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RUA LIFE SCIENCES PLC
Earnings Release • Dec 11, 2024
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Earnings Release
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National Storage Mechanism | Additional information 
RNS Number : 5836P
RUA Life Sciences PLC
11 December 2024
11 December 2024
RUA Life Sciences plc
("RUA Life Sciences", the "Company" or the "Group")
Interim Results
RUA Life Sciences, the holding company of a group of medical device businesses focused on the exploitation of the world's leading long-term implantable biostable polymer (Elast-Eon TM ) , today announces its unaudited interim results for the six months ended 30 September 2024.
Highlights:
· Revenue increased 92% to £1,524k (H1 FY2024: £794k)
· Strong Gross profit margin growing from 78% to 83%
· Strategic purchase of Abiss - £1.1m assets purchased for £68k
· Profit before taxation - £631k (H1 FY2024: Loss £1,396k)
· Cash burn over half year significantly reduced
· Cash balance £3,779k (30 September 2023: £493k, 31 March 2024: £3,931k)
Geoff Berg, Chairman of RUA Life Sciences, commented:
" The focus of management has been to maximise revenue from Contract Manufacturing, reduce costs and secure deals for longer term growth. Success has been demonstrated in each of these areas which together with the Abiss purchase has resulted in a profit being reported for the period, marking a significant milestone. "
The information contained within this announcement is deemed by the Company to constitute inside information as stipulated under the UK version of the EU Market Abuse Regulation (2014/596), which is part of UK law by virtue of the European Union (Withdrawal) Act 2018, as amended and supplemented from time to time.
For further information contact:
RUA Life Sciences Tel: +44 (0)1294 317073
Geoffrey Berg, Non-Executive Chairman
Bill Brown, Chief Executive
Lachlan Smith, Group Chief Financial Officer
Cavendish Capital Markets Limited
(Nominated Adviser and Broker) Tel: +44 (0)20 7220 0500
Giles Balleny/Dan Hodkinson (Corporate Finance)
Charlie Combe (Broking)
Michael Johnson (Sales)
About RUA Life Sciences
RUA Life Sciences plc is the ultimate parent company of the Group, whose principal activities comprise exploiting the value of its IP & know-how, medical device contract manufacturing and development of medical devices.
CHAIRMAN'S STATEMENT
At this time last year, the company outlined a strategy focused on achieving short-term profitability by expanding contract manufacturing and leveraging the commercialising of R&D efforts undertaken in recent years. I am pleased to report good progress towards this goal during the six months ended 30 September 2024 (the "period"), along with the establishment of strong foundations for future growth.
On 6 September 2024, the Group completed the strategic acquisition of the Abiss Group, a medical device manufacturer based in France, with a subsidiary in Poland specialising in the distribution of medical devices. The results presented include the consolidation of the Abiss group from the date of acquisition.
Taking into account the progress made on delivering on strategy and the initial benefits of the strategic acquisition of Abiss, it is pleasing to be able to report a consolidated profit of £636,000 for the period.
Unaudited interim results for the six months to 30 September 2024
Consolidated revenues for the Group increased 92% from £794k to £1,524k in the period. Of the revenues achieved, £238k (H1 2023 £199k) was represented by the Group's Biomaterials business, which enjoyed year-on-year growth of 20%. Other revenues delivered from the sale of Medical Devices and Components increased 116% from £595k to £1,286k in the period.
It is recognised that revenues in the comparative period were adversely affected by delays in shipments which were recovered in the second half of the year. A more appropriate comparator is the average revenues across each of the two half years in FY24 of £840k. Against this more challenging comparator, revenue growth from the Sale of Medical Devices and Components was 53% including the benefit of the Abiss group or 47% on a like-for-like basis.
Gross Profit margins continued to improve from the 78% achieved in the first half of FY24 and 81% over FY24, to 83% in the period. The gross profit margin achieved from Medical Devices and Components was 80% in the period compared to 76% in the comparative period.
Administrative expenses were reduced by £326k (16%) from £2,020k (H1 24) to £1,694k in the first half of the current year. The like-for-like reduction in costs (excluding Abiss) was £375k.
Included in other income for the period is the initial bargain purchase gain from the acquisition of the Abiss group. The profit on acquisition is £1,062,000, representing the excess of the book value of assets acquired over the purchase price of £68,000. An exercise to calculate the fair value of assets purchased, including any intangible assets identifiable, is currently being undertaken, and the final acquisition accounting adjustments will be included in the second interim period to 31 March 2025. As plant, machinery and other fixed assets utilised in the business have a current written down value of only £23k compared to the original cost of £730k, it is anticipated that a further bargain purchase gain will be recognised at the second interim period to 31 March 2025.
Balance Sheet Strengthened
The Group's drive to profitability, together with the Abiss acquisition has had a positive impact on the balance sheet of the Group. Cash at 30 September amounted to £3,779k, a net reduction of only £152k over the period compared to reductions of £523k (excluding proceeds of the equity issue) in the second half of FY24 and £976k in the comparative period. Total Assets increased £1,637k over the period with the £833k increase in liabilities (attributable to the acquisition of Abiss group) resulting in a net increase in equity of £682k from £7,182k to £7,864k over the period.
RUA Vascular and Structural Heart
The objectives for RUA Vascular and Structural Heart are to find alternative ways to fund the remaining regulatory pathway for the polymer sealed graft products and to introduce the Group's heart valve leaflet material (AurTexTM) to the wider industry as a realistic alternative to animal tissue in heart valves.
As noted in the trading update of 30 October 2024, while the AurTex materials tested under the Company's Material Transfer Agreement ("MTA") with a heart valve company successfully met all the expected results for the tests undertaken, at this point, it is not expected to lead to a commercial agreement due to current priorities of the Company's MTA partner. Notwithstanding this, the results of the MTA have confirmed the management's belief in the potential for AurTex.
The team working on the vascular project has continued to make good progress with significant improvements made in the handling of the graft to address feedback from potential partners.
Several opportunities are being pursued for each of the Vascular and Structural Heart businesses, and further updates will be made as appropriate.
Abiss Acquisition
RUA was introduced to the Abiss Group ("Abiss") by our major customer around a year ago. The former parent company of Abiss had been placed into liquidation by the French Courts, and our customer was motivated to ensure a seamless continuity in the supply of products and devices supplied to it by Abiss. The Abiss Group comprises two European businesses: Abiss France and Abiss Poland. Abiss France is a CE mark holder of a number of medical devices and is a licensor and subcontract manufacturer of devices. Abiss Poland is a 60% subsidiary of Abiss France and is a distributor of gynaecological and urology devices into hospitals. In Poland, Abiss holds a market-leading position in Stress Urinary Incontinence (SUI) and pelvic floor repair. Around 70% of the revenues generated by Abiss France were dependent upon sales to the major customer.
Having reviewed the future product demand from the major customer and satisfied ourselves on any product liability issues, RUA agreed to participate in a formal auction process to acquire the entire issued share capital of Abiss France. The Abiss group was sold as a going concern. Although financial information was made available by Abiss, detailed financial due diligence was not possible nor were any warranties on the purchase available from the French courts. However, the strong relationship that RUA has with its customer provided it with significant comfort on matters which might be perceived as risks by other bidding parties. As a result, RUA's offer of €80,000 for the share capital of Abiss France was the highest bid and was accepted by the French courts with the purchase completing on 6 September 2024.
Strategic Integration
There are many similarities between Abiss and RUA's Contract Manufacturing business unit, not least the customer relationship. Going forward, it is anticipated that Abiss will be reported as part of the expanded Medical Devices and Components business unit. The acquisition has enabled us to achieve our stated objective of doubling the scale of this business unit, with many other opportunities for further growth. The acquisition of Abiss came with a €900k order backlog due to a shortage of packaging materials, and the short-term priority has been to catch up with those orders, which are expected to be completed in the second interim period. The objective for the enlarged business unit and Abiss specifically is to grow revenues through broadening the product range offered to the division's largest customer. RUA has held unexploited IP related to integrating Elast-EonTM into SUI devices to address the complications occasionally suffered by patients.
Change of accounting reference date
The Group announced on 30 October 2024, that it will be changing its accounting reference date and financial year end from 31 March to 30 September. Going forward, interim and annual accounts will be prepared and published for the six months ending 31 March and the twelve months ending 30 September, respectively.
The Company has changed its financial year end to better guide business planning and international business unit assimilation.
As a result of this change, the Company's future reporting calendar is expected to be as follows:
· Publication of unaudited accounts for the 12-month period ending 31 March 2025 in mid-June 2025.
· Publication of audited accounts for the 18-month period ending 30 September 2025 by end of January 2026.
· Publication of unaudited interim accounts for the six-month period ending 31 March 2026 in mid-June 2026; and
· Publication of audited accounts for the 12-month period ending 30 September 2026 by the end of January 2027.
Conclusion and Outlook
The focus of management has been to maximise revenue from Contract Manufacture, reduce costs and secure deals for longer term growth. Success has been demonstrated in each of these areas which together with the Abiss purchase has resulted in a profit being reported for the period, marking a significant milestone.
The Group's development is centred on two key platforms: leveraging its intellectual property (IP) and advancing subcontract development and manufacturing of medical devices. Recent priorities have focused on strengthening the solid financial foundation established through last year's equity fundraise by elevating Contract Manufacturing to the next level.
The targets for the Group's graft IP and AurTex are to commercialise the investment made to date to license the Group's IP and to generate revenues through the manufacture of devices and components based on the Group's graft and AurTex technology.
Geoff Berg, Chairman
10 December 2024
CONDENSED INTERIM CONSOLIDATED STATEMENT OF PROFIT OR LOSS
| Unaudited | Unaudited | Audited | ||||
| Note | Six months to 30 Sep 2024 GB£000 |
Six months to 30 Sep 2023 GB£000 |
Twelve months to 31 Mar 2024 GB£000 |
|||
| Revenue | 3 | 1,524 | 794 | 2,191 | ||
| Cost of sales | (255) | (178) | (415) | |||
| Gross profit | 1,269 | 616 | 1,776 | |||
| Other income | 4 | 1,090 | 44 | 79 | ||
| Administrative expenses | (1,694) | (2,020) | (3,792) | |||
| Operating Profit / (loss) | 665 | (1,360) | (1,937) | |||
| Net finance expense | (34) | (36) | (83) | |||
| Profit / (Loss) before taxation | 631 | (1,396) | (2,020) | |||
| Taxation (received) / charge | (5) | 386 | 580 | |||
| Profit / (Loss) for the period | 636 | (1,010) | (1,440) | |||
| Other comprehensive income: | ||||||
| Currency translation differences | (2) | - | - | |||
| Total comprehensive income for the period | 634 | (1,010) | (1,440) | |||
| Total comprehensive income for the period is attributable to: | ||||||
| Equity holders of the parent | 632 | (1,010) | (1,440) | |||
| Non-controlling interests | 2 | - | - | |||
| 634 | (1,010) | (1,440) | ||||
| Profit / (Loss) per share : | ||||||
| Basic & Diluted (GB Pence per share) | 1.03 | (4.55) | (4.29) |
CONDENSED INTERIM CONSOLIDATED STATEMENT OF FINANCIAL POSITION
| Unaudited | Unaudited | Audited | ||||
| Note | 30 Sep 2024 GB£000 |
30 Sep 2023 GB£000 |
31 Mar 2024 GB£000 |
|||
| Assets | ||||||
| Non-current assets | ||||||
| Goodwill | 5 | 301 | 301 | 301 | ||
| Other intangible assets | 6 | 569 | 445 | 419 | ||
| Property, plant and equipment | 7 | 3,028 | 2,621 | 2,456 | ||
| Total non-currents assets | 3,898 | 3,367 | 3,176 | |||
| Current assets | ||||||
| Inventories | 8 | 1,112 | 139 | 112 | ||
| Trade and other receivables | 9 | 1,017 | 755 | 950 | ||
| Cash and cash equivalents | 10 | 3,779 | 493 | 3,931 | ||
| Total current assets | 5,908 | 1,387 | 4,993 | |||
| Total assets | 9,806 | 4,754 | 8,169 | |||
| Equity | ||||||
| Issued capital | 3,103 | 1,109 | 3,103 | |||
| Share premium | 13,709 | 11,729 | 13,709 | |||
| Capital redemption reserve | 11,840 | 11,840 | 11,840 | |||
| Reserves | (1,438) | (1,389) | (1,485) | |||
| Profit and loss account | (19,351) | (19,555) | (19,985) | |||
| Total equity attributable to equity holders of the parent company | 7,864 | 3,734 | 7,182 | |||
| Non-controlling interests | 123 | - | - | |||
| Total Equity | 7,986 | 3,734 | 7,182 | |||
| Liabilities | ||||||
| Non-current liabilities | ||||||
| Borrowings | 11 | 70 | 150 | 132 | ||
| Lease liabilities | 11 | 696 | 169 | 140 | ||
| Deferred tax | 69 | 80 | 74 | |||
| Other Liabilities | 72 | 101 | 87 | |||
| Total non-current liabilities | 907 | 500 | 433 | |||
| Current liabilities | ||||||
| Borrowings | 11 | 247 | 29 | 31 | ||
| Lease liabilities | 11 | 163 | 97 | 86 | ||
| Trade and other payables | 12 | 474 | 354 | 408 | ||
| Other liabilities | 29 | 40 | 29 | |||
| Total current liabilities | 913 | 520 | 554 | |||
| Total liabilities | 1,820 | 1,020 | 987 | |||
| Total equity and liabilities | 9,806 | 4,754 | 8,169 |
CONDENSED INTERIM CONSOLIDATED CASH FLOW STATEMENT
| Unaudited | Unaudited | Audited | |||
| Six months to | Six months to | Twelve months to | |||
| 30 Sep 2024 | 30 Sep 2023 | 31 March 2024 | |||
| GB£000 | GB£000 | GB£000 | |||
| Cash flows from operating activities: | |||||
| Group Profit / (Loss) after tax | 636 | (1,010) | (1,440) | ||
| Adjustments for: | |||||
| Gain on bargain purchase | (1,062) | - | - | ||
| Amortisation of intangible assets | 36 | 25 | 51 | ||
| Depreciation of property, plant and equipment | 142 | 160 | 313 | ||
| Share-based payments | 49 | 61 | (35) | ||
| Net finance costs | 34 | 36 | 83 | ||
| Tax credit in year | - | (381) | (580) | ||
| (Increase)/decrease in trade and other receivables | 219 | 214 | (362) | ||
| (Increase)/decrease in inventories | (34) | (58) | (31) | ||
| Taxation received | (5) | (5) | 569 | ||
| (Increase)/decrease in trade and other payables | (238) | 75 | 104 | ||
| Net cash flow from operating activities | (223) | (883) | (1,328) | ||
| Cash flows from investing activities: | |||||
| Purchase of property plant and equipment | (35) | (42) | (55) | ||
| Proceeds from disposal of tangible assets | - | - | 25 | ||
| Acquisition of subsidiary (net of cash acquired) | 208 | - | - | ||
| Interest paid | (19) | (21) | (55) | ||
| Interest received | 23 | - | - | ||
| Net cash flow from investing activities | 177 | (63) | (85) | ||
| Cash flows from financing activities: | |||||
| Proceeds from borrowing | 8 | 33 | 7 | ||
| Repayment of borrowings and leasing liabilities | (71) | (63) | (93) | ||
| Proceeds from share issue | 3,974 | ||||
| Net cash flow from financing activities | (63) | (30) | 3,888 | ||
| Net increase / (decrease) in cash and cash equivalents | (109) | (976) | 2,475 | ||
| Cash and cash equivalents at beginning of year | 3,931 | 1,484 | 1,484 | ||
| Effect of foreign exchange rate changes | (43) | (15) | (28) | ||
| Cash and cash equivalents at end of the period | 3,779 | 493 | 3,931 |
| CONDENSED INTERIM CONSOLIDATED STATEMENT OF CHANGES IN EQUITY | ||||||
| Issued Share capital | Share premium | Capital Redemption Reserve | Other reserve | Translation Reserve | Non- Controlling Interest | Profit and loss account | Total equity | |
| GB£000 | GB£000 | GB£000 | GB£000 | GB£000 | GB£000 | GB£000 | GB£000 | |
| Balance at 31 March 2023 | 1,109 | 11,729 | 11,840 | (1,450) | - | - | (18,545) | 4,683 |
| Share based payments | - | - | - | 61 | - | - | - | 61 |
| Transactions with owners | - | - | - | 61 | - | - | - | 61 |
| Total comprehensive income for the period | - | - | - | - | - | - | (1,010) | (1,010) |
| Balance at 30 September 2023 | 1,109 | 11,729 | 11,840 | (1,389) | - | - | (19,555) | 3,734 |
| Shares Issued (Net of Expenses) | 1,994 | 1,980 | - | - | - | - | 3,939 | |
| Share based payments | - | - | - | (96) | - | - | - | (35) |
| Transactions with owners | - | - | - | (96) | - | - | - | (35) |
| Total comprehensive income for the period | - | - | - | - | - | - | (430) | (430) |
| Balance at 31 March 2024 | 3,103 | 13,709 | 11,840 | (1,485) | - | - | (19,985) | 7,182 |
| Share based payments | - | - | - | 49 | - | 49 | ||
| Transactions with owners | - | - | - | 49 | - | - | - | 49 |
| Adjustment to NCI from foreign entity acquisition | - | - | - | - | - | 121 | - | 121 |
| Total comprehensive income for the period | - | - | - | - | (2) | 2 | 634 | 634 |
| Balance at 30 September 2024 | 3,103 | 13,709 | 11,840 | (1,436) | (2) | 123 | (19,351) | 7,986 |
NOTES TO THE CONDENSED CONSOLIDATED INTERIM FINANCIAL STATEMENTS
1. Reporting entity
The interim consolidated financial statements cover the consolidated entity RUA Life Sciences plc and the entities it controlled at the end of, or during, the interim period to 30 September 2024 ("the Group").
RUA Life Sciences plc ("the Company") is a public limited company and is domiciled and incorporated in Scotland with number SC170071. The Company is listed on the AIM market of the London Stock Exchange (ticker: RUA, ISIN: GB0033360586)
The registered office is
c/o Davidson Chalmers Stewart LLP
163 Bath Street
Glasgow
G2 4SQ.
RUA Life Sciences plc is the ultimate parent company of the Group, whose principal activities are contract design and manufacture of medical devices and exploiting the value of its IP and know-how.
2. Basis of preparation
These condensed consolidated interim financial statements are for the six months ended 30 September 2024 and have been prepared with regard to the requirements of IAS 34 on "Interim Financial Reporting". They do not include all of the information required for full financial statements and should be read in conjunction with the audited consolidated financial statements of the Group for the year ended 31 March 2024.
The financial information for the six months ended 30 September 2024 and the comparative figures for the six months ended 30 September 2023 are unaudited. They have been prepared on the basis of the accounting policies set out in the consolidated financial statements of the Group for the year ended 31 March 2024 and, on the recognition, and measurement principles of IFRS in issue as effective at 30 September 2024. The accounting policies have been applied consistently throughout the Group for the purposes of preparation of these condensed consolidated interim financial statements.
The figures for the year ended 31 March 2024 have been extracted from the audited statutory accounts which were approved by the Board of Directors on 23 July 2024, prepared under IFRS. The Independent Auditor's Report on the Report and Financial Statements for the year ended 31 March 2023 was unqualified but did draw attention to Note 1 of those financial statements which explains that the Group and Parent Company's ability to continue as a going concern is dependent on the execution of its business plan together with its ability to raise sufficient capital to meet capital and liquidity requirements. The auditors report did not contain any statements under sections 498(2) or 498(3) of the Companies Act 2006.
The financial information is presented in pounds Sterling which is the functional and presentational currency of the Company. Balances are rounded to the nearest thousand (£'000) except where otherwise indicated.
The Interim Financial Statements were approved by the Board of Directors on 10 December 2024.
Going concern
The Directors have considered the applicability of the going concern basis in the preparation of the financial statements. This included the review of financial results, internal budgets and cash flow forecasts for the period of at least 12-months following the date of approval of these interim financial statements (the "Going Concern Period").
In assessing whether the going concern assumption is appropriate, the directors have considered the Group's existing working capital and are of the opinion that the Group has adequate resources to undertake its planned program of activities for the 12 months from the date of approval of these financial statements.
Principal Risks and Uncertainties
The principal risks and uncertainties affecting the business activities of the Group remain those detailed on pages 22-24 of the Annual Report 2024, a copy of which is available on the Company's website www.rualifesciences.com
Profit/(Loss) per share
Profit/(Loss) per share has been calculated on the basis of the result for the period after tax, divided by the weighted average number of ordinary shares in issue in the period of 62,060,272. (30 September 2023: 22,184,798 and 31 March 2024: 33,546,577).
3. BUSINESS SEGMENTS AND REVENUE ANALYSIS
The principal activity of the RUA Life Sciences Group comprises exploiting the value of its IP & know-how, medical device manufacturing and development of cardiovascular devices.
Following the acquisition of the ABISS Group on 6th September 2024 and an internal organisation and reporting review, the Board has decided to rename the business segment Contract Manufacturing to Medical Devices and Components to more accurately describe it. This change incorporates revenues generated from contract manufacturing of medical devices, manufacturing and sale & distribution of medical devices into a single reporting segment. This change is consistent with both how the business will be managed and be reported internally in the future. The following analysis by segment is presented in accordance with IFRS 8 on the basis of those segments whose operating results are regularly reviewed by the Chief Operating Decision Maker (considered to be the Chief Executive Officer) to assess performance and make strategic decisions about the allocation of resources. Segmental results are calculated on an IFRS basis.
A brief description of the segments of the business is as follows:
· Biomaterials - Licensor of Elast-EonTM polymers to the medical device industry.
· Medical Devices and Components - End-to-end contract developer, manufacturer, and seller of medical devices and implantable fabric specialist.
· Vascular - Development and commercialisation of the Group's Elast-Eon sealed Vascular Graft products.
· Structural Heart - Development of the Group's Elast-Eon composite heart valve material AurTexTM.
Operating results which cannot be allocated to an individual segment are recorded as central and unallocated.
Segment revenue represents revenue from external customers arising from sale of goods and services. Segment results, assets and liabilities include items directly attributable to a segment as well as those that can be allocated on a reasonable basis.
The Group's revenue from continuing operations to destinations outside the UK amounted to 100% (6 months to 30 September 2023: 100%; year to 31 March 2024: 100%). The revenue analysis below is based on the country of registration of the customer:
| Analysis of revenue by geographical location | Unaudited | Unaudited | Audited | ||
| Six months to 30 Sep 2024 GB£000 |
Six months to 30 Sep 2023 GB£000 |
Twelve months to 31 Mar 2024 GB£000 |
|||
| Israel | 28 | 26 | 50 | ||
| Italy | - | 19 | 38 | ||
| Switzerland | - | - | 158 | ||
| France | 6 | - | - | ||
| Poland | 33 | - | - | ||
| USA | 1,457 | 749 | 1,945 | ||
| Total | 1,524 | 794 | 2,191 |
The Group's revenue for six months to 30 September 2024 is segmented as follows:
| Analysis of revenue by income stream | ||||||
| Unaudited | Unaudited | Unaudited | Unaudited | Unaudited | Unaudited | |
| Biomaterials | Medical Devices & Components | Vascular | Structural Heart | Central and unallocated | Total | |
| GB£000 | GB£000 | GB£000 | GB£000 | GB£000 | GB£000 | |
| Manufacture and sale of Medical Devices |
- | 1,286 | - | - | - | 1,286 |
| Royalty revenue | 238 | - | - | - | - | 238 |
| Total | 238 | 1,286 | - | - | - | 1,524 |
| Analysis of revenue by geographical location | ||||||
| Unaudited | Unaudited | Unaudited | Unaudited | Unaudited | Unaudited | |
| Biomaterials | Medical Devices & Components | Vascular | Structural Heart | Central and unallocated | Total | |
| GB£000 | GB£000 | GB£000 | GB£000 | GB£000 | GB£000 | |
| Israel | 28 | - | - | - | - | 28 |
| Italy | - | - | - | - | - | - |
| USA | 210 | 1,247 | - | - | - | 1,457 |
| France | - | 6 | - | - | - | 6 |
| Poland | - | 33 | - | - | - | 33 |
| Total | 238 | 1,286 | - | - | - | 1,524 |
The Group's revenue for six months to 30 September 2023 is segmented as follows:
| Analysis of revenue by income stream | ||||||
| Unaudited | Unaudited | Unaudited | Unaudited | Unaudited | Unaudited | |
| Biomaterials | Medical Devices & Components | Vascular | Structural Heart | Central and unallocated | Total | |
| GB£000 | GB£000 | GB£000 | GB£000 | GB£000 | GB£000 | |
| Manufacture and sale of Medical Devices |
- | 579 | 16 | - | - | 595 |
| Royalty revenue | 199 | - | - | - | - | 199 |
| Total | 199 | 579 | 16 | - | - | 794 |
| Analysis of revenue by geographical location | ||||||
| Unaudited | Unaudited | Unaudited | Unaudited | Unaudited | Unaudited | |
| Biomaterials | Medical Devices & Components | Vascular | Structural Heart | Central and unallocated | Total | |
| GB£000 | GB£000 | GB£000 | GB£000 | GB£000 | GB£000 | |
| Israel | 26 | - | - | - | - | 26 |
| Italy | - | 19 | - | - | - | 19 |
| USA | 173 | 560 | 16 | - | - | 749 |
| Total | 199 | 579 | 16 | - | - | 794 |
The Group's revenue for 12 months to 31 March 2024 is segmented as follows:
| Analysis of revenue by income stream | ||||||
| Unaudited | Unaudited | Unaudited | Unaudited | Unaudited | Unaudited | |
| Biomaterials | Medical Devices & Components | Vascular | Structural Heart | Central and unallocated | Total | |
| GB£000 | GB£000 | GB£000 | GB£000 | GB£000 | GB£000 | |
| Manufacture and sale of Medical Devices |
- | 1,679 | 16 | - | - | 1,695 |
| Royalty revenue | 496 | - | - | - | - | 496 |
| Total | 496 | 1,679 | 16 | - | - | 2,191 |
| Analysis of revenue by geographical location | ||||||
| Unaudited | Unaudited | Unaudited | Unaudited | Unaudited | Unaudited | |
| Biomaterials | Medical Devices & Components | Vascular | Structural Heart | Central and unallocated | Total | |
| GB£000 | GB£000 | GB£000 | GB£000 | GB£000 | GB£000 | |
| Switzerland | 158 | - | - | - | - | 158 |
| Israel | 50 | - | - | - | - | 50 |
| Italy | - | 38 | - | - | - | 38 |
| USA | 288 | 1,641 | 16 | - | - | 1,945 |
| Total | 496 | 1,679 | 16 | - | - | 2,191 |
The Group's Segmental analysis for six months to 30 September 2024 is segmented as follows:
| Unaudited | Unaudited | Unaudited | Unaudited | Unaudited | Unaudited | |
| Biomaterials | Medical Devices & Components | Vascular | Structural Heart | Central and unallocated | Total | |
| GB£000 | GB£000 | GB£000 | GB£000 | GB£000 | GB£000 | |
| Consolidated group revenues from external customers | 238 | 1,286 | - | - | - | 1,524 |
| Contributions to group operating loss | 215 | 703 | (336) | (205) | 288 | 665 |
| Depreciation | - | 57 | 59 | 7 | 19 | 142 |
| Amortisation of intangible assets | - | 32 | - | - | 4 | 36 |
| Segment assets | 140 | 3,570 | 1,096 | 209 | 4,791 | 9,806 |
| Segment liabilities | - | 1,270 | 280 | 9 | 261 | 1,820 |
| Intangible assets - goodwill | - | 301 | - | - | - | 301 |
| Other intangible assets | - | 369 | 139 | - | 61 | 569 |
| Additions to non-current assets | - | 29 | 2 | 2 | 2 | 35 |
The Group's Segmental analysis for six months to 30 September 2023 is segmented as follows:
| Unaudited | Unaudited | Unaudited | Unaudited | Unaudited | Unaudited | |
| Biomaterials | Medical Devices & Components | Vascular | Structural Heart | Central and unallocated | Total | |
| GB£000 | GB£000 | GB£000 | GB£000 | GB£000 | GB£000 | |
| Consolidated group revenues from external customers | 199 | 579 | 16 | - | - | 794 |
| Contributions to group operating loss | 166 | 305 | (602) | (215) | (1,014) | (1,360) |
| Depreciation | - | 27 | 99 | 9 | 25 | 160 |
| Amortisation of intangible assets | - | 22 | - | - | 3 | 25 |
| Segment assets | 103 | 1,329 | 1,225 | 165 | 1,930 | 4,752 |
| Segment liabilities | - | 220 | 407 | 19 | 374 | 1,020 |
| Intangible assets - goodwill | - | 301 | - | - | - | 301 |
| Other intangible assets | - | 237 | 139 | - | 69 | 445 |
| Additions to non-current assets | 1 | - | 3 | - | 38 | 42 |
The Group's Segmental analysis for 12 months to 31 March 2024 is segmented as follows:
| Unaudited | Unaudited | Unaudited | Unaudited | Unaudited | Unaudited | |
| Biomaterials | Medical Devices & Components | Vascular | Structural Heart | Central and unallocated | Total | |
| GB£000 | GB£000 | GB£000 | GB£000 | GB£000 | GB£000 | |
| Consolidated group revenues from external customers | 496 | 1,679 | 16 | - | - | 2,191 |
| Contributions to group operating loss | 421 | 931 | (1,009) | (465) | (1,816) | (1,938) |
| Depreciation | - | 135 | 116 | 17 | 45 | 313 |
| Amortisation of intangible assets | - | 43 | - | - | 8 | 51 |
| Segment assets | 225 | 1,527 | 1,013 | 149 | 5,065 | 7,979 |
| Segment liabilities | 5 | 218 | 383 | 22 | 358 | 986 |
| Intangible assets - goodwill | - | 301 | - | - | - | 301 |
| Other intangible assets | - | 216 | 139 | - | 64 | 419 |
| Additions to non-current assets | - | 14 | 3 | - | 38 | 55 |
4. BUSINESS COMBINATIONS
On 6 September 2024, RUA Life Sciences acquired the assets of Analytic Biosurgical Solutions SAS, ("Abiss") for a cash consideration of £68,000 (€80,000) through a transaction facilitated by the French courts. Abiss was part of a wider medical devices group which went into insolvent liquidation in June 2021 because of the impacts of Covid. Although the parent company was in liquidation, Abiss itself was not placed in receivership/liquidation. Abiss has continued to trade solvently and has traded within its own financial resources. There is no future, deferred or contingent consideration due on this transaction. Further details of the acquisition are detailed in the Chairmans statement.
As part of the acquisition, the net identifiable assets' carrying value was determined to be £1,130,000, which exceeds the total consideration transferred of £68,000. Consequently, a gain on a bargain purchase of £1,062,000 has been recognised in profit or loss as of the acquisition date.
This gain reflects the favourable terms of the transaction, arising primarily from the purchase through court proceedings at a value significantly below the fair value of the assets acquired. Due to the timing and nature of the transaction, no fair value adjustments have been made to the assets acquired, and the amounts presented represent the carrying values at the date of acquisition. Thus, the accounting is currently provisional . The Group intends to complete a thorough review of the fair value of the acquired assets and liabilities during the annual reporting process for the 18-month period ending 30 September 2025 , as permitted under IFRS 3-Business Combinations.
The ABISS Group had an operating loss from the date of acquisition to 30 September 2024 of £40,000. Abiss was impacted by supply chain challenges, resulting in back orders expected to be completed in the second interim period. Cash consumed in operating activities since the acquisition date amounted to £55,000.
Details of the Acquisition:
· Date of Acquisition: 6 September 2024
· Consideration Transferred: £ 68,000
· Carrying Value of Identifiable Net Assets Acquired: £1,130,000
· Gain on Bargain Purchase: £1,062,000
· Recognition of Gain: Included under "Other Income" in the Statement of Comprehensive Income for the period ended 30 September 2024
The fair value assessment of the net assets acquired is provisional and subject to adjustments as the Group finalises the purchase price allocation. Any changes to this assessment will be reported in the annual reporting process for the year ending 30 September 2025 in accordance with IFRS 3 - Business Combinations .
Details of the consideration paid and the fair value of net assets acquired are as follows:
| ABISS Group | |
| Provisionally recognised carrying value on acquisition | |
| GB£000 | |
| Consideration paid | 68 |
| Less: | |
| Intangible Assets | 186 |
| Property, Plant and Equipment | 660 |
| Trade receivables | 286 |
| Inventory | 115 |
| WIP | 851 |
| Cash | 275 |
| Trade payables | (290) |
| Other interest-bearing loans and borrowings | (832) |
| Non-Controlling Interest | (121) |
| Carrying value of net assets acquired | 1,130 |
| Gain on bargain purchase | 1,062 |
5. GOODWILL
The final valuation following the acquisition of RUA Medical Devices Limited gave rise to adjustments being required to the value of intangibles recognised in the Interim Report for the six months ended 30 September 2020, and lead to the following goodwill being recognised:
No impairment review has been carried out in the six-month period.
| GB£000 | |
| Gross carrying amount | |
| Balance at 30 September 2023 | 301 |
| Balance at 31 March 2024 | 301 |
| Balance at 30 September 2024 | 301 |
6. 
OTHER INTANGIBLE ASSETS
| Development costs | Intellectual property | Customer Related (CM) | Technology Based (CM) | Total | |
| GB£000 | GB£000 | GB£000 | GB£000 | GB£000 | |
| Gross carrying amount | |||||
| At 31 March 2023 | 337 | 3,325 | 247 | 141 | 4,050 |
| Additions | - | - | - | - | - |
| At 30 September 2023 | 337 | 3,325 | 247 | 141 | 4,050 |
| Additions | - | - | - | - | - |
| At 31 March 2024 | 337 | 3,325 | 247 | 141 | 4,050 |
| Additions | 179 | - | - | 6 | 185 |
| At 30 September 2024 | 516 | 3,325 | 247 | 147 | 4,235 |
| Amortisation and impairment | |||||
| At 31 March 2023 | 337 | 3,114 | 87 | 42 | 3,580 |
| Charge | - | 3 | 15 | 7 | 25 |
| At 30 September 2023 | 337 | 3,117 | 102 | 49 | 3,605 |
| Charge | - | 5 | 14 | 7 | 26 |
| At 31 March 2024 | 337 | 3,112 | 116 | 56 | 3,631 |
| Charge | 10 | 3 | 15 | 7 | 35 |
| At 30 September 2024 | 347 | 3,125 | 131 | 63 | 3,666 |
| Net book value | |||||
| At 31 March 2023 | - | 211 | 160 | 99 | 470 |
| At 30 September 2023 | - | 208 | 145 | 92 | 445 |
| At 31 March 2024 | - | 203 | 131 | 85 | 419 |
| At 30 September 2024 | 169 | 200 | 116 | 84 | 569 |
7. PROPERTY, PLANT AND EQUIPMENT
| Land & Buildings | Assets Under Construction | Plant & Machinery | Office Equipment | Motor Vehicles | Total | |
| GB£000 | GB£000 | GB£000 | GB£000 | GB£000 | GB£000 | |
| Cost | ||||||
| At 31 March 2023 | 1,335 | 142 | 1,905 | 95 | 25 | 3,502 |
| Additions | - | - | 7 | 2 | 33 | 42 |
| At 30 September 2023 | 1,335 | 142 | 1,912 | 97 | 58 | 3,544 |
| Transfer of Assets | - | (142) | 142 | - | - | - |
| Additions | - | - | 11 | 2 | - | 13 |
| Disposals | - | - | - | - | (25) | (25) |
| At 31 March 2024 | 1,335 | - | 2,065 | 99 | 33 | 3,532 |
| Transfer of Assets | - | - | - | - | - | - |
| Additions | 654 | - | 55 | 3 | 1 | 713 |
| At 30 September 2024 | 1,989 | - | 2,120 | 102 | 34 | 4,245 |
| Depreciation | ||||||
| At 31 March 2023 | 180 | - | 509 | 50 | 24 | 763 |
| Charge | 20 | - | 127 | 7 | 6 | 160 |
| At 30 September 2023 | 200 | - | 636 | 57 | 30 | 923 |
| Charge | 33 | - | 109 | 8 | 3 | 153 |
| At 31 March 2024 | 233 | - | 745 | 65 | 33 | 1,076 |
| Charge | 28 | - | 107 | 6 | - | 142 |
| At 30 September 2024 | 261 | - | 852 | 71 | 33 | 1,218 |
| Net book value | ||||||
| At 30 September 2023 | 1,135 | 142 | 1,276 | 40 | 28 | 2,621 |
| At 31 March 2024 | 1,102 | - | 1,320 | 34 | - | 2,456 |
| At 30 September 2024 | 1,728 | - | 1,268 | 31 | 1 | 3,028 |
Included in the net carrying amount of property plant and equipment are right-of-use assets as follows:
| Buildings (Leased) | Plant & Machinery (Leased) | Motor Vehicles | Total | ||||
| GB£000 | GB£000 | GB£000 | GB£000 | ||||
| Cost | |||||||
| At 31 March 2023 | - | 391 | 25 | 416 | |||
| Additions | - | 33 | 33 | ||||
| At 30 September 2023 | - | 391 | 58 | 449 | |||
| Additions | - | - | (25) | (25) | |||
| At 31 March 2024 | - | 391 | 33 | 424 | |||
| Additions | 653 | 8 | - | 661 | |||
| At 31 September 2024 | 653 | 399 | 33 | 1,085 | |||
| Depreciation | |||||||
| At 31 March 2023 | - | 48 | 24 | 72 | |||
| Charge | - | 21 | 5 | 26 | |||
| At 30 September 2023 | - | 69 | 29 | 98 | |||
| Charge | - | 9 | 4 | 13 | |||
| At 31 March 2024 | - | 78 | 33 | 111 | |||
| Charge | 5 | 20 | - | 35 | |||
| At 31 September 2024 | 5 | 98 | 33 | 136 | |||
| Net book value | |||||||
| At 30 September 2023 | - | 322 | 29 | 351 | |||
| At 31 March 2024 | - | 313 | - | 313 | |||
| At 30 September 2024 | 648 | 301 | - | 949 |
8. INVENTORIES
Inventories consist of the following:
| Unaudited | Unaudited | Audited | |||
| Six months to 30 Sep 2024 | Six months to 30 Sep 2023 | Twelve months to 31 Mar 2024 | |||
| GB£000 | GB£000 | GB£000 | |||
| Raw Materials | 194 | 58 | 59 | ||
| Work in Progress | 728 | 65 | 53 | ||
| Finished Goods | 190 | 16 | - | ||
| 1,112 | 139 | 112 |
The cost of inventories recognised as an expense and included in cost of goods sold amounted £36K (2023: £26K).
9. TRADE AND OTHER RECEIVABLES
| Unaudited | Unaudited | Audited | |||
| Six months to 30 Sep 2024 | Six months to 30 Sep 2023 | Twelve months to 31 Mar 2024 | |||
| GB£000 | GB£000 | GB£000 | |||
| Current: | |||||
| Trade receivables - gross | 407 | 98 | 301 | ||
| Allowance for credit losses | - | - | - | ||
| Trade receivables net | 407 | 98 | 301 | ||
| Tax credit due | 189 | 381 | 189 | ||
| Prepayments and accrued income | 421 | 276 | 460 | ||
| 1,017 | 755 | 950 |
10. CASH AND CASH EQUIVALENTS
| Unaudited | Unaudited | Audited | |||
| Six months to 30 Sep 2024 | Six months to 30 Sep 2023 | Twelve months to 31 Mar 2024 | |||
| GB£000 | GB£000 | GB£000 | |||
| Cash at bank and in hand | 3,779 | 493 | 3,931 | ||
| 3,779 | 493 | 3,931 |
11. BORROWINGS & LEASE LIABILITIES
| Unaudited | Unaudited | Audited | |||
| Six months to 30 Sep 2024 | Six months to 30 Sep 2023 | Twelve months to 31 Mar 2024 | |||
| GB£000 | GB£000 | GB£000 | |||
| Current: | |||||
| Bank loans | 247 | 29 | 31 | ||
| Lease Liabilities | 163 | 97 | 86 | ||
| 410 | 126 | 117 | |||
| Non-current: | |||||
| Bank loans | 70 | 150 | 132 | ||
| Lease Liabilities | 696 | 169 | 140 | ||
| 766 | 319 | 272 |
| Bank loans | Lease liabilities | Total | |||
| GB£000 | GBP£000 | GB£000 | |||
| Repayable in less than 6 months | 69 | 81 | 150 | ||
| Repayable in 7 to 12 months | 178 | 82 | 260 | ||
| Repayable in 1 to 5 years | 70 | 529 | 599 | ||
| Repayable after 5 years | - | 167 | 167 | ||
| 317 | 859 | 1,176 |
£128,230 of bank loans is secured on the property at 2 Drummond Crescent, Irvine, Ayrshire and subject to a bond and floating charge over the Group's assets. Secured bank loans carry a variable rate of interest, which were between 6% and 7.8%.
£188,567 of bank loans is an unsecured government support loan. Unsecured bank loans carry an effective rate of interest at 9%.
The lease liabilities are secured by the related underlying assets. Lease borrowings carry fixed rates of interest, ranging between 4.0% and 9.6%.
Reconciliation of change in lease liabilities:
| GB£000 | |
| As at 1 April 2023 | 282 |
| Payment of lease liability - principal | (16) |
| Payment of lease liability - interest | (12) |
| Interest expense | 12 |
| Additions | - |
| Disposals | - |
| As at Sep 2023 | 266 |
| Payment of lease liability - principal | (42) |
| Payment of lease liability - interest | (29) |
| Interest expense | 29 |
| Additions | 2 |
| Disposals | - |
| As at 31 March 2024 | 226 |
| Payment of lease liability - principal | (47) |
| Payment of lease liability - interest | (14) |
| Interest expense | 14 |
| Additions | 680 |
| Disposals | - |
| As at 30 September 2024 | 859 |
12. TRADE AND OTHER PAYABLES
| Unaudited | Unaudited | Audited | |||
| Six months to 30 Sep 2024 | Six months to 30 Sep 2023 | Twelve months to 31 Mar 2024 | |||
| GB£000 | GB£000 | GB£000 | |||
| Current liabilities: | |||||
| Trade payables | 115 | 184 | 140 | ||
| Other payables | 151 | 24 | 46 | ||
| Accruals and deferred income | 208 | 146 | 222 | ||
| 474 | 354 | 408 | |||
| Other Liabilities (Grant Income) | 101 | 141 | 116 | ||
| Total Trade and Other Payables | 575 | 496 | 524 |
Deferred grant income is included within other liabilities in the Consolidated statement of financial position. £29,000 (2023: £40,000) is included in current liabilities and £72,000 (2023: £101,000) included in Non-current Liabilities.
13. SUBSEQUENT EVENTS
None to report.
14. ISSUED SHARE CAPITAL
The Company's issued share capital as at 30 September 2024 comprises 62,060,272 Ordinary Shares of which none are held in treasury.
15. INTERIM ANNOUNCEMENT
The interim results announcement was released on 11 December 2024. A copy of this Interim Report is also available on the Company's website www.rualifesciences.com.
BOARD OF DIRECTORS AND ADVISORS
| W Brown - CEO | |
| L Smith - Group CFO | |
| G Berg - Non-Executive Chairman | |
| I Ardill - Non-Executive Director | |
| J McKenna - Director of Marketing | |
| J Ely - Non-Executive Director | |
| COMPANY SECRETARY | |
| L Smith | |
| HEAD OFFICE | REGISTERED OFFICE |
| 2 Drummond Crescent | c/o Davidson Chalmers Stewart LLP |
| Irvine | 163 Bath Street |
| Ayrshire | Glasgow |
| KA11 5AN | G2 4SQ |
| web: www.rualifesciences.com | |
| email: [email protected] | |
| REGISTRARS | |
| Equiniti Limited | |
| Aspect House | |
| Spencer Road | |
| West Sussex | |
| BN99 6DA | |
| LAWYERS | |
| Davidson Chalmers Stewart | |
| 163 Bath Street | |
| Glasgow | |
| G2 4SQ | |
| Burness Paull LLP | |
| 50 Lothian Road | |
| Festival Square | |
| Edinburgh | |
| EH3 9WJ | |
| INDEPENDENT AUDITOR | |
| RSM Audit UK LLP | |
| Centenary House | |
| 69 Wellington Street | |
| Glasgow | |
| G2 6HG | |
Registered in Scotland, Company No.SC170071
Financial statements will be available to Shareholders from the Company Website, along with copies of the announcement. Dealings permitted on Alternative Investment Market (AIM) of the London Stock Exchange .
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