Plant Health Care Annual Report 2017

FY2017 Annual Report · Plant Health Care

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LEADING
THE FIELD

PLANT HEALTH CARE PLC
ANNUAL REPORT AND ACCOUNTS 2017

Plant Health Care is a leading provider of
proprietary agricultural biological products and
technology solutions focused on improving crop
performance. We work in both research and
development as well as commercial sales.

STRATEGIC REPORT
1 Highlights
2 At a glance
4 Our products and technologies
6 Chairman’s letter
10 Business model and strategy
12 Key performance indicators (“KPIs”)
13 Principal risks and uncertainties
14 Financial review

CORPORATE GOVERNANCE
17 Board of Directors
18 Corporate governance report
20 Audit Committee report
21 Remuneration Committee report
26 Directors’ report
27 Statement of Directors’ responsibilities

FINANCIAL STATEMENTS
29 Independent auditor’s report
33 Consolidated statement of
comprehensive income
34 Consolidated statement of

financial position

35 Consolidated statement of changes

in equity

36 Consolidated statement of cash flows
37 Notes forming part of the Group

financial statements
59 Company statement of

financial position

60 Company statement of changes

in equity
Notes forming part of the Company
financial statements
64 Directors and advisers

Harpin aß

Harpin aß sales growing
23% CAGR 2013–2017

PREtec

PREtec has been under
evaluation by nine partners

First PREtec technology
licence planned for 2018

Read more on page 4

Online report available at
ar17.planthealthcare.com

Highlights

OPERATIONAL
• Significant progress in moving the PREtecTM (Plant Response Elicitor) technology towards the Company’s

first Technology Licence.

• All five of the top global agricultural/seed companies and a number of other companies are testing lead

peptides from our PREtec platforms Innatus™ 3G, T-Rex 3G and Y-Max 3G.

• Four global agricultural/seed majors are running field trials in Brazil of Innatus 3G added to chemical

sprays for the control of Asian Soybean Rust (ASR), a devastating fungal disease of soybeans. Farmers
spent US$1.7 billion on soybean fungicides in 2016 in Brazil; there are increasing concerns about disease
resistance and the resulting impact on yield.

• Exclusive rights to Innatus 3G for use in South American soybeans are expected to be licensed through

a competitive licensing process in the second half of 2018.

• In the Company’s trials, our lead peptides have shown promise for the control of ASR, especially for the

control of resistant disease when used in mixture with conventional agrochemicals. Data from these ASR
trials are due in Q2 2018.

• PHC expanded its programme of trials in other crops. Results continued to show good performance for
Innatus 3G under disease and drought stress, and for T-Rex 3G against nematodes. Y-Max 3G peptides
increased yields even under optimal growing conditions.

• Discussions continue with partners about future licensing of Innatus 3G in other crops and regions and

of both T-Rex 3G and Y-Max 3G.

FINANCIAL
• On 27 February 2018, the Group successfully raised $6.7 million (net of costs) which was well supported

by existing shareholders and brought in a number of new institutional investors.

• Revenue from commercial products in 2017 increased by 21% to $7.7 million (2016: $6.3 million); in

constant currency*, sales increased by 23%. Strong external sales growth in Rest of World (up 100%;
107% in constant currency) was offset by weaker sales in Mexico due to low produce prices in the first
half of the year; sales in external North America grew 8%.

• Sales of core Harpin™ �ß products increased by 42% (44% in constant currency), driven by broadly based
growth in all geographies. Harpin �ß and Myconate® products represented 69% of sales in 2017 (2016: 59%).

• Harpin �ß was launched into sugarcane in Brazil in early 2018. Initial response has been very

encouraging in this large market.
• Gross margin was steady at 62%.
• Cash, cash equivalents and investments at 31 December 2017 were $3.9 million.

We calculate constant currency percentages by converting our prior-period local currency financial results using the current period exchange rates
and comparing these adjusted amounts to our current period reported results.

REVENUE
($’000)

$7,685

2017

7,685

2016

6,329

CASH AND INVESTMENTS
($’000)

$3,894

2017

3,894

2016

10,076

STRATEGIC REPORTPlant Health Care plc Annual Report and Accounts 2017At a glance

BIOLOGICAL PRODUCTS –
A GROWING OPPORTUNITY

Farmers confront many challenges in providing food for a rapidly growing and more prosperous world.
These challenges include reducing the use of toxic agrochemical products. Biological products are
becoming an increasingly important part of the solution because of the benefits they offer.

COMPARED TO CONVENTIONAL
AGROCHEMICALS, BIOLOGICALS ARE:

• less toxic products which do not contaminate soils

or the environment;

• safer for farmers to handle; and

• promote sustainable agriculture.

In addition to these advantages, biologicals such as Plant Health
Care’s products can promote more efficient agriculture through:

• protecting plants from stress such as drought;

• helping plants to resist disease; and

• increasing resistance to soil pests.

As a result of these advantages, regulatory authorities around the
world are adopting accelerated regulations, which allow biological
products to come to market more quickly than conventional
agrochemicals. In addition, biological products tend to cost
far less to develop than conventional agrochemicals.

The demand for biological products is increasing rapidly as a result.

HOW THEY WORK

Plant Health Care products
can be applied both to the
leaves of plants (foliar
applications) and to the
seeds (seed treatment).

BIOLOGICALS: AN EMERGING MARKET
(global demand for biologicals)

$9.1bn
2020

$5.7bn
2016

Source: Dunham Trimmer.

12% CAGR
(compound annual
growth rate)

Protection from disease and
promotion of growth.

Protection from stress such
as drought.

Protection against soil pests.

Plant Health Care plc Annual Report and Accounts 2017PLANT HEALTH CARE IS A LEADING PROVIDER
OF PROPRIETARY BIOLOGICAL PRODUCTS

Current commercial use

PREtec trials

COMMERCIAL

NEW TECHNOLOGY

Plant Health Care’s Commercial business is driven by sales
of Harpin �ß, a recombinant protein which acts as a powerful
biostimulant, promoting the yield and quality of crops. Sales
are growing at more than 20% per annum. The Company
sells the proprietary soil treatment Myconate in selected
countries. The Company sells Harpin �ß and Myconate through
specialist distributors around the world. In Mexico, the
Company also distributes third-party biological products.

Plant Health Care’s New Technology is focused on PREtec –
plant response elicitors. These are peptides (short chains
of amino acids) which stimulate plants to increase yield and
resist disease. The Company intends to license PREtec
platforms to large companies which will develop and
commercialise them. The Company has so far launched
three platforms of PREtec, which have been under
evaluation by nine potential licence partners.

WHERE BIOLOGICALS WORK

ROW CROPS

SPECIALTY CROPS

STRATEGIC REPORTPlant Health Care plc Annual Report and Accounts 2017Our products and technologies

INNOVATIVE AND PROPRIETARY

Our innovative line of patent-protected products provides both economic and environmental
benefits for our customers and capitalises upon long-term trends towards natural systems and
biological solutions to promote plant health and growth.

PREtec
PREtec (plant response elicitor technology) is our core new
technology, inspired by natural proteins found in plants and plant
pathogens. We are able to identify families of peptides (chains
of amino acids) that can provide various agronomic benefits for
farmers. We have so far characterised four 3G peptide platforms
from our research, three of which we have launched with partners.
By platform, we mean a family of related peptide designs, all
covered by extensive patent filings. 3G signifies third generation
and indicates that these are small peptides. In addition, we have
fourth generation or 4G platforms, which are applications of DNA
or RNA forms of PREtec for various genetic uses in agriculture
and plant breeding.

Within each 3G platform, we are able to modify the peptide
sequence in order to customise the performance of peptides
in various ways. For example, to make them better at inducing
resistance to pests and diseases in plants, to improve the tolerance
of plants to drought or to accelerate root growth. Furthermore,
we can optimise the physical and chemical stability of peptides,
so that they are stable in mixtures with agrochemicals.

Technology
Innatus 3G was our first platform. It delivers a range of disease
and yield benefits to growers. It has been under evaluation with
four of the top global agricultural seed companies. Their field
testing and other technical evaluation is well advanced. Our
3G peptides are designed to be combined with standard crop
protection applications through both seed treatment and
foliar applications to improve plant health.

T-Rex 3G is a platform developed to protect crop plants against
pest nematodes. It also shows good effects in limiting the loss
of yield caused by drought stress. Y-Max 3G behaves more like
a biostimulant, promoting vigour and yield by regulating growth
genes in the plant. T-Rex 3G and Y-Max 3G were introduced to
selected partners in the latter part of 2016. During 2017, eight
industry partners conducted evaluation trials on one or both
of these platforms.

We are in the early stages of development of our 4G peptide
platforms. The first platform entails the incorporation of
genetic sequences in the plant that allow the plant to express
peptides internally.

Harpin �ß
Sales of Harpin�ß have grown at 23% CAGR over the five years
to 2017, since we adopted a strategy of expanding registrations
and developing distribution through new partners. We are now
able to sell Harpin �ß in more than 14 countries.

In the USA, we sell into corn as a component of seed treatment
and, since 2016, as a component of fluency agents used in
seed planters.

These treatments all improve crop yield. We also sell into fruit
in the Pacific Northwest and into soft fruit and citrus in Florida.
In Europe, we started sales into table grapes in Italy in 2016; sales
are growing and there are plans to expand to other countries. In
Spain, sales are growing rapidly in citrus and have also started in
rice. In the UK, activity included the launch into potatoes in 2017
and sales also started in turf, where Harpin �ß improves the vigour
and condition of the grass. Extensive trials over the last three
years have shown significant benefits of Harpin �ß in sugarcane
in Brazil, where the benefit is increased yield; the product was
launched in Brazil in early 2018. In South Africa, sales have been
developed into fruit, corn and sugarcane.

Benefits of Harpin �ß in Brazil

• There are 10 million has of sugarcane in Brazil*.

• There are 5 million has of sugarcane in Sao Paulo state.

• Coplacana, our distributor, is the largest supplier of inputs

for sugarcane in Sao Paulo state.

• Applications of H2Copla (Harpin �ß) have been shown to
potentially increase sugarcane yield by as much as 12%
resulting in a possible 4x return for the grower**.

• Coplacana launched the H2Copla brand in February 2018.

Based on 2016 sugarcane harvested data and 2017/2018 projected data
from USDA Foreign Agricultural Service’s GAIN report dated 19 April 2017.

** Yield increase based on Plant Health Care field trials conducted on
sugarcane in Brazil in 2017; Value and ROI based on cost data from
Agrianual 2016 FNP – Informa report.

Plant Health Care plc Annual Report and Accounts 2017WHAT IS PREtec?

PREtec works by inducing natural defensive and
metabolic responses in crop plants so that they suffer
less harm from the usual stresses (like drought or
disease) that they face during a growing season. This is
achieved by designing short proteins (peptides) that
mimic the active sites of larger naturally occurring
proteins to which plants are evolved to
respond defensively.

These peptides are generally accepted as being safe to handle
and having negligible toxicity. They do not leave any detectable
residue and rapidly degrade so that they do not persist on the
plant after application. For these reasons, PREtec peptides
should be generally easier, cheaper and quicker to register for
commercial use than most other agricultural chemicals.

PREtec: THREE PROPRIETARY PLATFORMS

PREtec IS PROTECTED BY EXTENSIVE IP:

Variations on peptide structures are patentable and, within
each of these “platforms”, it is possible to design and make a very
large number of closely related peptide variants. Our first proprietary
design platform, Innatus 3G, was introduced to partners in 2014–2015.
In 2016, we presented the next two platforms – T-Rex 3G and
Y-Max 3G. We continue to work on further patentable designs,
which will be launched in due course.

Patent filings cover the various PREtec peptide designs in all
agricultural applications – what we call 3G technologies. They also
extend to the genes that code for those peptides, for example in
crops bred to display increased defensive responses – what we
call 4G. A number of patent filings are now being progressed.

BIOPESTICIDES

Innatus 3G

T-Rex 3G

Broad plant defence
and growth platform

Nematode defence
platform

BIOSTIMULANTS

Y-Max 3G

Yield and growth platform

Value propositions

Yield
improvement

Crop protection
value-add

Breeding:
seed-applied traits

STRATEGIC REPORTPlant Health Care plc Annual Report and Accounts 2017Chairman’s letter

EXCITING NEW DEVELOPMENTS

“ 2017 was a year of substantial progress.
Our Commercial sales are now on a firm
growth track. In New Technology, we are
poised for our first technology licence
of PREtec in 2018.”

Overview
Plant Health Care is a leading provider of proprietary agricultural
biological products and technology solutions focused on improving
crop performance.

2017 was a year of strong progress for the Group. Revenue and
gross profit rose strongly in the Commercial business; we now
have a well-diversified business. At the same time, great strides
have been made in New Technology and we are well placed to
deliver our first substantial technology licence during 2018.

Commercially, sales growth of 21% was driven by increased
sales of our core product, Harpin �ß; sales of Harpin �ß have
now grown at 21% Compound Annual Growth Rate (“CAGR”) since
we re-launched the business in 2013. The Commercial business
is well placed to fulfil its mission of generating profit and cash
to finance the business by 2021.

In New Technology, nine partners have been evaluating our
PREtec platforms of biorational peptides, including all five of the
top global agricultural/seed companies. We are particularly excited
about the potential for the first Innatus 3G technology licences,
which we now plan will be for rights for use on South American
soybeans; we expect that competitive licensing process to be
completed by the end of Q3 2018, ahead of the planting of the
next soybean crop.

We report here separately on the two areas of focus for the business:
New Technology and Commercial. We are organised in these two
lines of business and report our Commercial business in three
geographic segments – Americas, Mexico and Rest of World.
We report our New Technology business in a single segment.

New Technology
New Technology is focused on the discovery and early development
of novel proprietary biological solutions using the Group’s PREtec
science and technology capabilities (PREtec signifies plant
response elicitor technology). These new technologies will mainly
be developed into final products in partnership with agricultural
industry companies active downstream, who will take them to

market; the Group would then receive licence payments on these
sales. We expect to partner with major agrochemical companies
for the larger arable crops such as corn and soybean; for specialty
crops, such as regional crops and fruits and vegetables, we will
work with a wider range of partners.

Our laboratory, glasshouse and field trials, and a number of
other trials run for us by university groups and other specialists,
confirm that peptides from Innatus 3G, T-Rex 3G and Y-Max 3G
can be customised to deliver targeted agronomic benefits, such
as, resistance to attack by fungi and soil pests and improved
recovery from the effects of drought. All of these benefits
increase crop yield.

Our peptides have been shown to be compatible with standard
agricultural applications, such as seed treatment and foliar sprays,
and to work with different genetic strains of crops. They can
enhance the performance of established chemical and biological
products, and resistant crop varieties. In some instances peptides
on their own perform as effectively as significant commercial
products currently on the market. However, we generally expect
our peptides to be used in combination with conventional
agricultural products, to extend the performance and to
reduce their environmental impact.

This promise has encouraged an increasing number of potential
licensees to evaluate PREtec peptides. This now includes all five
of the major global agricultural/seed companies. In total, nine
potential partners ran field trials during 2017, under the terms
of formal evaluation agreements with the Company.

During 2017, we also made significant progress in characterising
the lead peptides from each of Innatus 3G, T-Rex 3G and Y-Max 3G.
From the total of eight lead peptides we worked on in 2017, PHC279
is currently the focus for work in three main areas – demonstrating
effectiveness; establishing the route towards regulatory licences
to sell; and developing a cost-effective production process. While
we are also working on a wide range of opportunities across the
three platforms, I will focus here on PHC279, for purposes
of illustration.

Plant Health Care plc Annual Report and Accounts 2017PREtec: MOVING FROM PLATFORMS TO PRODUCTS

Many peptide variants possible within each platform: focusing on lead peptides

3G platform

Performance focus

Innatus 3G

Disease resistance,
vigour, quality, yield

T-Rex 3G

Nematode, yield

Y-Max 3G

Growth, roots, yield

Lead peptides
(synthetic  fermented
product)

PHC398  PHC279
PHC296  PHC863
PHC958  PHC404
PHC180  PHC148

PHC176  PHC032
PHC097  PHC949

PHC353  PHC414
PHC326  PHC535

Partner trials
started

2015

2016

Discovery

Proof of
concept

Early
development

Advanced
development

Pre-launch

Commercial

OUR LEAD PEPTIDE FOR SOYBEAN IN BRAZIL: PHC279

Value proposition

• Works on disease that is resistant

to fungicides.

• Extends commercial life of existing

fungicide products; defend or extend
market share.

• Potential to boost yield through plant

health effects.

• Innatus 3G platform can be mined for

potentially even better peptides
over time.

Asian Soybean Rust field trial Iracemápolis Brazil
21DAT4 Bars are one standard error from the mean

)
y
t
i
r
e
v
e
s
(

e
v
e

e
s
a
e
s
i
D

U ntreated

P H C

B ayer

Treatment

B ayer + P H C

Syngenta +P H C
Syngenta

U P L/B ayer + P H C
U P L/B ayer

2016

2017

2018

Before 2021

Efficacy

Lab/greenhouse

Evaluation field trials

Development field trials

Commercial sales

Ability to make

Synthesis

Bench-top fermentation

Pilot production

Commercial production

Regulatory

Fast-track strategy

Submit package

Approval

Technology licence

Competitive arena

Announce competitive
licensing

Competitive licensing
H2

Milestone payments

Complete

In progress

Planned

STRATEGIC REPORTPlant Health Care plc Annual Report and Accounts 2017

Chairman’s letter continued

New Technology continued
PHC279 is showing notable promise for use in the control
of Asian Soybean Rust (“ASR”) in Brazil. ASR is a devastating
disease of soybeans; Brazilian farmers spend some US$1.7 billion
(according to the 2015 AgrAspire database) each year on its
control. However, ASR is developing resistance even to the
most advanced chemical fungicides in the market, leading to
poorer control and the need for ever larger and more frequent
applications. Our own trials, including repeated greenhouse
tests and field trials in two countries, indicate that PHC279,
when mixed with the market-leading fungicides, improves
control of resistant ASR even on disease-tolerant soybean
varieties. We also expect that PHC279 applications will
boost soybean yield, by enhancing crop health.

The four market leaders in the fungicide market in Brazil are
now running their own field trials with our lead peptides from
the Innatus 3G platform. Trials started in late 2017 and results are
anticipated late in Q2 2018. Embrapa, the highly regarded Brazilian
government agricultural research entity, is also evaluating
Innatus 3G peptides in the field, in parallel with our own field trials.

In parallel with these field trials, we are evaluating the path to
regulatory licences needed to sell Innatus 3G peptides in Brazil,
as well as in other countries. We are encouraged that regulatory
authorities have indicated that they are likely to treat PREtec
peptides as biologicals, which have a substantially faster route
to market than conventional agrochemicals.

The most cost-effective means of production for the Company’s
peptides is likely to be by industrial fermentation. We have now
developed a high-yield fermentation process for PHC279 and taken
it up to pilot scale. Material produced in this way has been shown
to be fully effective in field and greenhouse trials and physically
stable, including in mixtures with agricultural chemicals.
Importantly, the costs of production have now achieved our targets
to ensure cost-efficiency in the field. We are working towards a
competitive licensing round in the second half of 2018 for rights
to use Innatus 3G in South American soybean markets. Whoever
licenses these rights will be seeking to use Innatus 3G as an
ingredient or component of their own product ranges. If our
peptides can show benefits such as performance improvement,
resistance management and environmental and regulatory
advantages this will be of significant commercial value.

We anticipate that a series of competitive licensing events in
other crops, geographical regions and other value propositions
will follow over the coming years.

PRODUCT SALES**
($’000)

6,314

2,125

397

3,792

6,730

3,165

459

3,106

7,258

3,863

421
2,974

6,329

3,405

356
2,568

7,685

4,822

455

2,406

Commercial
Our Commercial business sells our proprietary products
worldwide through distributors and also distributes
complementary third-party products in Mexico.

Overall sales in 2017 were $7.7 million, an increase of 21% over
2016 ($6.3 million); in constant currency*, the increase was 23%.
Strong external sales growth in Rest of World (up 100%; 107%
in constant currency) was offset by weaker sales in Mexico due
to low produce prices in the first half of the year. External sales
in the Americas grew 8%, following moves in 2016 to reduce
distributor inventories.

Sales of the core Harpin �ß products increased by 42% (44%
in constant currency), driven by broadly based growth in many
countries. Harpin �ß and Myconate products represented 69%
of sales in 2017 (59% in 2016). Gross margin was steady at 62%.
Sales of Harpin �ß are now established on a strong growth track;
CAGR from 2013–2017 was 23%.

In Rest of World, sales increased strongly in Spain and South
Africa. Harpin �ß is growing well in Italy, following the launch
onto table grapes in 2016, through our partner Sipcam. Harpin
�ß was also successfully launched on potatoes in the UK. During
the year, registration and first sales were achieved in Morocco.
We anticipate further registrations and product launches in 2018.

In the Americas, sales by our largest distributor in the Pacific
Northwest were held back by adverse weather. However, new
outlets in Florida and as a fluency agent in corn (maize) helped
to support modest sales growth.

Mexico had a challenging year, particularly due to very low prices
of peppers, tomatoes and other produce exported to the USA in
the first half of the year. Sales were more positive in the second
half of the year but ended up 11% lower (in local currency) than
in 2016.

In Brazil, Harpin �ß was launched into sugarcane at the turn of
the year. Results from demonstration trials have shown significant
increases in yield, which is a promising indicator for the launch.
First sales by the Company were expected at the end of 2017; due
to delays in importation, these sales slipped into early 2018 but
first in-country sales were not affected.

Financial and corporate
Operating expenses in 2017 were $10.5 million, compared
with $15.2 million in 2016. Excluding the exceptional costs
incurred in 2016 evaluating a potential US listing ($1.2 million) and
a non-cash decrease in the value of loans from our UK subsidiary
(a gain of $1.3 million in 2017, compared with a loss of $1.5 million
in 2016), cash operating expenses reduced by $0.6 million to
$11.9 million (2016: $12.5 million). R&D costs increased by
$0.6 million to $5.1 million, while other costs excluding the
exceptional costs detailed above decreased by $1.2 million.

As we report in US Dollars, the increase in Sterling value has
resulted in a foreign currency gain of $1.3 million arising in
respect of the Sterling loan between the holding company and
the UK trading company. The net increase in the consolidated
statement of comprehensive income in respect of the
revaluation of these loans is $1.3 million.

2013

2014

2015

2016

2017

Harpin �ß

Myconate

Third party

** Excludes license revenue.

We calculate constant currency percentages by converting our
prior-period local currency financial results using the current period
exchange rates and comparing these adjusted amounts to our current
period reported results.

Plant Health Care plc Annual Report and Accounts 2017Constant currency
We evaluate our results of operations on both an as reported and
a constant currency basis. The constant currency presentation,
which is a non-IFRS measure, excludes the impact of fluctuations
in foreign currency exchange rates. We believe providing constant
currency information provides valuable supplemental information
regarding our results of operations, consistent with how we
evaluate our performance. We calculate constant currency
percentages by converting our prior-period local currency
financial results using the current period exchange rates and
comparing these adjusted amounts to our current period
reported results.

Board changes
I have had the honour to act as Interim CEO, as well as Executive
Chairman, since November 2016.

The Board reviewed these arrangements in early 2018 and
has requested that I continue as Interim CEO for the time being.
The Board will review the situation periodically and may initiate
a search for a new CEO in due course.

The relevant experience and background of each member
of the Board is set out on page 17.

Outlook
After depressed years in 2015–2016, agriculture markets appear
to have stabilised at a new, lower level; commodity prices are
unlikely to recover while grain stocks remain at relatively high
levels. The global agrochemical market is estimated to have
been flat in 2017. Even in depressed agrochemical markets;
however, we believe that growers in key markets will continue
to adopt agricultural biological products which increase their
productivity. Based on various reports, we expect growth in the
demand for biological products to increase at approximately 10%
per annum from 2017 to 2020. We are confident that Harpin �ß

TECHNOLOGY LICENSING TIMELINES

Innatus 3G

sales will continue to grow significantly faster than the market
for biological products as a whole over the medium term. However,
sales in any one period will be subject to seasonal factors such as
weather, timing of registrations and third-party relations”. As a
result, Group sales may not follow a strictly linear trend.

We are currently focused on ensuring successful field trials
of PHC279 and other Innatus 3G peptides for the control of ASR
and yield enhancement in soybeans. We are confident that our
partners will replicate our own positive results, which will lead
to a successful competitive licensing of rights to the platform
for South American soybean during the H2 2018. In addition, we are
working on a number of other value propositions for our PREtec
peptides, in co-operation with our partners; we expect these
to lead to a series of technology licensing agreements over
the coming years.

Plant Health Care has a clearly defined strategy, which we are
implementing effectively. 2018 will be a decisive year for the
Company, which we enter with confidence.

In closing, I would like to thank the entire Plant Health Care
team for all its hard work during the year. Strong results come
from great people, working towards shared goals. As Interim
CEO, I am proud of the Group’s impressive team of highly motivated
professionals, in whom I have the greatest confidence.

On 27 February 2018, the Group successfully completed an equity
raise which generated $6.7 million (net of costs) from new and
existing investors. The signal of our investors confidence in the
Group is highly noteworthy.

Dr Christopher Richards
Executive Chairman and Interim Chief Executive Officer
9 April 2018

2015
• Signed four evaluation

agreements for Innatus 3G
with major players

2016–2017
• PHC develops

product concepts

• Partners test

products and explore
platform capabilities

2018–2019
• Exclusive rights by
crop and geography

• Competitive licensing
process H2 2018 for
South American soybeans

• Further competitive
licences planned

T-Rex 3G Y-Max 3G and PREtec 4G

2016–2017
• Present to

potential partners

• Complementary to

Innatus 3G

2018–2019
• Exclusive rights against
milestone achievement

• Multiple competitive
licences feasible

STRATEGIC REPORTPlant Health Care plc Annual Report and Accounts 2017Business model and strategy

HOW WE WORK

Plant Health Care believes that PREtec has very significant commercial potential.
We therefore plan to license the technology to larger companies, which will have the
resources to turn our lead peptides into final products and take them to market.

RESEARCH AND DEVELOPMENT

NEW TECHNOLOGY

Plant Health Care has so far characterised four platforms and launched three of them:

• Innatus 3G

• T-Rex 3G

• Y-Max 3G

Plant Health Care’s laboratory in Seattle:
• Designs peptides from each platform and launched three of them.
• Screen them for activity in protecting plants from stress such as drought or disease.
• Select lead peptides for testing.

Field trials
Field trials are run through a network of universities and specialist contractors.

Collaborating with partners
Partners carry out laboratory, greenhouse and field trials on many crops and targets.

Manufacturing process
During 2017, we developed production processes for PHC279. Fermentation is now being done at pilot scale.
We are moving other lead peptides down this route.

Obtaining regulatory approvals
Regulatory rules vary across the world; Plant Health Care is pursuing “fast-track” approvals for PREtec peptides.

Out-licensing to partners
Plant Health Care intends to segment our licences by crop and geography. The Company anticipates that the first
licence will be for Innatus 3G in South American soybean. Licences for Innatus 3G in other crops and geographies will
follow, as well as licences to T-Rex 3G and Y-Max.

OUR PARTNERS
PREtec has been under evaluation by nine partners, including all of the “big five” global
agricultural/seed companies.

Our value proposition to our partners:

• Improving efficacy of fungicides, to combat

disease resistance.

• Improving corn or soybean yield.
• Controlling of nematode infestations through the season.

• Safening chemical products used in seed treatment.
• Increasing yield and quality of grapes, tomatoes, peppers,

lettuces and cucumbers.

• Improving turf health under heat and traffic stress.

Plant Health Care plc Annual Report and Accounts 2017OUR GROWTH STRATEGY

Our future growth will be achieved by focusing on the following key areas:

INCREASING SALES OF EXISTING
COMMERCIAL PRODUCTS
We intend to drive revenue in the short term in our
Commercial business, focusing on Harpin �ß, particularly
in specialty crops. We plan to grow in crops where Harpin �ß
provides the most benefits to farmers, including sugarcane,
citrus, tomatoes and potatoes.

BUILDING FURTHER THE CAPABILITY
TO SUPPORT OUR LICENCES
Plant Health Care has a unique understanding of PREtec,
which will be important for supporting partners as they
develop and commercialise products from our platforms.
Our capacity to develop cost-effective production,
processes and our skill in achieving fast-track
registrations will enable our partners to accelerate
market launches. Our extensive experience of the
platforms will enable us to mine our platforms for further
peptides over time, in co-operation with our licensees.

LICENSING OF PREtec PLATFORMS:
INNATUS 3G, T-REX 3G AND Y-MAX 3G
Our partners have been evaluating our peptide platforms
since 2016. With partners currently evaluating these
platforms in many crops and countries, we anticipate
a series of competitive licensing rounds, leading to
licensing events by crop and geography over several
years. We are currently focused on our first technology
licence, which we anticipate will be for Innatus 3G in
South American soybeans, during the second half
of 2018.

CONTINUING TO DEVELOP FURTHER
PEPTIDE PLATFORMS
We have already filed a patent application for a further
peptide platform, beyond the three already under
evaluation by partners. We expect to discover more
platforms over time.

OUR RESEARCH AND DEVELOPMENT PROCESS

Discovery

Characterisation

Partner
evaluation

Product
development

STRATEGIC REPORTPlant Health Care plc Annual Report and Accounts 2017Key performance indicators (“KPIs”)

MONITORING THE BUSINESS

The Group uses a range of performance measures to monitor and manage
the business effectively. These are both financial and non-financial. The most
significant relate to Group financial performance and to the Group’s progress
in driving the two pillars of its strategy.

The KPIs for financial performance of the Commercial area
and for the Group as a whole include revenue, gross profit
and margin, and operating profit/loss. These KPIs indicate
the volume of work the Group has undertaken, as well as the
efficiency with which this work has been delivered.

The KPIs for financial performance for the year ended
31 December 2017, with comparatives for the year ended
31 December 2016, are set out below:

REVENUE
($’000)

$7,685

2017

7,685

2016

6,329

GROSS PROFIT MARGIN
(%)

61.6%

2017

2016

61.6

61.5

GROSS PROFIT
($’000)

$4,732

2017

2016

4,732

3,893

OPERATING LOSS
($’000)

$(5,801)

(11,350)

(5,801)

2017

2016

In addition, an important KPI is the movement in revenue achieved
from the sale of our proprietary products. These movements are
shown below, separating out the product revenue from the receipt
of licence/milestone payments and other one-off payments, which
are less predictable and tend to distort the product sales growth.

Non-financial
The KPIs for non-financial performance relate to the Group’s
technologies and include the number and nature of relationships
realised with partners, and progress along the mutually agreed
paths to commercial launch of products.

Proprietary sales (excluding licencing revenue)
2017
$’000

The Americas

Mexico

Rest of World

Total

1,574

570

3,200

5,344

The Board continues to monitor the progress of its R&D activities
and expenditures. As each research project advances, specific
progress is reported to the Board and costs against budget are
monitored. We anticipate refining the KPIs for R&D as each
project develops.

2016
$’000

1,424

734

1,603

3,761

Plant Health Care plc Annual Report and Accounts 2017Principal risks and uncertainties

MEASURING RISK

Our business is subject to a number of potential risks and uncertainties, including those listed below. The occurrence of
any of these risks may materially and adversely affect our business, financial condition, results of operations and future
prospects. We manage and mitigate these risks by executing the strategy described on page 11.

Risk

Description

FINANCIAL AND
LIQUIDITY RISK

• We have a history of losses since inception, and anticipate continuing to incur losses in the future, and may

not achieve or maintain profitability.

• We expect to require additional financing in the future and may be unable to obtain such financing on favourable
terms or at all, which could force us to delay, reduce or eliminate our research, development or commercial activities.

TECHNOLOGY AND
COMMERCIALISATION
RISK

• Our PREtec out-licensing strategy depends on evaluation partners converting their declared interest into formal

commercial offers.

• We are subject to risks relating to product concentration due to the fact that we derive substantially all of our

revenues from our Harpin �ß and Myconate product lines and from the sale of third-party products.

• We may be unable to establish or maintain successful relationships with third-party distributors and retailers,

which could materially and adversely affect our sales.

• We have a limited number of sales and marketing personnel and will need to expand our sales and marketing

capabilities to grow revenues from our commercial products.

• While a number of patents have been filed to date, we may be unable to secure adequate protection for the
intellectual property covering our New Technology and product candidates, or develop and commercialise
these product candidates without infringing the intellectual property rights of third parties.

• Our partners’ trials can be influenced by weather and other factors, which can result in the trials having to be

repeated; this can lead to delays of a year in planned licences.

REGULATORY
AND LEGAL RISK

• If we are unable to obtain regulatory approvals, or comply with ongoing and changing regulatory requirements,
it could delay or prevent sales of our commercial products or impede the development of potential products.

• If we use PREtec in trait development, our technologies and product candidates will face more stringent

regulatory regimes.

• If we are unable to comply with regulations applicable to our facilities and procedures and those of our third-party
manufacturers, our research and development or manufacturing activities could be delayed, limited or prevented.

CREDIT RISK

• The majority of our net sales are credit sales that are made primarily to customers whose ability to pay is dependent,
in part, upon the economic strength of the industry and geographic areas in which they operate, and the failure to
collect, or, timely collect, monies owed from customers could materially and adversely affect our financial condition.

PERSONNEL

• Our future growth and ability to compete depend on retaining our key personnel and recruiting additional

qualified personnel.

Financial instruments
The Group uses various financial instruments, including cash, short-term investments of investment grade notes and bonds, and items
such as trade receivables and trade payables that arise directly from its operations.

Information on the risks associated with the Group’s involvement in financial instruments is given in note 19 to the financial statements.

On behalf of the Board

Dr Christopher Richards
Executive Chairman and Interim Chief Executive Officer
9 April 2018

STRATEGIC REPORTPlant Health Care plc Annual Report and Accounts 2017Financial review

STRONG SALES GROWTH

“ Plant Health Care had strong sales
growth in 2017. Sales increased 21%
to $7.7 million. At the same time,
operating expenses decreased 31%
to $10.5 million.”

A summary of the financial results for the year ended
31 December 2017 with comparatives for the previous
financial year is set out below:

Revenue

Gross profit

Operating loss

Finance income (net)

2017
$’000

7,685

4,732

2016
$’000

6,329

3,893

(5,801)

(11,350)

Net loss for the year

(5,716)

(11,217)

Revenues
Revenues in 2017 increased by 21% to $7.7 million
(2016: $6.3 million) as a result of strong growth in
our Rest of World segment, in particular Spain and
South Africa. The gross margin remained steady
at 62% of sales in 2017.

The Americas
External revenue in the Americas segment increased
8% to $1.6 million (2016: $1.5 million). The increase in
revenue was primarily due to increased sales of
Harpin �ß in potatoes in the Upper Midwest and
strawberries in Florida. The Americas includes
revenues from the sales to North and South America.
Initial sales to Brazil were delayed due to importation
issues; these sales occurred in early 2018, with the
launch into sugarcane. Revenue in Americas
is predominantly from Harpin �ß sales.

Mexico
A significant portion of the Group’s revenue
continues to come from Mexico. Revenue from the
Mexican segment decreased 11% (10% in local currency)
to $2.9 million (2016: $3.2 million). This was due to
lower than expected produce prices in the north-west
portion of Mexico. Revenue in Mexico includes sales
of Harpin �ß, Myconate and third-party products.

Rest of World
In 2017, the Group’s largest revenues were derived
from the Rest of World segment. External revenue
increased 100% to $3.2 million (2016: $1.6 million).
The increase was primarily due to increased sales in
the South African and Spain regions. Sales increased
104% and 60% for South Africa and Spain, respectively.
Revenue in the Rest of World segment is predominantly
from Harpin �ß sales.

Operating expenses
Operating expenses decreased to $10.5 million from
$15.2 million. The factors that contributed to the
decrease were continued investment in Research and
Development up 11% to $5.1 million, non-cash expenses
associated with the increase in the value of loans
from our UK subsidiary of a foreign currency gain of
$1.3 million (2016: foreign currency loss of $1.5 million)
and costs of approximately $1.2 million were incurred
in 2016 in association with evaluating a potential USA
listing. There were no USA listing costs in 2017. The
2016 costs associated with a potential USA listing
were charged to administration. Administration
expenses also included $1.3 million (2016: foreign
currency loss of $1.5 million) of a non-cash foreign
currency gain associated with the increase in the
value of the loans from our UK subsidiary.

Plant Health Care plc Annual Report and Accounts 2017Net cash provided by financing activities was $nil
for 2017 (2016: $9.7 million). The decrease is due
to a $9.7 million fundraise concluded in 2016.

On 27 February 2018, the Group successfully completed
an equity raise which generated $6.7 million (net of
costs) from new and existing investors.

Based upon the Group’s current cash and cash
equivalent position, projected revenue from product
sales, anticipated operating costs and the additional
funding received post year end, the Group is confident
that it will have sufficient cash to meet its working
capital needs through the next 12 months.

Jeffrey Hovey
Chief Financial Officer
9 April 2018

Expenditure within the New Technology
segment increased $0.5 million to $5.5 million in
2017 (2016: $5.0 million). The increase was due to
the hiring of additional R&D staff, increased contract
research and intellectual property costs.

In addition, we have set out in note 9 the separate
category of expenditure relating to Business
Development, which decreased to $0.6 million in 2017
(2016: $1.0 million). This relates to reduced personnel
costs and other costs relating to customer support and
market research.

Unallocated corporate expenses decreased
$4.7 million to a gain of $0.3 million (2016: $4.4 million).
The increase was attributable to costs in 2016 associated
with a USA listing and the increase in the value of
Sterling loans from our UK subsidiary due to the
appreciation of the Pound.

Balance sheet
At 31 December 2017 and 2016, investments
cash and cash equivalents were $3.9 million and
$10.1 million respectively.

Working capital was $7.2 million at 31 December 2017
(31 December 2016: $12.5 million). The $5.3 million
reduction is primarily due to an increase in accounts
receivable, accounts payable and further spend in
research and development activities.

Translation of the results of foreign subsidiaries
for inclusion within the consolidated Group results
resulted in an exchange loss of $1.3 million recorded
within Other Comprehensive Income and Foreign
Exchange Reserves (2016: gain of $1.3 million).

Cash flow and liquidity
Net cash used in operations was $4.9 million in 2017
(2016: $9.2 million), a decrease of $4.3 million. This
decrease was primarily the result of a decrease in
the Group’s net loss offset by an increased working
capital position.

Net cash provided by investing was $2.6 million
in 2017 (2016: $1.8 million). The Group holds surplus
cash in several bond and money market funds. The
movement in these funds was used to further invest
in the New Technology business and fund the
Commercial business.

STRATEGIC REPORTPlant Health Care plc Annual Report and Accounts 2017CORPORATE GOVERNANCE

17 Board of Directors
18 Corporate governance report
20 Audit Committee report
21 Remuneration Committee report
26 Directors’ report
27 Statement of Directors’ responsibilities

Plant Health Care plc Annual Report and Accounts 2017Board of Directors

THE RIGHT TEAM

Dr Christopher G J Richards
(Executive Chairman and Interim Chief Executive Officer)
Dr Christopher Richards joined the Company as Non-executive
Chairman in August 2012. He became Executive Chairman in April 2015
to take on a more active role in investor relations and in developing
strategy, particularly the focus on New Technology. Following the
departure of Paul Schmidt in November 2016, Dr Christopher Richards
became the Interim Chief Executive Officer. Dr Christopher Richards
spent 20 years at Syngenta and its predecessor companies in
various strategic management positions in South America, Europe
and Asia. In November 2003, he was appointed COO of Arysta
LifeScience, and he served as CEO from 2004 until 2010, leading
Arysta LifeScience’s transformation into a global agrochemical
company with sales above $1.6 billion. He also served as a director
of Arysta LifeScience from 2003 to 2015. He serves on the board
of directors of Origin Enterprises plc, a service provider to farmers
for food production solutions, and Nanoco Group plc, a technology
company carrying out research, development and commercialisation
of products based on heavy metal-free quantum dots.

Michael J Higgins
(Senior Independent Director)
Michael Higgins joined the Company in May 2013 as Senior Independent
Director and Chair of the Audit Committee. He also serves as a member
of the Remuneration Committee. He currently serves as non-executive
chairman of Ebiquity plc, a leading independent marketing and media
consultancy, a non-executive director of Progility plc, a project
management services group, and a non-executive director of Premier
Technical Services Group plc, a niche specialist services provider.
Michael is also non-executive Chairman of IPSX UK Ltd, which,
subject to regulatory approval, will operate the first regulated
securities exchange dedicated to the IPO and secondary trading
in Exchange-Traded Properties, and a non-executive director of the
Quoted Companies Alliance, a non-profit organisation that champions
the interests of small to mid-sized publicly traded companies. He is also
an alternate member of the Panel on Takeovers and Mergers on behalf
of the Quoted Companies Alliance. Michael Higgins was a partner at
KPMG for 10 years and subsequently served as a senior adviser at KPMG.
Prior to KPMG, Michael Higgins was a director at Charterhouse Bank,
worked at Saudi International Bank and qualified as an accountant
with Price Waterhouse (now PricewaterhouseCoopers).

Dr Richard H Webb
(Executive Director, New Technology)
Dr Richard Webb joined the Company in September 2013 as a
Non-executive Director. In January 2015, he was appointed an
Executive Director, responsible for supporting the Chief Science
Officer, Dr Zhongmin Wei, as the Company was expanding its
research and development capability. He leads the New Technology
strategy and licensing for the business. He was previously engaged
by the Company as a consultant, contracted through StepOut Ltd.,
a consultancy business he founded in 1995. In this capacity, between
2012 and 2014, he was instrumental in the development of the Company’s
new business strategy. He previously held various positions at Imperial
Chemical Industries, including responsibilities for managing
laboratory discovery and field development programmes for its
public health pesticide business. His doctorate, in pest biology,
was from the London School of Hygiene and Tropical Medicine.

William M Lewis
(Non-executive Director)
William Lewis joined the Company as a Non-executive Director in
April 2015. He also currently serves as Chairman of the Remuneration
Committee and as a member of the Audit Committee. Since June 2014,
William Lewis has served as President and CEO of Summit Agro USA, LLC,
a joint venture agrochemicals business between Sumitomo Corporation
and ISK Biosciences. He previously held senior roles within Arysta
LifeScience, Syngenta Crop Protection and Zeneca/ICI. William Lewis
has also been an owner/operator of two John Deere dealerships in
GA, where he improved the overall operations and value of the
business, which led to the successful sale of the businesses.

CORPORATE GOVERNANCEPlant Health Care plc Annual Report and Accounts 2017Corporate governance report

HIGH STANDARDS OF GOVERNANCE

Plant Health Care plc has taken note of the UK Corporate
Governance Code (the “UK Code”) published in April 2016.
The UK Code and associated guidance can be found
on the Financial Reporting Council website at
https://www.frc.org.uk/directors/corporate-
governance-and-stewardship/uk-corporate-
governance-code. The rules of the London Stock
Exchange do not require companies that have
securities traded on AIM to formally comply with the
UK Code and the Company does not seek to formally
comply nor give a statement of compliance. However,
the Board is accountable to the Company’s shareholders
for good governance and has sought to apply those
principles of corporate governance commensurate
with the Company’s size.

The Company’s approach is set out below:

Board composition
The Board comprises an Executive Chairman,
who is also the Interim Chief Executive Officer, one
Executive Director and two Non-executive Directors.
The Board considers both of the Non-executives
to be independent in judgement and character.

Biographies of the Board members appear on page 17.
These indicate the high levels and range of business
experience which is essential to oversee effectively
a business of the size, complexity and geographical
spread of the Group. Concerns relating to the executive
management of the Group or the performance of the
Directors can be raised in confidence by contacting
the Senior Independent Director, Michael Higgins,
through the Company Secretary.

Board Committees
The Board has established Audit and Remuneration
Committees, as described on page 19. No separate
Nominations Committee has been established.
A Nominations Working Group comprised of
Non-executive Directors provides advice and
guidance on the selection of candidates; the full
Board acts as a Nominations Committee when
changes to the Board of Directors are proposed.

Workings of the Board
The Board meets on a pre-scheduled basis at least
six times each year and more frequently when required.
The Board has reserved certain matters to it for
decision and the requirement for Board approval on
these matters is communicated widely throughout
the senior management of the Group. This includes
matters such as: approval of the Group’s strategic
plan; extension of the Group’s activities into new

business or geographic areas; any decision to
cease to operate all or any material part of the Group’s
business; changes relating to the Group’s capital
structure; contracts that are material strategically
or by reason of size; investments, including the
acquisition or disposal of interests in the voting shares
of any company or the making of any takeover offer;
and the prosecution, defence or settlement of
litigation material to the Group.

There is an agreed procedure for Directors to take
independent professional advice, if necessary, at the
Company’s expense. This is in addition to the access
which every Director has to the Company Secretary,
who is charged by the Board with ensuring that Board
procedures are followed.

The differing roles of Chairman and Chief Executive
are acknowledged. The key functions of the Chairman
are to conduct Board meetings and meetings of
shareholders and to ensure that all Directors are
properly briefed in order to take a full and constructive
part in Board discussions. The Chief Executive is
required to develop and execute business strategies
and processes to enable the Group’s business
to meet the requirements of its shareholders.
Dr Christopher Richards, Executive Chairman and
Interim CEO, is currently filling both of these roles.
The Senior Independent Director acts as a point of
contact for shareholders and other stakeholders
with concerns which have failed to be resolved, or
would not be appropriate to be addressed, through
the normal channels of the Chairman or Chief Executive.

The Senior Independent Director also meets with the
other members of the Board without the Chairman
present on at least an annual basis in order to evaluate
and appraise the performance of the Chairman.

To enable the Board to function effectively and
allow Directors to discharge their responsibilities,
full and timely access is given to all relevant information.
In the case of Board meetings, this consists of a
comprehensive set of papers, including regular
business progress reports and discussion documents
regarding specific matters. All Board members engage
actively with management to provide support in their
areas of specific competence; this provides ample
opportunity for Non-executive Directors to
understand the business in depth.

In line with the requirements of the UK Code, the Board
normally conducts an internal Board performance
evaluation on a regular basis, including during 2017.

Plant Health Care plc Annual Report and Accounts 2017Re-election of Directors
Any Director appointed during the year is required
under the provisions of the Company’s articles of
association to retire and seek election by shareholders
at the next annual general meeting. The articles also
require that one-third of the Directors retire by rotation
each year and seek re-election at the annual general
meeting. The Directors required to retire will be those
in office longest since their previous re-election.
In any event, each Director must retire at the third
annual general meeting following his appointment
or re-appointment in a general meeting. Retiring
Directors are eligible for re-election by shareholders.

Remuneration of Directors
A statement of the Company’s remuneration
policy and full details of Directors’ remuneration
are set out in the Remuneration Committee report
on pages 21 to 25. Executive Directors abstain from
any discussion or voting at full Board meetings on
Remuneration Committee recommendations where
the recommendations have a direct bearing
on their own remuneration package.

Communication
The Company places a great deal of importance on
communication with its shareholders. The Company
publishes online both an interim statement and its
full-year report and accounts. The annual report is
mailed to all shareholders who have so requested and,
upon request, to other parties who have an interest
in the Group’s performance. Regular communication
with shareholders also takes place via the Company’s
website: www.planthealthcare.com/for-investors.

There is regular dialogue with major shareholders,
as well as general presentations after the release
of the interim and final results. From time to time,
these meetings involve the Executive Chairman or
Non-executive Directors. All shareholders have the
opportunity to ask questions at the Company’s
annual general meeting.

Risk management and internal controls
The Directors recognise that the Group is ambitious
and seeking significant growth.

The Board has in place a formal process for identifying,
evaluating and managing the significant risks faced
by the Group, which complies with the Revised Guidance
on Board Effectiveness published by the Financial
Reporting Council.

The Directors are responsible for the Group’s system
of internal control and for reviewing its effectiveness.

However, such a system can provide only reasonable,
but not absolute, assurance against material
misstatement or loss.

There is a formal process in place to regularly review
the control systems across the Group to evaluate
whether they are designed appropriately to mitigate
emerging risks and in anticipation of expected growth.
Twice a year, the Chief Financial Officer presents to
the Board, for discussion and approval, a summary
of the key internal controls in place during the prior
period and proposals for enhancements to these
controls in the forthcoming period. Based on this
process, the Directors believe that the Group has
internal control systems in place appropriate to
its size and nature.

The Remuneration Committee is chaired by
William Lewis. Michael Higgins is also a member.
Both are Non-executive Directors. The Committee
is responsible for determining the contract terms,
remuneration and other benefits of the Executive
Directors including the Executive Chairman, and for
monitoring the remuneration of first-line executive
management. The Committee may call on outside
compensation experts as required.

Remuneration policy
It is Group policy to set Directors’ remuneration
levels to attract, incentivise and retain the quality
of individuals that the Group requires to succeed
in its chosen objectives. It is also Group policy to
ensure that there is a strong link between the level
of Executive Directors’ remuneration and the
performance of the Group in achieving its goals.

Remuneration Committee
The members of the Remuneration Committee are
William Lewis (Chairman) and Michael Higgins. The
Remuneration Committee’s responsibilities include
the following:

• reviewing and approving, or making

recommendations to the Board with respect to,
the compensation of the Executive Directors and
senior management;

• overseeing an evaluation of senior management; and

• overseeing and administering the Group’s
employee share option scheme and equity
incentive plans in operation from time to time.

The Remuneration Committee report is set out on
pages 21 to 25.

CORPORATE GOVERNANCEPlant Health Care plc Annual Report and Accounts 2017Audit Committee report

the external auditor and its associates to confirm
this in writing, and detail the procedures which the auditor
has carried out in order to make this confirmation.
The Committee also ensures that all partners engaged
in the audit process are rotated at least every five
years, and assesses the likely impact on the auditor’s
independence and objectivity before awarding it any
contract for additional services. It is Group policy to
require Audit Committee approval for all non-audit
services provided by the independent auditor.

The consideration of auditor independence is a standing
agenda item at each Audit Committee meeting.

The Audit Committee is chaired by Michael Higgins.
The Audit Committee is made up solely of independent
Non-executive Directors.

The Committee provides a forum for reporting by
the Group’s auditor and reviews the Group’s budget
and its interim and final financial statements before
their submission to the Board. The Committee also
ensures appropriate challenge and governance around
accounting treatment and the Group’s risk management
and internal control practices. The Committee advises
the Board on the appointment of the external auditor
and on its remuneration, both for audit and non-audit
work. It also discusses the nature and scope of the
audit with the auditor.

The Audit Committee has sole responsibility for
assessing the independence of the external auditor,
BDO LLP. Each year, the Committee seeks reassurance
that the external auditor and its staff have no family,
financial, employment, investment or business
relationship with the Group. The Committee requires

Plant Health Care plc Annual Report and Accounts 2017Remuneration Committee report

Elements of remuneration – Executive Directors
The following comprised the principal elements of
the Group’s Executive Directors during 2017:

• basic salary and benefits;

• annual bonus (performance related

and discretionary);

• long-term share-based incentives; and

• pension contributions.

Long-term share-based incentives
Each of the Executive Directors was eligible to
participate in the Company’s share option schemes
and long-term incentive stock award plans. The main
features of these plans are:

(a) 2004 Unapproved Share Option Scheme
In July 2004, the Board adopted the Plant Health
Care plc Unapproved Share Option Scheme 2004.
Under this scheme, the Board could grant options at
an exercise price of not less than the market value of
a share on the date of award. Options may normally
be exercised between three and 10 years from grant.
In most cases, vesting is also dependent upon the
option holder remaining an eligible employee. In 2014,
the scheme reached the 10th anniversary of its approval
by shareholders; no further options may be granted.
The Company was authorised to award options and
shares under these plans up to the greater of 3% of
its issued share capital or such number as, when
aggregated with any outstanding options converted
from the Plant Health Care, Inc. option plans from
1996 and 2001, amounts to no more than 10% of the
issued share capital of the Company.

(b) Value Creation Plan
On 2 July 2013, the Company adopted the
Plant Health Care plc 2013 Equity Incentive Plan,
or the Value Creation Plan. Participants (which
include the Executive Chairman, Chief Executive
Officer and key members of the Group’s senior
management team) are entitled to receive a share
of the Executive total incentive pool established by
the plan. The Executive total incentive pool equals
up to 10% of the equity value created. Equity

value created is defined as the value generated
for shareholders in excess of the initial market value
of the ordinary shares increased by an 8% annual
hurdle, over a four-year performance period. The
initial market value was 78p (corresponding to the
price of the ordinary shares issued in the April 2013
private placement). The performance period extends
from 16 April 2013 to the measurement date (the 20th
market trading day after announcement of the Group’s
financial results for the year ended 31 December 2016
or such shorter period in the event of certain changes
of control). The mechanics of the plan accommodate
equity issuances, including option awards and ordinary
shares issued in new placements or as consideration
for acquisitions by adjusting the Executive total
incentive pool by up to 10% of any value generated
from additional fundraisings in excess of the issue
price of those fundraisings increased by an annual
hurdle of 8% (multiplied by the number of shares
issued in the additional fundraising) from the date of
the fundraising up to the measurement date and the
payment of dividends during the performance period.
The vesting of awards under this plan is generally
subject to exercise conditions. The Company may not
award options that amount to more than 10% of the
issued share capital of the Company.

No awards have been made under the VCP plan since
15 April 2015. As at 31 December 2017, no shares were
deemed to have been earned, options over Ordinary
Shares granted pursuant to the VCP have expired
and are no longer capable of being exercised.

(c) 2015 Employee Share Option Plan
On 16 June 2015, the Company adopted the
Plant Health Care plc 2015 Employee Share
Option Plan, or the EMI Plan, which provides for
the grant of options to acquire the Company’s
ordinary shares. Under the EMI Plan, the Company may
grant enterprise management incentive options, known
as EMI options, to eligible bona fide employees who
qualify under applicable United Kingdom (“UK”) tax
law, as well as options that do not qualify as EMI
options, or NQOs. Vesting of options is subject to
the performance conditions set out in the applicable
option agreement and pursuant to the EMI Plan.

CORPORATE GOVERNANCEPlant Health Care plc Annual Report and Accounts 2017Remuneration Committee report continued

Elements of remuneration – Executive Directors
continued
Long-term share-based incentives continued
(c) 2015 Employee Share Option Plan continued
The Board has the discretion and authority to set
and measure the satisfaction of the performance
conditions, which under the EMI Plan must be linked
to the achievement of challenging financial
performance over a period of at least three years,
but no more than 10 years, from the date of grant
and the enhancement of shareholder value.
Performance conditions may be amended, relaxed
or waived by the Board provided that any varied
performance conditions would be a fairer measure
of performance than the original performance
conditions and are no more or no less difficult to
satisfy than prior to the amendment. At any time, the
total market value of the shares that can be acquired
upon the exercise of all EMI options under the
EMI Plan may not exceed £3 million.

As part of the EMI Plan, the Board has adopted
rules governing options awarded to the Company’s
US employees, or the US Sub-plan to the EMI Plan.
The US Sub-plan to the EMI Plan provides for grants
of both incentive stock options qualifying under section
422 of the Internal Revenue Code of 1986, as amended,
and non-statutory stock options. The term of an
incentive stock option may not exceed 10 years
(subject to certain limitations with respect to any
employee who owns more than 10% of the voting
power of all classes of the Company’s outstanding
ordinary shares). In the event the option holder ceases
to be an employee before he or she exercises the
vested portion of the option for any reason other
than death, disability or by the employer for cause,
the option shall expire three months after the date on
which the option holder ceases to be an employee. In
the event the option holder ceases to be an employee
because of death or disability, the option holder, or
his or her personal representative in the event of
death, may exercise the vested portion of the option
during the 12-month period following the date the
option holder ceases to be an employee. In the event
that the option holder’s employment is terminated
for cause by the employer, the option will expire
immediately upon the date employment is terminated.

On 16 June 2015, the Company also adopted the
Plant Health Care plc 2015 Non-Employee Share
Option Plan, or the Non-Employee Option Plan,
that provides for the grant of options to acquire
ordinary shares to eligible option holders who
are not employees.

As part of the Non-Employee Option Plan,
the Board has adopted rules governing options
awarded to individuals who are not employees, or
the US Sub-plan to the Non-Employee Option Plan.
This sub-plan provides for grants of non-statutory
stock options. As of 31 December 2017, no awards were
outstanding under the Non-Employee Option Plan or
the US Sub-plan to the Non-Employee Option Plan.

(d) 2017 Employee Share Option Plan
On 19 May 2017, the Company adopted the Plant
Health Care plc 2017 Employee Share Option Plan,
or the 2017 ESOP, which provides for the grant of
options to acquire the Company’s ordinary shares.
Under the 2017 ESOP, the Company may grant
enterprise management incentive options, known
as EMI options, to eligible bona fide employees who
qualify under applicable United Kingdom (“UK”) tax law,
as well as options that do not qualify as EMI options, or
NQOs. Vesting of options is subject to any performance
conditions set out in the applicable option agreement
and pursuant to the EMI Plan. At any time, the total
market value of the shares that can be acquired upon
the exercise of all EMI options under the 2017 ESOP
may not exceed £3 million.

As part of the 2017 ESOP, the Board has adopted
rules governing options awarded to the Company’s
US employees, or the US Sub-plan to the 2017 ESOP.
The US Sub-plan to the EMI Plan provides for grants
of both incentive stock options qualifying under
section 422 of the Internal Revenue Code of 1986,
as amended, and non-statutory stock options. The
term of an incentive stock option may not exceed
10 years (subject to certain limitations with respect
to any employee who owns more than 10% of the
voting power of all classes of the Company’s
outstanding ordinary shares).

Plant Health Care plc Annual Report and Accounts 2017(e) Options granted outside option schemes
The Company has granted options to acquire shares
pursuant to separate unapproved option agreements
to Michael Higgins, William Lewis and Dr Richard Webb.
Generally, the options may only be exercised while the
option holder is a service provider to the Company.
In the event that the option holder ceases to be a
service provider as a result of injury, ill health or
disability, upon the company for which the option
holder works ceasing to be a member of the Group, or
the transfer of the business that employs the option
holder to a person that is not in the Group, the option
may be exercised during the six-month period beginning
on the date upon which the option holder is no longer
a service provider to the Company. Shares allotted
under these options rank equally with all other shares
in the same class in issue at the date of allotment.
If and for so long as the allotted shares are listed or
traded on any stock exchange, the Company shall
apply for the shares allotted under these options to
be admitted to the relevant exchange. In the event of
any capitalisation issue, rights issue, consolidation,
sub-division, reduction or other variation of the
Company’s share capital, the number and description of
the shares subject to each option or the exercise price
of each option shall be varied as the Board determines,
provided that it considers such adjustment to be fair and
appropriate. Limitations apply to the extent to which any
such adjustment may reduce the price at which shares
may be purchased pursuant to the exercise of an option
and the exercise price for a share to be newly issued
on the exercise of an option shall not be reduced
below its nominal value.

Pension benefit
United States employees were entitled to participate
in the Plant Health Care, Inc. 401(k) Plan. This is a defined
contribution plan approved by the US Internal Revenue
Service. The main features of the plan are:

• participation is open to all US-based employees
who have completed a probationary period after
initial employment;

• employees may contribute a percentage of salary
to the plan through a payroll withholding scheme;

• in 2017, the Group made matching contributions
of up to 2% through September of 2017 and 3%
thereafter of compensation to participating
employees. In 2018, the Group will continue to
match contributions up to 3% of compensation
to participating employees;

• beginning in 2014, Group contributions vest

immediately; and

• the plan is subject to various statutory

non-discrimination tests to ensure that it does
not favour highly compensated employees.

Elements of remuneration – Non-executive Directors
During 2016 and 2017, the remuneration for
Non-executive Directors consisted solely of fees
for their services in connection with the Board and
Board Committees. The Non-executive Directors
receive their fees wholly in cash.

CORPORATE GOVERNANCEPlant Health Care plc Annual Report and Accounts 2017Remuneration Committee report continued

Service contracts
During 2016 and 2017, the Company had service contracts
with all Executive and Non-executive Directors.

The Group’s Chief Executive Officer’s employment
continued through 30 November 2016, at which time
his employment agreement was terminated.

• the Company may also terminate the agreement

with immediate effect at any time without notice or
payment in lieu of notice for certain circumstances
including gross misconduct affecting the business.

Provisions in the service contracts of Non-executive
Directors include:

Provisions in the service contracts of other
Executive Directors (including the Executive
Chairman/Interim Chief Executive Officer) include:

• each Director’s appointment may be terminated
with no less than three months’ prior written
notice; and

• termination may be initiated by the Company or the
Director at any time with three months’ written notice;

• the Company may also terminate the agreement with
immediate effect by paying a sum in lieu of notice
equal to the basic fixed salary the Director would
have been entitled to receive during the notice
period; and

• each Director’s appointment may also be terminated
with immediate effect for certain circumstances
including serious breach or repeated breach of any
obligations to the Company; any act of fraud or
dishonesty; or a declaration of bankruptcy.

Directors’ remuneration
For the years ended 31 December 2016 and 31 December 2017, the table below sets forth the compensation
paid to the Directors and, in the case of Paul Schmidt, reflects the compensation paid for his services as
Chief Executive Officer through November 2016. In the case of James Ede-Golightly, reflects the compensation
paid for his services as Non-executive Director through November 2016.

Executive:

Dr C Richards

Dr R Webb

P Schmidt (resigned 30 November 2016)

Non-executive:

M Higgins

W Lewis (appointed 1 April 2015)

J Ede-Golightly
(resigned 30 November 2016)

Base salary
and fees
$’000

Performance-
related
bonus
$’000

Other
benefits
$’000

Share
option
benefit
$’000

130

200

—

421

—

178

144

—

322

Total
2017
$’000

308

344

—

743

Total
2016
$’000

134

107

529

894

Other information
During the year, the Company’s share price on AIM
ranged between 13.5p and 33.0p. At 31 December 2017,
the share price was 16.25p. At 9 April 2018, the last
working day prior to the approval of this annual
report, the share price was 22.2p.

Executive salaries
At the time of his resignation, at 30 November 2016,
Paul Schmidt had a base salary of $250,000 and
bonus potential of 100%.

Other benefits
In 2017, the Company contributed to the 401(k) Plan
3% (2016: 2%) of eligible compensation. In 2017,
pension expense for the Executive Directors was
$nil (2016: $5,523).

In 2017, the Company incurred $nil (2016: $19,228) of
medical, dental and life insurance expense on behalf
of one Director.

Plant Health Care plc Annual Report and Accounts 2017Report of the Directors
The Directors present their annual report together with the audited financial statements for the year ended
31 December 2017. See note 19 for discussion of financial risk management objectives and policies, and exposure
to price, credit, liquidity and cash flow risk.

Results and dividends
The results of the Group for the year are set out on page 33 and show a loss for the year of $5,454,000 (2016:
loss of $11,217,000).

The Directors recommend that no dividend be paid at this time.

Directors
The beneficial interests of the Directors in the ordinary share capital of the Company and options to purchase
ordinary shares of the Company as of 31 December 2017 were as follows:

Dr C Richards

Dr R Webb

M Higgins

W Lewis

At 31 December 2017

Options

1,263,253*

1,503,673

868,400

1,606,189

60,000

373,460

117,647

89,686

Includes a beneficial interest of William Richards, a minor child of Dr Christopher Richards, of 34,578 ordinary shares.

None of the Directors has any holding in any subsidiary company, nor any material interest in the transactions
of the Group.

Substantial shareholders
On 9 April 2018, the Directors are aware of the following persons who, directly or indirectly, are interested in 3%
or more of the Company’s existing ordinary share capital:

Name

Richard Griffiths

1798 Volantis

Boulder River Capital Corporation and its affiliates

Polar Capital

City Financial

Universities Superannuation Scheme (USS)

Shares held

63,447,432

35,675,171

12,651,444

12,044,098

6,529,245

5,531,558

Percent of issued
share capital*

36.71

20.64

7.32

6.97

3.78

3.20

* The percentages shown are based on the most recent share register analysis or notification.

Research and development
The Group continues to invest in R&D activities with an emphasis on the improvement of existing technologies,
the formulation of products to meet specific customer needs and the development of proprietary Group’s
biostimulants based on the Company’s Harpin platform technology. For further details of the Group’s R&D
activities, see the Chairman’s letter and Strategic report on pages 6 to 15.

Business review
For a discussion of the Group’s 2017 performance and future developments, see the Chairman’s letter and
Strategic report on pages 6 to 15.

CORPORATE GOVERNANCEPlant Health Care plc Annual Report and Accounts 2017Directors’ report

Board meetings and attendance
The following table shows the attendance of Directors at meetings of the Board, Audit Committee and
Remuneration Committee held during the 2017 financial year:

Number of meetings held

Dr C Richards

Dr R Webb

M Higgins

W Lewis

Board

Audit
Committee

Remuneration
Committee

—

Auditor
All of the Directors have taken all the steps that they ought to have taken to make themselves aware of any information
needed by the Company’s auditor for the purposes of its audit and to ensure that the auditor is aware of that
information. The Directors are not aware of any relevant audit information of which the auditor is unaware.

Post balance sheet event
On 27 February 2018, the Group successfully completed an equity raise which generated $6.7 million from new
and existing investors.

Going concern
In consideration of the Group’s current resources and review of financial forecasts and projections, the Directors
have a reasonable expectation that the Group has adequate resources to continue in operational existence for
the foreseeable future. No material uncertainties that may cast significant doubt about the ability of the Company
to continue as a going concern have been identified by the Directors. Accordingly, the Directors continue to
adopt the going concern basis in preparing the annual report and accounts.

Annual general meeting
At the forthcoming annual general meeting of the Company, resolutions will be put forward to re-elect
Dr Richard Webb as a Director and to re-appoint BDO LLP as the auditor of the Company.

By Order of the Board

Christine Mazzone
Company Secretary
9 April 2018

Plant Health Care plc Annual Report and Accounts 2017Statement of Directors’ responsibilities

The Directors are responsible for preparing the annual report and the financial statements in accordance
with applicable law and regulations.

Company law requires the Directors to prepare financial statements for each financial year. Under that
law, the Directors have elected to prepare the Group financial statements in accordance with International
Financial Reporting Standards (“IFRSs”), as adopted by the European Union, and the Company financial statements
in accordance with United Kingdom Generally Accepted Accounting Practice (United Kingdom Accounting
Standards and applicable law). Under company law, the Directors must not approve the financial statements
unless they are satisfied that they give a true and fair view of the state of affairs of the Group and Company
and of the profit or loss of the Group for that period. The Directors are also required to prepare financial
statements in accordance with the rules of the London Stock Exchange for companies trading securities
on AIM.

In preparing these financial statements, the Directors are required to:

• select suitable accounting policies and then apply them consistently;

• make judgements and accounting estimates that are reasonable and prudent;

• state whether they have been prepared in accordance with IFRSs, as adopted by the European 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 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 the Group and enable them to ensure that the financial statements comply with the requirements
of the Companies Act 2006. They are also responsible for safeguarding the assets of the Company and the
Group and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.

Website publication
The Directors are responsible for ensuring the annual report and the financial statements are made available
on a website. Financial statements are published on the Company’s website in accordance with legislation
in the United Kingdom governing the preparation and dissemination of financial statements, which may vary from
legislation in other jurisdictions. The maintenance and integrity of the Company’s website is the responsibility of
the Directors. The Directors’ responsibility also extends to the ongoing integrity of the financial statements
contained therein.

CORPORATE GOVERNANCEPlant Health Care plc Annual Report and Accounts 2017FINANCIAL STATEMENTS

29 Independent auditor’s report
33 Consolidated statement of comprehensive income
34 Consolidated statement of financial position
35 Consolidated statement of changes in equity
36 Consolidated statement of cash flows
37 Notes forming part of the Group financial statements
59 Company statement of financial position
60 Company statement of changes in equity
61
64 Directors and advisers

Notes forming part of the Company financial statements

Plant Health Care plc Annual Report and Accounts 2017Independent auditor’s report
to the members of Plant Health Care plc

Opinion
We have audited the financial statements of Plant Health Care plc (the “parent company”) and its subsidiaries (the “Group”) for the year
ended 31 December 2017 which comprise the consolidated statement of comprehensive income, the consolidated statement of
financial position, the consolidated statement of changes in equity, the consolidated statement of cash flows, the Company
statement of financial position, the Company statement of changes in equity and the related notes to the financial statements,
including a summary of significant accounting policies.

The financial reporting framework that has been applied in the preparation of the Group financial statements is applicable law and
International Financial Reporting Standards (“IFRSs”) as adopted by the European Union. The financial reporting framework that has
been applied in the preparation of the parent company financial statements is applicable law and United Kingdom Accounting
Standards, including Financial Reporting Standard 102 The Financial Reporting Standard Applicable in the United Kingdom and
Republic of Ireland (United Kingdom Generally Accepted Accounting Practice).

In our opinion:
• the financial statements give a true and fair view of the state of the Group’s and of the parent company’s affairs as at 31 December 2017

and of the Group’s loss for the year then ended;

• the Group financial statements have been properly prepared in accordance with IFRSs as adopted by the European Union;

• the parent company financial statements have been properly prepared in accordance with United Kingdom Generally Accepted

Accounting Practice; and

• the financial statements have been prepared in accordance with the requirements of the Companies Act 2006.

Basis for opinion
We conducted our audit in accordance with International Standards on Auditing (UK) (“ISAs (UK)”) and applicable law. Our
responsibilities under those standards are further described in the Auditor’s responsibilities for the audit of the financial statements
section of our report. We are independent of the Group and the parent company in accordance with the ethical requirements that are
relevant to our audit of the financial statements in the UK, including the FRC’s Ethical Standard as applied to listed entities, and we
have fulfilled our other ethical responsibilities in accordance with these requirements. We believe that the audit evidence we have
obtained is sufficient and appropriate to provide a basis for our opinion.

Use of our report
This report is made solely to the Company’s members, as a body, in accordance with Chapter 3 of Part 16 of the Companies Act 2006.
Our audit work has been undertaken so that we might state to the Company’s members those matters we are required to state to
them in an auditor’s report and for no other purpose. To the fullest extent permitted by law, we do not accept or assume responsibility
to anyone other than the Company and the Company’s members as a body, for our audit work, for this report, or for the opinions we
have formed.

Conclusions relating to going concern
We have nothing to report in respect of the following matters in relation to which the ISAs (UK) require us to report to you where:

• the Directors’ use of the going concern basis of accounting in the preparation of the financial statements is not appropriate; or

• the Directors have not disclosed in the financial statements any identified material uncertainties that may cast significant doubt

about the Group’s or the parent company’s ability to continue to adopt the going concern basis of accounting for a period of at least
12 months from the date when the financial statements are authorised for issue.

FINANCIAL STATEMENTSPlant Health Care plc Annual Report and Accounts 2017Independent auditor’s report
to the members of Plant Health Care plc continued

Key audit matters
Key audit matters are those matters that, in our professional judgement, were of most significance in our audit of the financial
statements of the current period and include the most significant assessed risks of material misstatement (whether or not due to
fraud) we identified, including those which had the greatest effect on: the overall audit strategy, the allocation of resources in the
audit; and directing the efforts of the engagement team. These matters were addressed in the context of our audit of the financial
statements as a whole, and in forming our opinion thereon, and we do not provide a separate opinion on these matters.

Key audit matter

Audit response

Revenue recognition (note 3)
The Group generates revenue primarily from the sale of
Third party and proprietary products.

Our procedures included reviewing the Group’s adopted revenue
recognition policy to ensure that it complies with accounting
standards and has been consistently applied throughout the year.

We considered there to be a significant audit risk arising from
inappropriate or incorrect recognition of revenue where the
Group makes sales under specific agreements and contracts.
These contractual sales differ to “normal” product sales in
that the terms are more complex and the accounting is
therefore more susceptible to fraud/error.

The sales agreements will frequently have several
components such as protracted payment terms, multiple
performance conditions and other rebate/support
payments which need to be suitably considered and
accounted for so as to ensure revenue is not recorded
inaccurately/recognised prematurely.

Recoverability of accounts receivable (note 16)
The Group has significant accounts receivable balances at
the year end, as the credit terms provided are frequently in
excess of 90 days extending in some instances to greater
than 12 months, the collectability of these balances at the
point of sign off is judgemental.

A sample of sales agreements subject to additional contractual
terms signed during the year were reviewed in conjunction with
management’s proposed accounting treatment and BDO
assessed whether the terms under the contract had been
fulfilled and the revenue appropriately recognised.

Where rebates/marketing support payments are provided
by the Group, for a sample BDO has agreed the estimations made
by management to the supporting information (historical,
current and forecast) to ensure that the amount of revenue
recognised is appropriate.

Where funds have been collected post year end we have reviewed
evidence of the bank receipts and for balances subject to
payment plans we have checked that receipts are in accordance
with these plans.

In instances where balances are not yet due we have reviewed
management’s assessment of the recoverability which included
looking at historical payment patterns.

This was discussed with both Executive and Non-executive
Directors who explicitly confirmed their expectation that the
accounts receivable balance would be recovered in full.

Our application of materiality
We apply the concept of materiality both in planning and performing our audit, and in evaluating the effect of misstatements.
We consider materiality to be the magnitude by which misstatements, including omissions, could influence the economic decisions
of reasonable users that are taken on the basis of the financial statements. Importantly, misstatements below these levels will not
necessarily be evaluated as immaterial as we also take into account the nature of identified misstatements, and the particular
circumstances of their occurrence, when evaluating their effect on the financial statements as a whole.

We determined materiality for the financial statements as a whole to be $300,000 (2016: $400,000) which represents 5% of loss
before tax (2016: 5% loss before tax excluding non-recurring items).

We used loss before tax as a benchmark as this is a primary KPI used to address the performance of the business by the Board.

Materiality for the parent company was set at $150,000 (2016: $200,000).

Performance materiality is the application of materiality at the individual account or balance level set at an amount to reduce to
an appropriately low level the probability that the aggregate of uncorrected and undetected misstatements exceeds materiality
for the financial statements as a whole. Performance materiality was set at 75% (2016: 75%) of materiality. In setting the level of
performance materiality we considered a number of factors including the expected total value of known and likely misstatements
(based on past experience and other factors) and management’s attitude towards proposed adjustments.

We agreed with the Audit Committee that misstatements in excess of $15,000 (2016: $20,000), which are identified during the audit,
would be reported to it, as well as smaller misstatements that in our view must be reported on qualitative grounds.

Plant Health Care plc Annual Report and Accounts 2017An overview of the scope of our audit
We tailored the scope of our audit to ensure that we performed enough work to be able to give an opinion on the financial statements
as a whole, taking into account the geographic structure of the Group, the accounting processes and controls, and the industry in
which the Group operates.

In establishing the overall approach to the Group audit, we assessed the audit significance of each reporting unit in the Group by
reference to both its financial significance and other indicators of audit risk, such as the complexity of operations and the degree
of estimation and judgement in the financial results.

Classification of components
A full scope statutory audit was carried out for the UK subsidiary.

BDO Mexico was engaged as both local statutory auditor and component auditor, to perform a full scope audit of financial
information. We instructed BDO Mexico as to the scope and timing of its work on the financial information for Group reporting
purposes; we met with the audit team to review its audit documentation and findings. Furthermore, we visited the Group’s Mexican
facility to ensure we obtained a full understanding of the operational activities and appropriately scoped risks and agreed responses
to those risks, meeting local management.

Work on all remaining components was completed by BDO UK, with individual component audits carried out using component
materialities of between 18–50% of overall financial statement materiality.

The US was identified as an individually significant component (determined as those that were greater than 15% revenue) and full
scope audit procedures were planned and performed by the UK team accordingly. We visited this location to ensure we obtained a full
understanding of the operational activities, met with management and appropriately scoped risks.

Specific procedures have been performed over the Spanish subsidiary. This was also inclusive of a meeting with local management.

Other information
The Directors are responsible for the other information. The other information comprises the information included in the annual
report, other than the financial statements and our Auditor’s report thereon. Our opinion on the financial statements does not cover
the other information and, except to the extent otherwise explicitly stated in our report, we do not express any form of assurance
conclusion thereon.

In connection with our audit of the financial statements, our responsibility is to read the other information and, in doing so, consider
whether the other information is materially inconsistent with the financial statements or our knowledge obtained in the audit or
otherwise appears to be materially misstated. If we identify such material inconsistencies or apparent material misstatements, we
are required to determine whether there is a material misstatement in the financial statements or a material misstatement of the
other information. If, based on the work we have performed, we conclude that there is a material misstatement of this other
information, we are required to report that fact. We have nothing to report in this regard.

Opinions on other matters prescribed by the Companies Act 2006
In our opinion, based on the work undertaken in the course of the audit:

• the information given in the Strategic report and the Directors’ report for the financial year for which the financial statements are

prepared is consistent with the financial statements; and

• the Strategic report and the Directors’ report have been prepared in accordance with applicable legal requirements.

Matters on which we are required to report by exception
In light of the knowledge and understanding of the Group and the parent company and its environment obtained in the course of the
audit, we have not identified material misstatements in the Strategic report or the Directors’ report.

We have nothing to report in respect of the following matters in relation to which the Companies Act 2006 requires us to report to you
if, in our opinion:

• adequate accounting records have not been kept, or returns adequate for our audit have not been received from branches not

visited by us; or

• the parent company 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.

FINANCIAL STATEMENTSPlant Health Care plc Annual Report and Accounts 2017Independent auditor’s report
to the members of Plant Health Care plc continued

Responsibilities of Directors
As explained more fully in the Directors’ responsibilities statement set out on page 27, the Directors are responsible for the
preparation of the financial statements and for being satisfied that they give a true and fair view, and for such internal control as the
Directors determine is necessary to enable the preparation of financial statements that are free from material misstatement,
whether due to fraud or error.

In preparing the financial statements, the Directors are responsible for assessing the Group’s and the parent company’s ability to
continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of
accounting unless the Directors either intend to liquidate the Group or the parent company or to cease operations, or have no
realistic alternative but to do so.

Auditor’s responsibilities for the audit of the financial statements
Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material
misstatement, whether due to fraud or error, and to issue an auditor’s report that includes our opinion. Reasonable assurance is a
high level of assurance, but is not a guarantee that an audit conducted in accordance with ISAs (UK) will always detect a material
misstatement when it exists.

Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be
expected to influence the economic decisions of users taken on the basis of these financial statements.

A further description of our responsibilities for the audit of the financial statements is located on the Financial Reporting Council’s
website at: www.frc.org.uk/auditorsresponsibilities. This description forms part of our Auditor’s report.

Iain Henderson (Senior Statutory Auditor)
For and on behalf of BDO LLP, Statutory Auditor
55 Baker Street London
W1U 7EU
9 April 2018

BDO LLP is a limited liability partnership registered in England and Wales (with registered number OC305127).

Plant Health Care plc Annual Report and Accounts 2017Consolidated statement of comprehensive income
for the year ended 31 December 2017

Revenue

Cost of sales

Gross profit

Research and development expenses

Business development expenses

Sales and marketing expenses

Administrative expenses

Operating loss

Finance income

Finance expense

Loss before tax

Income tax credit

Loss for the year attributable to the equity holders of the parent company

Other comprehensive income:

Items which will or may be reclassified to profit or loss:

Exchange difference on translation of foreign operations

Total comprehensive loss for the year attributable to the equity holders
of the parent company

Note

2017
$’000

7,685

(2,953)

4,732

(5,127)

(623)

(2,995)

(1,788)

(5,801)

(2)

(5,716)

262

(5,454)

(1,282)

(6,736)

Basic and diluted loss per share

$(0.04)

The notes on pages 37 to 58 form part of these consolidated financial statements.

2016
$’000

6,329

(2,436)

3,893

(4,485)

(954)

(2,518)

(7,286)

(11,350)

(2)

(11,300)

(11,217)

1,393

(9,824)

$(0.11)

FINANCIAL STATEMENTSPlant Health Care plc Annual Report and Accounts 2017Consolidated statement of financial position
at 31 December 2017

Assets

Non-current assets

Intangible assets

Property, plant and equipment

Trade and other receivables

Total non-current assets

Current assets

Inventories

Trade and other receivables

Investments

Cash and cash equivalents

Total current assets

Total assets

Liabilities

Current liabilities

Trade and other payables

Finance leases

Total current liabilities

Non-current liabilities

Finance leases

Total non-current liabilities

Total liabilities

Total net assets

Share capital

Share premium

Foreign exchange reserve

Accumulated deficit

Total equity

Note

2017
$’000

2016
$’000

1,898

968

134

3,000

1,536

4,668

2,719

1,175

10,118

13,118

2,162

1,236

131

3,529

1,245

3,284

5,349

4,727

14,605

18,134

2,879

2,088

2,887

2,096

—

2,887

10,231

2,237

2,103

16,031

2,237

79,786

(389)

893

(71,403)

(66,885)

10,231

16,031

The consolidated financial statements were approved and authorised for issue by the Board on 9 April 2018.

Christopher Richards
Director

Registered no: 05116780 (England and Wales)

The notes on pages 37 to 58 form part of these consolidated financial statements.

Plant Health Care plc Annual Report and Accounts 2017Consolidated statement of changes in equity
for the year ended 31 December 2017

Balance at 1 January 2016

Loss for the year

Exchange difference arising on translation of foreign operations

Total comprehensive income/(loss)

Shares issued

Share-based payments

Options exercised

Balance at 31 December 2016

Loss for the year

Exchange difference arising on translation of foreign operations

Total comprehensive income/(loss)

Shares issued

Share-based payments

Options exercised

Share
capital
$’000

1,236

Share
premium
$’000

71,040

—

1,001

8,746

—

Foreign
exchange
reserve
$’000

Accumulated
deficit
$’000

Total
$’000

(500)

(56,731)

15,045

—

(11,217)

1,393

—

1,393

(11,217)

(9,824)

—

1,063

—

9,747

1,063

—

2,237

79,786

893

(66,885)

16,031

—

(5,454)

(1,282)

—

(1,282)

(5,454)

(1,282)

(6,736)

—

936

—

936

—

Balance at 31 December 2017

2,237

79,786

(389)

(71,403)

10,231

The notes on pages 37 to 58 form part of these consolidated financial statements.

FINANCIAL STATEMENTSPlant Health Care plc Annual Report and Accounts 2017Consolidated statement of cash flows
for the year ended 31 December 2017

Cash flows from operating activities

Loss for the year

Adjustments for:

Depreciation

Amortisation of intangibles

Share-based payment expense

Finance income

Finance expense

Income taxes credit

(Increase)/decrease in trade and other receivables

Gain on disposal of fixed assets

(Increase)/decrease in inventories

Increase/(decrease) in trade and other payables

Income taxes paid

Net cash used in operating activities

Investing activities

Purchase of property, plant and equipment

Sale of property, plant and equipment

Finance income

Purchase of investments

Sale of investments

Net cash provided by investing activities

Financing activities

Finance expense

Issue of ordinary share capital

Repayment of finance lease principal

Net cash (used)/provided by financing activities

Net (decrease)/increase in cash and cash equivalents

Effects of exchange rate changes on cash and cash equivalents

Cash and cash equivalents at the beginning of period

Cash and cash equivalents at the end of period

The notes on pages 37 to 58 form part of these consolidated financial statements.

Note

2017
$’000

2016
$’000

(5,454)

(11,217)

393

264

936

(87)

(262)

(1,024)

(4)

(291)

771

(121)

359

273

1,063

(52)

(83)

1,145

(14)

146

(973)

205

(4,877)

(9,146)

(125)

(469)

(2,258)

(7,918)

4,888

2,596

10,060

1,796

(2)

—

(8)

(10)

(2,291)

(1,261)

4,727

1,175

(2)

9,747

(9)

9,736

2,386

1,393

948

4,727

Plant Health Care plc Annual Report and Accounts 2017Notes forming part of the Group financial statements
for the year ended 31 December 2017

1. General information
Plant Health Care plc (the ‘‘Company’’) is a public limited company incorporated in England and Wales. The address of its registered
office is 1 Scott Place, 2 Hardman Street, Manchester M3 3AA. The Company and its subsidiaries (together, the ‘‘Group’’) is a leading
provider of proprietary agricultural biological products and technology solutions focused on improving crop performance by activating
a growth response and bolstering plant defence mechanisms against both abiotic and biotic stresses. The principal markets of the
Company and its subsidiaries are described in note 9.

2. Accounting policies
Reporting currency
The financial statements are presented in thousands of US Dollars. The Directors believe that it is appropriate to use US Dollars as
the presentational currency for reporting since the majority of the Group’s transactions are conducted in that currency. The exchange
rates used to convert British Pounds to US Dollars at 31 December 2017 and 2016 were 1.3491 and 1.2336, respectively, and the average
exchange rate for the years then ended were 1.2885 and 1.3548, respectively.

The functional currency of the parent company is US Dollars.

Basis of preparation
These consolidated financial statements have been prepared in accordance with International Financial Reporting Standards,
International Accounting Standards and interpretations (collectively “IFRSs”) issued by the International Accounting Standards Board
(“IASB”) and as adopted by the European Union and those parts of the Companies Act 2006 which apply to companies preparing their
financial statements under IFRSs.

Amounts are rounded to the nearest thousand, unless otherwise stated.

Basis of measurement
The consolidated financial statements have been prepared on a historical cost basis, except for financial instruments designated at
fair value through the profit and loss.

The principal accounting policies are set out below. The policies have been applied consistently to all the years presented and on a
going concern basis.

Standards, amendments and interpretations to published standards effective in 2017 adopted by the Group
A number of new and amended standards have become effective since the prior year. None of the new amendments materially affect
the Group.

Standards, amendments and interpretations to published standards not yet effective
There are a number of new standards and amendments to and interpretations of existing standards which have been published and
are not yet mandatory and which the Group has decided not to adopt early.

A summary of these standards is given in note 25 to the financial statements.

Basis of consolidation
These consolidated financial statements incorporate the financial statements of the Group and the entities controlled by the Group.
Control exists when the Group has (i) power over the investee, (ii) exposure, or rights, to variable returns from its involvement with the
investee, and (iii) the ability to use its power over the investee to affect the amount of the investor’s returns. The financial statements
of subsidiaries are included in the consolidated financial statements from the date that control commences until the date that
control ceases. All significant intercompany transactions, balances, revenues and expenses have been eliminated.

The consolidated financial statements incorporate the results of business combinations using the purchase method. In the consolidated
statement of financial position, the acquiree’s identifiable assets, liabilities and contingent liabilities are initially recognised at their
fair values at the acquisition date. The results of acquired operations are included in the statement of comprehensive income from
the date on which control is obtained. They are deconsolidated from the date control ceases.

Revenue
The Group recognises revenue at the fair value of consideration received or receivable. Sales of goods to external customers are at
invoiced amounts less value-added tax or local tax on sales. The Group currently generates revenue solely within its Commercial
business through the sale of its proprietary and third-party products, as well as from granting certain licences for the use of its
intellectual property. Revenue from the sale of goods is recognised when all the following conditions have been satisfied:

• the significant risks and rewards of ownership of the goods have been transferred to the buyer;

• the Group retains neither continuing managerial involvement to the degree usually associated with ownership nor effective control

over the goods sold;

• the amount of revenue can be measured reliably;

• it is probable that the economic benefits associated with the transaction will flow to the Group; and

• the costs incurred or to be incurred in respect of the transaction can be measured reliably.

FINANCIAL STATEMENTSPlant Health Care plc Annual Report and Accounts 20172. Accounting policies continued
Revenue continued
The Group typically transfers significant risks of ownership and title in the products upon shipment of goods from one of its
locations. After the Group transfers title and ships goods to the customer, it typically does not retain significant involvement nor
does it have effective control over the goods sold. Therefore, if all other revenue recognition criteria are met, revenue is recognised
upon shipment of the goods to the customer. Payment terms range from 30 to 270 days depending on the local custom. This applies
to both proprietary and third-party products.

In the limited situation where the Group offers a product rebate to the customer, it records the fair value of the product rebate as a reduction
to product revenue. An accrued liability for these product rebates is estimated and recorded at the time the revenues are recorded.

Licence/milestone payment income is recognised when the Group has no remaining obligations to perform under a non-cancellable
contract which permits the user to act freely under the terms of the agreement and the collection of the resulting receivable
is reasonably assured. To date the Group has not achieved the performance obligations for any milestone payments.

Goodwill
Goodwill is measured as the excess of the cost of an acquisition over the net fair value of the identifiable assets, liabilities and contingent
liabilities, plus any direct costs of acquisition for acquisitions before 1 January 2010. For business combinations completed on or
after 1 January 2010, direct costs of acquisition are recognised immediately as an expense.

Goodwill is capitalised as an intangible asset with any impairment in carrying value being charged to administrative expenses in the
consolidated statement of comprehensive income. The Company performs annual impairment tests for goodwill at the financial year end.

Other intangible assets
Externally acquired intangible assets are initially recognised at cost and subsequently amortised on a straight-line basis over their
useful economic lives. The amortisation expense is included within administrative expenses in the consolidated statement of
comprehensive income.

Intangible assets are recognised on business combinations if they are separable from the acquired entity or give rise to contractual
or other legal rights, and are initially recognised at their fair value.

Expenditure on internally-developed intangible assets (development costs) are capitalised if it can be demonstrated that:

• it is technically feasible to develop the product for it to be sold;

• adequate resources are available to complete the development;

• there is an intention to complete and sell the product;

• the Group is able to sell the product;

• sale of the product will generate future economic benefits; and

• expenditure on the project can be measured reliably.

Development expenditure not satisfying the above criteria and expenditure on the research phase of internal projects are recognised
in profit or loss.

Capitalised development costs are amortised over the periods of the future economic benefit attributable to the asset. The amortisation
expense is included within administrative expenses in the consolidated statement of comprehensive income. The Group has not
capitalised any development costs to date.

The significant intangibles recognised by the Group and their estimated useful economic lives are as follows:

Licences
Registrations – 5–10 years

– 12 years

Impairment of goodwill and other intangible assets
Impairment tests on goodwill are undertaken annually at the financial year end. Other non-financial assets are subject to impairment
tests whenever events or changes in circumstances indicate that their carrying amount may not be recoverable. Where the carrying
value of an asset exceeds its recoverable amount (that is the higher of value in use and fair value less costs to sell), the asset is
written down accordingly.

Impairment charges are included within administrative expenses in the consolidated statement of comprehensive income.
An impairment loss recognised for goodwill is not reversed.

Notes forming part of the Group financial statements continuedfor the year ended 31 December 2017Plant Health Care plc Annual Report and Accounts 20172. Accounting policies continued
Foreign currency
Foreign currency transactions of individual companies are translated into the individual company’s functional currency at the date
of transaction.

At the year end, non-functional currency monetary assets and liabilities are translated at the year-end rate with the differences being
recognised in the profit or loss.

On consolidation, the results of operations that have a functional currency other than US Dollars are translated into US Dollars at rates
approximating to those ruling when the transactions took place. Statements of financial position are translated at the rate ruling at
the end of the financial period. Exchange differences arising on translating the opening net assets at opening rate and the results of
operations that have a functional currency other than US Dollars at average rate are included within “other comprehensive income”
in the consolidated statement of comprehensive income and taken to the foreign exchange reserve within capital and reserves.

Operating segments
Operating segments are reported in a manner consistent with the internal reporting provided to the Group’s chief operating decision
maker (“CODM”). The CODM, who is responsible for allocating resources and assessing performance of the operating segments, has
been identified as the Chief Executive Officer.

Financial instruments
Trade receivables collectible within one year from the date of invoicing are recognised at invoice value less provision for amounts the
collectability of which is uncertain. Trade receivables collectible after more than one year from the date of invoicing are initially recognised
at fair value, and subsequently carried at amortised cost using the effective interest rate method, less provision for impairment.

Investments comprise short-term investments in notes and bonds having investment grade ratings. Investments are designated as at fair
value through profit and loss upon initial recognition when they form part of a group of financial assets which is actively managed and
evaluated by key management personnel on a fair value basis in accordance with the Company’s documented investment strategy
that seeks to improve the rate of return earned by the Company on its excess cash while providing unrestricted access to the funds. The
Company’s investments are carried at fair value as determined by quoted prices on active markets, with changes in fair values
recognised through profit or loss.

Cash and cash equivalents comprise cash on hand, demand deposits and other short-term highly liquid investments that are readily
convertible to a known amount of cash and are subject to insignificant risk of changes in value.

Trade and other payables are initially recognised at fair value and subsequently carried at amortised cost using the effective
interest method.

Equity instruments issued by the Company are recorded at the proceeds received, net of direct issue costs. The Group’s ordinary
shares are classified as equity instruments.

Employee benefits
The Group maintains a number of defined contribution pension schemes for certain of its employees; the Group does not contribute
to any defined benefit pension schemes. The amount charged to profit or loss represents the employer contributions payable to the
schemes for the financial period.

The expected costs of all short-term employee benefits, including short-term compensated absences, are recognised during the
period the employee service is rendered.

Equity share-based payments
The Group operates a number of equity-settled, share-based payment plans, under which it receives services from employees and
non-employees as consideration for the Company’s equity instruments, in the form of options or restricted stock units (‘‘awards’’).
The fair value of the award is recognised as an expense, measured as of the grant date using a binomial option pricing model. The
total amount to be expensed is determined by reference to the fair value of instruments granted, excluding the impact of any service
and non-market performance vesting conditions. Non-market vesting conditions are included in assumptions about the number of
options that are expected to vest. The total expense is recognised over the vesting period, which is typically the period over which all
of the specified vesting conditions are to be met.

Leased assets: lessee
Where assets are financed by leasing agreements that give rights approximating to ownership (“finance leases”), the assets are
treated as if they had been purchased outright. The amount capitalised is the lower of fair value and present value of the minimum
lease payments payable over the term of the lease. The corresponding lease commitments are shown as amounts payable to the
lessor. Depreciation on the relevant assets is recognised in profit or loss over the shorter of useful economic life and lease term.

Lease payments are analysed between capital and interest components. The interest element of the payment is charged to income
over the period of the lease and is calculated so that it represents a constant proportion of the balances of capital repayments
outstanding. The capital element reduces the amounts payable to the lessor.

All other leases are treated as operating leases. Their annual rentals are charged to income on a straight-line basis over
the lease term.

FINANCIAL STATEMENTSPlant Health Care plc Annual Report and Accounts 20172. Accounting policies continued
Property, plant and equipment
Items of property, plant and equipment are initially recognised at cost. Cost includes the purchase price and costs directly attributable
to bringing the asset into operation. Depreciation is provided to write off the cost, less estimated residual values, of all property,
plant and equipment over their expected useful lives.

It is calculated at the following rates:

– 10–20% per annum
Production machinery
– 20–33% per annum
Office equipment
Vehicles
– 20% per annum
Leasehold improvements – 25% per annum

Inventories
Inventories are initially recognised at cost, and subsequently at the lower of cost and net realisable value. Cost is based upon a weighted
average cost method. The Group compares the cost of inventory to its net realisable value and writes down inventory to its net realisable
value, if lower than its cost. Cost comprises all costs of purchase and all other costs of conversion. Net realisable value is the estimated
selling price in the ordinary course of business, less applicable variable selling expenses. The inventory provision is based on which
products have been determined to be obsolete.

Taxation
Companies within the Group may be entitled to claim special tax allowances in relation to qualifying research and development
expenditure (e.g. R&D tax credits). The Group accounts for such allowances as tax credits which means they are recognised when it is
probable that the benefit will flow to the Group and that the benefit can be reliably measured. R&D tax credits reduce current tax expense
and to the extent the amounts are due in respect of them and not settled by the balance sheet date, reduce current tax payable.

Deferred tax
Deferred tax assets and liabilities are recognised where the carrying amount of an asset or liability in the statement of financial
position differs from its tax base, except for differences on:

• the initial recognition of goodwill;

• the initial recognition of an asset or liability in a transaction which is not a business combination and at the time of the transaction

affects neither accounting nor taxable profit; and

• investments in subsidiaries and joint arrangements where the Group is able to control the timing of the reversal of the difference

and it is probable that the difference will not reverse in the foreseeable future.

Recognition of deferred tax assets is restricted to those instances where it is probable that taxable profit will be available against
which the difference can be utilised.

The amount of the asset or liability is determined using tax rates that have been enacted or substantively enacted by the end of the
financial period and are expected to apply when the deferred tax liabilities/(assets) are settled/(recovered).

Deferred tax assets and liabilities are offset when the Group has a legally enforceable right to offset current tax assets and liabilities
and when they relate to income taxes levied by the same tax authority and the Group intends to settle its current tax assets and liabilities
on a net basis.

3. Critical accounting estimates and judgements
In preparing its financial statements, the Group makes certain estimates and judgements regarding the future. Estimates and
judgements are continually evaluated based on historical experience and other factors, including expectations of future events that
are believed to be reasonable under the circumstances. In the future, actual experience may differ from estimates and assumptions.
The estimates and judgements that have a risk of causing a material adjustment to the carrying amounts of assets and liabilities
within the next financial year are discussed below.

Revenue
The Group recognises revenue at the fair value of consideration received or receivable. Sales of goods to external customers are at
invoiced amounts less value-added tax or local tax on sales. The Group currently generates revenue solely within its Commercial
business through the sale of its proprietary and third-party products, as well as from granting certain licences for use of its intellectual
property. When the Group makes product sales under contracts/agreements which may be inclusive of additional performance
conditions, different payment terms and associated rebate or support payments judgement can be required in the assessment
of the fair value of consideration.

Notes forming part of the Group financial statements continuedfor the year ended 31 December 2017Plant Health Care plc Annual Report and Accounts 20173. Critical accounting estimates and judgements continued
Licensing arrangements and milestone payments
The Group granted a limited number of intellectual property licences to other biotechnology and agricultural companies. The terms
of the Group’s licensing agreements require delivery of an intellectual property licence for use of the Group’s intellectual property in
either research only, or in research and commercial development of biological products. Payments to the Group under these arrangements
may include upfront payments and payments based on the achievement of certain milestones.

If the licence for the Group’s intellectual property is determined to be distinct from the other performance obligations identified in the
arrangement, the Group recognises revenues from non-refundable, upfront fees allocated to the licence when the licence is transferred
to the customer and the customer is able to use and benefit from the licence.

Non-refundable upfront payments are generally received upon signing of a licensing agreement. All non-refundable upfront payments
received or to be received under these arrangements are recognised when IAS 18 revenue recognition criteria are met, they are
receivable, they are non-refundable, and provided they are in substance consideration for a completed separate earnings process.

Milestone payments are recognised as revenue when the performance obligations, as defined in the contracts, are achieved.
These milestone payments are generally tied to a specific performance condition and are recognised in full when the performance
obligation is met. To date, the Group has not achieved the performance obligations for any milestone payments.

At the inception of each agreement that includes milestone payments, the Group evaluates whether each milestone is substantive
on the basis of the contingent nature of the milestone. We recognise revenues related to substantive milestones in full in the period
in which the substantive milestone is achieved. If a milestone payment is not considered substantive, we recognise the applicable
milestone over the remaining period of performance.

Judgement can be required in assessing whether milestones have been achieved.

Impairment of goodwill
The Group tests whether goodwill has suffered any impairment on an annual basis. The recoverable amount is determined based
on value-in-use calculations. The use of this method requires the estimation of future cash flows and the choice of a discount rate
in order to calculate the present value of the cash flows. Actual outcomes may vary. Additional information on carrying values is
included in note 13.

Impairment of intangible assets (excluding goodwill)
At the end of the financial period, the Group reviews the carrying amounts of its definite lived intangible assets to determine whether
there is any indication that those assets have suffered any impairment loss. If any such indication exists, the recoverable amount of the
asset is estimated to determine the extent of the impairment loss (if any).

Recoverable amount is the higher of fair value less costs to sell and value in use. In assessing the value in use, the estimated future
cash flows are discounted to their net 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.

If the recoverable amount of an asset is estimated to be less than its carrying amount, the carrying amount of the asset is reduced to
its recoverable amount. An impairment loss is recognised immediately within administrative expenses in the consolidated statement
of comprehensive income. Additional information on carrying values is included in note 13.

4. Revenue

Revenue arises from:

Proprietary products

Third-party products

Total

2017
$’000

5,344

2,341

7,685

2016
$’000

3,761

2,568

6,329

FINANCIAL STATEMENTSPlant Health Care plc Annual Report and Accounts 2017Note

5. Operating loss

Operating loss is arrived at after charging/(crediting):

Share-based payment charge

Depreciation

Amortisation of intangibles

Operating lease expense

Gain on disposal of property, plant and equipment

Costs associated with abandoned USA listing

Employee termination costs

Foreign exchange losses

Auditor’s remuneration:

Amounts for audit of parent company and consolidation

Amounts for audit of subsidiaries

Total auditor’s remuneration

6. Staff costs
Staff costs for all employees, including Executive Directors, comprise:

Wages and salaries

Social security and payroll taxes

Defined contribution pension costs

Medical and other benefits

Redundancy

Share-based payments charge

The average number of employees of the Group during the year, including Executive Directors, was as follows:

Research

Development

Administration

Sales and marketing

2017
$’000

936

393

264

446

(4)

—

228

(1,432)

113

2017
$’000

3,910

326

275

228

4,797

936

5,733

2017

2016
$’000

1,063

359

273

446

(14)

1,247

267

1,927

2016
$’000

4,273

341

225

267

5,160

1,063

6,223

2016

Notes forming part of the Group financial statements continuedfor the year ended 31 December 2017Plant Health Care plc Annual Report and Accounts 20177. Directors’ and key management personnel remuneration
Key management personnel are those persons having authority and responsibility for planning, directing and controlling activities
of the Group, and includes only the Directors of the Company. Further disclosures on the remuneration of each individual Director are
included in the Directors’ remuneration section of the Remuneration Committee report on page 24.

Base salary, fees and bonuses

Other short-term employee benefits

Share-based payments

Social security and taxes

Pensions and other post-retirement benefits

Compensation for loss of office

2017
$’000

421

—

338

—

804

2016
$’000

599

723

257

1,641

No Executive Directors who served during the year were eligible to participate in the Group’s 401(k) retirement plan (2016: one).

The highest paid Director earned $200,000 (2016: $234,000), consisting of an annual salary as well as $nil (2016: $19,000) of other
benefits and $nil (2016: $5,523) of pension. In 2016, the compensation for loss of office expense incurred for the former Director was
$250,000 of annual salary as well as $1,770 of other benefits and $5,000 of pension.

8. Share-based payments
The Company operates four equity-settled share-based remuneration schemes for employees: a share option scheme, a Value
Creation Plan and two employee share option plans, as described in the “Elements of remuneration” section for Executive Directors
within the Remuneration Committee report on pages 21 to 23.

(a) Share options
In June 2004, the Company approved the 2004 Unapproved Share Option Scheme (the ‘‘Option Plan’’). The Option Plan provides for
the issuance of options for ordinary share capital of the Group to all eligible employees.

In 2014, the scheme reached the 10th anniversary of its approval by shareholders and no further options may be granted under the
Option Plan.

In addition, in limited instances, the Company has granted options to certain management for ordinary share capital of the Company
under separate unapproved option agreements.

(b) Value Creation Plan
In July 2013, the Group approved the 2013 Value Creation Plan (the “VCP”). The VCP provides for the issuance of restricted stock units and
options for ordinary share capital of the Company. The Chairman, CEO and key members of the senior executive team are able to participate.
The VCP calculates value generated for shareholders from the point of the April 2013 fundraising over a four-year period, with the plan
participants receiving in aggregate up to 10% of value generated above an annual hurdle of 8%, paid in shares valued at that end point.

No awards have been made under the VCP plan since 15 April 2015. As at 31 December 2017, no shares were deemed to have been
earned and all outstanding awards were forfeited.

(c) 2015 Employee Share Option Plan
In June 2015, the Board approved the 2015 Employee Share Option Plan and the 2015 Non-Employee Share Option Plan (the ‘‘Plans’’).
The Plans provide for the issuance of options for ordinary share capital of the Company to both employees and non-employees. The 2015
Employee Share Option Plan provides for the grant of both enterprise management incentive (“EMI“) options as well as non-qualifying
options (“NQO”).

FINANCIAL STATEMENTSPlant Health Care plc Annual Report and Accounts 20178. Share-based payments continued
(c) 2015 Employee Share Option Plan continued
The valuation of the awards granted under the 2015 Employee Share Option Plan during the year ended 31 December 2017 were as follows:

Share options granted

Weighted average fair value

Assumptions used in measuring fair value:

Weighted average share price

Exercise price

Risk-free rate

Expected vesting period (years)

Option life (years)

Expected volatility

Expected dividend rate

6 February
2017

4,285,132

17p

20p

0.44%

1.0–3.0

10.0

60.0%

0.0%

The valuation of the share options granted during the year ended 31 December 2017 was as follows:

• the weighted average share price and the expected volatility were determined by reference to the share price of Plant Health Care plc

on AIM and the historical share price of Plant Health Care plc on AIM for the applicable expected vesting period, respectively;

• the expected vesting period reflects market-based performance conditions for these options;

• one-third of options are exercisable when the arithmetic mean closing price of the shares over 60 trading days exceeds 25p since

the grant date;

• one-third of options are exercisable when the arithmetic mean closing price of the shares over 60 trading days exceeds 40p since

the grant date; and

• one-third of options are exercisable when the arithmetic mean closing price of the shares over 60 trading days exceeds 50p since

the grant date.

(d) 2017 Employee Share Option Plan
In May 2017, the Board approved the 2017 Employee Share Option Plan. The plan provides for the issuance of options for ordinary
share capital of the Company to both employees and non-employees. The 2017 Employee Share Option Plan provides for the grant
of both enterprise management incentive (“EMI“) options as well as non-qualifying options (“NQO”).

The valuation of the awards granted under the 2017 Employee Share Option Plan during the year ended 31 December 2017 were as follows:

Share options granted

Weighted average fair value

Assumptions used in measuring fair value:

Weighted average share price

Exercise price

Risk-free rate

Expected vesting period (years)

Option life (years)

Expected volatility

Expected dividend rate

19 May
2017

10 July
2017

2,842,788 3,936,920

12p

14p

27p

26p

28p

25p

0.28%

0.61%

1.0–3.0

10.0

60.0%

0.0%

The valuation of the share options granted during the year ended 31 December 2017 was as follows:

• the weighted average share price and the expected volatility were determined by reference to the share price of Plant Health

Care plc on AIM and the historical share price of Plant Health Care plc on AIM for the applicable expected vesting period,
respectively; and

• the expected vesting period reflects performance conditions for these options.

Additional details of share-based payments are provided in note 21.

Notes forming part of the Group financial statements continuedfor the year ended 31 December 2017Plant Health Care plc Annual Report and Accounts 20179. Segment information
The Group’s CODM views, manages and operates the Group’s business segments according to its strategic business focuses –
Commercial and New Technology. The CODM further analyses the results and operations of the Group’s Commercial business on
a geographical basis and therefore the Group has presented separate geographic segments within its Commercial business below:
Commercial – Americas (North and South America, other than Mexico); Commercial – Mexico; and Commercial – Rest of World. The
Rest of World segment includes the results of the United Kingdom and Spanish subsidiaries, which together operate across Europe
and South Africa. The Group’s Commercial segments are focused on the sale of biological products and are the Group’s only revenue
generating segments. The Group’s New Technology segment is focused on the research and development of the Group’s PREtec platform.

Below is information regarding the Group’s segment loss information for the year ended:

2017

Revenue*

Proprietary product sales

Third-party product sales

Intersegment product sales

Total revenue

Group consolidated revenue

Cost of sales

Research and development

Business development

Sales and marketing

Administration

Non-cash expenses:

Depreciation

Amortisation

Share-based payment

Segment operating (loss)/profit

Corporate expenses**

Wages and professional fees

Administration***

Operating loss

Finance income

Finance expense

Loss before tax

The
Americas
$’000

Mexico
$’000

Rest of World
$’000

Elimination
$’000

Total
Commercial
$’000

New
Technology
$’000

Total
$’000

1,574

1,608

3,207

570

2,310

—

2,880

3,200

3,291

—

(1,693)

5,344

2,341

—

7,685

(1,978)

(1,440)

(1,228)

1,693

(2,953)

—

5,344

2,341

—

7,685

(2,953)

—

(561)

(1,277)

(860)

(30)

(255)

(83)

(1,837)

—

(688)

(318)

(1,030)

(58)

(55)

—

(3)

376

(7)

(9)

(70)

(889)

—

(4,350)

(561)

(62)

(623)

(2,995)

(1,236)

—

(2,995)

(188)

(1,424)

(92)

(264)

(156)

(301)

—

(632)

(393)

(264)

(788)

(572)

(5,533)

(6,105)

(1,048)

1,352

(5,801)

(2)

(5,716)

* Revenue from one customer within the Americas segment totalled $1,001,000, or 13% of Group revenues.
Revenue from one customer within the RoW segment totalled $1,958,000, or 25% of Group revenues.
Revenue from one customer within the Mexico segment totalled $989,000 or 13% of Group revenues.

** These amounts represent public company expenses for which there is no reasonable basis by which to allocate the amounts across the Group’s segments.

*** Includes net share-based payment expense of $148,000 attributed to corporate employees who are not affiliated with any of the Commercial or

New Technology segments.

Other segment information

Segment assets

Segment liabilities

Capital expenditure

The
Americas
$’000

7,014

1,630

—

Mexico
$’000

Rest of World
$’000

Elimination
$’000

Total
Commercial
$’000

New
Technology
$’000

1,997

251

3,198

420

—

12,209

2,301

909

586

Total
$’000

13,1178

2,887

125

FINANCIAL STATEMENTSPlant Health Care plc Annual Report and Accounts 20179. Segment information continued

2016

Revenue*

Proprietary product sales

Third-party product sales

Intersegment product sales

Total revenue

Group consolidated revenue

Cost of sales

Research and development

Business development

Sales and marketing

Administration

Non-cash expenses:

Depreciation

Amortisation

Share-based payment

The Americas
$’000

Mexico
$’000

Rest of World
$’000

Elimination
$’000

Total
Commercial
$’000

New
Technology
$’000

1,424

1,252

2,729

734

2,513

—

3,247

1,603

—

1,605

—

(1,252)

3,761

2,568

—

6,329

(1,556)

(1,620)

(512)

1,252

(2,436)

—

Total
$’000

3,761

2,568

—

6,329

(2,436)

—

(954)

(916)

(293)

(33)

(255)

(295)

—

(733)

(206)

(53)

—

(5)

—

(869)

(1,233)

(7)

(18)

—

(3,868)

(954)

(2,518)

(1,732)

(93)

(273)

(300)

—

(220)

(266)

—

(631)

(954)

(2,518)

(1,952)

(359)

(273)

(931)

(1,977)

(4,985)

(6,962)

(2,494)

(1,894)

(11,350)

(2)

(11,300)

Segment operating (loss)/profit

(1,573)

630

(1,034)

Corporate expenses**

Wages and professional fees

Administration***

Operating loss

Finance income

Finance expense

Loss before tax

* Revenue from one customer within the Americas segment totalled $1,024,000, or 16% of Group revenues.
Revenue from one customer within the RoW segment totalled $835,000, or 13% of Group revenues.

** These amounts represent public company expenses for which there is no reasonable basis by which to allocate the amounts across the Group’s segments.

*** Includes net share-based payment expense of $132,000 attributed to corporate employees who are not affiliated with any of the Commercial or

New Technology segments.

Other segment information

Segment assets

Segment liabilities

Capital expenditure

The Americas
$’000

12,963

1,527

Mexico
$’000

1,966

164

Rest of
World
$’000

2,115

Eliminations
$’000

Total
Commercial
$’000

New
Technology
$’000

—

17,044

1,090

1,783

320

387

Total
$’000

18,134

2,103

469

Segment assets include all operating assets used by a segment and consist principally of operating cash, receivables, inventories,
property, plant and equipment and intangible assets, net of allowances and provisions. Segment liabilities include all operating
liabilities and consist principally of trade payables and accrued liabilities.

Notes forming part of the Group financial statements continuedfor the year ended 31 December 2017Plant Health Care plc Annual Report and Accounts 20179. Segment information continued
Geographic information
The Group operates in three principal countries – the United Kingdom (country of domicile), the US and Mexico.

The Group’s revenues from external customers by location of operation are detailed below:

United Kingdom

United States

Mexico

All other

Total

The Group’s non-current assets by location of assets are detailed below:

United Kingdom

United States

Mexico

All other

Total

10. Finance income and expense

Finance income

Interest on deposits and investments

Finance expense

Interest on finance leases

11. Tax credit

Current tax on profit for the year

Deferred tax – origination and reversal of timing differences

Total tax credit

Year ended
31 December 2017

Year ended
31 December 2016

Amount
$’000

2,687

1,598

2,880

520

7,685

Percent

100

Amount
$’000

1,280

1,477

3,247

325

6,329

Percent

100

Year ended
31 December 2017

Year ended
31 December 2016

Amount
$’000

2,782

180

Percent

—

Amount
$’000

3,297

193

Percent

3,000

100

3,529

100

2017
$’000

2016
$’000

(2)

2017
$’000

(256)

(6)

(262)

(2)

2016
$’000

(50)

(33)

(83)

The reasons for the difference between the actual tax charge for the year and the standard rate of corporation tax in the UK applied
to profits for the year are as follows:

Loss before tax

Expected tax credit based on the standard rate of corporation tax in the UK of 19.25% (2016: 20.0%)

Disallowable expenses

Share-based payment expense per accounts

Prior-period R&D credit

Losses available for carryover

Losses utilised in the year

Capital allowances in excess of amortisation

Other temporary differences

Actual tax credit

2017
$’000

2016
$’000

(5,716)

(11,300)

(1,100)

(2,260)

180

(360)

1,225

(398)

(80)

240

(262)

213

(242)

2,268

—

(83)

(36)

(83)

FINANCIAL STATEMENTSPlant Health Care plc Annual Report and Accounts 201711. Tax credit continued

Deferred tax asset

At 1 January 2017

Charged to the profit and loss account

At 31 December 2017

Deferred
taxation
$’000

The deferred tax asset comprises sundry timing differences.

At 31 December 2017, the Group had a potential deferred tax asset of $17,557,554 which includes tax losses available to carry forward
of $16,226,770 (being actual federal, foreign and state losses of $89,835,719) arising from historical losses incurred and other timing
differences of $1,330,574. Due to US tax reform the potential U.S. deferred tax asset as of December 31, 2017 was reduced by $7,715,912
due to the reduction in US tax rate from 35% to 21% beginning 1 January 2018 to the final amount of $17.6 million as shown above.

12. Loss per share
Basic loss per ordinary share has been calculated on the basis of the loss for the year of $5,454,000 (2016: loss of $11,217,000) and
the weighted average number of shares in issue during the period of 147,822,881 (2016: 100,369,025).

Equity instruments of 9,709,418 (2016: 8,383,332), which includes share options, the Value Creation Plan, the 2015 Employee Share
Option Plan and 2017 Employee Share Option Plan, as shown within note 21, that could potentially dilute basic earnings per share in
the future have been considered but not included in the calculation of diluted earnings per share because they are anti-dilutive for
the periods presented. This is due to the Group incurring a loss on operations for the year.

13. Intangible assets

Cost

Balance at 1 January 2016

Additions – externally acquired

Balance at 31 December 2016

Additions – externally acquired

Balance at 31 December 2017

Accumulated amortisation

Balance at 1 January 2016

Amortisation charge for the year

Balance at 31 December 2016

Amortisation charge for the year

Balance at 31 December 2017

Net book value

At 1 January 2016

At 31 December 2016

At 31 December 2017

Goodwill
$’000

Licences and
registrations
$’000

Trade name
and customer
relationships
$’000

1,620

3,342

—

1,620

3,342

—

1,620

3,342

—

1,620

2,527

273

2,800

264

3,064

815

542

278

159

—

159

—

159

—

159

—

159

—

Total
$’000

5,121

—

5,121

—

5,121

2,686

272

2,959

264

3,223

2,435

2,162

1,898

The intangible asset balances have been tested for impairment using discounted budgeted cash flows of the relevant cash generating units.
For the years ended 31 December 2016 and 2017, cash flows are projected over a five-year period with a residual growth rate assumed at 0%.
For the years ended 31 December 2016 and 2017, a pre-tax discount factor of 16.4% and 15.6% has been used over the forecast period.

Goodwill
Goodwill comprises a net book value of $1,432,000 related to the 2007 acquisition of the assets of Eden Bioscience and $188,000
related to an acquisition of VAMTech LLC in 2004. The entire amount is allocated to Harpin, a cash generating unit within the Commercial -
The Americas segment. No impairment charge is considered necessary, and no reasonable possible change in key assumptions used
would lead to an impairment in the carrying value of goodwill.

Licences and registrations
These amounts represent the cost of licences and registrations acquired in order to market and sell the Group’s products internationally
across a wide geography. These amounts are amortised evenly according to the straight-line method over the term of the licence
or registration. Impairment is reviewed and tested according to the method expressed above. Licences and registrations have a
weighted average remaining amortisation period of three years. No impairment charge is considered necessary, and no reasonable
possible change in key assumptions used would lead to an impairment in the carrying value of licences and registrations.

Notes forming part of the Group financial statements continuedfor the year ended 31 December 2017Plant Health Care plc Annual Report and Accounts 201714. Property, plant and equipment

Cost

Balance at 1 January 2016

Additions

Disposals

Reclassification

Balance at 31 December 2016

Additions

Disposals

Balance at 31 December 2017

Accumulated depreciation

Balance at 1 January 2016

Depreciation charge for the year

Disposals

Reclassification

Balance at 31 December 2016

Depreciation charge for the year

Disposals

Balance at 31 December 2017

Net book value

At 1 January 2016

At 31 December 2016

At 31 December 2017

Production
machinery
$’000

Office
equipment
$’000

Leasehold
improvements
$’000

Vehicles
$’000

Total
$’000

—

(13)

—

(13)

—

837

—

1,016

—

1,106

392

141

—

536

338

—

874

448

483

232

570

337

—

(97)

810

—

815

158

—

(3)

193

—

206

529

614

609

352

1,772

(72)

—

330

—

469

(72)

—

2,169

125

(13)

360

2,281

146

(15)

—

191

—

589

359

(15)

—

933

393

(13)

233

1,313

206

139

127

1,183

1,236

968

During 2016, it was identified that some fixed assets were not correctly classified. These assets were re-categorised accordingly.
There was no impact on depreciation charged.

The net book value of property, plant and equipment includes an amount of $6,429 (2016: $14,144) in respect of assets held under
finance leases. Depreciation expense includes an amount of $7,700 (2016: $7,700) in respect of assets held under finance leases.

15. Inventories

Raw materials

Finished goods and goods for resale

2017
$’000

1,495

1,536

2016
$’000

1,215

1,245

The inventory provision amount reversed during the year was $10,794 (2016: reversal of $5,890). In 2017, raw materials and finished
goods for resale included in cost of sales was $2.8 million (2016: $2.4 million).

FINANCIAL STATEMENTSPlant Health Care plc Annual Report and Accounts 201716. Trade and other receivables

Current:

Trade receivables

Less: provision for impairment

Trade receivables, net

Other receivables and prepayments

Tax receivable

Current trade and other receivables

Non-current:

Trade receivables

Less: provision for impairment

Deferred tax asset

Non-current trade and other receivables

2017
$’000

2016
$’000

4,131

(52)

3,124

(51)

4,079

3,073

232

377

211

—

4,688

3,284

—

134

4,822

—

131

3,415

The trade receivable current balance represents trade receivables with a due date for collection within a one-year period. The trade
receivable non-current balance represents the present value of trade receivables with a collection period that exceeds one year.

Movements on the provision for impairment of trade receivables are as follows:

Balance at the beginning of the year

Provided

Receivables written off as uncollectible

Foreign exchange

Balance at the end of the year

2017
$’000

2016
$’000

(2)

(1)

(11)

(10)

The net value of trade receivables for which a provision for impairment has been made is $80,000 (2016: $52,000).

The maximum exposure to credit risk at the reporting date is the fair value of each class of receivables set out above.

The following is an analysis of the Group’s trade receivables, both current and past due, identifying the totals of trade and other receivables
which are not yet due and those which are past due but not impaired.

Current

Past due:

Up to 30 days

31 to 60 days

61 to 90 days

Greater than 90 days

Total

2017
$’000

3,927

2016
$’000

2,617

157

259

100

4,147

3,073

The main factors used in assessing the impairment of trade receivables are the age of the balances and the circumstances of the
individual customer.

Notes forming part of the Group financial statements continuedfor the year ended 31 December 2017Plant Health Care plc Annual Report and Accounts 201717. Trade and other payables

Current:

Trade payables

Accruals

Taxation and social security

Income tax liability

18. Finance leases
(a) Current borrowings

Finance leases

(b) Non-current borrowings

Finance leases

2017
$’000

2016
$’000

1,523

1,292

491

1,542

2,879

2,088

2017
$’000

—

2016
$’000

Finance lease obligations are secured by retention of title to the relevant equipment and vehicles.

In less than one year

In more than one year, but less than two years

Trade and other payables

Finance leases

2017
$’000

1,863

—

1,863

2016
$’000

1,261

—

1,261

2017
$’000

2016
$’000

—

19. Financial instruments
(a) Capital risk management
The Group manages its capital to ensure that all entities in the Group will be able to continue as going concerns, while maximising shareholder
value through the optimisation of its debt and equity structure. The capital structure of the Group consists of cash and cash equivalents
and equity attributable to equity holders of the parent, comprising issued capital, reserves and accumulated deficit as disclosed in note 22.

(b) Categories of financial assets and financial liabilities

Financial assets

Trade and other receivables

Investments

Cash and cash equivalents

Financial liabilities

Trade and other payables

Borrowings due within one year

Borrowings due after one year

Fair value through
profit or loss

Cash and receivables

2017
$’000

2016
$’000

2017
$’000

2016
$’000

—

4,147

3,144

2,719

5,349

—

2,719

5,349

—

1,175

5,322

—

4,727

7,871

Financial liabilities measured
at amortised cost

2017
$’000

2016
$’000

1,863

1,261

—

1,871

1,276

The amounts disclosed for all of the above financial assets and financial liabilities approximate fair value in all material respects.
Accrued liabilities are not included in the table as owing to their nature they are not classified as financial liabilities.

FINANCIAL STATEMENTSPlant Health Care plc Annual Report and Accounts 201719. Financial instruments continued
(c) Investments
2017 – investments

Description

PNC Money Market Fund

PNC Ultra Short Bond Fund

2016 – investments

Description

PNC Ultra Short Bond Fund

Classification

Government

Mutual fund

Classification

Mutual fund

2017 value
$’000

2,718

2,719

2016 value
$’000

5,349

The above instruments are Level 1 in the IFRS 13 fair value measurements hierarchy.

The Group limits its investments to instruments with maturities of less than five years having a rating at or exceeding investment grade in
order to limit credit and liquidity risk. These investments are managed by an investment adviser and the portfolio’s performance is reviewed
by key management personnel. The aim of the portfolio includes both capital preservation and a rate of return that exceeds the rate
available through the purchase of money market securities.

(d) Liquidity risk
The Group manages liquidity risk by maintaining adequate reserves and banking facilities, by reference to continuously monitored
forecast and actual cash flows. As part of its monitoring, the Group ensures that the financial liabilities due to be paid can be met
by existing cash and cash equivalents. Cash equivalents are composed of short-term investment grade securities and are readily
marketable and convertible to cash. The Group does not currently generate sufficient cash from its operations to meet its annual
funding needs. However, the Group is well funded due to an equity placement in August 2016 and is able to meet its obligations.

(e) Financial risk management objectives
The Group invests its surplus cash in bank deposits denominated in US Dollars and British Pounds, which earn interest at money market
rates, and in short-term investments comprised of notes and bonds with maturities of less than five years and having investment grade
ratings. In doing so, the Group exposes itself to fluctuations in money market interest rates and market price fluctuations.

(f) Market risk
The Group is exposed to risk from movements in foreign currency exchange rates, interest rates and market prices that affect its
assets, liabilities and anticipated future transactions.

The Group is exposed to foreign currency risk from transactions and from translating the monetary net assets of overseas entities
denominated in currencies other than functional currency. Transaction exposure arises because affiliated companies undertake
transactions in foreign currencies. The Group does not use forward foreign exchange rate contracts to hedge exchange rate risk.

The US Dollar carrying amounts of the Group’s material foreign currency-denominated monetary assets and monetary liabilities at the
reporting date are as follows:

Euro

Pound

Mexican Peso

Assets

Liabilities

2017
$’000

220

2,595

1,360

2016
$’000

206

1,699

1,343

2017
$’000

263

157

251

2016
$’000

164

If the exchange rate on uncovered exposures were to move significantly there would be foreign exchange differences on the
retranslation of financial assets and liabilities and an impact on the Group’s gross profit. A significant change in the Mexican Peso
or British Pound could have a negative impact on the Group’s gross profit.

Notes forming part of the Group financial statements continuedfor the year ended 31 December 2017Plant Health Care plc Annual Report and Accounts 201719. Financial instruments continued
(f) Market risk continued
A hypothetical 10% change (positive or negative) in foreign currency exchange rates applicable to our business would have
the following effect (increase or decrease) on revenue:

Mexican Peso

Pound Sterling

2017
$’000

288

277

A hypothetical 10% change (positive or negative) in foreign currency exchange rates applicable to our business would have
the following effect (increase or decrease) on expenses:

Mexican Peso

Pound Sterling

2017
$’000

250

690

2016
$’000

325

128

2016
$’000

261

785

(g) Price risk
The Group is exposed to price risk on its investments. To manage the price risk arising from investments in securities, the Group limits
its portfolio to include only investment grade securities on active exchanges having maturities of less than five years.

(h) Interest rate risk
The Group is exposed to interest rate risk on its cash and investment balances. To manage the interest rate risk, the Group limits its
portfolio to cash and investment grade securities on active exchanges having maturities of less than five years.

If interest rates were to move significantly, finance revenues could be affected. However, this impact would not be material to the
Group’s financial statements and, therefore, no analysis of the sensitivities has been presented.

The Group is exposed to interest rate risk on its cash deposits, which earn interest at a variable rate of interest.

The Group’s borrowings comprise finance leases, which are at fixed rates.

The Group does not utilise any hedging instruments to address interest rate risk.

(i) Credit risk management
The Group’s principal credit risk relates to the recovery of trade receivables. In order to manage credit risk, the Group sets limits
for customers based on a combination of payment history and third-party credit references. Credit limits are reviewed on a regular
basis in conjunction with debt ageing and collection history. Balances that are beyond agreed upon terms are actively followed up
to ensure collection.

The Group sells to a large number of customers across international locations within the US, Europe, South Africa and Mexico.

Further details on trade receivables, including analysis of bad debts and ageing, are given in note 16.

The Group manages the credit risk on its investments by limiting investments to notes and bonds with maturities of less than five
years having investment grade ratings.

The Group believes the credit risk on liquid funds, being cash and cash equivalents, is limited because the counterparties are banks
with high credit ratings assigned by international credit rating agencies. However, the concentration of credit risk by counterparty
does exceed 10% of the overall cash and cash equivalent balance.

The maximum exposure to credit risk on cash balances at the reporting date is the carrying value of the cash balances. The Group
ensures that its investments are maintained in high-quality investment grade securities to limit credit risk.

FINANCIAL STATEMENTSPlant Health Care plc Annual Report and Accounts 201720. Subsidiary undertakings
The following were subsidiary undertakings of the Company at 31 December 2017:

Name

Plant Health Care, Inc.

Plant Health Care Brazil

Plant Health Care de
Mexico S. de R.L. de C.V.

Registered addresses

701 S. Carson Street
Suite 200
Carson City, NV 89701

Rua Dr Antonio Cento 560
– cj 708 São Paulo – SP CEP
04750-001 Brazil

Bodega 26
Avenida Ceylan 959
Colonia Industrial Vallejo
2300 Ciudad de Mexico
CDMX, Mexico

Country of incorporation
or registration

United States
(Nevada)

United States
(Pennsylvania)

Brazil

Proportion of voting
rights and ordinary
share capital held

Nature of business

100%

Holding company

100%*

Sales

Mexico

100%*

Sales

Plant Health Care (UK) Limited Chess Park Moor Road

United Kingdom

100%*

Sales

Unit 30
Chesham HP5 1SD

CL. Serrano, 76
28.612, Madrid

2711 Centerville Road
Suite 400
Wilmington, DE 19808

Spain

United States
(Delaware)

Plant Health Care Espaňa

VAMTech, LLC

* Held indirectly.

100%*

Sales

For all undertakings listed above, the country of operation is the same as its country of incorporation or registration.

21. Share capital
(a) Issued share capital

Allotted, called up and fully paid share capital:

147,822,881 (2016: 147,822,881) ordinary shares at £0.01 each

(b) Movement in share capital
The movements on issued share capital are as follows:

In issue at 1 January 2016

Shares issued

In issue at 31 December 2016

Shares issued

In issue at 31 December 2017

2017
$’000

2016
$’000

2,237

Ordinary shares of
Plant Health Care plc

Number

71,855,085

75,967,796

147,822,881

—

147,822,881

$’000

1,236

1,001

2,237

—

2,237

During the year ended 31 December 2016, the following fully paid £0.01 ordinary shares in the Company were issued:

75,967,796 new ordinary shares with net proceeds of $9,746,312 (directly attributable costs of $262,000) were issued pursuant to
an equity placing at £0.10 per share.

On 27 February 2018, the Company successfully completed an equity raise which generated $6.7 million (net of costs) from new
and existing investors. The Company issued 25,000,000 ordinary shares at 20p per share, directly attributable costs of $270,000
were incurred.

Notes forming part of the Group financial statements continuedfor the year ended 31 December 2017Plant Health Care plc Annual Report and Accounts 201721. Share capital continued
(c) Other equity instruments
The Company had the following other equity instruments in issue at 31 December 2017 and 2016:

Share awards under the VCP

Share awards under the 2004 plan

Share awards under 2015 plan

Share awards under 2017 plan

2017
Number

2016
Number

— 5,335,544

806,038

991,538

4,359,212 2,056,250

4,544,168

—

9,709,418 8,383,332

(d) Share options
The Company has issued share options to certain employees under the Plant Health Care plc Unapproved Share Option Scheme 2004. In 2014,
the scheme reached the 10th anniversary of its approval by shareholders; no further options may be granted. At the time of its admission to
AIM, the Company also agreed to honour outstanding options under the Plant Health Care, Inc. 2001 Equity Incentive Plan. No further options
have been or will be issued under that plan. In addition, in limited instances, the Company has granted options to certain management
for ordinary share capital of the Company under separate unapproved option agreements.

The movements on share options are as follows:

Outstanding at 1 January 2016

Awarded

Exercised

Forfeited

Outstanding at 31 December 2016

Awarded

Exercised

Forfeited

Options over ordinary shares

Directors
and former
Directors

Other

Total

Weighted
average
exercise
price

535,538

506,000 1,041,538

147p

—

(50,000)

535,538

456,000

991,538

—

— (185,500)

(185,500)

—

123p

148p

—

225p

131p

Outstanding at 31 December 2017

535,538

270,500

806,038

Of the total number of options outstanding at 31 December 2017, 716,652 (2016: 702,000) had vested and were exercisable.
The weighted average exercise price was 133p (2016: 179p).

The options outstanding at 31 December 2017 have a weighted average remaining life of 2.28 years (2016: 2.68 years) and the range
of exercise prices is 53p to 325p (2016: 53p to 325p).

FINANCIAL STATEMENTSPlant Health Care plc Annual Report and Accounts 2017
21. Share capital continued
(e) Value Creation Plan
The Chairman, CEO and key members of senior management participate in the VCP.

The movements in Value Creation Plan awards are as follows:

Outstanding at 1 January 2016

Awarded

Outstanding at 31 December 2016

Awarded

Forfeited

Outstanding at 31 December 2017

Directors

Other

Total

2,571,821 2,763,723 5,335,554

—

2,571,821 2,763,723 5,335,554

—

(2,571,821) (2,763,723) (5,335,554)

—

Weighted
average
exercise
price

77p

—

77p

—

77p

—

Of the total number of options outstanding at 31 December 2016, none had vested and were exercisable.

The options outstanding at 31 December 2016 had a weighted average remaining life of 0.3 years and a range of exercise prices
of 55p to 111p.

During 2017, all options awarded under the Value Creation Plan were forfeited due to the performance targets and vesting conditions
not being met based on the four-year Performance Period.

(f) 2015 Employee Share Option Plan

Outstanding at 31 December 2015

Awarded

Forfeited

Outstanding at 31 December 2016

Awarded

Forfeited

Outstanding at 31 December 2017

Directors

Other

Total

1,790,000

266,250 2,056,250

—

1,790,000

266,250 2,056,250

— 4,285,132 4,285,132

(1,790,000)

(192,170) (1,982,170)

— 4,359,212 4,359,212

Weighted
average
exercise
price

105p

—

105p

20p

99p

24p

Of the total number of options outstanding at 31 December 2017, 177,500 (2016: 685,000) had vested and were exercisable.

The options outstanding at 31 December 2017 have a weighted average remaining life of 3.0 years (2016: 2.5 years) and the range
of exercise prices is 20p to 89p (2016: 89p to 107p).

(g) 2017 Employee Share Option Plan

Outstanding at 31 December 2015

Awarded

Forfeited

Outstanding at 31 December 2016

Awarded

Forfeited

Outstanding at 31 December 2017

Directors

Other

Total

—

3,768,577

3,011,131 6,779,708

(786,920) (1,448,620) (2,235,540)

2,981,657

1,562,511 4,544,168

Weighted
average
exercise
price

—

25p

Of the total number of options outstanding at 31 December 2017, 1,701,380 (2016: nil) had vested and were exercisable.

The options outstanding at 31 December 2017 have a weighted average remaining life of 9.4 years and the range of exercise prices
is 25p to 26p.

Notes forming part of the Group financial statements continuedfor the year ended 31 December 2017Plant Health Care plc Annual Report and Accounts 201722. Reserves
The following describes the nature and purpose of each reserve within owners’ equity:

Reserve

Share capital

Description and purpose

Amount subscribed for share capital at nominal value.

Share premium

Amount subscribed for share capital in excess of nominal value.

Foreign exchange reserve

Gains/losses on retranslating the net assets of overseas operations.

Accumulated deficit

Cumulative net gains and losses recognised in the consolidated income statement. During
the year ended 31 December 2014, the Company transferred the amounts in the share-based
payment reserve and reverse acquisition reserve into retained earnings.

23. Pensions
The Group does not maintain any defined benefit pension plans. The Group does maintain a retirement plan qualified under section
401(k) of the United States Internal Revenue Code. This plan covers all US employees. In 2017, the Group’s pension expense under the
scheme was $50,532 (2016: $41,987). Mexico has a government-run pension plan to which our operations there must contribute. In 2017,
the expense for this plan was $1,828 (2016: $14,055). Several United Kingdom employees receive contributions to their pension plans.
The expense for this was $7,310 (2016: $12,594). The total pension liability at the end of the year was $59,670 (2016: $68,636).

24. Leases
Finance leases – as lessee
The Group leases vehicles, production equipment and office equipment on leases classified as finance leases.

Future lease payments are due as follows:

2017

Not later than one year

Later than one year and not later than five years

2016

Not later than one year

Later than one year and not later than five years

Minimum
lease
payments
$’000

Interest
$’000

Present
value
$’000

—

Minimum
lease
payments
$’000

Interest
$’000

Present
value
$’000

—

Operating leases
The Group leases all of its properties, as well as office equipment. The terms of property leases vary from country to country and
tend to have rent reviews at the end of the lease term for renewal purposes.

The total present values of minimum lease payments are due as follows:

Not later than one year

Later than one year and not later than five years

2017
$’000

364

554

918

2016
$’000

376

971

1,347

FINANCIAL STATEMENTSPlant Health Care plc Annual Report and Accounts 201725. Standards, amendments and interpretations to published standards not yet effective
The IASB and the International Financing Reporting Interpretations Committee (“IFRIC”) have issued the following standards
and interpretations to be applied to financial statements with periods commencing on or after the following dates:

New standards and interpretations currently in issue but not effective, based on EU mandatory effective dates are:

Standard impact

Description

Financial Instruments

Effective date

1 January 2018

Expected

No material impact

Revenue from Contracts with Customers

1 January 2018

See below

Leases

1 January 2019

Assessment ongoing

IFRS 9

IFRS 15

IFRS 16

IFRS 9: In July 2014, the IASB issued the final version of IFRS 9, Financial Instruments, which reflects all phases of the financial
instruments project and replaces IAS 39, Financial Instruments: Recognition and Measurement and all previous versions of IFRS 9.
The standard introduces new requirements for classification and measurement, impairment, and hedge accounting. IFRS 9 is
effective for annual periods beginning on or after 1 January 2018, with early application permitted. Retrospective application is
required, but comparative information is not compulsory.

The Group’s primary financial instruments include cash, trade receivables & payables and short-term investments. The Group has
determined the adoption of IFRS 9 will not result in material alterations to the reporting of these financial instruments and does not
expect to there to be any material impact going forward.

IFRS 15: As per note 9 Segment information on pages 45 to 47, 100% of the Group’s revenues in 2017 were derived from the sale of
its proprietary and third-party products. The Group typically transfers significant risks of ownership and title in the products upon
shipment of goods from one of its locations. Revenue is typically recognised at the time of shipment and is not expected to change
after the implementation of IFRS 15 due to no further performance obligations.

The recognition of any milestone or licence revenues received in future years could be impacted by the new accounting standard.
The Group is assessing the impact of the accounting changes that will arise under IFRS 15.

IFRS 16: “Leases” was issued in January 2016 to replace IAS 17 “Leases”. The standard is effective for accounting periods beginning
on or after 1 January 2019.

IFRS 16 will primarily change lease accounting for lessees; lease agreements will give rise to the recognition of an asset representing
the right to use the leased item and a loan obligation for future lease payables. Lease costs will be recognised in the form of depreciation
of the right to use asset and interest on the lease liability. Lessee accounting under IFRS 16 will be similar in many respects to existing
IAS 17 accounting for finance leases, but will be substantively different to existing accounting for operating leases where rental charges
are currently recognised on a straight-line basis and no lease asset or lease loan obligation is recognised.

The Group is still assessing the potential impact of the alterations.

No other standards or amendments are considered likely to have an effect on the financial statements going forward. Plant Health Care
does not anticipate that the adoption of these standards and interpretations will have a material accounting impact on the Group’s
financial statements.

Notes forming part of the Group financial statements continuedfor the year ended 31 December 2017Plant Health Care plc Annual Report and Accounts 2017Company statement of financial position
at 31 December 2017

Fixed assets

Fixed asset investments

Current assets

Debtors

Cash at bank and in hand

Total current assets

Creditors: amounts falling due within one year

Net current assets

Total assets less current liabilities

Capital and reserves

Called-up share capital

Share premium

Accumulated deficit

Shareholders’ funds

Note

2017
$’000

2016
$’000

19,018

22,650

220

238

299

(60)

1,878

1,915

246

1,669

18,958

24,319

2,237

79,786

(63,065)

(57,704)

18,958

24,319

The financial statements were approved and authorised for issue by the Board on 9 April 2018.

Christopher Richards
Director

Registered no: 05116780 (England and Wales)

The Company has taken advantage of the exemption allowed under section 408 of the Companies Act 2006 and has not presented its
own profit and loss in these financial statements. The Group loss for the year includes loss after tax of $6,297,000 (2016: loss of $15,052,000),
which is dealt with in the financial statements of the parent company.

The notes on pages 61 to 63 form part of these financial statements.

Plant Health Care plc Annual Report and Accounts 2017

FINANCIAL STATEMENTSPlant Health Care plc Annual Report and Accounts 2017Company statement of changes in equity
for the year ended 31 December 2017

Balance at 1 January 2016

Shares issued

Share-based payment

Loss in the year

Balance at 31 December 2016

Share-based payment

Profit in the year

Balance at 31 December 2017

The notes on pages 61 to 63 form part of these financial statements.

Share
capital
$’000

1,236

1,001

—

Share
premium
$’000

71,040

8,746

—

Accumulated
deficit
$’000

Total
$’000

(43,715)

28,561

—

1,063

9,747

1,063

(15,052)

2,237

79,786

(57,704)

24,319

—

936

(6,297)

2,237

79,786

(63,065)

18,958

Plant Health Care plc Annual Report and Accounts 2017Notes forming part of the Company financial statements
for the year ended 31 December 2017

26. Accounting policies
Basis of preparation
The financial statements have been prepared under the historical cost convention and in accordance with FRS 102, the Financial
Reporting Standard applicable in the United Kingdom and the Republic of Ireland. The principal accounting policies, which have been
applied consistently, are set out below.

The preparation of financial statements in compliance with FRS 102 requires the use of certain critical accounting estimates. It also
requires management to exercise judgement in applying the Company’s accounting policies. See note 27.

In preparing the separate financial statements of the parent company, advantage has been taken of the following disclosure
exemptions available in FRS 102:

• only one reconciliation of the number of shares outstanding at the beginning and end of the period has been presented as the

reconciliations for the Group and the parent company would be identical;

• no cash flow statement has been presented for the parent company;

• disclosures in respect of the parent company’s financial instruments have not been presented as equivalent disclosures have been

provided in respect of the Group as a whole;

• disclosures in respect of the parent company’s share-based payment arrangements have not been presented as equivalent

disclosures have been provided in respect of the Group as a whole; and

• no disclosure has been given for the aggregate remuneration of the key management personnel of the parent company as their

remuneration is included in the totals for the Group as a whole.

Investments
Fixed asset investments comprise investments by the Company in the shares of subsidiary undertakings and loans to Group
undertakings. At the end of each financial period, the Directors review the carrying amount of the Company’s investments with
reference to forecast discounted future cash flows and related estimates and judgements to determine whether there is any indication
that those assets have suffered an impairment loss. They are stated at cost less any provision where, in the opinion of the Directors,
there has been impairment.

Share-based payments
The Company operates a number of equity-settled, share-based payment plans, under which it receives services from employees
and non-employees as consideration for the Company’s equity instruments, in the form of options or restricted stock units (‘‘awards’’).
The fair value of the award is recognised as an expense, measured as of the grant date using a binomial option pricing model. The total
amount to be expensed is determined by reference to the fair value of instruments granted, excluding the impact of any service and
non-market performance vesting conditions. Non-market vesting conditions are included in assumptions about the number of options
that are expected to vest. The total expense is recognised over the vesting period, which is typically the period over which all of the
specified vesting conditions are to be met.

The Company grants share options and shares under its share-based payment plans directly to employees of its subsidiaries. In accordance
with the provisions of the plan, the cost of the share-based payments will be recorded by each subsidiary as an expense, with a
corresponding increase in equity as a contribution from the parent.

The Company, over whose shares options are issued, recognises an increase in the investment in the related subsidiary and a credit
to accumulated deficit.

Deferred taxation
Deferred tax balances are recognised in respect of timing differences that have originated but not reversed by the balance sheet
date. However, where there is uncertainty over the timing of their realisation, deferred tax assets are not recognised.

27. Judgement in applying accounting policies and key sources of estimation uncertainty
In preparing these financial statements, the Directors have made the following judgements:

At the end of the financial period, the Company reviews the carrying amounts of its fixed asset investments to determine whether
there is any indication that those assets have suffered any impairment loss. The recoverable amount is determined based on a
value-in-use calculation. The use of this method requires the estimation of future cash flows and the choice of a discount rate
in order to calculate the present value of the cash flows. Actual outcomes may vary. More details are included in note 33.

FINANCIAL STATEMENTSPlant Health Care plc Annual Report and Accounts 2017Notes forming part of the Company financial statements continued
for the year ended 31 December 2017

28. Share-based payments
See note 21 of the Group financial statements.

29. Reserves
See note 22 of the Group financial statements for a description of the nature and purpose of each reserve within owner’s equity.

30. Directors’ remuneration
The Directors’ remuneration for the Company is disclosed in note 7 of the Group financial statements.

31. Staff costs
Staff costs for all employees, including Executive Directors, comprise:

Wages and salaries

Social security and payroll taxes

Share-based payments charge

The average number of employees of the Group during the year, including Executive Directors, was four (2016: five).

2017
$’000

261

295

515

810

2016
$’000

280

312

833

1,145

32. Fixed asset investments

Cost

Cost at 1 January 2016

Additions, net of repayments

Cost at 31 December 2016

Additions, net of repayments

Cost at 31 December 2017

Impairments

Impairments at 1 January 2016

Charge

Impairments at 31 December 2016

Charge

Impairments at 31 December 2017

Net book value

At 31 December 2016

At 31 December 2017

Shares
in Group
undertakings
$’000

Loans to
Group
undertakings
$’000

Total
$’000

16,915

55,677

72,592

—

4,529

16,915

60,206

—

3,946

4,529

77,121

3,946

16,915

64,152

81,067

(16,915)

(27,263)

(44,178)

—

(10,293)

(16,915)

(37,556)

(54,471)

—

(7,578)

(16,915)

(45,134)

(62,049)

—

22,650

19,018

The fixed asset investment balances have been tested for impairment using discounted budgeted cash flows, a pre-tax discount
rate of 15.6% (2016: 16%), and performance projections over five years. The calculated net present value in this review is $19,018,000
(2016: net present value of $22,650,000), which caused an impairment of $7,577,000 in 2016 (2017: nil).

Plant Health Care plc Annual Report and Accounts 201733. Subsidiary undertakings
The subsidiary undertakings of the Company are disclosed in note 20 of the Group financial statements.

34. Debtors

Prepayments

All amounts fall due within one year.

35. Creditors

Trade creditors

Accruals

Totals

2017
$’000

103

195

298

2016
$’000

195

246

36. Share capital
The share capital of the Company is disclosed in note 21 of the Group financial statements.

37. Related party transactions
The Company has taken advantage of the exemption allowed by Financial Reporting Standard 102 “Related Party Transactions”,
not to disclose any transactions with its wholly-owned subsidiary companies as these are included within the consolidated financial
statements of the Group.

38. Post balance sheet events
On 27 February 2018, the Company successfully completed an equity raise which generated $6.7 million (net of costs) from new
and existing investors. The Company issued 25,000,000 ordinary shares at 20p per share, directly attributable costs of $270,000
were incurred.

FINANCIAL STATEMENTSPlant Health Care plc Annual Report and Accounts 2017Directors and advisers

Directors

Dr Christopher G J Richards
Executive Chairman

Dr Richard H Webb
Executive Director

Michael J Higgins
Senior Independent Director

William M Lewis
Non-executive Director

Secretary
Christine Mazzone

Registered office
1 Scott Place
2 Hardman Street
Manchester M3 3AA

Company number
05116780

Broker and nominated adviser
Liberum Capital Limited
Ropemaker Place
25 Ropemaker Street
London EC2Y 9LY

Auditor
BDO LLP
55 Baker Street
London W1U 7EU

Company solicitor
DWF LLP
1 Scott Place
2 Hardman Street
Manchester M3 3AA

Registrar
Neville Registrars Limited
Neville House
18 Laurel Lane
Halesowen
West Midlands B63 3DA

In this document, references to “the Company” are to Plant Health Care plc. References to “Plant Health Care”,
“the Group”, “we” or “our” are to Plant Health Care plc and its subsidiaries and lines of business, or any of them as the
context may require. The Plant Health Care name and logo, Myconate, ProAct, N-Hibit, Innatus 3G and other names
and marks appearing herein and on Company literature are trademarks or trade names of Plant Health Care.
All other third-party trade mark rights are acknowledged.

Plant Health Care plc Annual Report and Accounts 2017Plant Health Care plc’s commitment to environmental issues is reflected in
the production of this annual report which has been printed on Arcoprint,
made from an FSC® certified and ECF (Process Chlorine Free) material.
Printed in the UK by Proco using their environmental printing technology.
Both manufacturing mill and the printer are registered to the Environmental
Management System ISO14001 and are Forest Stewardship Council® (FSC)
chain-of-custody certified.

Plant Health Care plc
2626 Glenwood Avenue
Suite 350
Raleigh
NC 27608
USA

Phone: 919-926-1600
Email: info@planthealthcare.com