TIDMSARS
RNS Number : 9270S
Sarossa PLC
30 September 2014
Sarossa Plc
Annual Report and Financial Statements 2014
30 September 2014
AUDITED RESULTS FOR THE YEAR ENDED 30 JUNE 2014
Sarossa Plc ("Sarossa" or the "Company) announces its audited
financial results for the year ended 30 June 2014.
Highlights:
- Net assets at 30 June 2014 of GBP17.22 million (2013: GBP13.53 million).
- Profit after tax of GBP3.69 million (2013: GBP0.62 million)
inclusive of an exceptional release of a legacy biotechnology
provision of GBP1.60 million (2013: GBPnil).
- Operating profit before exceptional items of GBP2.08 million (2013: GBP 0.46 million).
- Portfolio investments at 30 June 2014 valued at GBP10.62
million represented by 4 AIM quoted holdings (2013: GBP7.61 million
represented by 3 quoted holdings).
- Spend on new investments at cost of GBP1.09 million (2013: GBP6.65 million).
- Re-organisation into a Jersey, Channel Islands, based group
under a new Jersey holding company, Sarossa Plc.
Michael Bretherton, Chairman, said:
"We remain committed to deliver additional value for our
shareholders and will continue to maintain a rigorous and highly
selective investment approach with a view to exploiting
opportunities as they emerge. We are confident that this approach
will enable us to build considerable value for shareholders going
forward."
A letter will shortly be posted to shareholdersadvising that a
full copy of the Company's Annual Report 2014 is now available on
the Company's website at www.sarossaplc.com under the Investor
Centre/Financial Reports section and that this contains on page 36,
a Notice of the Annual General Meeting to be held at 11.00 a.m. on
20 November 2014 at the Company's registered office at 17 The
Esplanade, St Helier, Jersey, JE2 3QA.
Enquiries :
Sarossa Plc
Mike Bretherton, Chairman 01534 719760
WH Ireland Limited (Nominated adviser)
Chris Fielding, Head of Corporate Finance 020 7220 1650
Chairman's Statement
The Group delivered a profit after tax for the year ended 30
June 2014 0f GBP3.69 million compared to a profit of GBP0.62
million in the previous year. That profit included an exceptional
release of a legacy biotechnology provision of GBP1.60 million
(2013: GBPnil). Operating profit before exceptional items was
GBP2.08 million (2013: GBP0.46 million) and the increase of GBP1.62
million mainly reflects further revaluation gains amounting to
GBP1.08 million on portfolio investments, together with an
additional gain of GBP0.68 million on a derivative trading
asset.
Antisoma Plc changed its name to Sarossa Capital Plc on 1
November 2013 in order to reflect the fact that it no longer has
operations in biotechnology development and is now an investment
and management company.
Sarossa Capital Plc subsequently completed a successful
re-organisation into a Jersey, Channel Islands, based Group under
which the former parent company became a wholly owned subsidiary of
a new Jersey holding company, Sarossa Plc ('Sarossa' or 'the
Company'), which was admitted to AIM on 2 May 2014. The business
operation, assets and liabilities of the Sarossa Group immediately
after the re-organisation were no different from those immediately
before the re-organisation.
During the year, the Group spent GBP1.09 million on the purchase
of additional portfolio investments. This spend comprised of a
follow on investment in Silence Therapeutics Plc and also an
investment in GVC Holdings Plc, undertaken in conjunction with the
close out of an existing financial derivative position in that GVC
stock.
The Company holds currently 4 portfolio investments, all of
which are quoted on AIM, and for which the carrying value at 30
June 2014 was GBP10.62 million (30 June 2013: GBP7.61 million
represented by 3 quoted holdings).
The Group continues to benefit from a strong balance sheet with
cash and short term deposit balances of GBP6.13 million at 30 June
2014 compared to cash and short term deposit balances of GBP6.87
million at the previous 30 June 2013 year end. Net assets at 30
June 2014 were GBP17.22 million compared with GBP13.53 million at
30 June 2013.
Sarossa is an investment holding and management company whose
principal activity is investment in and growth and development of
businesses which present opportunities for value creation. The
Company is mainly focused on portfolio businesses with product and
service platforms targeting major international markets through
customers and partners with an international profile.
Investment portfolio update
An overview of the activities of the portfolio businesses in
which Sarossa has a holding of over 3 per cent. is given below:
Silence Therapeutics Plc ('Silence'), which is AIM listed, is a
global leader in the discovery, development and delivery of novel
RNAi therapeutics for the treatment of serious diseases. The core
technology of Silence is its proprietary form of a short
interfering RNA molecule, known as AtuRNAi, that enables the
development of novel molecular entities that "silence" or
inactivate the genes expressed in some diseases. Additionally, the
company has developed technology that preferentially delivers
AtuRNAi to the vascular endothelium (AtuPLEX), the lung endothelium
(DACC) and the liver (DBTC). ATU027 is the company's leading
Oncology product and the company achieved a further key milestone
during the last year by completing recruitment for a Phase 2a trial
for Atu027 in combination with gemcitabine for pancreatic cancer.
Another key target was achieved in April 2014 when Silence
confirmed successful gene knockdown in non-human primates using its
RNAi lung delivery system, DACC. The company has a robust IP estate
protecting its proprietary technology and also has a sound balance
sheet with net cash and deposits at 30 June 2014 of GBP26.3m.
Sarossa' s shareholding at 30 June 2014 was, and continues to be,
4.65 per cent. of the issued share capital of Silence.
Plant Health Care Plc ('PCH') which is AIM listed, is a leading
provider of novel patent protected biological products to the
global agriculture markets. The company has a portfolio of
established products based on its proprietary Harpin and
Myconate(R) technologies. PHC's products increase crop yields by
enhancing natural processes within the plant. In 2013, the company
signed a development and commercialisation agreement with Arysta
LifeScience for the foliar use of Harpin <ALPHA><BETA>
in several crops, in a number of geographies. The first fruit of
that collaboration was the US launch in 2014 of "Astera(TM) with
<ALPHA><BETA>pro(TM)", a mixture of Harpin
<ALPHA><BETA> with the fungicide propiconazole.
Development work on other products and territories continues with
Arysta LifeScience. PHC is also continuing to seek other commercial
agreements for both Harpin <ALPHA><BETA> and Myconate
with other agricultural majors and has an active pipeline of
negotiations. PHC anticipates completing at least one additional
commercial agreement during the remainder of 2014. Sarossa's
holding in PCH at 30 June 2014 was, and continues to be, 4.72 per
cent.
In addition to the above, Sarossa has holdings of below 3 per
cent. in two profitable AIM listed companies, one of which operates
in the online gaming and sports betting markets and the other is a
care sector support services business. Both of these companies have
solid dividend yield and favourable growth records.
Outlook
There is continued reason for investment caution in the near
term, given the many threats to a sustained global recovery,
including the crises in Ukraine and the Middle East, Europe's
continuing debt problems and the slowing down of Federal Reserve
bond purchases in the US. We remain committed, however, to deliver
additional value for our shareholders and will continue to maintain
a rigorous and highly selective investment approach with a view to
exploiting opportunities as they emerge. We are confident that this
approach will enable us to build considerable value for
shareholders going forward.
Michael Bretherton
Chairman
30 September 2014
Consolidated Statement of Comprehensive Income for the year
ended 30 June 2014
2014 2013
GBP'000 GBP'000
-------- --------
Gain on portfolio investments 1,816 133
Other income 594 644
----------------------------------------------- -------- --------
Portfolio return and revenue 2,410 777
Research and development credit/(expenditure) 6 (6)
Release of legacy biotechnology provision 1,603 -
Administrative expenses (333) (310)
----------------------------------------------- -------- --------
Operating profit 3,686 461
----------------------------------------------- -------- --------
Analysed as:
Operating profit before exceptional items 2,083 461
Exceptional items 1,603 -
----------------------------------------------- -------- --------
Operating profit 3,686 461
Finance income 47 170
Finance expense (43) (9)
----------------------------------------------- -------- --------
Profit before taxation 3,690 622
Taxation - -
-------- --------
Profit for the year 3,690 622
----------------------------------------------- -------- --------
Earnings per ordinary share
Basic 0.58p 0.10p
----------------------------------------------- -------- --------
Diluted 0.58p 0.10p
----------------------------------------------- -------- --------
There are no other items of comprehensive income.
Consolidated Statement of Changes in Equity as at 30 June
2014
Retained earnings
Share capital Share premium Merger reserve Other reserve deficit Total
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
--------------------- -------------- -------------- --------------- -------------- -------------------- --------
At 1 July 2012 10,725 122,091 - 8,282 (128,186) 12,912
Total comprehensive
income for the year - - - - 622 622
At 30 June 2013 10,725 122,091 - 8,282 (127,564) 13,534
--------------------- -------------- -------------- --------------- -------------- -------------------- --------
Total comprehensive
income for the year - - - - 3,690 3,690
Group
re-organisation (4,331) (122,091) 126,422 (8,282) 8,282 -
At 30 June 2014 6,394 - 126,422 - (115,592) 17,224
--------------------- -------------- -------------- --------------- -------------- -------------------- --------
Consolidated Statement of Financial Position at 30 June 2014
2014 2013
GBP'000 GBP'000
----------------------------- ---------- ----------
ASSETS
Non-current assets
Portfolio Investments 10,624 7,606
---------- ----------
10,624 7,606
----------------------------- ---------- ----------
Current assets
Trade and other receivables 594 697
Derivative trading assets - 170
Short-term deposits 2,603 1,500
Cash and cash equivalents 3,530 5,367
6,727 7,734
----------------------------- ---------- ----------
Total assets 17,351 15,340
----------------------------- ---------- ----------
LIABILITIES
Current liabilities
Trade and other payables (127) (96)
Provisions - (1,710)
----------------------------- ---------- ----------
Total liabilities (127) (1,806)
---------- ----------
Net current assets 6,600 5,928
----------------------------- ---------- ----------
Net assets 17,224 13,534
----------------------------- ---------- ----------
Shareholders' equity
Share capital 6,394 10,725
Share premium - 122,091
Merger reserve 126,422 -
Other reserves - 8,282
Retained earnings deficit (115,592) (127,564)
---------- ----------
Total shareholders' equity 17,224 13,534
----------------------------- ---------- ----------
Consolidated Statement of Cash Flows for the year ended 30 June
2014
2014 2013
GBP'000 GBP'000
-------- --------
Cash flows from operating activities
Profit before tax 3,690 622
Adjustments for:
Foreign exchange (gains)/losses (48) 94
Release of legacy biotechnology provision (1,603) -
Finance income (47) (170)
Unrealised gain on revaluation of portfolio investments and derivative assets (1,763) (85)
------------------------------------------------------------------------------- -------- --------
Operating cash inflows before movement in working capital 229 461
Purchase of portfolio investments (1,085) (6,648)
Decrease / (increase) in trade and other receivables 87 (21)
Increase in trade and other payables 31 8
------------------------------------------------------------------------------- -------- --------
Cash used in operations (738) (6,200)
Interest received 47 170
------------------------------------------------------------------------------- -------- --------
Net cash used in operating activities (691) (6,030)
------------------------------------------------------------------------------- -------- --------
Cash flows from investing activities
(Increase)/reduction of short-term deposits with banks (1,103) 1,600
------------------------------------------------------------------------------- -------- --------
Net cash (used)/generated from investing activities (1,103) 1,600
------------------------------------------------------------------------------- -------- --------
Net increase in cash and cash equivalents (1,794) (4,430)
Exchange losses on cash balances (43) (9)
Cash, cash equivalents at beginning of year 5,367 9,806
------------------------------------------------------------------------------- -------- --------
Cash and cash equivalents at end of year 3,530 5,367
------------------------------------------------------------------------------- -------- --------
Short term deposits at end of year 2,603 1,500
------------------------------------------------------------------------------- -------- --------
Cash, cash equivalents and short term deposits at end of year 6,133 6,867
------------------------------------------------------------------------------- -------- --------
This information is provided by RNS
The company news service from the London Stock Exchange
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