs to be undertaken in a laboratory environment. During the Covid-19
pandemic there have been occasions where access to laboratories has been restricted which has led to
some timing delays in research and development activity.
Key performance indicators (KPI's)
The directors have identified the following KPIs that they feel are the most vital measurements for the
Group to monitor given its current stage of development. These KPI’s are considered at each board and
monthly operational meeting.
Cash management
The directors consider the cash flows for the previous month and the updated rolling cash flow forecast
for the Group. At 31 December 2021 the Group had cash balances amounting to £875,000 and no
borrowings.
Intellectual Property
Each month the directors review the Group’s Intellectual Property Portfolio and the applications and
renewals required to maintain this portfolio.
The Group’s patent portfolio currently includes:
- CIZ1 Replication Protein
- Methods and Compounds for diagnosis and treatment of cancer; and
- Use of a Fibrinogen Capture Agent to detect a CIZ1B variant.
Diversity
The Group is committed to workplace diversity which includes but is not limited to gender, age, ethnicity
and cultural background. The Group’s only employees are the directors, which consists of three men and
one woman.
Corporate Responsibility
The Group consists of four directors who all work from their homes and one director also works at the
University of York. As we undertake our research and development activities and manage the affairs of
the business and develop our plans for the future our business practices focus on the following areas:
- Health and Safety, and ensuring that all of our employees operate in a safe environment;
- Environment, managing our environmental impact in areas of waste, energy and water;
- Employee support, to ensure that all employees flourish;
- Ethical Standards, operating at the highest level in all business dealings.
Whist our current levels of engagement do not enable much engagement with the local community, we
wish, as our business grows, to have positive interaction with the communities in which we operate.
Greenhouse Gas Emissions
There is limited scope for the Group to have a major impact on environmental manners but we do attempt
to minimise the amount of travel that we undertake and take actions to undertake recycling and energy
conservation in our daily activities.
Cizzle Biotechnology Holdings PLC (formerly Bould Opportunities PLC)
8
Strategic Report for the year ended 31 December 2021 (continued)
Promotion of the Company for the benefit of the Members as a whole
S172 of the Companies Act 2006 requires the Board to promote the Company for the benefit of the
members as a whole. In particular, the requirements of s172 are for the Directors to:
• Consider the likely consequences of any decision in the long term;
• Act fairly between the members of the Company;
• Maintain a reputation for high standards of business conduct;
• Consider the interests of the Company’s employees;
• Foster the Company’s relationships with suppliers, customers and others; and
• Consider the impact of the Company’s operations on the community and the environment.
The directors have strived to ensure that these considerations are embedded within its decision-making
process.
Decision-making
The day to day operation decisions of the Group have been made by the executive directors. All key
decisions of the Group have been made at board meetings involving all directors.
The Directors believe that during the year they have acted in the way most likely to promote the success
of the Company for the benefit of its members as a whole and have adhered to the requirements set out
above that are applicable to the Company given its scope of operations. For example, the Company,
does not have any employees other than the directors, so considering employee interests is not currently
relevant.
The principal decisions taken by the Group during the year ended 31 December 2021 and since the year
end have been summarised in the Chair’s Statement on pages 2 to 4 and are summarised as follows:
Decision: change the strategic direction of the Group and establish a sound financial base.
Context
Following the Group’s decision in January 2019 to close down its remaining lighting business activity it
became, in April 2019, a cash-shell listed on the Alternative Investment Market (AIM). Since then the
Company has been searching for a new business activity and on 14 May 2021 the Company
announced the decision to:
- Complete the proposed acquisition of CBL;
- Raise £2.2m (Gross before expenses) through the Placing of new ordinary shares; and
- Admission of the Company’s shares to the Standard List of the London Stock Exchange.
Stakeholder considerations (Shareholders)
The acquisition of CBL means that the Group is engaged in a very exciting area of development that
seeks to address an urgent clinical lead and could potentially provide significant benefits to patients
and the health care system, as well as potentially significant competitive and commercial advantages
for the Group. The raising of new finance and listing the Company’s shares on the Standard-Listing of
the London Stock Exchange also establish a sound financial platform from which to develop the Group’s
activities.
Cizzle Biotechnology Holdings PLC (formerly Bould Opportunities PLC)
9
Strategic Report for the year ended 31 December 2021 (continued)
Promotion of the Company for the benefit of the Members as a whole (continued)
Decision: to build a portfolio of early cancer detection tests, companion diagnostics and royalty
bearing stakes in significant drug assets.
Context
The Group currently does not have any trading revenues and wishes to a build a portfolio of income
streams from a variety of early cancer detection tests.
-
-
In September 2021 the Group entered into a royalty sharing agreement with SGSC to grant
the Group potential royalty payments from the commercialisation of SGSC’s therapeutic
asset AZD1656 of up to £5m, plus potentially further payments from the use of a companion
diagnostic. During the year the Group paid a total of £0.2m for this investment.
In February 2022 the Group announced a further royalty deal in Inflammatory Pulmonary and
Cardiovascular diseases with Conduit Pharmaceuticals Ltd (“Conduit”) and SGSC to acquire
an additional 5% economic interest in the commercialisation of the AZD 1656 asset or such
other assets being developed by Conduit or SGSC to treat inflammatory pulmonary and
cardiovascular disease.
Stakeholder considerations (Shareholders)
The investment in SGSC’s therapeutic asset AZD 1656 provides an opportunity for the Group to earn
additional revenues, from an additional source of income, other than its proposed test for the early
detection of lung cancer.
Decision: to enhance its research and development capabilities
Context
The Group is developing a blood test for the early detection of lung cancer. Its proof of concept
prototype test is based on the ability to detect a stable plasma biomarker, a variant of CIZ1 known as
CIZ1B. CIZ1 is a naturally occurring cell nuclear protein involved in DNA replication, and the targeted
CIZ1B variant is highly correlated with early stage lung cancer. Currently the laboratory test developed
by Professor Dawn Coverley at The University of York, has been used to validate the use of CIZ1B
to detect lung cancer, and a proof of concept prototype test developed, which is compatible with
potential use within a hospital laboratory setting.
-
-
In June 2021 we entered into a Collaboration Agreement with FairJourney Biologics to
develop proprietary antibodies. Along with other key suppliers the Group expects to create a
range of monoclonal antibodies and reagents that are the foundation for developing
immunoassays, and in the future point of care tests not only for early-stage lung cancer but
other cancers with unmet clinical need.
In September 2021 we announced a new research agreement with The University of York for
developing our blood test for the early detection of lung cancer, and potentially other forms
of cancer. A further new agreement was announced in April 2022 that extended this work
until June 2022.
- A research and development agreement was finalised in October 2021 with “SGSC”, the UK
based biomedical charity to develop a companion diagnostic test for autoimmune disease.
Its aim is to develop tests that will operate alongside SGSC’s programme for the development
of therapeutic assets licensed to SGSC from one of the world’s largest pharmaceutical
companies, Astra Zeneca. This seeks to address unmet clinical needs in a variety of
autoimmune diseases which will significantly broaden the Company’s product pipeline for
which SGSC will pay the Group up to £1m in development fees.
Stakeholder considerations (Shareholders)
The decisions taken have enhanced the Group’s research and development capabilities as well as
providing a source of additional revenues for research and development activity to be carried out for
SGSC.
Cizzle Biotechnology Holdings PLC (formerly Bould Opportunities PLC)
10
Strategic Report for the year ended 31 December 2021 (continued)
Promotion of the Company for the benefit of the Members as a whole (continued)
Decision: to spread the global reach of the Group’s technology to Global markets where there
is much need for the use of the early detection of lung cancer tests.
Context
One of the target markets identified for the Group is in China where we are aware there are serious
challenges in being able to detect cancer early, and there is a great need for screening and diagnosing
cancers among the Chinese population. Targeted testing can improve timely access to cancer care
and save lives.
Lung cancer is the leading cause of cancer death in the USA, making up almost 25% of all cancer
deaths.
- China. The Group entered into a Memorandum of Understanding (“MOU”) with the
International Co-innovation Centre for Advanced Medical Technology (“iCCAMT”) and
Shenzhen Intelliphecy Life Technologies Co. Ltd (“Intelliphecy”) to develop and market the
Group’s proprietary early lung cancer diagnostic tests based on the CIZ1B biomarker in
China. In February 2022 a full commercial agreement was executed to develop and market
early lung cancer diagnostic tests in China. This agreement will generate future revenues for
the Group via a 10% royalty on the sales of all products and services using its proprietary
CIZ1B technology and from payment for monoclonal antibodies and reagents.
- USA. On 6 May 2022 the Group announced that it had signed a heads of terms to partner
with CorePath Laboratories (CorePath), a full service cancer reference laboratory, to develop
and offer its proprietary early-stage lung cancer test throughout the USA. The proposal is that
the Group would receive a 15% royalty and royalty sharing arrangements over products and
services using CIZ1B via CorePath in the USA.
Stakeholder considerations (Shareholders)
The decisions taken so far enhance the Group’s Global future revenue streams whilst minimising the
amount of investment required to reach these potential markets.
This report was approved by the board on 30 May 2022 and was signed on its behalf by:
Allan Syms
Director
Cizzle Biotechnology Holdings PLC (formerly Bould Opportunities PLC)
11
Directors’ Report for the year ended 31 December 2021
The directors present the annual report and audited financial statements for the year ended 31 December
2021.
Principal activity, business review and future developments
On 14 May 2021, the Company’s ordinary shares were admitted to the Standard-Listing of the London
Stock Exchange. Also on that date, the Company completed the reverse acquisition of CBL.
The Group’s principal activity since 14 May 2021 has been the early detection of lung cancer via the
development of an immunoassay test for the CIZ1B biomarker. For the period to 14 May 2021 the
Company was a holding company that was an AIM Rule 15 cash shell seeking a new investment.
The Statement of Group Comprehensive Income is set out on page 32. A review of the Group’s trading
during the year, its position at the year-end, post balance sheet events, and its prospects for the future
are set out in the Chair’s Statement and the Strategic Report.
Dividends
No dividend is proposed in respect of the year (CBL 2020: £Nil).
Financial risk management
Information in respect of financial risk management objectives and policies, exposure to price, credit,
liquidity and cash flow risks, and current trading and trading outlook for the Company are outlined in Note
4.
Directors
The directors of the Company who served during the year are listed below:
Directors
Function
Allan Syms
Nigel Lee
Dawn Coverley
John Treacy
Martin Lampshire
Executive Chair (appointed Executive Chair on 14 May 2021)
Finance Director (appointed 14 May 2021)
Non- Executive Director (appointed 14 May 2021)
Non-Executive Director
Non-Executive Director (resigned 14 May 2021)
Board Responsibility and Corporate Governance Statement
The Board is responsible for approving the interim and annual financial statements, formulating and
monitoring the Group’s strategy, approving financial plans and reviewing performance, as well as
complying with legal, regulatory and corporate governance matters. The Board is committed to
maintaining appropriate standards of corporate governance and, as detailed below, has concluded that it
will adopt the Quoted Companies Alliance’s Corporate Governance Code.
Employees
At 31 December 2021 the total number of employees in the Company comprised 4 employees (CBL
2020: 3), who were all directors.
The Group’s employment policies are designed to attract, retain and motivate the very best staff for each
role in the Group, recognising that this can only be achieved through equal opportunities regardless of
gender, race, religion or disability. Regular meetings were held by the directors to discuss the performance
of the Group as a whole. Financial and economic factors were dealt with in this context. Information
concerning employees and their remuneration is given in Note 8.
Cizzle Biotechnology Holdings PLC (formerly Bould Opportunities PLC)
12
Directors’ Report for the year ended 31 December 2021 (continued)
Capital structure
Details of the issued share capital are set out in Note 14. On recognition of the reverse takeover of CBL
on 14 May 2021 the Group had 3 classes of share:
- New Ordinary Shares of 0.01p each.
- Deferred ‘A’ shares of 0.01p each.
- Deferred ‘A’ Shares of 0.99p each.
None of these shares have any rights to fixed income and only new ordinary shares carry the right to
one vote per share at general meetings of the Company.
There are no specific restrictions on the size of a holding or on the transfer of New Ordinary Shares,
which are both governed by the general provisions of the Articles of Association and prevailing
legislation. The directors are not aware of any agreements between holders of the Company’s shares
that may result in restrictions on the transfer of securities or on voting rights.
Details of employee share option schemes are set out in Note 14. During the year ended 31 December
2021 19,741,345 share options were issued to the directors and 3,690,696 options were generated on
the completion of the acquisition of CBL.
No person has any special right of control over the Company’s share capital and all issued shares are
fully paid.
The appointment and replacement of directors of the Company is governed by its Articles of Association,
the Companies Act 2006 and related legislation. The Articles themselves may be amended by special
resolution of the shareholders. The current Articles have been in place for some years and are in the
process of being reviewed and updated. It is anticipated that updated articles will be proposed for
approval at the forthcoming Annual General Meeting.
Donations
No charitable or political donations were made during the year (2020: £Nil).
Share issues
Details of shares issued during the year are set out in Note 14.
Going concern
The Directors have adopted the going concern basis in preparing the financial statements for the year to
31 December 2021. In reaching this conclusion, the Directors have considered for the Company, current
trading and the current and projected funding position for the period of just over 12 months from the date
of approval of the financial statements through to 30 June 2023. The Company, as anticipated in the
Company’s Prospectus announced on 23 April 2022, will need to generate finance through equity or debt
in order to meet its committed liabilities as they fall due for the foreseeable future and progress its planned
product research and development activities.
Post balance sheet events
Sine the year end, the Company has issued further equity to increase its share of royalty arrangements
in a therapeutic asset of SGSC, AZD1656. In February 2022 the Group announced a royalty deal in
Inflammatory Pulmonary and Cardiovascular diseases with Conduit Pharmaceuticals Ltd (“Conduit”) and
SGSC to acquire a 5% economic interest in the commercialisation of the AZD1656 asset or such other
assets being developed by Conduit or SGSC to treat inflammatory pulmonary and cardiovascular disease.
The consideration due is £1.88m with the initial consideration of £1m being settled through the issue of
25,000,000 new ordinary shares at a price of 4.0p per share, which was a premium of 56.9% to the
Company’s closing mid-market price of 2.55p on 11 February 2022. The remaining consideration of
£0.88m will be payable in new ordinary shares at 4.0p per share, on the sooner of receiving shareholder
approval to issue the shares or the first anniversary of completion.
Cizzle Biotechnology Holdings PLC (formerly Bould Opportunities PLC)
13
Directors’ Report for the year ended 31 December 2021 (continued)
Disclosure of information to auditor
The directors who held office at the date of approval of this Directors’ report confirm that, so far as they
are aware, there is no relevant audit information of which the Company’s auditor is unaware; and each
Director has taken all steps that he ought to have taken as a Director to make himself aware of any
relevant audit information and to establish that the Company’s auditor is aware of that information.
Auditor
The existing auditors of the Company are PKF Littlejohn LLP and a resolution for their re-appointment will
be put to the Annual General Meeting.
Annual General Meeting
The Annual Report is made available to shareholders at least 21 clear days’ notice before the Annual General
Meeting (“AGM”) along with the notice of the AGM. Shareholders are given the opportunity to vote on each
separate resolution proposed at the AGM. The Company counts all proxy votes and will indicate the level of
proxies lodged for each resolution, after it has first been dealt with by a show of hands.
Website publication
The Directors are responsible for ensuring the annual report and the financial statements are made
available on a website. Financial statements are published on the Company's website in accordance
with legislation in the United Kingdom governing the preparation and dissemination of financial
statements, which may vary from legislation in other jurisdictions. The maintenance and integrity of the
Company's website is the responsibility of the Directors. The Directors' responsibility also extends to
the ongoing integrity of the financial statements contained therein.
Approved by the Board of Directors and signed by order of the Board
Allan Syms
Director
30 May 2022
Cizzle Biotechnology Holdings PLC (formerly Bould Opportunities PLC)
14
Statement of Directors’ Responsibilities
The directors are responsible for preparing the strategic report, the directors’ report and the financial
statements in accordance with applicable law and regulations.
Company law requires the directors to prepare financial statements for each financial year. Under that
law the directors have elected to prepare the Group and Company financial statements in accordance
with UK-adopted international accounting standards. Under company law the directors must not
approve the financial statements unless they are satisfied that they give a true and fair view of the state
of affairs of the Group and Company and of the profit or loss of the Group and Company for that period.
In preparing these financial statements, the Directors are required to:
select suitable accounting policies and then apply them consistently;
•
• make judgements and accounting estimates that are reasonable and prudent;
•
state whether they have been prepared in accordance with UK-adopted international accounting
standards, subject to any material departures disclosed and explained in the financial
statements; and
• prepare the financial statements on the going concern basis unless it is inappropriate to
presume that the Company will continue in business.
The Directors are responsible for keeping adequate accounting records that are sufficient to show and
explain the Group and Company’s transactions and disclose with reasonable accuracy at any time the
financial position of the Group and Company and enable them to ensure that the financial statements
comply with the requirements of the Companies Act 2006. They are also responsible for safeguarding
the assets of the Group and Company and hence for taking reasonable steps for the prevention and
detection of fraud and other irregularities.
They are also responsible to make a statement that they consider that the Annual Report and Financial
Statements, taken as a whole is fair, balanced and understandable and provides the information
necessary for the shareholders to assess the Group and Company’s position and performance, business
model and strategy.
Directors’ Responsibility Statement Pursuant to Disclosure and Transparency Rules
Each of the Directors, whose names and functions are listed on page 1, confirm that, to the best of their
knowledge and belief:
•
the financial statements prepared in accordance with UK-adopted international accounting
standards, give a true and fair view of the assets, liabilities, financial position and loss of the
Group and Company; and
• The Annual Report and financial statements, including the Business review, includes a fair
review of the development and performance of the business and the position of the Group and
Parent Company, together with a description of the principal risks and uncertainties that they
face.
Cizzle Biotechnology Holdings PLC (formerly Bould Opportunities PLC)
15
Corporate Governance Statement
The Directors recognise the importance of sound corporate governance. The directors continue to adopt
the Quoted Companies Alliance’s Corporate Governance Code (“the QCA Code”). In addition, the
Directors have adopted a code of conduct for dealings in the shares of the Company by directors and
employees and are committed to maintaining the highest standards of corporate governance. During
2021 Allan Symms has continued as Chair of the Company. On 14 May 2021, when the Company
completed the acquisition of CBL and was admitted to the Standard-List of the London Stock Exchange,
his role changed to being an executive director.
The corporate governance arrangements that the Board has adopted are designed to ensure that the
Company delivers long term value to its shareholders and that shareholders have the opportunity to
express their views and expectations for the Company in a manner that encourages open dialogue with
the Board. The Board recognises that their decisions regarding strategy and risk will impact the corporate
culture of the Company as a whole and that this will impact the performance of the Company. The Board
is very aware that the tone and culture set by the Board will greatly impact all aspects of the Company as
a whole and the way that employees behave.
Much of the Company’s activities since 14 May 2021 have been focussed on taking forward the research
and development activities of the Group that have been developed over many years by Professor Dawn
Coverley and her team at The University of York. The Company is committed to respectful dialogue with
its suppliers, partners and potential customers. It is a crucial part of the Company to have sound ethical
values and behaviours in its undertakings to successfully achieve its corporate objectives.
The Board places great importance on this aspect of corporate life and seeks to ensure that this flows
through all that the Company does.
The Board currently consists of two executive and two non-executive directors and does not have a CEO.
The Board continues to consider whether it would be appropriate to seek to appoint additional non-
executive and/or executive directors but at this time believes that appropriate oversight of the Company
is provided by the currently constituted Board. This view will continue to be reviewed by the Board.
John Treacy
Non-Executive Director
Cizzle Biotechnology Holdings PLC (formerly Bould Opportunities PLC)
16
Corporate Governance Statement (continued)
The QCA Code sets out 10 principles which should be applied. These are listed below together with a
short explanation of how the Company applies each of the principles. Where the Company does not fully
apply each principle an explanation as to why has also been provided:
Principle One - Business Model and Strategy
The Board’s strategy during 2021 has been in two distinct parts. Prior to 14 May 2021 it was focussed on
finalising the acquisition of CBL, seeking admission to the Standard Listing of the London Stock
Exchange, and raising funds to ensure that the Group could continue with the research and development
activity into the early detection of lung cancer that has been undertaken by CBL. Since the Group raised
£2.2m of new funds, before expenses, the Group has been able to continue with its research and
development activity and in particular had adopted a strategy of developing CBL’s prototype test into a
commercial, CE marked and/or FDA 510(k) cleared diagnostic immunoassay that can be readily
performed as a sufficiently reliable test in a hospital setting.
Principle Two - Understanding Shareholder Needs and Expectations
The Board is committed to maintaining good communication and having constructive dialogue with its
shareholders. Institutional shareholders and analysts have the opportunity to discuss issues and provide
feedback at meetings with the Company. In addition, all shareholders are encouraged to attend the
Company’s Annual General Meeting. Investors also have access to current information on the Company
though its website, https://cizzlebiotechnology.com and via Allan Syms, Non-Executive Chair who is
available to answer investor relations enquiries through IFC Advisory Limited (cizzle@investor-
focus.co.uk).
Principle Three - Stakeholder Responsibilities
The Board recognises that the long-term success of the Company is reliant upon the efforts of the
employees of the Company and its contractors, suppliers and regulators. The Board has put in place a
range of processes and systems to ensure that there is close Board oversight and contact with its key
resources and relationships. Currently the directors of the Company are the Group’s only employees but
it has systems in place whereby the effectiveness of the board is reviewed and discussed.
Principle Four - Risk Management
In addition to its other roles and responsibilities the Audit and Compliance Committee is responsible to
the Board for ensuring that procedures are in place, and are being effectively implemented to identify,
evaluate and manage the significant risks faced by the Company. The risk assessment matrix below sets
out those risks, and identifies their ownership and the controls that are in place. This matrix is updated
as changes arise in the nature of risks or the controls that are implemented to mitigate them. The Audit
Committee reviews the risk matrix and the effectiveness of scenario testing on a regular basis. The
following principal risks, and controls to mitigate them, have been identified during 2021:
Activity
Financial
Risk
Pre-revenue
business
Healthcare Industry
Pace of development
in
the healthcare
industry
Management
employees
and
Retention of key
staff
Research
Development
and
Complex processes
.
Patents and other
intellectual
property
rights (IPR)
Infringement of other
patents, IPR
Impact
Revenues are not generated
to support the development
and commercialisation of the
Group’s technology.
The Group’s technology may
be superseded by other
competitor technologies.
The loss of key members of
staff could have an adverse
the pace of
impact on
development.
Additional
development
than anticipated.
costs
takes
if
longer
Additional costs of defending
any IPR claims and/or delays/
in current
additional costs
programme of research and
development.
Control(s)
Regular appraisal of
project milestones.
that
Continual monitoring
of competitor products
alternative
and
solutions.
key
Ensuring
have
employees
to ensure
incentives
that they do not wish to
leave.
Regular appraisal of
project milestones and
consideration of a
variety of strategies.
Regular monitoring of
third party patents/
IPR with patent
advisers.
Cizzle Biotechnology Holdings PLC (formerly Bould Opportunities PLC)
17
Corporate Governance Statement (continued)
Principle Four - Risk Management (continued)
The Company has already established procedures, as represented by this and previous years’
statements, for the purpose of providing a system of internal control. In addition, there were a range of
Company policies that were reviewed at least annually by the Board and a programme of training and
then confirmation of understanding that all employees of the Company were required to undertake each
year. These Company policies covered matters such as share dealing, insider legislation and expenses.
The directors consider that an internal audit function is not considered necessary or practical due to the
size of the Company and the close day to day control exercised by the directors. The directors will
continue to monitor the need for new systems of internal control and an internal audit function.
The annual review of internal control and financial reporting procedures did not highlight any issues
warranting the introduction of an internal audit function.
Principle Five - A Well-Functioning Board of Directors
On 14 May 2021 the composition of the board changed to two executive directors and two non-executive
directors. Allan Syms remains as Chair but in an executive capacity and Nigel Lee was appointed Finance
Director. John Treacy continues as non-executive director and Professor Dawn Coverley was appointed
a new non-executive director. Also on this date Martin Lampshire retired as a non-executive director and
we thank him for his valuable guidance in helping the Company transition into a new business activity.
The time commitment formally required by the Company is an overriding principal that each director will
devote as much time as is required to carry out the roles and responsibilities that the director has agreed
to take on. All directors of the Company are part-time. Biographical details of the current directors are set
out on page 5.
Executive and non-executive directors are subject to re-election intervals as prescribed in the Company’s
Articles of Association. At each Annual General Meeting one-third of the Directors, who are subject to
retirement by rotation shall retire from office. They can then offer themselves for re-election. The letters
of appointment of all directors are available for inspection at the Company’s registered office during
normal business hours.
The Executive Chair and Finance Director both receive a salary for their services as a director which is
approved by the Board, being mindful of the time commitment and responsibilities of their roles and of
current market rates for comparable organisations and appointments. They are also reimbursed for
travelling and other incidental expenses incurred on Group business.
The Non-Executive Directors receive payments under appointment letters which are terminable by three
months’ notice by either party.
The Board encourages the ownership of shares in the Company by Executive and Non-Executive
Directors alike and in normal circumstances does not expect Directors to undertake dealings of a short-
term nature. The Board considers ownership of Company shares by Non-Executive Directors as a positive
alignment of their interest with shareholders. The Board will periodically review the shareholdings of the
Non-Executive Directors and will seek guidance from its advisors if, at any time, it is concerned that the
shareholding of any Non-Executive Director may, or could appear to, conflict with their duties as an
independent Non-Executive Director of the Company or their independence itself. Directors’ emoluments,
including Directors’ interest in share options over the Company’s share capital, are set out in Note 14.
The Board has established that it will meet on at least 6 times throughout the year. It has established an
Audit Committee and a Remuneration Committee, particulars of which appear hereafter. The Board
agreed that appointments to the Board are made by the Board as a whole and so has not created a
Nominations Committee.
Cizzle Biotechnology Holdings PLC (formerly Bould Opportunities PLC)
18
Corporate Governance Statement (continued)
Principle Five - A Well-Functioning Board of Directors (continued)
Attendance at Board and Committee Meetings
The Board retains full control of the Company with day-to-day operational control delegated to Executive
Directors. The full Board meets at least every other month and on any other occasions it considers
necessary. During 2021 there were sixteen Board meetings, one Remuneration Committee meeting and
one Audit Committee meeting.
Principle Six - Appropriate Skills and Experience of the Directors
Directors who served during 2021:
Prior to 14 May 2021 the Board consisted of three Non-Executive Directors. In addition, the Company
used the services of CFO Solutions Limited for ad hoc financial advisory services and also to act as the
Company Secretary. Since 14 May 2021 the executive directors have been Allan Syms (Executive Chair)
and Nigel Lee (Finance Director). The Non-Executive directors have been John Treacy (specialising in
corporate governance, capital markets, legal matters) and Professor Dawn Coverley (cell biologist and
expert in cancer related research).
The current directors of the Company are as follows are detailed on page 5.
Principle Seven - Evaluation of Board Performance
Internal evaluation of the Board, the Committee and individual directors is seen as an important next step
in the development of the Board and one that will be addressed during 2022. The aim is that this will be
undertaken on an annual basis in the form of peer appraisal, questionnaires and discussions to determine
the effectiveness and performance in various areas as well as the directors’ continued independence.
Principle Eight - Corporate Culture
During 2021, the Board recognised that their decisions regarding strategy and risk will impact the
corporate culture of the Company as a whole and that this will impact the performance of the Company.
The Board is very aware that the tone and culture set by the Board will greatly impact all aspects of the
Company as a whole and the way that employees behave. A large part of the Company’s activities was
centred upon addressing customer and market needs. Therefore, the importance of sound ethical values
and behaviours is crucial to the ability of the Company to successfully achieve its corporate objectives.
The Board places great importance on this aspect of corporate life and seeks to ensure that this flows
through all that the Company does. The Board assessment of the culture within the Company at the
present time is one where there is respect for all individuals and there is open dialogue within the
Company.
Principle Nine - Maintenance of Governance Structures and Processes
Ultimate authority for all aspects of the Company’s activities rests with the Board. The Board has adopted
a Financial Position and Prospects Board Memorandum which summarises financial reporting procedures
and establishes procedures to ensure that it meets all regulatory requirements for accounting, financial
reporting and related obligations. This includes matters which are reserved to the Board and the division
of responsibilities between the executive and non-executive directors. The Chair is responsible for the
effectiveness of the Board.
Cizzle Biotechnology Holdings PLC (formerly Bould Opportunities PLC)
19
Corporate Governance Statement (continued)
Audit Committee
Until 14 May 2021 the Audit Committee comprised Allan Syms (Chair) and meetings were also attended
by a representative of CFO Solutions Limited. Since 14 May 2021 the Audit Committee consists of John
Treacy (Chair) and Professor Dawn Coverley. It meets as required and specifically to review the Interim
Report and Annual Report, and to consider the suitability and monitor the effectiveness of internal control
processes. There was one meeting of the Audit Committee during 2021. The Audit Committee also
reviews the findings of the external auditor and reviews accounting policies and material accounting
judgements.
The independence and effectiveness of the external auditor is reviewed annually. The possibility of
undertaking an audit tender process is considered on a regular basis. The Audit Committee meets at least
once a year with the auditor to discuss their independence and objectivity, the Annual Report, any audit
issues arising, internal control processes, appointment and fee levels and any other appropriate matters.
Since 14 May 2021 the auditor no longer provides tax and other advisory services. The fees in respect of
audit services are set out in Note 7.
Remuneration Committee
Until 14 May 2021 the Remuneration Committee comprised Allan Syms (Chair) and other non-executive
directors. Since 14 May 2021 the Audit Committee consists of John Treacy (Chair) and Professor Dawn
Coverley. The purpose of the Remuneration Committee is to ensure that the Executive Directors and other
employees are fairly rewarded for their individual contribution to the overall performance of the Company.
The Committee considers and recommends to the Board the remuneration of the Executive Directors and
is kept informed of the remuneration packages of senior staff and invited to comment on these. There was
one Remuneration Committee meeting during 2021. The Board retains responsibility for overall
remuneration policy. The Remuneration Committee recommends to the Board the remuneration packages
by reference to individual performance and uses the knowledge and experience of the Committee
members, published surveys relating to similar companies and market changes generally. The
Remuneration Committee has responsibility for recommending any long-term incentive schemes.
The Board determines whether or not Executive Directors are permitted to serve in roles with other
companies. Such permission would only be granted on a strictly limited basis, where there are no conflicts
of interest or competing activities and providing there is not an adverse impact on the commitments
required to the Company. Earnings from such roles would be required to be disclosed to the Chair.
During 2021 there were two main elements of the remuneration package for Executive and Non-Executive
Directors and former employees:
Basic salaries: Basic salaries are recommended to the Board by the Remuneration Committee,
1.
taking into account the performance of the individual and the rates for similar positions in comparable
companies. No benefits in kind are currently available to Executive Directors.
2.
Share options: The Company operates unapproved share option schemes for Executive Directors
and some non-executive directors to motivate those individuals through equity participation. Exercise of
share options under the schemes is subject to specified exercise periods and compliance with the Scheme
Rules and the rules of the London Stock Exchange. The schemes are overseen by the Remuneration
Committee which recommends to the Board all grants of share options based on the Remuneration
Committee’s assessment of personal performance and specifying the terms under which eligible
individuals may be invited to participate. It is intended that the performance related elements of
remuneration form a significant proportion of the total remuneration package of Executive Directors and
be designed to align their interests with those of shareholders. In this development phase of the Company
the Remuneration Committee currently considers that the best alignment of these interests is through the
continued use of incentives for performance through the award of share options.
Cizzle Biotechnology Holdings PLC (formerly Bould Opportunities PLC)
20
Corporate Governance Statement (continued)
Non-executive Directors
The Board has adopted guidelines for the appointment of non-executive directors which have been in
place and which have been observed throughout the year. These provide for the orderly and constructive
succession and rotation of the non-executive directors insofar as they will be appointed for an initial term
of three years and may, at the Board’s discretion believing it to be in the best interests of the Company,
be appointed for subsequent terms. In accordance with the Companies Act 2006, the Board complies
with: a duty to act within their powers; a duty to promote the success of the Company; a duty to exercise
independent judgement; a duty to exercise reasonable care, skill and diligence; a duty to avoid conflicts
of interest; a duty not to accept benefits from third parties and a duty to declare any interest in a proposed
transaction or arrangement.
Principle Ten - Shareholder Communication
The Board is committed to maintaining good communication and having constructive dialogue with its
shareholders. Institutional shareholders and analysts have the opportunity to discuss issues and provide
feedback at meetings with the Company. In addition, all shareholders are encouraged to attend the
Company’s Annual General Meeting. Investors also have access to current information on the Company
though its website, https://cizzlebiotechnology.com and via Allan Syms, non-executive Chair who is
available to answer investor relations enquiries through IFC Advisory Limited (cizzle@investor-
focus.co.uk).
Cizzle Biotechnology Holdings PLC (formerly Bould Opportunities PLC)
21
Directors Remuneration Report for the year ended 31 December 2021
The Company has established a remuneration committee. The Committee reviews the scale and structure
of the Directors’ fees, taking into account the interests of shareholders and the performance of the Group
and directors.
The items included in this report are unaudited unless otherwise stated.
Statement of Cizzle Biotechnology Holdings PLC Policy on Directors’ Remuneration by the Chair
of the Remuneration Committee
As Chair of the Remuneration Committee, I have pleasure in introducing our Directors’ Remuneration
Report. One of the Remuneration Committee’s aims is to provide clear, transparent remuneration
reporting for our shareholders which adheres to the best practice corporate governance principles that
are required for listed companies.
A key focus of the Directors’ Remuneration Policy is to align the interests of the Directors to the long-term
interests of the shareholders and aims to support a high-performance culture with appropriate rewards
for meeting the Group’s objectives without unnecessary risk-taking. This is underpinned through the
operation of incentive plans.
Key activities of the Remuneration Committee
The key activities of the Remuneration Committee are to:
• determine and agree with the board the framework or broad policy for the remuneration of the
Company’s Chair and the executive directors including pension rights and compensation
payments. The remuneration of non-executive directors shall be a matter for the board or the
shareholders (within the limits set in the articles of association). No director or senior manager
shall be involved in any decisions as to their own remuneration;
•
recommend and monitor the level and structure of remuneration for senior management taking
into account all factors which it deems necessary including relevant legal and regulatory
requirements and the provisions and recommendations of the UK Corporate Governance Code
(insofar as it applies to the Company) and other relevant guidance. These will be subject to annual
review. The objective of such policy shall be to attract, retain and motivate the executive
management of the Company without paying more than necessary. The remuneration policy
bears in mind the Company's appetite for risk and be aligned to the Company's long term strategic
goals. A significant proportion of remuneration should be structured so as to link rewards to
corporate and individual performance and be designed to promote the long term success of the
Company;
•
review and have regard to the pay and employment conditions across the Company or group,
especially when determining salary increases;
•
review the ongoing appropriateness and relevance of the remuneration policy;
• approve the design of, and determine targets for, any performance related pay schemes operated
by the Company and approve the total annual payments made under such schemes;
•
•
review the Company’s arrangements for its employees to raise concerns, in confidence, about
possible wrongdoing in financial reporting or other matters. The Committee shall ensure that
these arrangements allow proportionate and independent investigation of such matters and
appropriate follow up action;
review the design of all share incentive plans for approval by the board and shareholders. For
any such plans, determine each year whether awards will be made, and if so, the overall amount
of such awards, the individual awards to executive directors, Company Secretary and other senior
executives and the performance targets to be used;
• determine the policy for, and scope of, pension arrangements for each executive director and
other senior executives;
Cizzle Biotechnology Holdings PLC (formerly Bould Opportunities PLC)
22
Directors Remuneration Report for the year ended 31 December 2021 (cont’d)
Key activities of the Remuneration Committee (cont’d)
• determine the total individual remuneration package of the Chair, each executive director, the
Company Secretary and other senior executives including bonuses, incentive payments and
share options or other share awards;
• ensure that contractual terms on termination and any payments made are fair to the individual
and the Company; that failure is not rewarded and the duty to mitigate loss is fully recognised;
oversee any major changes in employee benefits structures throughout the Company or Group;
and agree the policy for authorising claims for expenses from the directors;
• be responsible for establishing the selection criteria, selecting, appointing and setting the terms
of reference for any remuneration of consultants who advise the Committee;
• obtain reliable, up-to-date information about remuneration in other companies of comparable
scale. The Committee shall have full authority to appoint remuneration consultants and to
commission or purchase any reports, surveys or information which it deems necessary to help it
fulfil its obligations within any budgetary restraints imposed by the board;
•
consider such other matters as may be requested by the board of directors; and
• work and liaise as necessary with all other board committees.
Members
The Remuneration Committee comprises the following independent Non-Executive Directors:
Name
John Treacy
Prof. Dawn Coverley
Position
Chair
Member
Date of
Committee
appointment
to
14 May 2021
14 May 2021
Prior to his appointment as Executive Chair of the Company, Allan Syms was Chair of the Remuneration
Committee from 21 May 2019 to 14 May 2021.
John Treacy, prior to his appointment as Chair of the Remuneration Committee on 14 May 2021, was a
member of the Remuneration Committee from 29 January 2019 to 14 May 2021.
Remuneration Components
The Company remunerates directors in line with best market practice in the industry in which it operates.
As the Group is currently a pre-revenue business the components of Director’s Remuneration consists
of:
• Base salaries
• Pension benefits
• Share incentive arrangements
These remuneration components will be reviewed at least annually by the Committee.
It is anticipated that once the Group becomes a revenue generating business that the following
components of Directors Remuneration are likely to be appropriate:
• Other benefits
• Annual bonus
Cizzle Biotechnology Holdings PLC (formerly Bould Opportunities PLC)
23
Directors Remuneration Report for the year ended 31 December 2021 (cont’d)
Recruitment policy
Base salaries take into account market data for the relevant role, internal relativities, their individual
experience and their current base salary. Where an individual is recruited at below market rates of
remuneration, they may be re-aligned over a period of time, subject to their performance in their role.
Service Agreements and Letters of Appointment
The Executive Directors’ service agreements are summarised below:
Executive
Director
Date of service
agreement
Initial term Notice period by
Company (Months)
Notice period by
Director (Months)
Allan Syms
14 May 2021
6 months
Nigel Lee
14 May 2021
N/a
6
6
6
6
The Non-Executive Directors’ service agreements are summarised below:
Non-Executive
Director
Date of service
agreement
Initial term Notice period by
Company (Months)
Notice period by
Director (Months)
John Treacy
14 May 2021
3 years
Dawn Coverley
14 May 2021
3 years
3
3
3
3
Non-Executive directors are typically expected to serve two three-year terms but may be invited by the
Board to serve for an additional period. Any term renewal is subject to Board review and AGM re-election.
Remuneration of Executive Directors
The remuneration of the Executive Directors for the year ended 31 December 2021 and since 14 May
2021 (date from which new Group commenced) was as follows:
14 May 2021 to 31 December 2021
Year ended 31 December 2021
Executive
Director
Allan Syms
Nigel Lee
TOTAL
Basic salary
Pension
Total
Basic salary
Pension
£’000
£’000
£’000
£’000
£’000
59
22
81
1
1
2
60
23
83
70
22
92
1
1
2
Total
£’000
71
23
94
Cizzle Biotechnology Holdings PLC (formerly Bould Opportunities PLC)
24
Directors Remuneration Report for the year ended 31 December 2021 (cont’d)
Share scheme interests of executive directors
The interests of the executive directors in share schemes are shown in the table below:
Executive
Director
Type of
scheme
Share
options at
31 Dec
2020
Granted
during the
year
Lapsed
or
cancelled
Share
options at 31
Dec 2021
Date from
which
exercisable
Expiry date
Allan Syms
CSOP 21
Nigel Lee *
CSOP 21
-
-
5,068,956
2,000,000
CSOP 17
CSOP 16
CSOP 15
500
800
300
-
-
-
TOTAL
1,600
7,068,956
-
-
-
-
-
-
5,068,956
2,000,000
**
**
2 Nov 2031
2 Nov 2031
500
9 Nov 2018 ***
8 Nov 2017
800
27 Oct 2017 ***
26 Oct 2026
300
25 May 2016 ****
25 Aug 2025
7,070,556
* Includes brought forward 1,600 beneficial interests in share options as director of CFO Solutions Limited.
** subject to achievement of certain Group objectives.
*** One-third of the total options vest on first , second and third anniversary from date of grant.
**** One third of the options vest on 25 May 2016, 25 February 2017 and 25 August 2017.
Remuneration of Non-Executive Directors
The remuneration of the Non-Executive Directors for the year ended 31 December 2021 and since 14
May 2021 (date from which new Group commenced) was as follows:
Non-
Executive
Director
John
Treacy
Dawn
Coverley
Martin
Lampshire
TOTAL
14 May 2021 to 31 December 2021
Year ended 31 December 2021
Basic
salary
£’000
Fees
Pension
Total
£’000
£’000
£’000
Basic
salary
£’000
Fees
Pension
Total
£’000
£’000
£’000
19
25
-
44
-
-
-
-
-
1
-
1
19
26
-
45
30
25
-
55
-
-
7
7
-
1
-
1
30
26
7
63
As mentioned in Note 20 on related party transactions, the Group Statement of Comprehensive Income
includes an amount of £7,366 (2020: £20,000) that was paid to Experience Capital Limited in respect of
non-executive director services provided by Martin Lampshire.
Cizzle Biotechnology Holdings PLC (formerly Bould Opportunities PLC)
25
Directors Remuneration Report for the year ended 31 December 2021 (cont’d)
Share scheme interests of non- executive directors
The interests of the Non-Executive directors in share schemes are shown in the table below:
Non-
executive
Director
Type of
scheme
Share
options at
31 Dec
2020
Granted
during the
year
Lapsed
or
cancelled
Share
options at
31 Dec 2021
Date from
which
exercisable
Expiry date
Dawn
Coverley
TOTAL
CSOP 21
CSOP 21
-
-
12,672,389
3,689,096
- 16,361,485
-
-
-
12,672,389
*
2 Nov 2031
3,689,096
14 May 2021 **
13 May 2031
16,361,485
* subject to achievement of certain Group objectives.
** may only be exercised for a period of 30 days from the date on which the Company’s audited annual
accounts are published each year; or at the discretion of the board of directors.
Relative importance of total remuneration
The table below illustrates total employee remuneration compared to distributions to shareholders and
operational cash outflow, excluding proceeds from the issue of ordinary shares (before issue costs):
14 May 2021 to 31
December 2021
Distributions to
shareholders
Total employee pay
(£’000)
Operational cash
outflow (£’000)
-
128
1,009
Operational cash outflow has been shown in the table above as cash flow monitoring and forecasting are
an important consideration for the Remuneration Committee and Board of Directors when determining
cash-based remuneration for directors and employees.
Cizzle Biotechnology Holdings PLC (formerly Bould Opportunities PLC)
26
Directors Remuneration Report for the year ended 31 December 2021 (cont’d)
Historical share price performance comparison
The table below compares the share price performance (based on notional investment of £100) of Cizzle
Biotechnology Holdings PLC against the FTSE SmallCap and FTSE Techmark Mediscience based on
prices/indices at close of business from 14 May 2021 to 31 December 2021. Note that month end prices
are based on the last day of trading of each month. The FTSE SmallCap has been chosen to provide a
wider market comparator and the FTSE Techmark Mediscience chosen due to sector relevance:
Historical data has been taken from the formation of the new Group and admission to the Standard-List
of the London Stock Exchange which occurred on 14 May 2021 upon completion of the acquisition of
Cizzle Biotechnology Ltd.
Consideration of shareholder views
The Board considers shareholder feedback received and guidance from shareholder bodies. This
feedback is considered as part of the Company’s policy on remuneration.
Approved on behalf of the Board of Directors
John Treacy
Director and Chair of the Remuneration Committee
30 May 2022
Cizzle Biotechnology Holdings PLC (formerly Bould Opportunities PLC)
27
Independent Auditor’s Report to the Members of Cizzle Biotechnology Holdings PLC
Opinion
We have audited the financial statements of Cizzle Biotechnology Holdings Plc (the ‘parent company’)
and its subsidiaries (the ‘group’) for the year ended 31 December 2021 which comprise the Consolidated
Statement of Comprehensive Income, the Consolidated and Company Statements of Financial Position,
the Consolidated and Company Statements of Changes in Equity, the Consolidated and Company
Statements of Cash Flows and notes to the financial statements, including significant accounting policies.
The financial reporting framework that has been applied in their preparation is applicable law and UK-
adopted international accounting standards and as regards the parent company financial statements, as
applied in accordance with the provisions of the Companies Act 2006.
In our opinion:
• the financial statements give a true and fair view of the state of the group’s and of the parent company’s
affairs as at 31 December 2021 and of the group’s loss for the year then ended;
• the group financial statements have been properly prepared in accordance with UK-adopted
international accounting standards;
• the company financial statements have been properly prepared in accordance with UK-adopted
international accounting standards and as applied in accordance with the provisions of the Companies
Act 2006; and
• the financial statements have been prepared in accordance with the requirements of the Companies Act
2006.
Basis for opinion
We conducted our audit in accordance with International Standards on Auditing (UK) (ISAs (UK)) and
applicable law. Our responsibilities under those standards are further described in the Auditor’s
responsibilities for the audit of the financial statements section of our report. We are independent of the
group and parent company in accordance with the ethical requirements that are relevant to our audit of
the financial statements in the UK, including the FRC’s Ethical Standard as applied to listed public interest
entities, and we have fulfilled our other ethical responsibilities in accordance with these requirements. We
believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our
opinion.
Material uncertainty related to going concern
We draw attention to note 2.2 in the financial statements, which indicates that the group will need to raise
additional funds in order to meet its committed liabilities during the going concern period. As stated in
note 2.2, these events or conditions indicate that a material uncertainty exists that may cast significant
doubt on the group’s and parent company’s ability to continue as a going concern. Our opinion is not
modified in respect of this matter.
In auditing the financial statements, we have concluded that the director's use of the going concern basis
of accounting in the preparation of the financial statements is appropriate. Our evaluation of the directors’
assessment of the group and company’s ability to continue to adopt the going concern basis of accounting
included a review of the directors’ statement in note 2.2 to the financial statements and review of the
company’s budgets for the period of the twelve months from the date of approval of the financial
statements, including checking the mathematical accuracy of the budgets and discussion of significant
assumptions used by the management.
Our responsibilities and the responsibilities of the directors with respect to going concern are described
in the relevant sections of this report.
Our application of materiality
The scope of our audit was influenced by our application of materiality. We set certain quantitative
thresholds for materiality. These, together with qualitative considerations, helped us to determine the
scope of our audit and the nature, timing and extent of our audit procedures on the individual financial
statement line items and disclosures and in evaluating the effect of misstatements, both individually and
in aggregate on the financial statements as a whole. Based on our professional judgement, we determined
materiality for the financial statements as a whole as follows:
Cizzle Biotechnology Holdings PLC (formerly Bould Opportunities PLC)
28
Independent Auditor’s Report to the Members of Cizzle Biotechnology Holdings PLC (continued)
Group financial statements
Company financial statements
Overall materiality
£27,000
Performance materiality
£18,900
£18,000
£12,600
Basis of materiality
5% of
exceptional items
loss before
tax
less
5% of
exceptional items
loss before
tax
less
Rationale
is
the primary
the users of
This
key
performance indicator used by
management in assessing the
performance of the group. We
consider
the
financial statements, such as
investors, will also consider the
loss before tax to be a key
metric. Performance materiality
is set at 70% of materiality as the
overall risk is considered to be
medium.
is
the primary
This
key
performance indicator used by
management in assessing the
the parent
performance of
the
company. We consider
users
financial
statements, such as investors,
will also consider the loss before
tax
to be a key metric.
Performance materiality is set at
70% of materiality as the overall
risk is considered to be medium.
the
of
For each component in the scope of our group audit, we allocated a materiality that is less than our overall
group materiality. The materiality applied to the audit of the subsidiary undertaking was £18,000. We
agreed with the Audit Committee that we would report to them misstatements identified during our audit
above £1,350 (group audit) and £900 (parent company audit) as well as misstatements below those
amounts that, in our view, warranted reporting for qualitative reasons.
Our approach to the audit
In designing our audit approach, we determined materiality and assessed the risk of material
misstatement in the financial statements. In particular, we looked at areas involving reverse acquisition
accounting, significant accounting estimate and judgement by the directors and considered future events
that are inherently uncertain. We also addressed the risk of management override of internal controls,
including among other matters consideration of whether there was evidence of bias that represented a
risk of material misstatement due to fraud.
The group has three companies (including one dormant company) within the consolidated financial
statements. We identified two significant components, the parent company and subsidiary undertaking
Cizzle Biotechnology Limited , which were subject to a full scope audit by the group audit team.
Key audit matters
Key audit matters are those matters that, in our professional judgment, were of most significance in our
audit of the financial statements of the current period and include the most significant assessed risks of
material misstatement (whether or not due to fraud) we identified, including those which had the greatest
effect on: the overall audit strategy, the allocation of resources in the audit; and directing the efforts of the
engagement team. These matters were addressed in the context of our audit of the financial statements
as a whole, and in forming our opinion thereon, and we do not provide a separate opinion on these
matters. In addition to the matter described in the Material uncertainty related to going concern section
we have determined the matters described below to be the key audit matters to be communicated in our
report.
Cizzle Biotechnology Holdings PLC (formerly Bould Opportunities PLC)
29
Independent Auditor’s Report to the Members of Cizzle Biotechnology Holdings PLC (continued)
Key Audit Matter
How our audit addressed this matter
Reverse acquisition of Cizzle Biotechnology
Limited (note 3)
On 14 May 2021 Cizzle Biotechnology Limited
the reverse acquisition of Cizzle
completed
Biotechnology Holdings plc
(formerly Bould
Opportunities plc). The enlarged group was
admitted
the London Stock
Exchange on the same date.
trading on
to
The reverse acquisition does not constitute a
business combination and is accounted for in
accordance with IFRS 2 ‘Share-based Payments’
and associated IFRIC guidance. There is a risk the
share-based payment has been
incorrectly
calculated and that the reverse acquisition has
been incorrectly presented and disclosed.
Our work in this area included:
▪ Reviewing the Prospectus and other applicable
documentation to ensure the terms of the reverse
acquisition are understood;
▪ Checking the basis for calculating the ‘deemed
acquisition cost’, comprising the consideration
shares, together with the fair value of the assets
and liabilities acquired at the date of acquisition
within Cizzle Biotechnology Holdings plc;
▪ Re-performing the calculations on consolidation;
and
▪ Checking the presentation and disclosure of the
reverse acquisition in the financial statements.
There were no issues noted for the reverse
acquisition of Cizzle Biotechnology Limited,
including
the associated presentation and
disclosure requirements.
Other information
The other information comprises the information included in the annual report, other than the financial
statements and our auditor’s report thereon. The directors are responsible for the other information
contained within the annual report. Our opinion on the group and parent company financial statements
does not cover the other information and, except to the extent otherwise explicitly stated in our report, we
do not express any form of assurance conclusion thereon. Our responsibility is to read the other
information and, in doing so, consider whether the other information is materially inconsistent with the
financial statements or our knowledge obtained in the course of the audit, or otherwise appears to be
materially misstated. If we identify such material inconsistencies or apparent material misstatements, we
are required to determine whether this gives rise to a material misstatement in the financial statements
themselves. If, based on the work we have performed, we conclude that there is a material misstatement
of this other information, we are required to report that fact.
We have nothing to report in this regard.
Opinions on other matters prescribed by the Companies Act 2006
In our opinion the part of the directors’ remuneration report to be audited has been properly prepared in
accordance with the Companies Act 2006. In our opinion, based on the work undertaken in the course of
the audit:
• the information given in the strategic report and the directors’ report for the financial year for which the
financial statements are prepared is consistent with the financial statements; and
• the strategic report and the directors’ report have been prepared in accordance with applicable legal
requirements.
Cizzle Biotechnology Holdings PLC (formerly Bould Opportunities PLC)
30
Independent Auditor’s Report to the Members of Cizzle Biotechnology Holdings PLC (continued)
Responsibilities of directors
As explained more fully in the directors’ responsibilities statement, the directors are responsible for the
preparation of the group and parent company financial statements and for being satisfied that they give a
true and fair view, and for such internal control as the directors determine is necessary to enable the
preparation of financial statements that are free from material misstatement, whether due to fraud or error.
In preparing the group and parent company financial statements, the directors are responsible for
assessing the group’s and the parent company’s ability to continue as a going concern, disclosing, as
applicable, matters related to going concern and using the going concern basis of accounting unless the
directors either intend to liquidate the group or the parent company or to cease operations, or have no
realistic alternative but to do so.
Auditor’s responsibilities for the audit of the financial statements
Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are
free from material misstatement, whether due to fraud or error, and to issue an auditor’s report that
includes our opinion. Reasonable assurance is a high level of assurance but is not a guarantee that an
audit conducted in accordance with ISAs (UK) will always detect a material misstatement when it exists.
Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate,
they could reasonably be expected to influence the economic decisions of users taken on the basis of
these financial statements.
Irregularities, including fraud, are instances of non-compliance with laws and regulations. We design
procedures in line with our responsibilities, outlined above, to detect material misstatements in respect of
irregularities, including fraud. The extent to which our procedures are capable of detecting irregularities,
including fraud is detailed below:
• We obtained an understanding of the group and parent company and the sector in which they operate
to identify laws and regulations that could reasonably be expected to have a direct effect on the financial
statements. We obtained our understanding in this regard through discussions with management and
application of our cumulative audit knowledge and experience of the sector.
• We determined the principal laws and regulations relevant to the group and parent company in this
regard to be those arising from UK-adopted international accounting standards and the Companies Act
2006.
• We designed our audit procedures to ensure the audit team considered whether there were any
indications of non-compliance by the group and parent company with those laws and regulations. These
procedures included, but were not limited to:
-
enquiries of management and review of Board minutes,
-
review of legal and regulatory correspondence.
• We also identified the risks of material misstatement of the financial statements due to fraud. We
considered, in addition to the non-rebuttable presumption of a risk of fraud arising from management
override of controls, we did not identify any significant fraud risks.
• We addressed the risk of fraud arising from management override of controls by performing audit
procedures which included, but were not limited to: the testing of journals; reviewing accounting estimates
for evidence of bias; and evaluating the business rationale of any significant transactions that are unusual
or outside the normal course of business.
Because of the inherent limitations of an audit, there is a risk that we will not detect all irregularities,
including those leading to a material misstatement in the financial statements or non-compliance with
regulation. This risk increases the more that compliance with a law or regulation is removed from the
events and transactions reflected in the financial statements, as we will be less likely to become aware of
instances of non-compliance. The risk is also greater regarding irregularities occurring due to fraud rather
than error, as fraud involves intentional concealment, forgery, collusion, omission or misrepresentation.
Cizzle Biotechnology Holdings PLC (formerly Bould Opportunities PLC)
31
Independent Auditor’s Report to the Members of Cizzle Biotechnology Holdings PLC (continued)
A further description of our responsibilities for the audit of the financial statements is located on the
Financial Reporting Council’s website at: www.frc.org.uk/auditorsresponsibilities. This description forms
part of our auditor’s report.
Other matters which we are required to address
Our total uninterrupted period of engagement is 4 years, covering the periods ending 31 December 2018
to December 2021. The non-audit services prohibited by the FRC’s Ethical Standard were not provided
to the group or the parent company and we remain independent of the group and the parent company in
conducting our audit. Our audit opinion is consistent with the additional report to the audit committee.
Use of our report
This report is made solely to the company’s members, as a body, in accordance with Chapter 3 of Part
16 of the Companies Act 2006. Our audit work has been undertaken so that we might state to the
company’s members those matters we are required to state to them in an auditor’s report and for no other
purpose. To the fullest extent permitted by law, we do not accept or assume responsibility to anyone,
other than the company and the company's members as a body, for our audit work, for this report, or for
the opinions we have formed.
David Thompson (Senior Statutory Auditor) 15 Westferry Circus
For and on behalf of PKF Littlejohn LLP Canary Wharf
Statutory Auditor London E14 4HD
30 May 2022
Cizzle Biotechnology Holdings PLC ( formerly Bould Opportunities PLC)
32
Consolidated Statement of Comprehensive Income
for the year ended 31 December 2021
Notes
Group
Year ended 31
December
2021
£’000
CBL
Year ended 31
December
2020
£’000
Revenue
Cost of sales
Gross profit
Administrative expenses
- on-going administrative costs
- share option charge
-
transaction costs
- reverse acquisition expenses
Total administrative expenses
Operating (loss) and (loss) before income tax
Income tax
Loss and total comprehensive income for the year
attributable to the equity shareholders of the parent
Earnings per ordinary share (pence) attributable to
the equity shareholders:
Continued operations basic and diluted
Earnings per ordinary share (pence) attributable to
the equity shareholders of the parent
6
6
6
6
9
10
10
-
-
-
(552)
(299)
(303)
(2,804)
(3,958)
(3,958)
37
(3,921)
-
-
-
(14)
-
-
-
(14)
(14)
-
(14)
(2.4p)
(2.4p)
(2.8p)
(2.8p)
The Company has elected to take the exemption provided under section 408, Companies Act 2006
from presenting the Company statement of comprehensive income.
The notes on pages 39 to 55 are an integral part of these financial statements.
Cizzle Biotechnology Holdings PLC (formerly Bould Opportunities PLC)
33
Registered number: 06133765 (England and Wales)
Consolidated Statement of Financial Position
As at 31 December 2021
Notes Group
2021
£’000
CBL
2020
£’000
Non-current assets
Intangible asset
Tangible assets
Current assets
Trade and other receivables
Cash and cash equivalents
Total assets
Equity
Capital and reserves attributable to equity holders
of the company
Ordinary shares
Share premium
Reverse acquisition reserve
Share capital reduction reserve
Share option reserve
Retained losses
Total equity
Liabilities
Current liabilities
Trade and other payables
Borrowings
Total liabilities
Total equity and liabilities
11
11
12
13
14
15
200
-
200
80
875
955
1,155
3,493
32,566
(40,021)
10,081
335
(5,517)
937
218
-
218
1,155
-
-
-
3
7
10
10
3
1,585
-
-
-
(1,596)
(8)
8
10
18
10
The notes on pages 39 to 55 are an integral part of these financial statements.
The financial statements were approved and authorised for issue by the board on 30 May 2022
and were signed on its behalf by:
Nigel Lee
Director
Cizzle Biotechnology Holdings PLC (formerly Bould Opportunities PLC)
34
Registered number: 06133765 (England and Wales)
Company Statement of Financial Position
As at 31 December 2021
Notes
2021
£’000
2020
£’000
Non-current assets
Intangible asset
Investments
Current assets
Trade and other receivables
Cash and cash equivalents
Total assets
Equity
Capital and reserves attributable to equity holders
of the company
Ordinary shares
Share premium
Share capital reduction reserve
Share option reserve
Accumulated losses
Total equity
Liabilities
Current liabilities
Trade and other payables
Total liabilities
Total equity and liabilities
11
11
12
13
14
200
21,803
22,003
241
848
1,089
23,092
3,493
32,566
10,081
335
(23,516)
22,959
15
133
133
23,092
-
-
6
84
90
90
3,470
8,852
10,081
-
(22,371)
32
58
58
90
The notes on pages 39 to 55 are an integral part of these financial statements. The loss for the year
of the Company was £1,145,000 (2020: loss of £306,000).
The financial statements were approved and authorised for issue by the board on 30 May 2022 and
were signed on its behalf by:
Nigel Lee
Director
Cizzle Biotechnology Holdings PLC (formerly Bould Opportunities PLC)
35
Consolidated Statement of Cash Flows for the year ended 31 December 2021
Cash flows from operating activities
Operating (loss) before tax
Adjustment for:
Reverse acquisition expense
Share option charge
Transaction costs settled through share issue
Share based payment to former director
Operating cash flow before working capital movements
Decrease in trade and other receivables
Decrease in trade and other payables
Net cash used in operating activities
Cash flows from investing activities
Cash acquired on acquisition of subsidiary
Purchase of investment in intangible assets
Net cash used in investing activities
Cash flows from financing activities
Proceeds from the issue of ordinary shares (net of issue
costs)
Borrowings received
Borrowings repaid
Net cash generated from financing activities
Net increase / (decrease) in cash and cash equivalents
Cash and cash equivalents at the start of the year
Cash and cash equivalents at the end of the year
Notes
Group
2021
£'000
CBL
2020
£'000
(3,958)
(14)
3,6
12
15
11
14
13
13
2,804
299
32
11
(812)
7
(204)
(1,009)
46
(200)
(154)
2,041
-
(10)
2,031
868
7
875
-
-
-
-
(14)
-
(2)
(16)
-
-
-
-
10
-
10
(6)
13
7
The notes on pages 39 to 55 are an integral part of these financial statements.
Cizzle Biotechnology Holdings PLC (formerly Bould Opportunities PLC)
36
Company Statement of Cash Flows for the year ended 31 December 2021
Cash flows from operating activities
Loss before tax
Share option charge
Transaction costs settled through share issue
Operating cash flow before working capital movements
Change in trade and other receivables
Change in trade and other payables
Net cash used in operating activities
Cash flows from investing activities
Purchase of investment in intangible assets
Investment in subsidiary company
Change in intra group funding
Net cash used in investing activities
Cash flows from financing activities
Proceeds from the issue of ordinary shares (net of issue
costs)
Net cash generated from financing activities
Net increase / (decrease) in cash and cash equivalents
Cash and cash equivalents at the start of the year
Cash and cash equivalents at the end of the year
Notes
12
15
11
14
13
13
2021
£'000
(1,145)
299
32
(814)
(19)
75
(758)
(200)
(103)
(216)
(519)
2,041
2,041
764
84
848
2020
£'000
(306)
-
(306)
25
(13)
(294)
-
-
-
-
-
-
(294)
378
84
The notes on pages 39 to 55 are an integral part of these financial statements.
Cizzle Biotechnology Holdings PLC (formerly Bould Opportunities PLC)
37
Group statement of Changes in Equity
for the year ended 31 December 2021
Ordinary
Share
Capital
Share
Premium
Capital
Redemption
Reserve
Share
Option
Reserve
Reverse
Acquisition
Reserve
Retained
Losses
Total
£'000
£'000
£’000
£'000
£'000
£'000
£'000
Group
At 1 January 2021
Issue of shares
3
-
1,585
11
-
-
-
Transfer to reverse acquisition reserve
(3)
(1,596)
Recognition of plc equity at acquisition date
3,470
8,852
10,081
Issue of shares for acquisition of subsidiary
21
21,679
Reverse acquisition expense
Issue of shares for cash
Issue of shares in settlement of fees
Issue of warrants
Cost of share issue
Share option charge
-
2
-
-
-
-
-
2,198
32
(36)
(159)
-
-
-
-
-
-
-
-
Comprehensive Loss for the year
-
-
-
3,493
32,566
10,081
-
-
-
-
-
-
-
-
36
-
299
335
-
-
(1,596)
-
1,599
(22,621)
(21,803)
2,804
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
(8)
11
-
(218)
(103)
2,804
2,200
32
-
(159)
299
(40,021)
(1,596)
4,858
-
(3,921)
(3,921)
At 31 December 2021
3,493
32,566
10,081
335
(40,021)
(5,517)
937
For the year ended 31 December 2020
CBL
At 1 January 2020
Comprehensive loss for the year
At 31 December 2020
Ordinary
Share
Capital
£'000
Share
Premium
£’000
Retained
Losses
£’000
3
-
3
1,585
(1,582)
-
(14)
1,585
(1,596)
Total
£’000
6
(14)
(8)
Cizzle Biotechnology Holdings PLC (formerly Bould Opportunities PLC)
38
Company statement of Changes in Equity
for the year ended 31 December 2021
Ordinary
Share
Capital
£’000
Share
premium
£’000
Share
capital
reduction
reserve
£’000
Share
option
reserve
£’000
Retained
Losses
£’000
Total
£’000
At 1 January 2020
3,470
8,852
10,081
Comprehensive Loss for the year
-
-
-
At 31 December 2020
3,470
8,852
10,081
Issue of shares for acquisition of
subsidiary
Issue of shares for cash
Issue of shares in settlement of fees
Cost of share issue
Issue of warrants
Share option charge
21
2
-
-
-
-
21,679
2,198
32
(159)
(36)
-
-
-
-
-
-
-
-
-
-
-
-
-
-
36
299
(22,065)
338
(306)
(306)
(22,371)
32
-
-
-
-
-
-
21,700
2,200
32
(159)
-
299
3,493
32,566
10,081
335
(22,371)
24,104
Comprehensive Loss for the year
-
-
-
-
(1,145)
(1,145)
At 31 December 2021
3,493
32,566
10,081
335
(23,516)
22,959
The notes on pages 39 to 55 are an integral part of these financial statements.
Cizzle Biotechnology Holdings PLC (formerly Bould Opportunities PLC)
39
Notes to the financial statements for the year ended 31 December 2021
1 General information
Cizzle Biotechnology Holdings PLC (“the Company” of “the Group”) (formerly Bould Opportunities PLC) is a
public limited company with its shares traded on the Standard Listing of the London Stock Exchange. On 14
May 2021 the Company acquired through a share for share exchange the entire share capital of Cizzle
Biotechnology Limited. The Company is a holding company of a group of companies (“the Group”) whose
principal activity is the early detection of lung cancer via the development of an immunoassay test for the
CIZ1B biomarker.
The directors consider there to be no ultimate controlling shareholder of the Company.
The address of the registered office is 6th Floor, 60 Gracechurch Street, London, EC3V 0HR and the registered
number of the Company is 06133765.
2
Accounting policies
The principal accounting policies applied in the preparation of these financial statements are set out below.
These policies have been consistently applied to all the years presented, unless otherwise stated.
2.1 Basis of preparation
The financial statements of Cizzle Biotechnology Holdings PLC (“the Company”) including subsidiary
undertakings (together referred to as “the Group”) have been prepared in accordance with UK-adopted
international accounting standards and the Companies Act 2006 on a historical cost basis.
The preparation of financial statements in conformity with IFRS requires the use of certain critical accounting
estimates. It also requires management to exercise its judgement in the process of applying the Company’s
accounting policies. The areas involving a higher degree of judgement or complexity, or areas where
assumptions and estimates are significant to the financial statements are disclosed in Note 4.
The results for the year ended 31 December 2021 are the Group results following the acquisition of Cizzle
Biotechnology Limited (“CBL”) on 14 May 2021. The results for the comparative period to 31 December
2020 are the results of CBL prior to the creation of the new Group.
(a) New standards and interpretations
The IASB and IFRS Interpretations Committee have issued the following standards and interpretations with
an effective date of implementation of 1 January 2021.
i)
New standards and amendments – applicable 1 January 2021
The following standard and interpretations apply for the first time to financial reporting periods
commencing on or after 1 January 2021:
Interest rate benchmark reform – Amendments to IFRS 17 “Insurance Contracts”
Interest rate benchmark reform – Amendments to IFRS 16 “Leases”
Interest rate benchmark reform – Amendments to IFRS 9 “Financial Instruments”
Interest rate benchmark reform – Amendments to IAS 39 “Financial Instruments: Recognition
and Measurement”
Interest rate benchmark reform – Amendments to IFRS 7 “Financial Instruments: Disclosures”
Effective for
accounting periods
beginning on or
after
1 January 2021
1 January 2021
1 January 2021
1 January 2021
Impact
None
None
None
None
1 January 2021
None
Cizzle Biotechnology Holdings PLC (formerly Bould Opportunities PLC)
40
Notes to the financial statements for the year ended 31 December 2021
2
Accounting policies (continued)
ii)
Forthcoming requirements
As at 31 December 2021, the following standards and interpretations had been issued but were not
mandatory for annual reporting periods ending on 31 December 2021 and not early adopted.
COVID-19 related Rent Concessions – Amendments to IFRS 16
Income Taxes – Deferred tax amendments to IAS 12
Property, Plant and Equipment: Proceeds before intended use – Amendments to IAS 16
Reference to the Conceptual Framework – Amendments to IFRS 3
Onerous Contracts: Cost of Fulfilling a Contract – Amendments to IAS 37
Annual Improvements to IFRS Standards 2018–2020
Classification of Liabilities as Current or Non-current – Amendments to IAS 1
2.2 Going concern
Effective for
accounting
periods
beginning on or
after
1 March 2021
1 May 2021
1 January 2022
1 January 2022
1 January 2022
1 January 2022
1 January 2022
Impact
None
None
None
None
None
None
None
The Directors have adopted the going concern basis in preparing the financial statements for the year to 31
December 2021. In reaching this conclusion, the Directors have considered current trading and the current
and projected funding position for the period of just over 12 months from the date of approval of the financial
statements through to 30 June 2023. The Company, as anticipated in the Company’s Prospectus announced
on 23 April 2021, will need to generate finance through equity or debt in order to meet its committed liabilities
as they fall due for the foreseeable future and progress its planned product research and development
activities. The auditors have made reference to a material uncertainty in respect of going concern in their audit
report. The assessment of the COVID-19 situation continues to be monitored by the directors. It’s impact to
date on the Group’s operations has been minimal.
Current funding
The Company’s cash balance as at 31 December 2021 was £875,000 and there were no borrowing facilities
at that date. On 14 May 2021 the Company raised £2,200,000, before share issue costs, through the placing
of new ordinary shares in conjunction with the admission of its shares to trading on the London Stock Exchange
by way of a Standard Listing.
Conclusion
After taking account of the Company’s current funding position, its cash flow projections and the risks and
uncertainties associated with these, the directors have a reasonable expectation that the Company has access
to adequate resources to continue in operational existence for the foreseeable future. For these reasons they
continue to prepare the financial statements on a going concern basis. These financial statements do not
include any adjustments that would result from the going concern basis of preparation being inappropriate.
2.3 Segmental reporting
IFRS 8 requires that segmental information be disclosed on the basis of information reported to the chief
operating decision maker. The Company considers that the role of chief operating decision maker is performed
by the Company’s Board of Directors. The Group’s only business activity and single segment is the
development of tests for the early detection of lung cancer.
2.4 Foreign currency translation
The functional currency of the Company is Sterling which is also the presentational currency of the financial
statements. Foreign currency assets and liabilities are converted into Sterling at the rates of exchange ruling
at the end of the financial year. Foreign currency transactions are translated into the functional currency using
the exchange rates prevailing at the dates of the transactions. Foreign exchange gains and losses resulting
from the settlement of such transactions and from the translation at year end exchange rates of monetary
assets and liabilities denominated in foreign currencies are recognised in the statement of comprehensive
income.
Cizzle Biotechnology Holdings PLC (formerly Bould Opportunities PLC)
41
Notes to the financial statements for the year ended 31 December 2021
2
Accounting policies (continued)
2.5 Non-Current assets
Investments in intangible assets and subsidiaries are stated at cost less accumulated impairment. Plant and
equipment are stated at costs less accumulated depreciation and any accumulated impairment losses.
Depreciation is charged to write off costs less estimated residual values on a straight-line basis over their
estimated useful lives. Estimated useful lives are reviewed each year and amended if necessary.
2.6 Cash and cash equivalents
Cash and cash equivalents include cash in hand, deposits held at call with banks and other short-term highly
liquid investments, with original maturities of three months or less.
2.7 Share capital
Ordinary shares are classified as equity. Incremental costs directly attributable to the issue of new shares or
options are shown in equity as a deduction, net of tax, from the proceeds.
2.8 Current and deferred income tax
Current income tax is calculated on the basis of the tax laws enacted or substantively enacted at the statement
of financial position date in the countries where the Company’s subsidiaries and associates operate and
generate taxable income. Management periodically evaluates positions taken in tax returns with respect to
situations in which applicable tax regulation is subject to interpretation and establishes provisions where
appropriate on the basis of amounts expected to be paid to the tax authorities.
Deferred income tax is provided in full, using the liability method, on temporary differences arising between
the tax bases of assets and liabilities and their carrying amounts in the financial statements. However, deferred
income tax is not accounted for if it arises from initial recognition of an asset or liability in a transaction other
than a business combination that at the time of the transaction affects neither accounting nor taxable profit nor
loss. Deferred income tax is determined using tax rates (and laws) that have been enacted or substantively
enacted by the statement of financial position date and are expected to apply when the related deferred income
tax asset is realised or the deferred income tax liability is settled. Deferred income tax assets are recognised
to the extent that it is probable that future taxable profit will be available against which the temporary differences
can be utilised.
2.9 Share based payments
The Company operates an equity-settled, share-based compensation plan. The fair value of the employee
services received in exchange for the grant of the options is recognised as an expense and credited to the
share option reserve within equity. The total amount to be expensed over the vesting period is determined by
reference to the fair value of the options granted, excluding the impact of any non-market vesting conditions
(for example, profitability and sales growth targets). Options that lapse before vesting are credited back to
income. The proceeds received net of any directly attributable transaction costs are credited to share capital
(nominal value) and, if applicable, share premium when the options are exercised.
2.10
Financial instruments
i) Financial assets
The Company classifies its financial assets in the following measurement categories:
•
•
those to be measured subsequently at fair value through profit or loss; and
those to be measured at amortised cost.
The classification depends on the business model for managing the financial assets and the contracted terms
of the cash flows. Financial assets are classified as at amortised cost only if both of the following criteria are
met:
•
•
the asset is held within a business model whose objective is to collect contracted cash flows; and
the contractual terms give rise to cash flows that are solely payments of principal and interest.
Cizzle Biotechnology Holdings PLC (formerly Bould Opportunities PLC)
42
Notes to the financial statements for the year ended 31 December 2021
2
Accounting policies (continued)
2.10 Financial instruments (continued)
Financial assets, including trade and other receivables and cash and bank balances, are initially recognised
at transaction price, unless the arrangement constitutes a financing transaction, where the transaction is
measured at the present value of the future receipts discounted at a market rate of interest.
Such assets are subsequently carried at amortised cost using the effective interest method.
At the end of each reporting period financial assets measured at amortised cost are assessed for objective
evidence of impairment. If an asset is impaired the impairment loss is the difference between the carrying
amount and the present value of the estimated cash flows discounted at the asset’s original effective interest
rate. The impairment loss is recognised in the consolidated income statement.
The Company applies the simplified approach in calculating the expected credit losses (ECLs) as permitted
by IFRS 9. Changes in credit risk is not tracked but instead a loss allowance is recognised at each reporting
date based on the financial asset’s lifetime ECL.
If there is a decrease in the impairment loss arising from an event occurring after the impairment was
recognised the impairment is reversed. The reversal is such that the current carrying amount does not exceed
what the carrying amount would have been had the impairment not previously been recognised. The
impairment reversal is recognised in the consolidated income statement.
Financial assets are derecognised when (a) the contractual rights to the cash flows from the asset expire or
are settled, or (b) substantially all the risks and rewards of the ownership of the asset are transferred to another
party or (c) despite having retained some significant risks and rewards of ownership, control of the asset has
been transferred to another party who has the practical ability to unilaterally sell the asset to an unrelated third
party without imposing additional restrictions
ii) Financial liabilities
Basic financial liabilities, being trade and other payables, are initially recognised at transaction price, unless
the arrangement constitutes a financing transaction, where the debt instrument is measured at the present
value of the future receipts discounted at a market rate of interest.
Trade payables are obligations to pay for goods or services that have been acquired in the ordinary course of
business from suppliers. Accounts payable are classified as current liabilities if payment is due within one year
or less. If not, they are presented as non-current liabilities. Trade payables are recognised initially at transaction
price and subsequently measured at amortised cost using the effective interest method.
Financial liabilities are derecognised when the liability is extinguished, that is when the contractual obligation
is discharged, cancelled or expires. The Company does not hold or issue derivative financial instruments.
iii) Offsetting
Financial assets and liabilities are offset and the net amounts presented in the financial statements when there
is an enforceable right to set off the recognised amounts and there is an intention to settle on a net basis or to
realise the asset and settle to liability simultaneously.
2.11
Pensions
For defined contribution schemes the amount charged to the statement of comprehensive income is the
contribution payable in the year. Differences between the contributions payable in the year and contributions
actually paid are shown either as accruals or prepayments.
2.12
Exceptional items
The Company has separately identified certain net expenses that are exceptional by either their size or the
fact that they do not normally occur in the Company’s normal course of business. Such items are recorded
separately in the Statement of Comprehensive Income and are explained further in Note 6.
Cizzle Biotechnology Holdings PLC (formerly Bould Opportunities PLC)
43
Notes to the financial statements for the year ended 31 December 2021
3 Reverse acquisition
On 14 May 2021 the Company acquired through a share for share exchange the entire share capital
of CBL whose principal activity is the early detection of lung cancer through the development of tests
to detect CIZ1B variant protein.
Although the transaction resulted in CBL becoming a wholly owned subsidiary of the Company, the
transaction constitutes a reverse acquisition as the previous shareholders of CBL own a substantial
majority of the shares of the Company.
In substance the shareholders of CBL acquired a controlling interest in the Company and the
transaction has therefore been accounted for as a reverse acquisition. As the Company’s activities
prior to the acquisition were purely the maintenance of the AIM listing, acquiring CBL and raising equity
finance to provide the required funding for the operations of the acquisition means it did not meet the
definition of a business combination in accordance with IFRS 3.
Accordingly, this reverse acquisition does not constitute a business combination and was accounted
for in accordance with IFRS 2 “Share-based Payments” and associated IFRIC guidance. Although the
reverse acquisition is not a business combination, the Company has become a legal parent and is
required to apply IFRS 10 and prepare consolidated financial statements. The directors have prepared
these financial statements using the reverse acquisition methodology, but rather than recognise
goodwill, the difference between the equity value given up by the CBL shareholders is charged to the
statement of comprehensive income as a share-based payment on reverse acquisition, and represents
in substance the cost of acquiring a quoted company.
In accordance with the reverse acquisition principles, these consolidated financial statements
represent a continuation of the consolidated statements of Cizzle Biotechnology Holdings Plc and its
subsidiaries and include:
- The assets and liabilities of CBL at their pre-acquisition carrying value amounts and the results for
all periods reported; and
- The assets and liabilities of the Company as at 14 May 2021 and its results from the date of reverse
acquisition (14 May 2021 to 31 December 2021).
On 14 May 2021 the Company issued 206,310,903 ordinary shares to acquire the 313,932 ordinary
shares of CBL Limited. At 14 May 2021 the valuation of the investment in CBL was £21,700,000.
Because the legal subsidiary, CBL, was treated on consolidation as the accounting acquirer and the
legal parent company, Cizzle Biotechnology Holdings Plc, was treated as an accounting subsidiary,
the fair value of the shares deemed to be issued by CBL was calculated at £2,587,000 based on an
assessment of the purchase consideration for a 100% holding of Cizzle Biotechnology Holdings plc.
The fair value of the net liabilities of Cizzle Biotechnology Holdings Plc at acquisition was as follows:
Cash and cash equivalents
Other assets
Liabilities
Net (Liabilities)
£’000
46
47
(310)
(217)
The difference between the deemed cost of £2,587,000 and the fair value of the net liabilities noted
above of £(217,000) resulted in £2,804,000 being expensed as “reverse acquisition expenses” in
accordance with IFRS2, Share- based Payments, reflecting the economic cost to CBL shareholders
of acquiring a quoted entity.
Cizzle Biotechnology Holdings PLC (formerly Bould Opportunities PLC)
44
Notes to the financial statements for the year ended 31 December 2021
3
Reverse acquisition (continued)
The reverse acquisition reserve which arose from the reverse takeover is made up as follows:
Pre-acquisition equity1
CBL share capital at acquisition2
Investment in CBL3
Reverse acquisition expense4
£’000
(22,621)
1,599
(21,803)
2,804
(40,021)
1. Pre-acquisition equity of Cizzle Biotechnology Holdings PLC at 14 May 2021.
2. CBL had issued share capital and share premium of £1,599,000. As these financial statements
represent the capital structure of the legal parent entity, the equity of CBL is eliminated.
3. The value of the shares issued by the Company in exchange for the entire share capital of
CBL plus stamp duty expenses.
4. The reverse acquisition expense represents the difference between the value of the equity
issued by the Company, and the deemed consideration given by CBL to the Group.
4
Financial risk
The Group’s principal risk factors are as follows:
4.1 Capital risk management
The Company monitors capital which comprises all components of equity (i.e. share capital, share premium,
capital reduction reserve, share option reserve, and retained earnings/losses). Note 22 describes how capital
is managed in respect of the debt to equity ratio.
4.2 Financial risk factors
The Group’s operations exposed it to a variety of financial risks that had included the effects of credit risk,
liquidity risk and interest rate risk. The Company had in place a risk management programme that attempted
to limit the adverse effects on the financial performance of the Company by monitoring levels of debt finance
and the related finance costs. The Company did not use derivative financial instruments to manage interest
rate costs and as such, no hedge accounting was applied.
Given the size of the Company, the directors did not delegate the responsibility of monitoring financial risk
management to a sub-committee of the Board. The policies set by the board of directors were implemented
by the Company’s finance department.
(a) Credit risk
The Company’s credit risk was primarily attributable to its trade receivables balance. The amounts
presented in the statement of financial position are net of allowances for impairment.
(b)
(c)
Liquidity risk
Liquidity risk was the risk that an entity will encounter difficulty in meeting obligations associated with
financial liabilities. The Company’s financial liabilities included its trade and other payables shown in
Note 15.
Interest rate cash flow risk
The Company had interest-bearing assets. Interest bearing assets comprised only cash balances, which
earned interest at floating rates.
Cizzle Biotechnology Holdings PLC (formerly Bould Opportunities PLC)
45
Notes to the financial statements for the year ended 31 December 2021
5 Critical accounting estimates and judgements
In the preparation of the financial statements the directors must make estimates and assumptions that
affect the asset and liability items and revenue and expense amounts recorded in the financial statements.
These estimates are based on historical experience and various other assumptions that the Board believes
are reasonable under the circumstances. The results of this form the basis for making judgements about
the carrying value of assets and liabilities that are not readily available from other sources.
a)
Accounting judgement
There were no judgments made.
b)
Accounting estimate
Share based payments
See Note 14 which explains the methods used to estimate the fair value of share options granted.
6 Operating expenses
Research and development
Professional advisers
Staff costs
Intellectual property renewal fees
Regulatory fees
Share based payment
Audit fees (Note 7)
Other expenditure
On-going administrative costs
Share option charge
Reverse acquisition expense
Transaction costs – IPO and reverse acquisition
Total administrative expenses
7
Auditor’s remuneration
Fees payable to the Company’s auditor for the audit of the Group,
Company and subsidiary financial statements
Non-audit services – reporting accountant for IPO
Group
2021
£’000
161
89
88
57
53
37
27
40
552
299
2,804
303
3,958
Group
2021
£’000
27
38
65
CBL
2020
£’000
-
-
-
14
-
-
-
-
14
-
-
-
14
CBL
2020
£’000
-
-
-
Cizzle Biotechnology Holdings PLC (formerly Bould Opportunities PLC)
46
Notes to the financial statements for the year ended 31 December 2021
8
Directors’ emoluments
Wages and salaries
Social Security Costs
Pension Contributions
Share based payments
Group
2021
£’000
125
10
3
299
437
CBL
2020
£’000
-
Company
2021
£’000
105
Company
2020
£’000
80
-
-
-
-
11
2
299
417
6
-
-
86
The Group does not have any employees other than the directors. The average number of directors during
the year was 4 (CBL 2020: 2).
9
Income tax credit
The tax credit for the year was as follows:
Research and development tax credits
Group
2021
£’000
(37)
(37)
CBL
2020
£’000
-
-
The tax on the Group’s loss before tax differs from the theoretical amount that would arise using the tax
rate applicable to the losses of the group (2020: CBL) as follows:
Loss before tax on continuing operations
Tax calculated at the domestic rate applicable of 19% (2020: 19%)
Expenses not deductible for tax purposes
Tax losses for which no deferred tax credit was recognised
Research and development tax credit
Total income tax credit
10 Earnings per share
Basic loss per share
Loss for the year
Weighted average number of ordinary shares
Basic loss per share
Group
2021
£’000
(3,958)
(752)
590
162
(37)
(37)
CBL
2020
£’000
-
-
-
-
-
-
Group
2021
(£3,921,000)
160,516,450
(2.4p)
CBL
2020
(£14,000)
493,844
(2.8p)
The basic loss per share is derived by dividing the loss for the period attributable to ordinary shareholders
by the weighted average number of shares in issue. The weighted average number of shares is adjusted
for the impact of the reverse acquisition as follows:
-
Prior to the reverse acquisition, the number of shares is based on CBL, adjusted using the share
exchange ratio arising on the reverse acquisition; and
From the date of the reverse acquisition, the number of share is based on the Company.
-
Cizzle Biotechnology Holdings PLC (formerly Bould Opportunities PLC)
47
Notes to the financial statements for the year ended 31 December 2021
10 Earnings per share (continued)
Diluted earnings per share is calculated by dividing the loss attributable to ordinary shareholders by the
weighted average number of ordinary shares outstanding after adjusting these amounts for the effects of
dilutive potential ordinary shares. As the results for the years ended 31 December 2021 and 31 December
2020 are a loss, any exercise of share options would have an anti-dilutive effect on earnings per share.
Consequently, earnings per share and diluted earnings per share are the same and the calculation has not
been included.
As at 31 December 2021, there were share options outstanding over 23,432,041 shares (CBL 2020:
14,928,864 shares), which could potentially have a dilutive impact in the future.
11 Non- Current assets
Investment in subsidiary undertakings
Intangible assets
Tangible assets
Total investments
Group
2021
£’000
-
200
-
200
CBL
2020
£’000
-
-
-
-
Company
2021
£’000
21,803
200
-
22,003
Company
2020
£’000
-
-
-
-
a.
Investments in subsidiary undertakings - Company
Opening balance
Acquisition during the year
Closing balance
2021
£’000
-
21,803
21,803
2020
£’000
-
-
-
The investment in subsidiary undertakings is in the following companies:
Name
Country of
incorporation
Proportion of ownership
interest
Principal
activities/status
Cizzle Biotechnology
Limited
England and
Wales
100% interest in ordinary
share capital
Early detection of lung
cancer
Cizzle Biotech Limited
(formerly Enfis Limited)
England and
Wales
100% interest in ordinary
share capital
Dormant
The registered address for ongoing subsidiaries is 6th floor, 60 Gracechurch Street, London, EC3V 0HR.
Cizzle Biotechnology Limited - as mentioned in Note 3, this investment represents the value of the shares
issued by the Company in exchange for the entire share capital of CBL (£21,700,000 plus stamp duty
expenses of £103,000).
b.
Intangible assets – Group and Company
Intangible assets represents the fair value an investment in a royalty sharing arrangement with St George
Street Capital (“SGSC”), a UK-based medical charity. This agreement grants the Company potential future
royalty payments from the commercialisation of St George Street’s therapeutic asset AZD1656 of up to
£5m, plus potentially further payments from the use of a companion diagnostic.
Opening balance
Acquisition during the year
Closing balance
2021
£’000
-
200
200
2020
£’000
-
-
-
Cizzle Biotechnology Holdings PLC (formerly Bould Opportunities PLC)
48
Notes to the financial statements for the year ended 31 December 2021
11 Non- Current assets
c.
Tangible assets - Group
Cost
At 1 January 2021
Acquired during the year
Write-off during the year
At 31 December 2021
Depreciation
At 1 January 2020
Acquired during the year
Write-off during the year
At 31 December 2021
Net book value
At 31 December 2021
At 31 December 2020
Laboratory
equipment
£’000
-
18
(18)
-
-
18
(18)
-
-
-
Total
£’000
-
18
(18)
-
-
18
(18)
-
-
-
On 14 May 2021 the Group acquired laboratory equipment with a cost of £18,000 and a net book value of
£Nil. This equipment was written off at 31 December 2021.
Cizzle Biotechnology Holdings PLC (formerly Bould Opportunities PLC)
49
Notes to the financial statements for the year ended 31 December 2021
12
Trade and other receivables
Trade receivables
Less: provision for impairment
Trade receivables (net)
Amounts due from subsidiaries
Social security and other taxes
Corporation tax recoverable
Prepayments and other receivables
Group
2021
£’000
-
-
-
-
14
37
29
80
CBL
2020
£’000
-
-
-
-
-
-
3
3
Company
2021
£’000
-
-
-
216
7
-
18
241
Company
2020
£’000
4
-
4
-
2
-
-
6
Trade and other receivables are non-derivative financial assets with fixed or determinable payments that
are not quoted in an active market. They are classified as ‘trade and other receivables’ in the statement of
financial position and are included in current assets, except for maturities greater than 12 months after the
statement of financial position date. These are classified as non-current assets. The value of trade
receivables shown above, in addition to the value of cash balances on deposit with counterparties (see
Note 17), represents the Company’s maximum exposure to credit risk. No collateral is held as security.
Amounts due from subsidiary undertakings at 31 December 2021 represented net amounts provided to the
Company’s wholly owned subsidiary, Cizzle Biotechnology Limited.
The fair value of trade and other receivables approximate to the net book values stated above.
As of 31 December 2021, trade receivables of £Nil (2020: £Nil) were past their due date of receipt.
Up to two months past due
Over two months past due
Group
2021
£’000
-
-
CBL
2020
£’000
-
-
Company
2021
£’000
-
-
Company
2020
£’000
-
4
As of 31 December 2021, trade receivables of £Nil (2020: £Nil) were impaired. The individually impaired
receivables relate to balances where it has been assessed that the receivable is not expected to be
recovered.
13
Cash and cash equivalents
Cash on hand and balances with banks
Group
2021
£’000
875
875
CBL
2020
£’000
7
7
Company
2021
£’000
848
848
Company
2020
£’000
84
84
Cizzle Biotechnology Holdings PLC (formerly Bould Opportunities PLC)
50
Notes to the financial statements for the year ended 31 December 2021
14 Share capital
Numbers in 000s
Nominal value per share
At 31 December 2020
Recognition of PLC equity
Issued
At 31 December 2021
The following table reconciles the total nominal value
of the shares in issue:
Nominal value per share
New
Ordinary
Shares
0.01p
-
24,817
228,631
253,448
Deferred ‘A’
shares
Deferred ‘A'
shares
0.01p
-
225,158
-
225,158
0.99p
-
12,383,626
-
12,383,626
New
Ordinary
shares
0.01p
£000
Deferred
£0.01p
‘A’ shares
0.01p
£’000
Deferred ‘A'
shares
0.99p
£000
At 31 December 2020
-
-
-
On reverse takeover of Cizzle Biotechnology Limited
- Recognition of PLC equity
- Consideration shares
- Placing of shares for cash
- Settlement of fees
At 31 December 2021
3
21
2
-
26
1,238
-
-
-
1,238
2,229
-
-
-
2,229
During the year ended 31 December 2021, the following shares were issued:
14 May 2021
Reverse takeover – Cizzle Biotechnology Ltd (non-
cash)
Placing (cash)
Settlement of fees (non-cash)
Total issued
No of shares
issued
000s
Issue price
per share
Pence
206,311
22,000
320
228,631
10.0p
10.0p
10.0p
Total
£000
-
3,470
21
2
-
3,493
On 14 May 2021 the Company issued investor warrants to subscribe for 11,000,000 Ordinary Shares at a fixed
price of 15p per share valid for three years until 13 May 2024.
On 14 May 2021 the Company issued broker and adviser warrants to subscribe for 1,350,000 Ordinary Shares
at a fixed price of 10p per share valid for three years until 13 May 2024. 250,000 of these broker warrants are
automatically exercisable upon the Company’s share price equalling 20p per share. The fair value of these
warrants at 31 December 2021 is £5,000 and has been accounted for as a cost to the Company and a reduction
of the share premium account ( see statement of changes in equity on pages 37 to 38).
Cizzle Biotechnology Holdings PLC (formerly Bould Opportunities PLC)
51
Notes to the financial statements for the year ended 31 December 2021
14 Share capital (continued)
Employee share scheme
The Company has an Executive Share Option Scheme.
The exercise terms of all granted options as at 31 December 2021 are summarised below:
Date of grant
2015
2016
2017
2021
2021
Number of
options
300
800
500
3,689,096
19,741,345
Exercise price
(pence per
share)
5.02
1.85
1.00
1.53
10.00
Exercise
dates from
2017
2017
2018
2021
2021 (based on performance)
The number and weighted average exercise price of the options that were exercisable at 31 December 2021
were 23,432,041 and 8.67p respectively.
Movements in the number of share options outstanding and their related weighted average exercise prices
are as follows:
At 31 December 2020
Acquired on reverse takeover
Issued during year
At 31 December 2021
Average
exercise price
(pence per
share)
-
1.53
10.00
8.67
Options
number
3,690,696
19,741,345
23,432,041
Share options outstanding at the end of the year have the following expiry dates and exercise prices:
Expiry date
2025
2026
2027
2027
2031
Exercise price
(pence per
share)
5.02
1.85
1.00
1.53
10.00
Options
2021
300
800
500
3,689,096
19,741,345
23,432,041
Cizzle Biotechnology Holdings PLC (formerly Bould Opportunities PLC)
52
Notes to the financial statements for the year ended 31 December 2021
14
Share capital (continued)
The Company determines the fair value of its share option contracts on the grant date, adjusts this to reflect
its expectation of the options that will ultimately vest, and then expenses the calculated balance on a straight-
line basis through its statement of comprehensive income over the expected vesting period with a
corresponding credit to its share option reserve. Subsequent changes to the expectation of number of options
that will ultimately vest are dealt with prospectively such that the cumulative amount charged to the statement
of comprehensive income is consistent with latest expectations. Subsequent changes in market conditions do
not impact the amount charged to the statement of comprehensive income.
The Company determines the fair value of its share option contracts using a model based on the Black-
Scholes-Merton methodology. In determining the fair value of its share option contracts, the Company made
the following assumptions (ranges are provided where values differ across tranches). Expected volatility was
determined by reference to historical experience.
Grant date
2021
2021
Share
Price
Pence
9.38p
4.40p
Exercise
Price
Pence
1.53p
10.00p
Expected
Option
Life
Years
10 years
10 years
Expected
Volatility
%
68%
32%
Expected
Dividend
Yield
%
0%
0%
Risk free
Interest
Rate
%
0.83%
0.83%
Fair Value
At date of
Grant
Pence
1.60p
3.00p
15
Trade and other payables
Trade payables
Social security and other taxes
Accruals and other payables
Due or due in less than one month
Due between one and three months
Due in more than three months
16
Borrowings
Loans repayable in less than one year
Group
2021
£’000
111
43
64
218
Group
2021
£’000
75
4
32
111
Group
2021
£’000
-
-
CBL
2020
£’000
2
-
6
8
CBL
2020
£’000
2
-
-
2
CBL
2020
£’000
10
10
Company
2021
£’000
73
6
54
133
Company
2021
£’000
37
4
32
73
Company
2020
£’000
14
5
39
58
Company
2020
£’000
14
8
(8)
14
Company
2021
£’000
-
-
Company
2020
£’000
-
-
Cizzle Biotechnology Holdings PLC (formerly Bould Opportunities PLC)
53
Notes to the financial statements for the year ended 31 December 2021
17
Financial assets and liabilities
The tables below analyse the carrying value of financial assets and financial liabilities in the Group’s and
Company’s statements of financial position. Further information on the classes that make up each category is
provided in the notes indicated. The carrying value of each category is considered a reasonable approximation
of its fair value. All amounts are due within one year.
Trade receivables (Note 12)
Amounts due from subsidiaries (Note 12)
Prepayments and other receivables (Note 12)
Cash and cash equivalents (Note 13)
Financial assets at amortised cost
Trade payables (Note 15)
Accruals and other payables (Note 15)
Borrowings (Note 16)
Financial liabilities at amortised cost
18 Deferred income tax
Group
2021
£’000
-
-
29
875
904
Group
2021
£’000
111
64
-
175
CBL
2020
£’000
-
-
3
7
10
CBL
2020
£’000
2
6
10
18
Company
2021
£’000
-
216
18
848
1,082
Company
2021
£’000
73
54
-
127
Company
2020
£’000
4
-
-
84
88
Company
2020
£’000
22
36
-
58
There is an un-provided deferred tax asset arising on taxable losses of £0.47m (2020: £0.2m). In accordance
with accounting standards, the deferred tax asset has not been recognised in the financial statements due to
uncertainty over the availability of sufficient future profits against which it could be recovered.
At 31 December 2021 there was no deferred tax liability (2020: £nil).
19 Commitments
The Group has no commitments as at 31 December 2021 (2020: £Nil).
20 Related party transactions
Transactions with directors
Directors’ emoluments as noted in note 8. The Group Statement of Comprehensive Income includes an
amount of £7,366 (2020: £20,000) paid to Experience Capital Limited in respect of non-executive director
services provided by Martin Lampshire.
21 Controlling party
The directors consider there to be no ultimate controlling party.
Cizzle Biotechnology Holdings PLC (formerly Bould Opportunities PLC)
54
Notes to the financial statements for the year ended 31 December 2021
22
Capital management
In managing its capital structure, the Company’s objective is to safeguard the Company's ability to continue
as a going concern, managing cash flows so that it can continue to provide returns for shareholders.
The Company makes adjustments to its capital structure in the light of changes in economic conditions and
the requirements of the Company’s businesses. The Board has sought to maintain low levels of borrowing to
reflect the development stage of the Company’s businesses. Over time as the Company’s businesses mature
and become profitable the Board is likely to make increased use of borrowing facilities to fund working capital.
In order to maintain or adjust the capital structure, the Company may issue new shares or seek additional
borrowing facilities. The Company monitors capital on several bases including the debt to equity ratio. This
ratio is calculated as debt ÷ equity. Debt is calculated as total borrowings as shown in the consolidated
statement of financial position.
Equity comprises all components of equity as shown in the consolidated statement of financial position. The
debt-to-equity ratio at 31 December 2021 and 31 December 2020 was as follows:
Total debt
Total equity
Debt-to-equity ratio
23
Reserves
Group
2021
£’000
-
937
0.0%
CBL
2020
£’000
10
(8)
125%
Company
2021
£’000
-
22,959
0.0%
Company
2020
£’000
-
32
0.0%
The following reserves describe the nature and purpose of each reserve within equity:
a.
Capital reduction reserve
The capital reduction reserve set out in the Statement of Changes in Equity arose in 2014 when the
nominal value of each share was reduced from 10p to 1p.
b.
Share premium
The amount subscribed for each share in excess of nominal value.
c.
Reverse acquisition reserve
The reverse acquisition reserve is explained in Note 3.
d.
Share option
The accumulated expense arising during their vesting period of share options granted to directors and
employees and warrants granted to third parties.
e.
Accumulated losses
All other net losses and gains not recognised elsewhere.
Cizzle Biotechnology Holdings PLC (formerly Bould Opportunities PLC)
55
Notes to the financial statements for the year ended 31 December 2021
24
Subsequent events
a)
Royalty Investment in AZD 1656
On 14 February 2022 it was announced that the Company had entered into a definitive agreement (the
"Agreement") with Conduit Pharmaceuticals Limited (“Conduit”) and St George Street Capital Limited
("SGSC") to acquire a 5% economic interest in the commercialisation of the AZD 1656 asset or other
such assets being developed by Conduit or SGSC to treat inflammatory pulmonary and cardiovascular
disease (the “Economic Interest”).
Highlights of the Agreement are as follows:
- Agreement with Conduit and SGSC to acquire a 5% economic interest for a total consideration
of £1.88 million, to be settled in new Cizzle ordinary shares at a price of 4.0p per share, a 56.9%
premium to the closing mid-market price on 11 February 2022;
- The Agreement is in addition to the Company’s existing interest in AZD 1656 as announced on
20 September 2021:
- SGSC recently reported the successful completion of the AZD 1656 ARCADIA clinical trial in
Covid-19 and SGSC and Conduit are in discussions with multiple pharmaceutical companies
about licensing opportunities for AZD 1656 for Covid-19 and potentially for further indications;
and
- The Agreement supports the Company’s ambitions to expand its target customer base into the
pharmaceutical industry and is in line with its strategy of building a portfolio of early cancer
detection tests, companion diagnostics and royalty bearing stakes in significant drug assets.
Consideration for the Agreement
Under the terms of the Agreement, Cizzle will pay consideration of £1.88 million to SGS for the Economic
Interest. Of the consideration payable, £1.0 million (the “Initial Consideration”) will be satisfied by the issue
of 25,000,000 new ordinary shares in the Company (the “Consideration Shares”), at a price of 4.0 pence
per Consideration Share, being a premium of 56.9 per cent. to the Company’s closing mid-market price of
2.55 pence on 11 February 2022. The remaining consideration of £880,000 will be payable in new ordinary
shares in the Company issued at 4.0 pence per share, on the earlier of receiving shareholder approval to
issue the shares or the first anniversary of completion.
The transaction is considered to be a non-adjusting subsequent event as the decision to make this
investment was not undertaken until just prior to the announcement. In 2022 the Group intends to account
for this investment within intangible assets.
b)
USA
On 6 May 2022 the Group announced that it had signed a heads of terms to partner with CorePath
Laboratories (CorePath), a full service cancer reference laboratory, to develop and offer its proprietary
early-stage lung cancer test throughout the USA. The proposal is that the Group would receive a 15%
royalty and royalty sharing arrangements overall offering of products and services using CIZ1B via
CorePath in the USA.