RNS Number : 7067D
CapRegen PLC
18 September 2008
18 September 2008
CapRegen plc
Interim Results for the Period Ended 30 June 2008
CapRegen plc ("CapRegen" or "the Group"), the AIM listed anti-ageing and regenerative medicine investment company, is pleased to
announce its interim results for 2008.
Highlights
* First investment in CapRegen Magnum is progressing ahead of plan
* Two new investments announced today
* Further strengthening of the Board with two new appointments
* Period end net cash of �3.6 million, being 4.0p per share
Douglas Emslie, Chairman of CapRegen, commented:
"The first six months of the year has been very positive for the Group. Trading at CapRegen Magnum has been ahead of our expectations
and expansion plans to further grow this investment are well advanced. We have today announced two new investments and a further
strengthening of the Board to support the Group's growth. Your Board is confident that its first full year of operation will be one of very
good progress."
FOR FURTHER INFORMATION, PLEASE CONTACT:
CapRegen plc:
Douglas Emslie, Chairman 020 8846 2700
Nominated Adviser:
Blue Oar Securities Plc
William Vandyk 020 7448 4400
CHAIRMAN'S STATEMENT
Introduction
The first six months of the year has been very positive for the Group. Our first investment, CapRegen Magnum, has performed ahead of
expectations and expansion plans to further grow this investment are well advanced.
Results
The Group generated revenues of �141,080 in the period and made a profit before tax of �122,532. The profit before tax, warrant charges
and amortisation charge was �155,212. Net assets as at 30 June 2008 were �3,648,846 of which �3,611,679 was cash which is 4.0p per share.
Your directors do not intend to recommend the payment of a dividend at this time.
First Investment - CapRegen Magnum
CapRegen Magnum has invested in medical device marketing initiatives in the aesthetics and sports medicine industries through a
marketing agreement with a US based company Arasys Perfector Inc. ("Arasys").
The devices sold by Arasys are used for aesthetic purposes, in particular skin rejuvenation and also to help build muscle and improve
muscle tone as part of an overall health and fitness programme. They are manufactured in the UK and Arasys has the worldwide sales and
marketing rights to them in the anti-ageing, aesthetic, spa, medical spa, medical clinic, hospital and preventative medicine markets.
In the period the Group received �141,080 of royalties from Arasys. Arasys is continuing to develop new products which are expected to
benefit the Group in the second half of the year. In addition, as a result of marketing initiatives through CapRegen, Arasys has expanded
its sales activities into Asia.
Board
George Greenwood was appointed to the Board as a non-executive director on 9 June 2008. George Greenwood has a strong background in the
financial services and investment arena, having originally qualified as a lawyer. He has spent much of his career at Steamship Mutual, a
Bermuda based international marine insurance mutual, where he was Chief Executive from 1986 until 2003. At Steamship Mutual he was
responsible for over $400 million of assets under management and a world-wide client base. Currently he is Vice-President of the Institute
of Chartered Shipbrokers, a non-executive director of Lloyd's broker J.B. Boda & Co. (UK) Ltd. and on the investment committees of several
not-for-profit organisations.
Today, we are also pleased to announce that David Michael Steel, 48, has joined the Board as Finance Director. David has over 20 years
of financial experience, having qualified as a Chartered Accountant in 1986 with KPMG. He is currently Group Financial Controller of Tarsus
Group plc.
In the previous five years David Steel has been a director of the following companies and remains a director:
CapRegen Natural Biosciences Ltd.
CapRegen Nutraceuticals Ltd.
CapRegen Biosciences Ltd.
There is no further information required to be disclosed under paragraph (g) of Schedule 2 of the AIM Rules.
Outlook
Sales of Arasys have started well in the second half with additional products being added to the portfolio and the expansion into Asia.
Your Board has announced two new investments today. The first is the formation of a new, US based company, CapRegen Nutraceuticals Inc.
("CNI"), which will initially be owned 96% by CapRegen and 4% by CNI staff and licensees. If agreed financial targets are achieved over the
first two years of operation the CNI staff and licensees' shareholding can increase to 12%. CNI will sell and market nutraceutical products
acquired under license from third parties to anti-ageing doctors. CNI has entered into two third party licenses today. CapRegen will provide
CNI with a working capital facility of up to $250,000.
The second investment is the acquisition of 50% of Natural Biosciences Inc ("NBI") a U.S. company, for $250,000. NBI will initially
market three medicinal mushroom products that assist the body's immune system in its fight against illness and disease. They also have
anti-oxidant and anti-inflammatory potential. In addition, NBI plans to develop diagnostic products for the early detection of oxidation
stress. NBI is also in the process of negotiating a license for a compound that may be able to carry a potent antioxidant back and forth
across cell barriers.
NBI is a newly established company and was set up by Dr Marvin Hausman, an accomplished immunologist, surgeon and life sciences
executive. Dr Hausman will be the CEO of NBI and will use the sales and marketing services of CNI, our second investment, to sell and market
the three medicinal mushroom products to anti-ageing doctors and medical professionals.
Dr Hausman has a long and successful track record of working in the public company arena. He was until recently Chairman and CEO of Oxis
International Inc., a US public company, which specialises in research and development of technologies and therapeutic products in the field
of oxidative stress and inflammatory reaction. He was also chairman of Axonyx, a NASDAQ company involved in the development of drugs
relating to Alzheimer's Disease and other central nervous system indications, until 2006 when it merged with Torry Pines Therapeutics. Prior
to founding Axonyx, Dr. Hausman was a co-founder of Medco Research Inc., a pharmaceutical biotechnology company specializing in adenosine
products which was subsequently acquired by King Pharmaceuticals.
Your Board is confident that its first full year of operation will be one of very good progress.
Douglas Emslie
Chairman
18 September 2008
CONDENSED CONSOLIDATED INTERIM INCOME STATEMENT
Notes Six month to 30 June Period to 31
2008 December 2007
� �
(unaudited) (audited)
Group revenue 7 141,080 -
Operating costs (114,747) (81,822)
Group operating profit 26,333 (81,822)
Interest receivable 96,199 75,418
Profit before taxation 122,532 (6,404)
Taxation expense 8 (27,600) (46,289)
Profit for the financial 94,932 (52,693)
period
Profit/(loss) for the 83,356 (48,971)
financial period attributable
to equity shareholders of the
parent company
Profit/(loss) for the 11,576 (3,722)
financial period attributable
to minority interests
94,932 (52,693)
Notes Six month to 30 June Period to 31 December 2007
2008
Earnings per share (pence) 9
- basic 0.1 -
- diluted 0.1 -
CONDENSED CONSOLIDATED INTERIM STATEMENT OF RECOGNISED INCOME AND EXPENSE
Six month to 30 June 2008 Period to 31 December 2007
� �
(unaudited) (audited)
Profit for the financial 94,932 (52,693)
period
Total recognised income and 94,932 (52,693)
expense for the period
Attributable to:
Equity holders of the parent 83,356 (48,971)
company
Minority interest 11,576 (3,722)
Total recognised income and 94,932 (52,693)
expense for the period
CONDENSED CONSOLIDATED INTERIM BALANCE SHEET
Notes 30 June 31 December
2008 2007
� �
(unaudited) (audited)
NON-CURRENT ASSETS
Intangible assets 10 206,853 150,182
Deferred tax asset 17,457 -
224,310 150,182
CURRENT ASSETS
Trade and other receivables 24,477 46,985
Cash and cash equivalents 3,611,679 3,574,588
3,636,156 3,621,573
TOTAL ASSETS 3,860,466 3,771,755
CURRENT LIABILITIES
Trade and other payables (211,620) (217,560)
NON-CURRENT LIABILITIES
Deferred tax liability - (26,368)
TOTAL LIABILITIES (211,620) (243,928)
NET ASSETS 3,648,846 3,527,827
EQUITY
Share capital 11 890,100 890,100
Share premium account 11 2,503,879 2,503,879
Other reserves 11 199,442 173,355
Retained earnings 11 34,385 (48,971)
Equity shareholders' funds 3,627,806 3,518,363
Minority interest 11 21,040 9,464
TOTAL EQUITY 3,648,846 3,527,827
CONDENSED CONSOLIDATED INTERIM CASH FLOW STATEMENT
Six month to 30 June Period to 31 December 2007
2008
�
�
(unaudited) (audited)
Cash flows from operating
activities
Profit for the period 94,932 (52,693)
Adjustments for:
Warrant charge 26,087 29,678
Amortisation 6,593 420
Tax charge 27,600 46,289
Net interest (96,199) (75,418)
Operating cashflow before 59,013 (51,724)
changes in working capital
Change in trade and other 5,051 (46,985)
receivables
Change in current trade and (54,974) 197,246
other payables
Cash generated from operations 9,090 98,537
Interest received 91,265 75,418
Net cash from operating 100,355 173,955
activities
Cash flows from investing
activities
Acquisition of subsidiaries - (18,346)
Acquisition of intangible (63,264) -
fixed assets
Net cash from investing (63,264) (18346)
activities
Cash flows from financing
activities
Issue of shares: Initial - 500,000
subscription
- 3,200,500
Flotation
Cost of share issue - (281,521)
Net cash outflow from - 3,418,979
financing activities
Net increase in cash and cash 37,091 3,574,588
equivalents
Opening cash and cash 3,574,588 -
equivalents
Closing cash and cash 3,611,679 3,574,588
equivalents
NOTES TO THE CONDENSED CONSOLIDATED INTERIM FINANCIAL STATEMENTS
1. REPORTING ENTITY
CapRegen plc (the "Company") is a company domiciled in the United Kingdom. The condensed consolidated interim financial statements of
the Company as at and for the six months ended 30 June 2008 comprise the Company and its subsidiaries (together referred to as the
"Group").
The consolidated financial statements of the Group as at and for the period ended 31 December 2007 are available upon request from the
Company's registered office at Metro Building, 1 Butterwick, London W6 8DL.
2. STATEMENT OF COMPLIANCE
These condensed consolidated interim financial statements have been prepared in accordance with International Financial Reporting
Standards (IFRS) IAS 34 Interim Financial Reporting. They do not include all of the information required for full annual financial
statements, and should be read in conjunction with the consolidated financial statements of the Group as at and for the period ended 31
December 2007 which were prepared under International Financial Reporting Standards and have been reported on by the Company's auditors and
delivered to the Registrar of Companies. The auditors' report was unqualified and did not contain a statement under section 237 (2) or (3)
of the Companies Act 1985.
The interim financial information was approved by a duly appointed and authorised committee of the Board of Directors on 18 September
2008. The interim financial information is unaudited.
3. SIGNIFICANT ACCOUNTING POLICIES
The accounting policies applied by the Group in these condensed consolidated financial statements are the same as those applied by the
Group in its consolidated financial statements as at and for the period ended 31 December 2007.
4. ESTIMATES
The preparation of consolidated interim financial statements requires management to make judgments, estimates and assumptions that
affect the application of accounting policies and the reported amounts of assets and liabilities, income and expense. Actual results may
differ from these estimates.
In preparing these condensed consolidated interim financial statements, the significant judgements made by management in applying the
Group's accounting policies and the key sources of estimation uncertainty were the same as those that applied to the consolidated financial
statements as at and for the period ended 31 December 2007.
5. FINANCIAL RISK MANAGEMENT
The Group's financial risk management objectives and policies are consistent with that disclosed in the consolidated financial
statements as at and for the period ended 31 December 2007.
6. PROFIT AND LOSS ANALYSIS
The following analysis illustrates the performance of the Group's activities, and reconciles the Group's profit, as shown in the interim
income statement, to adjusted profits. Adjusted profit is presented to provide a better indication of overall financial performance and to
reflect how the business is managed and measured on a day-to-day basis. The adjusted profit excludes share warrant charges and amortisation
of intangible assets.
Six months Period to
to 30 June 31
2008 December
� 2007
�
Profit for the financial period after taxation 94,932 (52,693)
Add back:
Taxation charge 27,600 46,289
122,532 (6,404)
Add back:
Warrant charge 26,087 29,678
Amortisation charge 6,593 420
Adjusted profit before tax 155,212 23,694
7. SEGMENTAL ANALYSIS
The Group only operates in the area of investing in early-concept anti-ageing technologies.
8. INCOME TAX EXPENSE
The taxation charge for the six months ended 30 June 2008 is based on the estimated effective tax rate of 23%.
9. EARNINGS PER SHARE
Six months Period to
to 30 June 31
2008 December
pence 2007
pence
Basic earnings per share 0.1 -
Diluted earnings per share 0.1 -
Basic earnings per share
The basic earnings per share has been calculated on the profit after tax attributable to ordinary shareholders for the six months of
�83,356 (December 2007: loss of �48,971) and 89,010,000 (December 2007: 70,287,871) ordinary shares being the weighted average number of
shares in issue during the period.
Diluted earnings per share
The diluted earnings per share has been calculated on the loss after tax attributable to ordinary shareholders for the six months of
�83,356 (December 2007: loss of �48,971) and 89,010,000 (December 2007: 70,287,871) ordinary shares being the diluted weighted average
number of shares in issue during the period.
Weighted average number of ordinary shares (diluted):
Six months Period to 31
to 30 June December
2008 2007
Weighted average number of ordinary shares 89,010,000 70,287,871
Effect of share options - -
Weighted average number of ordinary shares 89,010,000 70,287,871
(diluted)
Actual shares in issue at 4 September 2008: 89,010,000
10. INTANGIBLE FIXED ASSETS
Goodwill Marketing rights Total
�
� �
Cost:
At 1 January 2008 18,739 131,863 150,602
Additions 12,500 50,764 63,264
At 30 June 2008 31,239 182,627 213,866
Amortisation:
At 1 January 2008 - (420) (420)
Amortisation charge - (6,593) (6,593)
At 30 June 2008 - (7,013) (7,013)
Net book values:
At 31 December 2007 18,739 131,443 150,182
At 30 June 2008 31,239 175,614 206,853
11. RECONCILIATION OF MOVEMENTS IN EQUITY
Share Share Retained Minority Total
Other Sub
capital premium reserves earnings Total interest
account
� � � � � � �
As at 30 June 2008:
Profit for the period - - - 83,356 83,356 11,576 94,932
Movement relating to warrants - - 26,087 - 26,087 - 26,087
Net change in shareholders' - - 26,087 83,356 109,443 11,576 121,019
funds
Opening equity shareholders' 890,100 2,503,879 (48,971) 9,464 3,527,827
funds 173,355 3,518,363
Closing equity shareholders' 890,100 2,503,879 34,385 21,040 3,648,846
funds 199,442 3,627,806
12. RELATED PARTIES
Directors of the company control 21.8% (31 December 2007: 21.8%) of the voting shares of the company.
At 30 June 2008, there were balances owing to and from various Tarsus Group companies, relating to funding of various transactions. All
balances were settled by 18 September 2008.
At 30 June 2008, Tarsus Group plc held 17.4% of the voting shares of the company.
Montana Street Consultants Inc. has an office sublease with MCII, a Tarsus Group company. No rent was charged for the period to 30 June
2008.
13. POST BALANCE SHEET EVENT
On 18 September 2008, CapRegen formed a new, US based company, CapRegen Nutraceuticals Inc. (CNI), which will initially be 96% owned by
the Group and 4% by CNI staff and licensees. If agreed financial targets are achieved over the first two years of operation the CNI staff
and licensees' shareholding can increase to 12%. CNI will sell and market nutraceutical products acquired under license from third parties
to anti-ageing doctors. CNI has entered into two third party licenses today. CapRegen will provide CNI with a working capital facility of up
to $250,000.
Also on 18 September 2008, CapRegen acquired 50% of Natural Biosciences Inc (NBI) a U.S. company, for $250,000. NBI will initially
market three medicinal mushroom products that assist the body's immune system in its fight against illness and disease. They also have
anti-oxidant and anti-inflammatory potential. In addition, NBI plans to develop diagnostic products for the early detection of oxidation
stress. NBI is also in the process of negotiating a license for a compound that may be able to carry a potent antioxidant back and forth
across cell barriers.
This information is provided by RNS
The company news service from the London Stock Exchange
END
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