OptiBiotix Health Plc
ANNUAL REPORT AND ACCOUNTS
TO 30 NOVEMBER 2015
Developing a range of products to modify
the human microbiome and improve human health
OptiBiotix Health Plc
OptiBiotix Health Plc is a life sciences company operating
in one of the most progressive areas of biotechnological
research – the modulation of the Human Microbiome.
for more information
www.optibiotix.com
Contents
Company Information
Market Context
Chairman’s and
Chief Executive Statement
Strategic Report
Business Overview
Directors’ Report
1
2
4
7
8
10
Report of the Independent Auditors 12
Consolidated Statement of
Comprehensive Income
13
Consolidated Statement of
Financial Position
Consolidated Statement of
Changes in Equity
Consolidated Statement of
Cash Flows
Notes to the Consolidated
Statements of Cash Flows
Company Statement of
Financial Position
Company Statement of
Changes in Equity
19
Company Statement of Cash Flows 20
Notes to the Company
Statements of Cash Flows
Notes to the Financial Statements
Notice of Annual General Meeting
Explanatory Notes to the
Notice of Annual General Meeting
21
22
41
43
14
15
16
17
18
Annual Report and Accounts 2015
Company information
Directors:
Secretary:
Registered number:
Registered office:
Auditors:
Nominated adviser:
Brokers:
S P O’Hara
J Laird
D E Evans
A Reynolds
G Barker
P Wennström
International Registrars Limited
05880755 (England & Wales)
Innovation Centre
Innovation Way
York
YO10 5DG
Jeffreys Henry LLP
Finsgate
5-7 Cranwood Street
London
EC1V 9EE
Cairn Financial Advisers LLP
Peterhouse Corporate Finance Limited
Hybridan LLP
Website Address:
www.optibiotix.com
1
OptiBiotix Health Plc
Market Context
OptiBiotix Health plc is developing a range of compounds
which modify the human microbiome (the collective genome
of the microbes in the body), to prevent and manage human
disease. This targets a global market of strategic interest to
pharma, food, health, and wellbeing companies, which is forecast
to become one of the world’s fastest growth areas.
This is a substantial opportunity in an emerging market fashioned by new research
into the human microbiome which has created a unique window of opportunity
for compounds which can modify the human microbiome and bring specific health
benefits.
Continuing increase in awareness of the
microbiome
Throughout this year, the level of academic and
industry interest in this area has accelerated rapidly as
evidenced by the increase in the number of
publications.
Microbiome publications by year
Increasing awareness of OptiBiotix
OptiBiotix’s progress both commercially and technically is gaining increased recognition with OptiBiotix
being nominated for a variety of awards for its entrepreneurialism and financial track record.
Nominated for
Best Health Care plc
Nominated for
Entrepreneur of the Year
2
Annual Report and Accounts 2015
As the technology and R&D platforms have continued
to show progress, OptiBiotix has looked to increase
international awareness of its technology and product
opportunities. This has led to Stephen O’Hara and
Sofia Kolida presenting at international conferences,
including the Asian Microbiome and Probiotics
Congress in Malaysia, and Probiota in Amsterdam.
Stephen O’Hara – Kuala Lumpar March 2016
Presenting at the Asian Microbiome &
Probiotics Congress
The wider consumer and business understanding of the opportunity from the microbiome is
increasingly highlighted in mainstream press and media. As OptiBiotix demonstrates the
translation of its science into consumer products this has led to increased media interest in
the company.
Financial Times
15 January 2016
an
capability
The appointment of ProfessorTim Spector
to the company’s Scientific Advisory Group
brings
to
enhanced
communicate complex scientific data to a
wider public. The appointment of Peter
Wennström as a Non-Executive Director
will help identify and translate category and
product benefits to both consumer and
corporates alike.
3
OptiBiotix Health Plc
Chairman’s and Chief Executive Statement
For the year ended 30 November 2015
We are pleased
to present
OptiBiotix Health plc’s annual
report and accounts for the year
ended 30 November 2015.
its
to make
OptiBiotix continues
strategy of
progress on
compounds which
developing
modify the human microbiome and
commercialising
through
partnering with food, health, and
these
wellbeing, and pharmaceutical companies.
KEY ACHIEVEMENTS
During the period to date we have achieved a number of key
objectives which continue to build shareholder value. These
include:
• A substantive increase in our intellectual property (“IP”)
portfolio (from five to eleven patents, three to eight strain
registrations, and three to seven trademarks)
• The completion of successful human and manufacturing
studies on our cholesterol supplement
• The formation of a Scientific Advisory Group composed of
international key opinion leaders
• The appointment of Peter Wennström to the Board bringing
valuable market insight
• The completion of four commercial agreements (Nizo,
Venture Life, US multinational, CSL)
• Expansion of the OptBiotic® platform to a wider range of
microbial species, broadening the number of product and
partner opportunities
• A fundraising in November 2015 which raised £1.5m from
placing of 2m shares at 75p to:
– Strengthen in house development capability
– Accelerate the commercialisation of existing products
– Extend technology platforms into new application areas.
RESEARCH AND DEVELOPMENT (R&D)
STRATEGY
OptiBiotix’s R&D strategy has been designed to create
technology platforms which provide multiple product and
partnering opportunities both within each platform, and by
combining platforms. For example, by combining
the
oligosaccharides produced by our OptiBiotix® platform with the
microbes identified in our Optiscreen® platform we can create
a new product concept, called an OptiBiotic®. This means that
for a limited amount of extra cost we can potentially create large
amounts of extra value. Whilst this approach has complexity it
4
has been designed to mitigate development risk in an evolving
scientific field and provide a cost effective way to exploit the
many opportunities offered by the microbiome.
Development programs within this strategy are based around
contracting in international experts to carry out research in high
value areas. This provides a low fixed cost approach to carrying
out high risk research with the flexibility to upscale or downscale
programs linked to success. Having validated our technology
platforms the risk reward ratio changes and in 2016 we will
commence the process of moving our core technology platforms
in house. This builds up internal capability and expertise and
allows us to enhance our partner offering and build shareholder
value.
DEVELOPMENT PROGRAMMES
All of OptiBiotix’s development programmes remain on budget
and on target with significant progress having been made in
validating our OptiBiotic® and OptiScreen® technology platforms.
This has allowed the company to extend technology platforms
into other product and application areas, broadening the product
pipeline, and creating new partnership opportunities. We
currently have four ongoing R&D programs (1 x cholesterol, 3 x
sugar) with early commercial deals (cost sharing, joint
development) across all platforms. We anticipate adding to these
development programs throughout 2016 opening up new
opportunities.
SLIMBIOME
OptiBiotix’s weight management formulation, branded as
SlimBiome® was developed as a low risk product by experts in
the weight management field to give early market access. The
constituent ingredients are established, with a substantial scientific
evidence base, and the requisite regulatory approvals. The novelty
is in the formulation and delivery allowing SlimBiome® to be used
as a supplement or a food ingredient in cereal bars or dairy
products.
OptiBotix has established an early commercial partnership with
KSF, who own the rights to the UK Slimfast brand. This provides
an early route to market with an established brand. We continue
to work with a number of manufacturers and distributors and
hope to see SlimBiome® in a growing number of products in the
future.
OPTISCREEN
OptiBiotix’s first product developed using its OptiScreen®
platform is a bacterial strain targeting cholesterol reduction. The
product, provided as a supplement, successfully completed
human studies in September 2015. There were no safety,
compliance, or tolerance issues reported by volunteers during
the study. When compared to placebo the results demonstrated
Annual Report and Accounts 2015
Chairman’s and Chief Executive Statement (continued)
For the year ended 30 November 2015
a 7.2% reduction in LDL cholesterol (bad cholesterol) across the
test group with a 12.4% reduction seen in females, and a 15%
reduction in the 50-55 age groups. Volunteers’ with total
cholesterol levels higher than 6.0mmol/L group had even higher
reductions of LDL cholesterol (36.7%), an efficacy more in line
with pharmaceutical treatments such as statins. In addition to high
efficacy pilot scale manufacturing studies have demonstrated high
production yields (and hence low cost of production), and very
high freeze drying survival.
A statistically significant reduction in systolic blood pressure of
6mmHg (5.1%) was seen across the test group when compared
to placebo. These results opens up opportunities for a single
product for both conditions (high cholesterol and high blood
pressure), or two different products targeting separate
conditions.
The results of this study provide early evidence that our strain
has commercial potential as a safe, easy to use, low cost,
cholesterol reducing supplement. These results, suggest efficacy
across all volunteers similar or greater to 1.5 – 2.4g plant
sterols/stanols per day but at a much lower dose (0.1g). Even
more exciting is the observation that efficacy is similar to
pharmaceuticals in volunteers with higher cholesterol levels.
Given the market opportunity and limitations of existing
products such as statins the commercial potential for this product
looks promising. Commercial discussions are progressing with
potential partners best positioned to fully exploit the
opportunity as a cholesterol and/or hypertension supplement,
in isolation, or in combination with existing approaches (e.g.
statins).
OPTIBIOTIC
OptiBiotix’s sugar development platform has progressed rapidly
under the leadership of Dr Sofia Kolida. Whilst early development
was focused on creating prebiotic sugars with functional
properties development programs have been extended to
include:
• A new product concept called a SweetBiotix®, which is a
sweet natural healthy sugar not digested in the human gut and
hence calorie free
• A new product concept called an OptiBiotic®, a combination
of a targeted probiotic and prebiotic which selectively
enhances the in vivo growth of the probiotic, accentuating its
functional properties and health benefits
The SweetBiotix concept is an innovative concept with the
potential
to address a global requirement, addressing
international concerns over the impact of sugar on obesity, with
the prospect of replacing ‘unhealthy’ sugars in existing products
with non digestible, low calorie, healthy, SweetBiotix®. As the
food and beverage industry responds to growing public and
political concerns over traditional sugars and artificial sweeteners,
we expect growing interest in safer, healthy alternatives such as
our SweetBiotix®.
The OptiBiotic® concept, is similarly innovative, and directed at
companies in the probiotics functional food market who have
benefited from the global trend for fortified and functional foods.
This market is expected to be worth $46.55bn by 2020 (Markets
and Markets).
OptiBiotix has contracted the Spanish National Research Council
(Consejo Superior de Investigaciones Científicas, CSIC) based in
Madrid to support the development of these new product
concepts. Rapid scientific progress has been rewarded with an
early commercial deal with Centro Sperimentale Del Latte
(“CSL”), based in Italy, which, develops, manufactures and
distributes probiotics, starter cultures, moulds and yeasts for the
pharmaceutical, nutraceutical, dairy, food and agricultural sectors
all over the world. We believe these innovative product concepts
provide significant growth opportunities and will lead to further
deals in 2016.
The aim of all these development programmes is to establish a
scientific evidence base for mechanism of action, proof of safety
and human efficacy, and low cost manufacturability. As products
move through the development process risk is reduced and this
leads to a corresponding increase in value and greater interest
from corporate partners. As our development programmes
progress and OptiBiotix is able to demonstrate product safety
and efficacy, we anticipate increasing partner interest.
RESULTS
OptiBiotix results for the 12 months ended 30 November 2015
are set out in the Consolidated Statement of Comprehensive
Income. It shows a loss after tax for the period of £1.28 million
(2014: £0.810 million). The loss after tax and after adding back
the non-cash items, depreciation and amortisation charge and
share based payment expense was £0.874 million (2014: loss
£0.747 million). Cash flow remains tightly controlled with a focus
on building shareholder value through investment in R&D and IP.
The Group’s cash position at today’s date remains strong at
£4 million which is sufficient to fund its existing research and
development programs and extend technology platforms into
other product and application areas.
BOARD AND MANAGEMENT
We believe that we have a well balanced Board with a focus on
the domain expertise in the founder and Chief Executive
Stephen O’Hara, Commercial Director Jim Laird, Non-Executive
Director Dr Gareth Barker and Dr Sofia Kolida as Director of
Research and Development. This was supplemented in
5
OptiBiotix Health Plc
Chairman’s and Chief Executive Statement (continued)
For the year ended 30 November 2015
We have derisked a significant number of the technical challenges
in our development programs and validated their commercial
potential. This has led us to extend the scope of these platforms
into other product and application areas. This will help build the
product pipeline to ensure a constant supply of new products
entering the market to build the revenue streams of the future.
As these platforms build and start making a significant
contribution to group earnings we will consider creating new
divisions with the potential to form new legal entities. The board
believes our portfolio approach to product development
reduces shareholder risk, creates multiple opportunities to build
revenues streams, which will make a significant contribution to
building future shareholder value and a sustainable business.
In the last twelve months we have added significantly to our IP
portfolio and anticipate making further patents filings and strain
registrations where we feel there is commercial value. We will
continue to explore opportunities to in license or acquire new
technologies or IP to support our continued growth.
The Board believes OptiBiotix is at the leading edge of an
immature but emerging market forecast to become one of the
world’s fastest growth areas. OptiBiotix has made strong progress
in the last twelve months and now looks to build on this solid
foundation to build a microbiome business with significant value
for shareholders.
On behalf of everyone at OptiBiotix Health plc we thank you
for your support and look forward to an exciting future.
D Evans and S O’Hara
13 April 2016
November 2015 with the appointment of Peter Wennström, as
one of the world’s leading experts in functional food innovation
and marketing, as a Non-Executive Director. Peter replaced Dr
Mark Wyatt, his appointment reflecting the growing focus on
commercialising products. They are complemented by the CFO
Mark Collingbourne, Adam Reynolds and David Evans as
Chairman.
We expect the board to continue to evolve in line with the
continued growth and development of the company.
OUTLOOK
OptiBiotix is continuing its strategy of developing microbiome
modulators for large markets (>£100m), where there are high
growth opportunities (CAGR >10%), and a large unmet need.
The board is building a company which anticipates a future
where microbiome products will make a significant contribution
to the prevention, management, and treatment of disease. That
future is unfolding as expected with microbiome treatments
using faecal microbial transplants (FMT’s) now common place in
over 500 US and 10 UK hospitals. With a growing number of
research publications showing the potential of the human
microbiome in a broad range of health areas we anticipate
microbiome therapies will be a large part of modern healthcare
in the years to come.
During the last 12 months there has been increasing interest,
from industry in the microbiome, and this has correlated with
four commercial agreements for OptiBiotix. Commercial
progress has benefited from the appointment of Jim Laird from
Premier Foods, who brings considerable sector expertise and
capability.
Current deals are largely joint development, cost sharing, or
option agreements where the partner contributes funding in
return for certain future rights to commercialise. We anticipate
a number of these agreements will migrate into revenue bearing
deals. The January 2016 announcement of a commercial
agreement with KSF, who own the rights to the Slimfast brand, is
such an example. Whilst not so well known in the UK, CSL is a
large well established European manufacturer and supplier of
probiotics, starter cultures, moulds and yeasts for the
pharmaceutical, nutraceutical, who brings access to dairy, food
and agricultural sectors all over the world. These commercial
agreements demonstrate industry interest and confidence in
OptiBiotix’s technology platforms and make a significant financial
contribution to running costs. More importantly they create a
route to market with established brand suppliers with the
potential to generate multiple future revenue streams.
Discussions with partners suggest there is growing interest in the
microbiome and we anticipate further commercial partnerships
throughout 2016.
6
Strategic Report
For the year ended 30 November 2015
REVIEW OF BUSINESS
A review of the business of the Group,
together with comments on future
developments
the
Chairman’s and Chief Executive’s
Statement on pages 4 to 6.
is given
in
Annual Report and Accounts 2015
KEY PERFORMANCE INDICATORS
Financial
Year to
Year to
30 November 30 November
2014
£’000
2015
£’000
PRINCIPAL RISKS AND
UNCERTAINTIES FACING
THE GROUP
Revenue
Loss for the period
Cash as at 30 November 2015
28
1,281
2,041
–
811
2,870
Technology and products
and development. The development
The Group is involved in microbiome modulation products
discovery
and
commercialisation of its intellectual property and future products
will require human nutritional studies and there is a risk that
products may not perform as expected. This risk is common to
all new products developed for human consumption.
Technologies used within the food, beverage and healthcare
market place are constantly evolving and improving. There is a
risk that the Group’s products may become outdated or their
commercial value decrease as improvements in technology are
made and competitors launch competing products. To mitigate
this risk the Group is working with industry key opinion leaders,
will attend international conferences and intends to develop a
research and development department which will keep up with
the latest developments in the industry.
Intellectual Property
The Group is focused on protecting its IP and seeking to avoid
infringing on third parties’ IP. To protect its products, the Group
is building and securing patents to protect its key products.
However, there remains the risk that the Group may face
opposition from third parties to patents that it seeks to have
granted and that the outstanding patent applications are not
granted. The Group engages legal advisers to mitigate the risk of
patent infringement and to assist with the protection of the
Group’s IP.
FINANCIAL AND CAPITAL RISK MANAGEMENT
The directors constantly monitor the financial risks and
uncertainties facing the group with particular reference to the
exposure of credit risk and liquidity risk. They are confident that
suitable policies are in place and that all material financial risks
have been considered. The financial risk management objectives
and policies can be found within note 21 of the financial
statements.
During the year to 30 November 2015 the company has
achieved a number of key objectives which continue to build
shareholder value. These include:
• A substantive increase in our IP portfolio (from five to eleven
patents, three to eight strain registrations, and three to seven
trademarks)
• The completion of successful human and manufacturing
studies on our cholesterol supplement
• The completion of four commercial agreements (Nizo,
Venture Life, US multinational, CSL)
• Expansion of the OptBiotic® platform to a wider range of
microbial species, broadening the number of product and
partner opportunities
Non-financial
The board recognises the importance of KPIs in driving
appropriate behaviour and enabling of Group performance. For
the period to 30 November 2015 the primary KPI’s were the
completion of commercial agreements and the expansion of the
Optibiotic® platform. The group intends to review the following
non-financial KPIs going forward:
IP and trademark registrations
1. Customer relationships
2.
3. Service quality and brand awareness
4. Attraction motivation and retention of employees
DIVIDENDS
No dividends can be distributed for the year ended
30 November 2015.
FUTURE DEVELOPMENTS
The Chairman’s and Chief Executive Statement on pages 4 to 6
gives information on the future outlook of the Group.
ON BEHALF OF THE BOARD
S P O’Hara
13 April 2016
7
OptiBiotix Health Plc
OptiBiotix Business Overview
Strong progress across all areas
Products aimed at
large (>£100m),
growing markets
Market focussed R&D
Large Markets with unmet need
Research & Development
Working with world leaders in their
field and supported by Scientific
Advisory Group
Commercial Strategy
Collaborative partnerships initially with
joint development and cost sharing
proving the industry attractiveness leading
to recurring revenues via license
agreements
All activities
underpinned by
scientific approach
+
I
Validated and
de-risked
development
programmes
R&D
Patents & IP
II
Commercial
Commercial
protection:
11 patents and 8
strain deposits
OOptiScreen®
US Consumer
Goods Co
III
OptiBiotic®
Scalable
Multiple diversification opportunities and
combination applications from combining
platforms
Commercial
momentum with
scalability and
diversification
SlimBiome®
SkinBiotix®
KSF
8
Annual Report and Accounts 2015
+
Partner with food,
health and wellbeing
companies
+
Scalable business
model and
technology platforms
2015
2016
Validated and
de-risked
development
programmes
Commercial
protection:
11 patents and 8
strain deposits
Commercial
momentum with
scalability and
diversification
OptiScreen®
OptiBiotic®
SlimBiome®
SkinBiotix®
US Consumer
Goods Co
Venture
Life
KSF
9
OptiBiotix Health Plc
Directors’ Report
For the year ended 30 November 2015
The Directors present their report and the audited financial
statements of the group for the year to 30 November
2015.
PRINCIPAL ACTIVITY
The principal activity of the group is that of research and
development into microbiome modulators.
DIRECTORS
The directors who served the company during the year and up
to the date of this report were as follows:
Executive Directors
S P O’Hara
J Laird (appointed 30 March 2015)
Non-executive Directors
A Reynolds
D E Evans
M Wyatt (resigned 1 January 2016)
G Barker
P Wennström (appointed 1 January 2016)
Directors’ Remuneration
The directors are entitled to receive relevant fees, as detailed in
the directors’ remuneration in Note 4.
Directors and their interests
The directors of the group held the following beneficial interests
in the shares and share options of Optibiotix Health Plc at
30 November 2015 and at the date of this report:
Issued Share Capital
Share Warrants
Share Options
Ordinary
shares of
£0.02 each
1,208,825
3,452,066
10,049,696
–
–
Percentage
Held
Ordinary
shares of
£0.02 each
Warrant
exercise
price
Ordinary
shares of
£0.02 each
Warrant
exercise
price
1.38%
4.65%
13.60%
–
–
395,825
–
–
–
–
£0.08
–2,511,408
–
–
–358,772
–
£0.08
6,099,135
–
£0.20
1,000,000
–
£0.08
–
£0.28
A Reynolds
D E Evans
S P O’Hara
P Wennström
G Barker
J Laird
The share warrants held by A Reynolds were granted on 18 November 2014 and are exercisable at £0.08 at any time up to
17 November 2016.
The share options held by D E Evans and S P O’Hara were granted on 17 September 2014 and are exercisable at £0.08 at any time
up 16 September 2024, subject to vesting conditions.
The share options held by G Barker were granted on 10 March 2015 and are exercisable at £0.20 at any time up 10 March 2025,
subject to vesting conditions.
The share options held by J Laird were granted on 30 March 2015 and are exercisable at £0.28 at any time up 10 March 2025,
subject to vesting conditions.
SUBSTANTIAL SHAREHOLDINGS
Substantial shareholdings include directors as at 14 March 2016
were as follows:
FINANCIAL INSTRUMENTS
The group’s exposure to financial risk is set out in note 21 to the
accounts.
Finance Yorkshire Seedcorn LP
Steven O’Hara
Seneca Partners Limited
David Evans
% of shares issued
15.4
13.0
7.1
4.4
RESEARCH AND DEVELOPMENT
The Chairman’s and Chief Executive Statement on pages 4 to 6
gives information on the Group’s research and development
activities.
The share price per share at 30/11/2015 was £0.86 (30/11/2014: £0.22).
10
Annual Report and Accounts 2015
Directors’ Report (continued)
For the year ended 30 November 2015
EVENTS AFTER THE REPORTING PERIOD
Refer to note 22 to the financial statements for further details.
PUBLICATION OF ACCOUNTS ON GROUP
WEBSITE
Financial statements are published on the group’s website. The
maintenance and integrity of the website is the responsibility of
the directors. The directors’ responsibilities also extend to the
financial statements contained therein.
GOING CONCERN
The financial statements have been prepared on the assumption
that the group is a going concern. When assessing the foreseeable
future, the directors have looked at the budget for the next 12
months from the date of this report, the cash at bank available
as at the date of approval of this report and are satisfied that the
group should be able to cover its quoted maintenance cost, other
administrative expenses, as well as its ongoing research and
development expenditure.
After making enquiries, the directors have a reasonable
expectation that the group has adequate resources to continue
in operational existence for the foreseeable future. Accordingly,
they continue to adopt a going concern basis in preparing the
annual report and financial statements.
STATEMENT OF DIRECTORS’ RESPONSIBILITIES
The directors are responsible for preparing the Directors’ Report
and the financial statements in accordance with applicable laws
and regulations.
Company law requires the directors to prepare financial
statements for each financial period. Under that law the directors
have, as required by the AIM Rules for Companies of the London
Stock Exchange, elected to prepare financial statements in
accordance with International Financial Repor ting Standards
(IFRS) as adopted for use in the European Union. 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 company and of the profit or
loss of the 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 estimates that are reasonable and
prudent;
• state whether the company financial statements have been
prepared in accordance with IFRS as adopted by the Eurpoean
Union 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 confirm that the financial statements comply with
the above requirements.
The directors are responsible for keeping adequate accounting
records that are sufficient to show and explain the company’s
transactions and disclose with reasonable accuracy at any time
the financial position of the company and enable them to ensure
that the financial statements comply with the Companies Act
2006. They are also responsible for safeguarding the assets of the
company and hence for taking reasonable steps for the
prevention and detection of fraud and other irregularities.
STATEMENT AS TO DISCLOSURE OF
INFORMATION TO AUDITORS
So far as the directors are aware, there is no relevant audit
information (as defined by Section 418 of the Companies Act
2006) of which the company’s auditor is unaware, and each
director has taken all the steps that he ought to have taken as a
director in order to make himself aware of any relevant audit
information and to establish that the group’s auditor is aware of
the information.
AUDITOR
Jeffreys Henry LLP will be proposed for re-appointment as
auditors at the forthcoming Annual General Meeting.
STRATEGIC REPORT
In accordance with section 414C(11) of the Companies Act 2006
the Group chooses to report the review of the business, the
future outlook and the risks and uncertainties faced by the Group
in the Strategic Report on page 7.
ON BEHALF OF THE BOARD
S P O’Hara
13 April 2016
11
OptiBiotix Health Plc
Independent Auditor’s Report to The Members
of OptiBiotix Health Plc For the year ended 30 November 2015
We have audited the group financial statements of Optibiotix
Health Plc for the year ended 30 November 2015, which
comprises the consolidated statement of comprehensive income,
consolidated statement of financial position, consolidated
statement of changes in equity, consolidated statement of cash
flows, company statement of financial position, company
statement of changes in equity, company statement of cash flows
and the related notes. The financial reporting framework that has
been applied in their preparation is applicable law and
International Financial Reporting Standards (IFRSs) as adopted
by the European Union, and as regards to the parent company
financial statements, as applied in accordance with the provisions
of the Companies Act 2006
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 auditors 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.
Respective responsibilities of Directors and auditors
As explained more fully in the Statement of Directors’
Responsibilities set out on pages 10 to 11 the Directors are
responsible for the preparation of the group financial statements
and for being satisfied that they give a true and fair view. Our
responsibility is to audit the financial statements in accordance
with applicable law and International Standards on Auditing (UK
and Ireland). Those standards require us to comply with the
Auditing Practices Board’s Ethical Standards for Auditors.
Scope of the audit of the financial statements
An audit involves obtaining evidence about the amounts and
disclosures in the financial statements sufficient to give reasonable
assurance that the financial statements are free from material
misstatement, whether caused by fraud or error. This includes an
assessment of: whether the accounting policies are appropriate
to the Group’s circumstances and have been consistently applied
and adequately disclosed; the reasonableness of significant
accounting estimates made by the Directors; and the overall
presentation of the financial statements. In addition, we read all
the financial and non-financial information in the Chairman’s
report, Strategic report and Directors report to identify material
inconsistencies with the audited financial statements and to
identify any information that is apparently materially incorrect
based on, or materially inconsistent with, the knowledge acquired
by us in the course of performing the audit. If we become aware
of any apparent material misstatements or inconsistencies we
consider the implications for our report.
12
Opinion on financial statements
In our opinion:
– the financial statements give a true and fair view of the state
of the group’s and parent company’s affairs as at
30 November 2015 and of the group’s loss and group’s and
parent company’s cash flows for the year then ended;
– the group financial statements have been properly prepared
in accordance with IFRSs as adopted by the European Union;
and
– The parent company financial statements have been properly
prepared in accordance with IFRSs as adopted by the
European Union and as applied in accordance with the
provision of the Companies Act 2006; and
– the financial statements have been properly prepared in
accordance with the requirements of the Companies Act
2006.
Opinion on other matter prescribed by the
Companies Act 2006
In our opinion the information given in the Directors’ Report
and Strategic Report for the financial year for which the group
financial statements are prepared is consistent with the group
financial statements.
Matters on which we are required to report by
exception
We have nothing to report in respect of the following matters
where the Companies Act 2006 requires us to report to you if,
in our opinion:
– adequate accounting records have not been kept by the
group, or returns adequate for our audit have not been
received from branches not visited by us; or
– the group financial statements are not in agreement with the
accounting records and returns; or
– certain disclosures of Directors’ remuneration specified by law
are not made; or
– we have not received all the information and explanations we
require for our audit.
Sanjay Parmar
Senior Statutory Auditor
For and on behalf of
Jeffreys Henry LLP (Statutory Auditors)
Finsgate 5-7 Cranwood Street
London
EC1V 9EE
13 April 2016
Annual Report and Accounts 2015
Consolidated Statement of Comprehensive Income
For the year ended 30 November 2015
Revenue
Cost of sales
Gross Profit
Administrative expenses
Operating loss
Non-Operating Items
Admission expenses
Finance income/(costs)
Loss before Income tax
Income tax
Loss for the period
Other Comprehensive Income
Total comprehensive income for the period
Total comprehensive income attributable to the owners of the company
Loss per share
Basic & Diluted loss per share – pence
The notes on pages 22 to 40 form part of these financial statements
Notes
Year ended
30 November 2015
£
Year ended
30 November 2014
£
28,200
–
28,200
(1,451,451)
(1,423,251)
–
(1,423,251)
28
(1,423,223)
142,594
(1,280,629)
–
(1,280,629)
(1,280,629)
–
–
–
(489,015)
(489,015)
(365,038)
(854,053)
93
(853,960)
43,254
(810,706)
–
(810,706)
(810,706)
1.75p
3.03p
6
6
5
6
7
8
13
OptiBiotix Health Plc
Consolidated Statement of Financial Position
For the year ended 30 November 2015
ASSETS
Non-current assets
Intangibles
Property, plant & equipment
CURRENT ASSETS
Trade and other receivables
Current tax asset
Cash and cash equivalents
TOTAL ASSETS
EQUITY
Shareholders’ Equity
Called up share capital
Share premium
Share based payment reserve
Merger relief reserve
Accumulated deficit
Total Equity
LIABILITIES
Current liabilities
Trade and other payables
Non-current liabilities
Deferred tax liability
TOTAL LIABILITIES
TOTAL EQUITY AND LIABILITIES
Notes
As at
30 November 2015
£
As at
30 November 2014
£
10
11
13
7
14
15
16
17
2,146,401
2,012
2,148,413
62,597
120,000
2,040,888
2,223,485
4,371,898
7,117,315
3,863,687
383,435
1,500,000
(9,047,642)
3,816,795
125,823
125,823
429,280
429,280
555,103
4,371,898
2,259,369
855
2,260,224
4,651
43,254
2,870,442
2,918,347
5,178,571
7,078,346
3,746,781
90,970
1,500,000
(7,767,013)
4,649,084
77,613
77,613
451,874
451,874
529,487
5,178,571
These financial statements were approved and authorised for issue by the Board of Directors on 13 April 2016 and were signed on
its behalf by:
S P O’Hara
Director
Company Registration no. 05880755
The notes on pages 22 to 40 form part of these financial statements
14
Annual Report and Accounts 2015
Consolidated Statement of Changes in Equity
For the year ended 30 November 2015
Called up
Share capital
£
Accumu-
lated
deficit
£
Share
Premium
£
Balance at 30 November 2013
5,722,248
(6,956,307)
1,302,811
Loss for the year
Issue of consideration shares
to acquire subsidiary
Issues of shares during the year
Share issue expenses
Exercise of warrants
Share options and warrants
–
(810,706)
500,000
845,567
–
–
(124,323)
(124,323)
–
–
2,536,700
10,531
–
–
–
31,593
–
Merger
Relief
Reserve
£
–
–
1,500,000
–
–
–
Share-
based
Payment
Reserve
£
Total
equity
£
27,200
95,952
–
–
–
–
63,770
(810,706)
2,000,000
3,382,267
42,124
63,770
Balance at 30 November 2014
7,078,346
(7,767,013)
3,746,781
1,500,000
90,970
4,649,084
Loss for the year
Exercise of warrants
Share options and warrants
–
(1,280,629)
–
38,969
–
–
–
116,906
–
–
–
–
– (1,280,629)
–
155,875
292,465
292,465
Balance at 30 November 2015
7,117,315
(9,047,642)
3,863,687
1,500,000
383,435
3,816,795
Share capital is the amount subscribed for shares at nominal value. Share premium represents amounts subscribed for share capital
in excess of nominal value.
Merger relief reserve arises from the 100% acquisition of OptiBiotix Limited on 5 August 2014 whereby the excess of the fair value
of the issued ordinary share capital issued over the nominal value of these shares is transferred to this reserve in accordance with
section 612 of the Companies Act 2006.
Accumulated deficit represents the cumulative losses of the group attributable to the owners of the company.
Share based payment reserve represents the cumulative amounts charged in respect of unsettled warrants and options issued.
The notes on pages 22 to 40 form part of these financial statements
15
OptiBiotix Health Plc
Consolidated Statement of Cash Flows
For the year ended 30 November 2015
Notes
Year ended
30 November 2015
£
Year ended
30 November 2014
£
1
(1,026,746)
28
(1,026,718)
(1,965)
–
(1,965)
155,875
155,875
43,254
(829,554)
2,870,442
2,040,888
(706,336)
93
(706,243)
(1,099)
251,834
250,735
3,300,068
3,300,068
25,732
2,870,292
150
2,870,442
Cash flows from operating activities
Cash utilised by operations
Interest received
Net cash outflow from operating activities
Cash flows from investing activities
Purchases of property, plant and equipment
Net cash from acquisition of subsidiary
Net cash inflow from investing activities
Cash flows from financing activities
Share issues
Net cash inflow from financing activities
Taxation
Increase/(decrease) in cash and equivalents
Cash and cash equivalents at beginning of year
Cash and cash equivalents at end of year
14
The notes on pages 22 to 40 form part of these financial statements
16
Annual Report and Accounts 2015
Notes to the Consolidated Statement of Cash Flows
For the year ended 30 November 2015
1. Reconciliation of loss before income tax to cash outflow from operations
Operating loss
(Increase)/decrease in trade and other receivables
(Decrease)/increase in trade and other payables
Depreciation charge
Share Option expense
Amortisation of patents
Year ended
30 November 2015
£
Year ended
30 November 2014
£
(1,423,251)
(57,946)
48,210
808
292,465
112,968
(854,053)
296,616
(212,913)
244
63,770
–
Net cash outflow from operations
(1,026,746)
(706,336)
2. Cash and Cash Equivalents
Cash and cash equivalents
The notes on pages 22 to 40 form part of these financial statements
Year ended
30 November 2015
£
Year ended
30 November 2014
£
2,040.888
2,870,442
17
OptiBiotix Health Plc
Company Statement of Financial Position
For the year ended 30 November 2015
ASSETS
Non-current assets
Investments
CURRENT ASSETS
Trade and other receivables
Cash and cash equivalents
TOTAL ASSETS
EQUITY
Shareholders’ Equity
Called up share capital
Share premium
Merger relief reserve
Share based payment reserve
Accumulated deficit
Total Equity
LIABILITIES
CURRENT LIABILITIES
Trade and other payables
TOTAL LIABILITITES
TOTAL EQUITY AND LIABILITIES
Notes
As at
30 November 2015
£
As at
30 November 2014
£
12
13
14
15
16
2,000,100
2,000,100
842,030
1,948,647
2,790,677
4,790,777
7,117,315
3,863,687
1,500,000
383,435
(8,135,494)
4,728,943
2,000,000
2,000,000
131,107
2,690,375
2,821,482
4,821,482
7,078,346
3,746,781
1,500,000
90,970
(7,631,532)
4,784,565
61,834
61,834
36,917
36,917
4,790,777
4,821,482
These financial statements were approved and authorised for issue by the Board of Directors on 13 April 2016 and were signed on
its behalf by:
S P O’Hara
Director
Company Registration no. 05880755
The notes on pages 22 to 40 form part of these financial statements
18
Annual Report and Accounts 2015
Company Statement of Changes in Equity
For the year ended 30 November 2015
Called up
Share capital
£
Accumu-
lated
deficit
£
Share
Premium
£
Balance at 30 November 2013
5,722,248
(6,956,307)
1,302,811
Loss for the period
Issue of consideration shares
to acquire subsidiary
Issues of shares during the year
Share issue expenses
Exercise of warrants
Share options and warrants
–
(675,225)
500,000
845,567
–
–
(124,323)
(124,323)
–
–
2,536,700
10,531
–
–
–
31,593
–
Merger
Relief
Reserve
£
–
–
1,500,000
–
–
–
Share-
based
Payment
Reserve
£
Total
equity
£
27,200
95,952
–
–
–
–
63,770
(675,225)
2,000,000
3,382,267
42,124
63,770
Balance at 30 November 2014
7,078,346
(7,631,532)
3,746,781
1,500,000
90,970
4,784,565
Loss for the period
Exercise of warrants
Share options and warrants
–
(503,962)
–
38,969
–
–
–
116,906
–
–
–
–
–
–
(503,962)
155,875
292,465
292,465
Balance at 30 November 2015
7,117,315
(8,135,494)
3,863,687
1,500,000
383,435
4,728,943
Share capital is the amount subscribed for shares at nominal value. Share premium represents amounts subscribed for share capital
in excess of nominal value.
Merger relief reserve arises from the 100% acquisition of OptiBiotix Limited on 5 August 2014 whereby the excess of the fair value
of the issued ordinary share capital issued over the nominal value of these shares is transferred to this reserve in accordance with
section 612 of the Companies Act 2006.
Accumulated deficit represents the cumulative losses of the company attributable to the owners of the company.
Share based payment reserve represents the cumulative amounts charged in respect of unsettled warrants and options issued.
The notes on pages 22 to 40 form part of these financial statements
19
OptiBiotix Health Plc
Company Statement of Cash Flows
For the year ended 30 November 2015
Notes
1
Cash flows from operating activities
Cash utilised by operations
Interest received
Net cash outflow from operating activities
Cash flows from financing activities
Share issues
Net cash inflow from financing activities
Increase/(decrease) in cash and equivalents
Cash and cash equivalents at beginning of year
Cash and cash equivalents at end of year
14
The notes on pages 22 to 40 form part of these financial statements
Year ended
30 November 2015
£
Year ended
30 November 2014
£
(897,512)
9
(897,503)
155,775
155,775
(741,728)
2,690,375
1,948,647
(609,908)
65
(609,843)
3,300,068
3,300,068
2,690,225
150
2,690,375
20
Annual Report and Accounts 2015
Notes to the Company Statement of Cash Flows
For the year ended 30 November 2015
1. Reconciliation of loss before income tax to cash generated from operations
Operating loss
(Increase)/decrease in trade and other receivables
(Decrease)/increase in trade and other payables
Share Option expense
Net cash outflow from operations
2. Cash and Cash Equivalents
Cash and cash equivalents
The notes on pages 22 to 40 form part of these financial statements
Year ended
30 November 2015
£
Year ended
30 November 2014
£
(503,971)
(710,923)
24,917
292,465
(897,512)
(675,290)
170,160
(168,548)
63,770
(609,908)
Year ended
30 November 2015
£
Year ended
30 November 2014
£
1,948,647
2,690,375
21
OptiBiotix Health Plc
Notes to the Financial Statements
For the year ended 30 November 2015
1. General Information
Optibiotix Health Plc is a company incorporated and domiciled in England and Wales. Details of the registered office, the officers
and advisers to the company are presented on the company information page at the start of this report. The company’s offices
are in York. The company is listed on the AIM market of the London Stock Exchange (ticker: OPTI).
The principal activity of the group was that of research and development into microbiome modulators.
2. Accounting Policies
Statement of compliance
The consolidated financial statements of Optibiotix Health Plc have been prepared in accordance with International Financial
Reporting Standards (IFRSs), International Accounting Standards (IASs) and International Financial Reporting Interpretations
Committee (IFRIC) interpretations (collectively ‘IFRSs’) as adopted for use in the European Union and as issued by the
International Accounting Standards Board and with those parts of the Companies Act 2006 applicable to companies reporting
under IFRS.
Basis of preparation
The financial statements have been prepared under the historical cost convention.
The principal accounting policies are summarised below. They have all been applied consistently throughout the period under
review.
Going concern
The financial statements have been prepared on the assumption that the company is a going concern. When assessing the
foreseeable future, the directors have looked at the budget for the next 12 months from the date of this report, the cash at
bank available as at the date of approval of this report and are satisfied that the group should be able to cover its quoted
maintenance costs, other administrative expenses and its ongoing research and development expenditure.
After making enquiries, the directors have a reasonable expectation that the group has adequate resources to continue in
operational existence for the foreseeable future. Accordingly, they continue to adopt a going concern basis in preparing the
annual report and financial statements
New and amended standards adopted by the group
There are no IFRSs or IFRIC interpretations that are effective for the first time in this financial period that would be expected
to have a material impact on the group.
22
Annual Report and Accounts 2015
Notes to the Financial Statements (continued)
For the year ended 30 November 2015
2. Accounting Policies (continued)
IFRS 9
IFRS 10
New Standards, amendments and interpretations issued but not effective
Reference
Summary
Title
Application date
of standard
Financial
Instruments
Revised standard for accounting for
financial instruments
Periods commencing on
or after 1 January 2018
Application date
of Company
1 December 2018
Consolidated
financial statement Applying the Consolidation
Amended by Investment Entities:
Periods commencing on
or after 1 January 2016
1 December 2016
Exception
IFRS 11
Joint Arrangements Amended by Accounting for
Acquisitions of Interests in Joint
Operations
IFRS 12
IFRS 14
IFRS 15
Disclosure of
Interests in Other Applying the Consolidation
Entities
Amended by Investment Entities:
Exception
Regulatory
deferral accounts
Revenue from
contracts with
customers
Aims to enhance the comparability
of financial reporting by entities
subject to rate-regulations
Specifies how and when to
recognise revenue from contracts
as well as requiring more informative
and relevant disclosures
IFRS 16
Lease
IFRS 16 Leases published
IAS 16
IAS 27
IAS 28
Property, Plant
and Equipment
Amended standard for accounting
treatment for property, plant and
equipment
Separate financial Amended by Equity Method in
Separate Financial Statements
statement
(Amendments to IAS 27)
Investments in
Associates and
Joint Ventures
Amended by Investment Entities:
Applying the Consolidation
Exception
Periods commencing on
or after 1 January 2016
1 December 2016
Periods commencing on
or after 1 January 2016
1 December 2016
Periods commencing on
or after 1 January 2016
1 December 2016
Periods commencing on
or after 1 January 2018
1 December 2018
Periods commencing on
or after 1 January 2019
Periods commencing on
or after 1 January 2016
1 December 2019
1 December 2016
Periods commencing on
or after 1 January 2016
1 December 2016
Periods commencing on
or after 1 January 2016
1 December 2016
23
OptiBiotix Health Plc
Notes to the Financial Statements (continued)
For the year ended 30 November 2015
2. Accounting Policies (continued)
New Standards, amendments and interpretations issued but not effective (continued)
The Directors anticipate that the adoption of these Standards and Interpretations in future periods will have no material impact
on the financial statements of the group. The group does not intend to apply any of these pronouncements early.
Basis of consolidation
The consolidated financial statements incorporate the financial statements of the company and entities controlled by the company
(its subsidiaries) made up to 30 November each year. Control is achieved where the Company has the power to govern the
financial and operating policies of an investee entity so as to obtain benefits from its activities.
The results of subsidiaries acquired or disposed of during the year are included in the consolidated statement of comprehensive
income from the effective date of acquisition or up to the effective date of disposal, as appropriate.
Where necessary, adjustments are made to the financial statements of subsidiaries to bring their accounting policies into line
with those used by other members of the group.
All intra-group transactions, balances, income and expenses are eliminated on consolidation.
Changes in the group’s ownership interests in subsidiaries that do not result in the group losing control over the subsidiaries are
accounted for as equity transactions. The carrying amounts of the group’s interests and the non-controlling interests are adjusted
to reflect the changes in their relative interests in the subsidiaries. Any difference between the amount by which the non-
controlling interests are adjusted and the fair value of the consideration paid or received is recognised directly in equity and
attributed to owners of the company.
When the group loses control of a subsidiary, the profit or loss on disposal is calculated as the difference between (i) the
aggregate of the fair value of the consideration received and the fair value of any retained interest and (ii) the previous carrying
amount of the assets (including goodwill), and liabilities of the subsidiary and any non-controlling interests. Where certain assets
of the subsidiary are measured at revalued amounts or fair values and the related cumulative gain or loss has been recognised
in other comprehensive income and accumulated in equity, the amounts previously recognised in other comprehensive income
and accumulated in equity are accounted for as if the company had directly disposed of the related assets (i.e. reclassified to
profit or loss or transferred directly to retained earnings). The fair value of any investment retained in the former subsidiary at
the date when control is lost is regarded as the fair value on initial recognition for subsequent accounting under IAS 39 “Financial
Instruments: Recognition and Measurement” or, when applicable, the cost on initial recognition of an investment in an associate
or a jointly controlled entity.
Business combinations
Acquisitions of businesses are accounted for using the acquisition method. The consideration transferred in a business combination
is measured at fair value, which is calculated as the sum of the acquisition-date fair values of the assets transferred by the group,
liabilities incurred by the group to the former owners of the acquiree and the equity interests issued by the group in exchange
for control of the acquiree. Acquisition-related costs are recognised in profit or loss as incurred.
At the acquisition date, the identifiable assets acquired and the liabilities assumed are recognised at their fair value at the acquisition
date, except that:
– deferred tax assets or liabilities and liabilities or assets related to employee benefit arrangements are recognised and measured
in accordance with IAS 12 Income Taxes and IAS 19 Employee Benefits respectively;
– liabilities or equity instruments related to share-based payment transactions of the acquiree or the replacement of an acquiree’s
share-based payment transactions with share-based payment transactions of the group are measured in accordance with
IFRS 2 Share-based Payment at the acquisition date; and
– assets (or disposal groups) that are classified as held for sale in accordance with IFRS 5 Non-current Assets Held for Sale and
Discontinued Operations are measured in accordance with that standard.
24
Annual Report and Accounts 2015
Notes to the Financial Statements (continued)
For the year ended 30 November 2015
2. Accounting Policies (continued)
Business combinations (continued)
Goodwill is measured as the excess of the sum of the consideration transferred, the amount of any non-controlling interests in
the acquiree, and the fair value of the acquirer’s previously held equity interest in the acquiree (if any) over the net of the
acquisition-date amounts of the identifiable assets acquired and the liabilities assumed. If, after assessment, the net of the
acquisition-date amounts of the identifiable assets acquired and liabilities assumed exceeds the sum of the consideration
transferred, the amount of any non-controlling interests in the acquiree and the fair value of the acquirer’s previously held interest
in the acquiree (if any), the excess is recognised immediately in profit or loss as a bargain purchase gain.
Taxation
Income tax expense represents the sum of the tax currently payable and deferred tax.
(i) Current tax
Current taxes are based on the results shown in the financial statements and are calculated according to local tax rules
using tax rates enacted or substantially enacted by the statement of financial position date.
Income tax is recognised in the income statement or in equity if it relates to items that are recognised in the same or a
different period, directly in equity.
Current tax assets and liabilities for the current and prior periods are measured at the amount expected to be recovered
from or paid to the taxation authorities.
(ii) Deferred tax
Deferred tax is provided, using the liability method, on temporary differences at the statement of financial position date
between the tax base of assets and liabilities and their carrying amounts for financial reporting purposes.
Deferred tax liabilities are recognised for all taxable temporary differences.
Deferred tax assets are recognised for all deductible temporary differences, carry forward of unused tax assets and unused
tax losses, to the extent that it is probable that taxable profit will be available against which the deductible temporary
differenced, and the carrying forward or unused tax assets and unused tax losses can be utilised.
The carrying amount of deferred tax assets is reviewed at each balance sheet date and reduced to the extent that it is no
longer probable that sufficient taxable profit will be available to allow all or part of the deferred tax assets to be utilised.
Conversely, previously unrecognised deferred tax assets are recognised to the extent that it is probable that sufficient taxable
profit that sufficient taxable profit will be available to allow all or part of the deferred tax asset to be utilised.
Deferred tax assets and liabilities are measured at the tax rates that are expected to apply to the year when the asset is
realised or the liability is settled, based on the tax rates and tax laws that have been enacted or substantively enacted at the
balance sheet date.
Investments
Investments in subsidiaries are held at cost less any impairment.
Financial instruments
Financial assets and financial liabilities are recognised when the group becomes a party to the contractual provisions of the
instrument.
25
OptiBiotix Health Plc
Notes to the Financial Statements (continued)
For the year ended 30 November 2015
2. Accounting Policies (continued)
Trade and other receivables
Trade and other receivables are non-derivative financial assets with fixed or determinable payments that are not quoted in an
active market. Subsequent to the initial recognition, trade and receivables and measured at amortised cost less impairment
losses for bad and doubtful debts, except where the receivables are interest-free loans made to related parties without any
fixed repayment terms or the effect of discounting would be immaterial. In such cases, the receivables are stated at cost less
impairment losses for bad and doubtful debts.
Impairment losses for bad and doubtful debts are measured as the difference between the carrying amount of financial asset
and the estimated future cash flows, discounted where the effect of discounting is material.
Cash and cash equivalents
Cash and cash equivalents comprised of cash at bank and in hand.
Fair values
The carrying amounts of the financial assets and liabilities such as cash and cash equivalents, receivables and payables of the
company at the statement of financial position date approximated their fair values, due to relatively short term nature of these
financial instruments
Trade and other payables
Trade and other payables are initially recognised at fair value and thereafter stated in amortised cost, except where the payables
are interest free loans made by related parties without any fixed repayment terms or the effect of discounting would be
immaterial, in which case they are stated at cost.
Impairment of non-financial assets
At each statement of financial position date, the group reviews the carrying amounts of its investments to determine whether
there is any indication that those assets have suffered an impairment loss. If any such indication exists, the recoverable amount
of the asset is estimated in order to determine the extent of the impairment loss (if any). Where the asset does not generate
cash flows that are independent from other assets, the group estimates the recoverable amount of the cash-generating unit to
which the asset belongs. An intangible asset with an indefinite useful life is tested for impairment annually and whenever there
is an indication that the asset may be impaired.
Recoverable amount is the higher of fair value less costs to sell and value in use. In assessing value in use, the estimated future
cash flows are discounted to their present value using a pre-tax discount rate that reflects current market assessments of the
time value of money and the risks specific to the asset for which the estimates of future cash flows have not been adjusted. If
the recoverable amount of an asset (or cash-generating unit) is estimated to be less than its carrying amount, the carrying
amount of the asset (cash-generating unit) is reduced to its recoverable amount. An impairment loss is recognised as an expense
immediately, unless the relevant asset is carried at a re-valued amount, in which case the impairment loss is treated as a revaluation
decrease.
Where an impairment loss subsequently reverses, the carrying amount of the asset (cash-generating unit) is increased to the
revised estimate of its recoverable amount, but so that the increased carrying amount does not exceed the carrying amount
that would have been determined had no impairment loss been recognised for the asset (cash-generating unit) in prior years.
A reversal of an impairment loss is recognised as income immediately, unless the relevant asset is carried at a revalued amount,
in which case the reversal of the impairment loss is treated as a revaluation increase.
26
Annual Report and Accounts 2015
Notes to the Financial Statements (continued)
For the year ended 30 November 2015
2. Accounting Policies (continued)
Capital management
Capital is made up of stated capital, premium and retained earnings. The objective of the group’s capital management is to ensure
that it maintains strong credit ratings and capital ratios. This will ensure that the business is correctly supported and shareholder
value is maximised.
The group manages its capital structure through adjustments that are dependent on economic conditions. In order to maintain
or adjust the capital structure, the company may choose to change or amend dividend payments to shareholders or issue new
share capital to shareholders. There were no changes to the objectives, policies or processes during the year ended 30 November
2015.
Equity instruments
Equity instruments issued by the company are recorded at the proceeds received. Incremental costs directly attributable to the
issuance of new ordinary shares are deducted against share capital.
Share-based compensation
The fair value of the employee and suppliers services received in exchange for the grant of the options is recognised as an
expense. The total amount to be expensed over the vesting year 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). Non-
market vesting conditions are included in assumptions about the number of options that are expected to vest. At each statement
of financial position date, the entity revises its estimates of the number of options that are expected to vest. It recognises the
impact of the revision to original estimates, if any, in the income statement, with a corresponding adjustment to equity.
The proceeds received net of any directly attributable transaction costs are credited to share capital (nominal value) and share
premium when the options are exercised.
The fair value of share-based payments recognised in the income statement is measured by use of the Black Scholes model,
which takes into account conditions attached to the vesting and exercise of the equity instruments. The expected life used in
the model is adjusted; based on management’s best estimate, for the effects of non-transferability, exercise restrictions and
behavioural considerations. The share price volatility percentage factor used in the calculation is based on management’s best
estimate of future share price behaviour and is selected based on past experience, future expectations and benchmarked against
peer companies in the industry.
Property, plant and equipment
Property, plant and equipment are stated at historical cost less subsequent accumulated depreciation and accumulated impairment
losses, if any. Historical cost includes expenditure that is directly attributable to the acquisition of the items.
Subsequent costs are included in the asset’s carrying amount or recognised as a separate asset, as appropriate, only when it is
probable that future economic benefits associated with the item will flow to the Group and the cost of the item can be measured
reliably. All other repairs and maintenance are charged to profit or loss during the financial period in which they are incurred.
Depreciation on property, plant and equipment is calculated using the straight-line method to write off their cost over their
estimated useful lives at the following annual rates:
Computer equipment
30%
Useful lives and depreciation method are reviewed and adjusted if appropriate, at the end of each reporting period.
An item of property, plant and equipment is derecognised upon disposal or when no future economic benefits are expected to
arise from the continued use of the asset. Any gain or loss arising on the disposal or retirement of an item of property, plant and
equipment is determined as the difference between the sales proceeds and the carrying amount of the relevant asset, and is
recognised in profit or loss in the year in which the asset is derecognised.
27
OptiBiotix Health Plc
Notes to the Financial Statements (continued)
For the year ended 30 November 2015
2. Accounting Policies (continued)
Intangibles – Patents
Separately acquired patents are shown at historical cost. Patents have a finite useful life and are carried at cost less accumulated
amortisation. Amortisation is calculated using the straight line method to allocate the cost of the patents over their estimated
useful life of twenty years once the patents have been granted.
Research and Development
Research expenditure is written off to the statement of comprehensive income in the year in which it is incurred. Development
expenditure is written off in the same way unless the directors are satisfied as to the technical, commercial and financial viability
of individual projects. In this situation, the expenditure is deferred and amortised over the period during which the company is
expected to benefit.
Revenue recognition
Revenue is recognised to the extent that it is probable that the economic benefits will flow to the company and the revenue
can be reliably measured, regardless of when the payment is made. Revenue is measured at the fair value of the consideration
received or receivable, excluding discounts, rebates and sales taxes or duty.
Merger relief reserve
The merger relief reserve arises from the 100% acquisition of OptiBiotix Limited whereby the excess of the fair value of the
issued ordinary share capital issued over the nominal value of these shares is transferred to this reserve in accordance with
section 612 of the Companies Act 2006.
Critical accounting judgments and key sources of estimation uncertainty
The preparation of the financial statements requires management to make estimates and assumptions concerning the future
that affect the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities at the dates of the
financial statements and the reported amounts of revenues and expenses during the reporting periods.
The resulting accounting estimates will, by definition, differ from the related actual results.
•
•
•
Share based payments
The fair value of share based payments recognised in the income statement is measured by use of the Black Scholes model,
which takes into account conditions attached to the vesting and exercise of the equity instruments. The expected life used
in the model is adjusted; based on management’s best estimate, for the effects of non-transferability, exercise restrictions
and behavioural considerations. The share price volatility percentage factor used in the calculation is based on management’s
best estimate of future share price behaviour and is selected based on past experience, future expectations and benchmarked
against peer companies in the industry.
Amortisation
Management have estimated that the useful life of the fair value of the patents acquired on the acquisition to be 20 years.
The estimate will be reviewed annually and revised if the useful life is deemed to be lower than 20 years based on the
trading business or any changes to patent law.
Accounting for research and development (R&D) expenditure
During the period the group has charged all of its research costs to the income statement. Management have considered
the criteria for capitalising such costs, however, management determined that the commercial feasibility is not yet met for
its projects and as such the group’s R&D expenditure remains in the research phase.
3. Segmental Reporting
In the opinion of the directors, the group has one class of business, being that of research and development. The group’s primary
reporting format is determined by the geographical segment according to the location of its establishments. There is currently
only one geographic reporting segment, which is the UK. All costs are derived from the single segment.
28
Annual Report and Accounts 2015
Notes to the Financial Statements (continued)
For the year ended 30 November 2015
4. Employees and Directors
Wages and salaries
Directors remuneration
Directors Fees
Social security costs
The average monthly number of employees during the year was as follows:
Directors
Research and development
Directors’ remuneration
Directors’ share based payments
Bonus
Total emoluments
Year ended
30 November 2015
£
Year ended
30 November 2014
£
62,090
225,214
78,283
34,295
399,822
–
35,679
130,785
4,034
170,498
Year ended
30 November 2015
No.
Year ended
30 November 2014
No.
6
2
8
4
–
4
Year ended
30 November 2015
£
Year ended
30 November 2014
£
261,497
256,658
42,000
560,155
166,464
49,053
–
215,517
29
OptiBiotix Health Plc
Notes to the Financial Statements (continued)
For the year ended 30 November 2015
4. Employees and Directors (continued)
Directors’ remuneration
Details of emoluments received by Directors of the Group for the year ended 30 November 2015 are as follows:
A Reynolds*
S P O’Hara
M Wyatt*
D E Evans
G Barker
J Laird
Total
Remuneration
£
25,000
141,000
17,700
24,582
11,000
84,215
303,497
Share based
payments
£
–
132,035
–
54,367
28,568
41,688
256,658
Total
£
25,000
273,035
17,700
78,949
39,568
125,903
560,155
*For disclosure in relation to directors’ fees please refer to note 18.
5. Net Finance Income/(Costs)
Finance Income:
Bank Interest
Finance Costs:
Bank loan interest
Net Finance Income/(Costs)
Year ended
30 November 2015
£
Year ended
30 November 2014
£
28
–
28
93
–
93
30
Annual Report and Accounts 2015
Notes to the Financial Statements (continued)
For the year ended 30 November 2015
6. Expenses – analysis by nature
Research and development
Directors’ emoluments (Note 4)
Auditor remuneration – audit fees (Company only £8,000 (2014: £8,000))
Auditor remuneration – non audit fees
Share based payments charge
Depreciation on property, plant and equipment
Amortisation of patents
Patent and IP costs
Consultancy fees
Legal and professional fees
Other expenses
Administrative expenses
Aim Admission expenses
Total administrative expenses
Year ended
30 November 2015
£
Year ended
30 November 2014
£
230,119
303,947
15,000
3,430
292,465
808
112,968
53,682
74,803
125,241
238,988
1,451,451
–
1,451,451
56,733
166,464
14,630
500
63,770
244
–
23,121
52,042
60,066
51,445
489,015
365,038
854,053
Admission costs relate to the admission to Aim in August 2014.
Included within the admission expenses are one-off non-audit fees of £nil (2014: £53,400) in relation to the admission to Aim.
31
OptiBiotix Health Plc
Notes to the Financial Statements (continued)
For the year ended 30 November 2015
7.
Income Tax
Corporation tax credit
Deferred tax movement
Total taxation
Year ended
30 November 2015
£
Year ended
30 November 2014
£
(120,000)
(22,594)
(142,594)
(43,254)
–
(43,254)
Analysis of tax expense
No liability to UK corporation tax arose on ordinary activities for the year ended 30 November 2015 nor for the year ended
30 November 2014.
Year ended
30 November 2015
£
Year ended
30 November 2014
£
Loss on ordinary activities before income tax
(1,423,223)
(853,960)
Loss on ordinary activities multiplied by the standard rate of
corporation tax in UK of 20% (2014: 20%)
(284,645)
(170,792)
Effects of:
Disallowables
R&D enhanced deductions
Effect of research & development tax credit
Capital allowances
Losses surrendered
Unused tax losses carried forward
Tax credit
59,402
(118,139)
(120,000)
(231)
209,586
111,433
(142,594)
73,008
(33,145)
(43,254)
220
6,905
71,048
(43,254)
The group has estimated losses of £495,716 (2014: £151,860) and estimated excess management expenses of £1,354,501
(2014: £1,143,854).
The tax losses have resulted in a deferred tax asset of approximately £370,043 (2014: £259,143) which has not been recognized
as it is uncertain whether future taxable profits will be sufficient to utilise the losses.
Current tax asset – Group
Research & development tax credit claimed
2015
£
120,000
2014
£
43,254
32
Annual Report and Accounts 2015
Notes to the Financial Statements (continued)
For the year ended 30 November 2015
8. Earnings per Share
Basic earnings per share is calculated by dividing the earnings attributable shareholders by the weighted average number of
ordinary shares outstanding during the period.
Reconciliations are set out below:
2015
Weighted average
Number of shares
£
Loss per-share
30 November 2014
Pence
Earnings
£
Basic and diluted EPS
Earnings attributable to ordinary shareholders
(1,280,629)
73,167,562
1.75
2014
Weighted average
Number of shares
£
Loss per-share
30 November 2014
Pence
Earnings
£
Basic and diluted EPS
Earnings attributable to ordinary shareholders
(810,706)
26,751,262
3.03
Basic and diluted earnings per share are the same, since where a loss is incurred the effect of outstanding share options and
warrants is considered anti-dilutive and is ignored for the purpose of the loss per share calculation. As at 30 November 2015
there were 10,345,237 (2014: 8,627,693) outstanding share options and 2,631,125 (2014: 4,579,560) outstanding share warrants,
both are potentially dilutive.
9. Company’s result for the year
The Company has elected to take the exemption under section 408 of the Companies Act 2006 not to present the parent
Company income statement account.
The result for the parent Company for the year was £503,962 (2014: £675,225).
33
OptiBiotix Health Plc
Notes to the Financial Statements (continued)
For the year ended 30 November 2015
10. Intangible assets
Group
Cost
At 1 December 2013
Acquisitions through business combinations
At 30 November 2014 & 2015
Amortisation
At 1 December 2013 & 1 December 2014
Amortisation charge for the year
At 30 November 2015
Carrying amount
At 30 November 2015
At 30 November 2014
Patents
£
–
2,259,369
2,259,369
–
112,968
112,968
2,146,401
2,259,369
The above additions represent the fair value of patents on acquisition of the company’s subsidiary undertaking, OptiBiotix
Limited.
11. Property, plant and equipment
Group
Cost
At 1 December 2013
Additions
At 30 November 2014
Additions
At 30 November 2015
Depreciation
At 1 December 2013
Charge for the year
At 30 November 2014
Charge for the year
At 30 November 2015
Carrying amount
At 30 November 2015
At 30 November 2014
34
£
–
1,099
1,099
1,965
3,064
–
244
244
808
1,052
2,012
855
Annual Report and Accounts 2015
Notes to the Financial Statements (continued)
For the year ended 30 November 2015
12. Investment in subsidiary undertakings
Company
Cost
At 30 November 2013
Additions
At 30 November 2014
Additions
Carrying amount
At 30 November 2014 and 2015
£
–
2,000,000
2,000,000
100
2,000,100
As at 30 November 2015, the company directly held the following subsidiary:
Name of company
Principal activities
Country of incorporation
and place of business
OptiBiotix Limited
Research & Development United Kingdom
Skinbiotix Limited
Dormant
United Kingdom
Proportion of
equity interest
2015
100% of ordinary shares
100% of ordinary shares
13. Trade and other Receivables
Current
Amounts owed by group undertakings
Other receivables
Prepayments and accrued income
14. Cash and Cash Equivalents
Current
Group
2014
£
Company
2015
£
2014
£
–
706,108
131,107
3,304
1,347
4,651
125,938
9,984
–
–
842,030
131,107
2015
£
–
52,613
9,984
62,597
Group
2015
£
2014
£
Company
2015
£
2014
£
Cash and bank balances
2,040,888
2,870,442
1,948,647
2,690,375
35
OptiBiotix Health Plc
Notes to the Financial Statements (continued)
For the year ended 30 November 2015
15. Called Up Share Capital
Issued share capital comprises:
Ordinary shares of 2p each – 74,229,517
Deferred shares of 19p each – 26,001,739
Deferred shares of 0.9p – 63,373,961
Deferred shares of 0.09p – 135,587,295
2015
£
1,484,591
4,940,330
570,366
122,028
7,117,315
2014
£
1,445,622
4,940,330
570,366
122,028
7,078,346
During the year the company issued the ordinary shares of £0.02 each listed below, exercised at a price of £0.08 per share in
the capital of the company following the exercise of warrants:
Date issued
07/01/2015
19/01/2015
19/03/2015
20/04/2015
21/05/2015
04/06/2015
Number
125,000
24,375
441,807
479,787
25,941
191,625
Total warrants exercised in the year
Date issued
16/06/2015
11/08/2015
18/09/2015
13/11/2015
30/11/2015
Number
7,293
2,592
125,007
150,008
375,000
1,948,435
The ordinary shares are non-redeemable and provide holders with one vote per share on a vote at a company meeting. They
also provide one equal right per share in any ordinary dividend declared and one equal right per share in the distribution of any
surplus due to the ordinary shareholders on a winding up.
The deferred shares of 19p each, 0.9p each and 0.09p each respectively the A Deferred shares, B Deferred Shares and C Deferred
shares are non-redeemable, non-voting and the holders are not entitled to dividends or to participate in profits. On a return of
capital on a winding up, each holder is entitled to receive a sum equal to the nominal capital paid up or credited as paid up
thereon but only after the aggregate sum of £10,000,000, £20,000,000 and £30,000,000 (respectively for the A, B and C Deferred
shares) has been paid to the holders of ordinary shares and in proportion to the number of shares held and the holders of the
A, B and C Deferred shares shall not be entitled to any further participation in the assets or profits of the company.
Neither the passing by the company of any special resolution for the cancellation of the A Deferred shares, B Deferred shares
and C Deferred shares for no consideration by means of a reduction of capital requiring the confirmation of the Court, nor the
obtaining by the company nor the making by the Court of any order confirming any such reduction of capital, nor the becoming
effective of any such order shall constitute a variation, modification or abrogation of the rights attaching to the Deferred shares
accordingly the Deferred shares may at any time be cancelled for no consideration by means of a reduction of capital effected
in accordance with the Act without sanction on the part of the holders of the Deferred shares.
36
Annual Report and Accounts 2015
Notes to the Financial Statements (continued)
For the year ended 30 November 2015
16. Trade and other payables
Current:
Accrued expenses
Amount due to director
Group
2015
£
2014
£
Company
2015
£
2014
£
125,634
77,424
61,834
36,917
189
189
–
–
Total trade and other payables
125,823
77,613
61,834
36,917
17. Deferred Tax
Deferred tax is provided, using the liability method, on temporary differences at the statement of financial position date between
the tax base of assets and liabilities and their carrying amounts for financial reporting purposes.
Deferred tax is calculated in full on temporary differences under the liability method using a tax rate of 20% (2014: 20%).
The movement on the deferred tax account is as shown below:
At 1 December
Arising on business combination
Movement in the year
At 30 November
2015
£
451,874
–
(22,594)
429,280
2014
£
–
451,874
–
451,874
Deferred tax assets have not been recognised in respect of tax losses and other temporary differences giving rise to deferred
tax assets as the directors believe there is uncertainty whether the assets are recoverable.
18. Related Party Disclosures
Directors and shareholders of the Group
During the year to 30 November 2015 the group was charged £25,000 (2014: £64,333) for services provided by Reyco Limited,
a company controlled by A Reynolds.
During the year to 30 November 2015 the group was charged £17,700 (2014: £6,600) in relation to Mark Wyatt’s directors
fee by Enterprise Venture Limited.
During the year to 30 November 2015 the group was charged £25,000 (2014: £9,833) for services provided by Morrison
Kingsley Consultants Limited, a company controlled by Mark Collingbourne, Chief Financial Officer.
During the year to 30 November 2015 the group was charged £7,500 (2014: £40,000) by MBA consultancy for the services of
David Evans. At the year end, the group owed £16,666 to MBA Consulting.
At the year end the group owed £189 (2014: £189) to SP O’Hara for expenses incurred on behalf of the group.
37
OptiBiotix Health Plc
Notes to the Financial Statements (continued)
For the year ended 30 November 2015
19. Ultimate Controlling Party
No one shareholder has control of the company.
20. Share Based payment Transactions
Share options
(i)
The company had introduced a share option programme to grant share options as an incentive for employees of the former
subsidiaries.
Each share option converts into one ordinary share of the company on exercise. No amounts are paid or payable by the
recipient on receipt of the option and the company has no legal obligation to repurchase or settle the options in cash. The
options carry neither rights to dividends nor voting rights prior to the date on which the options are exercised. Options may
be exercised at any time from the date of vesting to the date of expiry.
Movements in the number of share options outstanding and their related weighted average exercise prices are as follows:
Number of options
Average exercise price
Outstanding at the beginning of the period
8,627,693
3,820,026
2015
No.
2014
No.
Effects of reorganisation*
Granted during the year
Forfeited/cancelled during the year
–
(3,800,926)
1,717,544
–
8,610,543
(1,950)
8,627,693
Outstanding at the end of the period
10,345,237
*After the share consolidation on 4 August 2014.
2015
£
0.08
–
0.25
–
0.11
2014
£
0.03
0.03
0.08
44.28
0.08
For the share options issued in 2014 vesting conditions dictate that half will vest if the middle market quotation of an existing
Ordinary share is 16p or more on each day during any period of at least 30 consecutive Dealing days and half will vest when a
commercial contract is signed. The two conditions are not dependent on each other and will vest separately.
For the share options issued in 2015 year vesting conditions dictate that some of the options will vest if the middle market
quotation of an existing Ordinary share is 40p or more on each day during any period of at least 30 consecutive Dealing days,
and some will vest if certain revenue targets are met or if certain scientific studies are completed. The conditions are not
dependent on each other and will vest separately.
The share options outstanding at the period end had a weighted average remaining contractual life of 3,241 days
(2014: 3,573,578 days) and the maximum term is 10 years.
38
Annual Report and Accounts 2015
Notes to the Financial Statements (continued)
For the year ended 30 November 2015
20. Share Based payment Transactions (continued)
The fair values of the share options issued in the year were derived using the Black Scholes model. The following assumptions
were used in the calculations:
Grant date
Exercise price
Share price at grant date
Risk-free rate
Volatility
Expected life
Fair value
10/03/2015
20.00p
28.38p
1%
64%
3 years
12.00p
30/03/2015
27.99p
27.99p
1%
64%
3 years
9.43p
The share price per share at 30/11/2015 was £0.86 (30/11/2014: £0.22).
Expected volatility is based on a conservative estimate for an AIM listed entity. The expected life used in the model has been
adjusted, based on management’s best estimate, for the effects of non-transferability, exercise restrictions and behavioural
considerations.
(ii) Warrants
On 20 February 2014, an open offer was made to the potential investors to subscribe for 203,380,942 new ordinary shares of
£0.0001 each at £0.0001 each. On a 1:1 basis, warrants attach to any shares issued under the open offer convertible at any time
to 30 November 2016 at £0.0004 per shares.
On 4 August 2014, the warrants in issue were consolidated in the ratio of 200:1 as part of the share reorganisation.
Movements in the number of share warrants outstanding and their related weighted average exercise prices are as follows:
Number of warrants
Average exercise price
2015
No.
2014
No.
Outstanding at the beginning of the period
4,579,560
713,010,000
Effects of reorganisation*
Granted during the year
Forfeited/cancelled during the year
Exchanged for shares
Outstanding at the end of the period
–
–
–
(1,948,435)
2,631,125
(709,450,064)
1,555,064
2,550
(537,990)
4,579,560
*After the share consolidation on 4 August 2014.
2015
£
0.08
0.08
0.08
0.08
0.08
0.08
2014
£
0.08
0.08
0.08
0.08
0.08
0.08
A charge of £292,465 (2014: £63,770) has been recognised during the year for the share based payments over the vesting
period.
39
OptiBiotix Health Plc
Notes to the Financial Statements (continued)
For the year ended 30 November 2015
21. Financial Risk Management Objectives and Policies
The group’s financial instruments comprise cash balances and receivables and payables that arise directly from its operations.
The main risks the group faces are liquidity risk, capital risk and foreign currency risk.
The board regularly reviews and agrees policies for managing each of these risks. The group’s policies for managing these risks
are summarised below and have been applied throughout the period. The numerical disclosures exclude short-term debtors
and their carrying amount is considered to be a reasonable approximation of their fair value.
Interest risk
The group is not exposed to significant interest rate risk as it has limited interest bearing liabilities at the year end.
Credit risk
The group is not exposed to significant credit risk as it did not make any credit sales during the year.
Liquidity risk
Liquidity risk is the risk that group will encounter difficulty in meeting these obligations associated with financial liabilities.
The responsibility for liquidity risks management rest with the Board of Directors, which has established appropriate liquidity
risk management framework for the management of the group’s short term and long-term funding risks management
requirements.
During the period under review, the group has not utilised any borrowing facilities.
The group manages liquidity risks by maintaining adequate reserves and reserve borrowing facilities by continuously monitoring
forecast and actual cash flows, and by matching the maturity profiles of financial assets and liabilities.
Capital risk
The group’s objectives when managing capital are to safeguard the ability to continue as a going concern in order to provide
returns for shareholders and benefits to other stakeholders and to maintain an optimal capital structure to reduce the cost of
capital.
22. Post Balance Sheet Events
On 7 December 2015 the company issued and allotted 2,000,000 ordinary shares of 2 pence each at a price of 7.5 pence per
share in a share placing.
On 26 January 2016 the company issued and allotted 125,000 ordinary shares of 2 pence each exercised at a price of 8 pence
per share in the capital of the Company following the exercise of warrants.
On 5 February 2015 the company issued and allotted 1,282,051 ordinary shares of 2 pence each at a price of 78 pence per
share in a share placing.
On 12 February 2016 the company issued and allotted 152,699 ordinary shares of 2 pence each exercised at a price of 8 pence
per share in the capital of the Company following the exercise of warrants.
On 18 February 2016 the company issued and allotted 65,500 ordinary shares of 2 pence each exercised at a price of 8 pence
per share in the capital of the Company following the exercise of warrants.
On 26 February 2016 the company issued and allotted 44,959 ordinary shares of 2 pence each exercised at a price of 8 pence
per share in the capital of the Company following the exercise of warrants.
23. Financial commitments
The company has unrecognised contractual commitments in relation to an agreement entered with CSIC of 8,750 Euros.
40
Annual Report and Accounts 2015
Notice of Annual General Meeting
OPTIBIOTIX HEALTH Plc
Notice is hereby given that the Annual General Meeting of OptiBiotix Health PLC (the “Company”) will be held at the offices of
London Capital Club, 15 Abchurch Lane, London EC4N 7BW at 12.00 noon on 10 May 2016 for the following purposes:
1.
2.
3.
4.
To receive the Company’s Report and Accounts for the year ended 30 November 2015.
To re-elect Adam Reynolds, who retires by rotation, as a Director.
To re-elect Peter Wennström, who retires by rotation, as a Director.
To re-appoint Jeffrey’s Henry LLP as auditors of the Company and to authorise the Directors to determine their
remuneration.
Special Business
To consider and, if thought fit, to pass the following resolutions as to the resolution numbered 5 as an Ordinary Resolution and as
to the resolutions numbered 6 to 8 as Special Resolutions:
5.
6.
THAT the Directors be and they are hereby authorised generally and unconditionally for the purposes of Section 551 of
the Companies Act 2006 (the “Act”) to exercise all powers of the Company to allot shares in the Company or to grant
rights to subscribe for, or to convert any security into, shares in the Company (such shares and/or rights being “Relevant
Securities”) up to an aggregate nominal amount of £519,347.56 being one third of the current issued share capital, provided
that this authority shall, unless renewed, varied or revoked by the Company, expire on the date being the earlier of the
date 15 months after the passing of this Resolution and the conclusion of the Annual General Meeting of the Company to
be held in 2017, save that the Company may, before such expiry, make offers or agreements which would or might require
Relevant Securities to be allotted and the Directors may allot Relevant Securities in pursuance of such offer or agreement
notwithstanding that the authority conferred by this Resolution has expired.
This authority shall be in substitution for and shall replace any existing authority pursuant to Section 551 of the Act to the
extent not utilised at the date this resolution is passed.
THAT, subject to and conditional upon the passing of resolution 5, the Directors be and they are hereby generally
empowered pursuant to Section 570 of the Act to allot equity securities (as defined in Section 560 of the Act) for cash
pursuant to the authority conferred under Resolution 5 above as if sub-section 561(1) of the Act did not apply to such
allotment, provided that this power shall be limited to:
(a)
the allotment of equity securities in connection with a rights issue or any pre-emptive offer in favour of holders
of ordinary shares in the Company where the equity securities attributable to the respective interests of such
holders are proportionate (as nearly as maybe) to the respective numbers of ordinary shares held by them on
the record date for such allotment subject to such exclusions or other arrangements as the Directors may deem
necessary or expedient to deal with fractional entitlements or any legal or practical difficulties under the laws of,
or the requirements of, any regulatory body or stock exchange of any overseas territory or otherwise;
(b)
the allotment (otherwise than pursuant to sub-paragraph (a) above) of equity securities up to an aggregate nominal
value of £467,412.80 being 30% of the current issued share capital;
and shall expire on the date being the earlier of the date 15 months after the passing of this Resolution and the conclusion
of the Annual General Meeting of the Company to be held in 2017, provided that the Company may before such expiry
make an offer or agreement which would require equity securities to be allotted in pursuance of such offer or agreement
as if the power conferred hereby had not expired and provided further that this authority shall be in substitution for and
supersede and revoke any earlier power given to directors.
41
OptiBiotix Health Plc
Notice of Annual General Meeting (continued)
OPTIBIOTIX HEALTH Plc
7.
THAT, the issued share capital of the Company be reduced by cancelling and extinguishing:
•
•
•
all of the issued A deferred shares of £0.19 each in the Company;
all of the issued B deferred shares of £0.009 each in the Company; and
all of the issued C deferred shares of £0.0009 each in the Company
in each case for nil consideration in accordance with the provisions of the Company’s articles of association.
8.
THAT, due to a typographical error appearing in resolution number 9 passed at the Annual General Meeting held on
11 August 2015 (whereby reference was made to “2015” rather than “2016” as was the clear intention), that resolution be
ratified, approved and affirmed in the following terms:
“THAT, subject to and conditional upon the passing of resolution 8, the Directors be and they are hereby generally
empowered pursuant to Section 570 of the Act to allot equity securities (as defined in Section 560 of the Act) for cash
pursuant to the authority conferred under Resolution 8 above as if sub-section 561(1) of the Act did not apply to such
allotment, provided that this power shall be limited to:-
(a)
the allotment of equity securities in connection with a rights issue or any pre-emptive offer in favour of holders
of ordinary shares in the Company where the equity securities attributable to the respective interests of such
holders are proportionate (as nearly as maybe) to the respective numbers of ordinary shares held by them on
the record date for such allotment subject to such exclusions or other arrangements as the Directors may deem
necessary or expedient to deal with fractional entitlements or any legal or practical difficulties under the laws of,
or the requirements of, any regulatory body or stock exchange of any overseas territory or otherwise;
(b)
the allotment (otherwise than pursuant to sub-paragraph (a) above) of equity securities up to an aggregate nominal
value of £440,267.90 being 30% of the current issued share capital;
and shall expire on the date being the earlier of the date 15 months after the passing of this Resolution and the conclusion
of the Annual General Meeting of the Company to be held in 2016, provided that the Company may before such expiry
make an offer or agreement which would require equity securities to be allotted in pursuance of such offer or agreement
as if the power conferred hereby had not expired and provided further that this authority shall be in substitution for and
supersede and revoke any earlier power given to Directors.”
Registered Office:
Innovation Centre
Innovation Way
Heslington
York
YO10 5DG
By Order of the Board
Stephen O’Hara
13 April 2016
42
Annual Report and Accounts 2015
Notice of Annual General Meeting (continued)
OPTIBIOTIX HEALTH Plc
Notes
1.
2.
3.
4.
A member of the Company is entitled to appoint a proxy or proxies to attend, speak and vote at the meeting in his stead.
A member may appoint more than one proxy provided each proxy is appointed to exercise rights attached to different
shares. A member may not appoint more than one proxy to exercise rights attached to any one share. A proxy does not
need to be a member of the Company.
The appointment of a proxy does not preclude you from attending the meeting and voting in person. If you appoint a
proxy and attend the meeting in person, your proxy appointment will automatically be terminated.
To be effective Forms of Proxy must be duly completed and returned so as to reach the Share Registrars Ltd, Suite E, First
Floor, 9 Lion & Lamb Yard, Farnham, Surrey GU9 7LL no later than 12.00 noon on 6 May 2016.
To be entitled to attend and vote at the meeting (and for the purpose of the determination by Company of the number
of votes they may cast), members must be entered in the Register of members at 12.00 noon on 6 May 2016 (“the specified
time”). If the meeting is adjourned to a time not more than 48 hours after the specified time applicable to the original
meeting, that time will also apply for the purpose of determining the entitlement of members to attend and vote (and for
the purpose of determining the number of votes they may cast) at the adjourned meeting. If however the meeting is
adjourned for a longer period then, to be so entitled, members must be entered on the Company’s Register of Members
at the time which is not less than 48 hours before the time fixed for the adjourned meeting or, if the Company gives notice
of the adjourned meeting, at the time specified in that notice.
43
OptiBiotix Health Plc
Explanatory Notes to the
Notice of Annual General Meeting
Resolution 1
The Directors are required by law to present to the meeting the Audited Accounts and Directors’ Report for the year ended
30 November 2015.
Resolution 2
Each of the Company’s Directors listed in this resolution offer themselves up for re-appointment under the terms of the Company’s
Articles of Association which state that each director must offer himself or herself up for re-appointment every three years.
Resolutions 3
Each of the Company’s Directors listed in this resolution was appointed by the Board after the last Annual General Meeting of the
Company. Under the terms of the Company’s Articles of Association any Director appointed as an additional director after the last
Annual General Meeting must resign at the next Annual General Meeting and may offer himself or herself for re-appointment. Each
of the Directors of the Company listed in these resolutions is offering himself for re-appointment.
Resolution 4
The Auditors are required to be re-appointed at each Annual General Meeting at which the Company’s Audited Accounts are
presented.
Resolution 5
Under the Act, the Directors may only allot shares if authorised to do so. Whilst the current authority has not yet expired, it is
customary to grant a new authority at each Annual General Meeting. Accordingly, this resolution will be proposed as an ordinary
resolution to grant a new authority to allot or grant rights over up to £519,347.56 in nominal value of the Company’s unissued
share capital. If given, this authority will expire at the Company’s next annual general meeting following the date of the resolution.
Although the Directors currently have no present intention of exercising this authority, passing this resolution will allow the Directors
flexibility to act in the best interests of the Company’s shareholders when opportunities arise.
Resolution 6
The Directors require additional authority from the Company’s shareholders to allot shares where they propose to do so for cash
and otherwise than to the Company’s shareholders pro rata to their holdings. This resolution will give the Directors power to issue
new ordinary shares for cash other than to the Company’s shareholders on a pro rata basis:
(i)
(j)
by way of a rights or similar issue; or
(ii) with a nominal value of up to £467,412.80. This resolution will be proposed as a special resolution.
Resolution 7
This is a resolution to consolidate the share capital to reflect the current position. The deferred shares relate to the period before
the reverse merger in August 2014.
Resolution 8
This is a resolution to correct a typographical error appearing in resolution number 9 passed at the Annual General Meeting held
on 11 August 2015 (whereby reference was made to “2015” rather than “2016” as was the clear intention).
44
Innovation Centre
Innovation Way
Heslington
York YO10 5DG
www.optibiotix.com