Half-year Report

Source: RNS
RNS Number : 0336E
Graft Polymer (UK) PLC
13 September 2024
 

This announcement contains inside information for the purposes of Article 7 of EU Regulation No. 596/2014, which forms part of United Kingdom domestic law by virtue of the European Union (Withdrawal) Act 2018 (as amended).

 

13 September 2024

Graft Polymer (UK) PLC

Unaudited interim results for the six months to 30 June 2024

 

Graft Polymer (UK) Plc (the "Company" or "Graft Polymer"), an innovative biotechnology company focused on co-developing therapeutics for mental health disorders, announces its unaudited interim results for the six months to 30 June 2024.

 

Highlights

·    Board changes undertaken, including appointment of Anthony Tennyson as Chief Executive Officer.

·    Completion of an operational review, leading to a strategic focus on the healthcare industry, specifically developing intellectual property ("IP") relating to the treatment of mental health and substance use disorders, and the co-development of therapeutics for mental health disorders.

·    Disposal of non-core, underperforming industrial polymer division to streamline operations and focus on higher-growth sectors.

·    Successful £1.8 million fundraising, post period end, through the publication of a prospectus (the "Prospectus") and placement of new shares.

·    Entered a commercial collaboration agreement with Awakn Life Sciences Corp. to co-develop a new class of therapeutics targeting trauma related mental health disorders such as Post-Traumatic Stress Disorder ("PTSD").

·    Strengthening of the intellectual property portfolio with four new patent applications related to mental health and substance use disorders.

 

Anthony Tennyson, CEO, said: "I am confident that the strategic steps taken since my appointment positions Graft Polymer as an innovative biotechnology company focused on developing IP relating to the treatment of mental health and substance use disorders, and the co-development of therapeutics for mental health disorders. We are committed to delivering value to our shareholders as we continue this journey and I look forward to providing further updates on our progress."

 

Chairman's Statement

The interim financial results cover the six-month period from the 1 January 2024 to 30 June 2024. A more detailed narrative on the Company's recent activities was provided in the Prospectus, published on 3 July 2024.

I joined Graft Polymer as Chairman in March 2024, during a period of financial distress for the Company. Upon my appointment, an injection of capital was urgently needed, which led to the initiation of a comprehensive operational review to chart a sustainable path forward.

In May 2024, Anthony Tennyson joined as CEO, bringing a mandate to reduce overheads, streamline operations, and build out our IP portfolio to capitalise on the growing potential of our Graft Bio division.

The operational review is now complete, and we are repositioned as a biotechnology company with a specific focus on mental health and substance use disorders. Through various announcements, we have communicated our strategy clearly, and I am grateful for the strong support from our shareholders since the July 2024 capital raise. Our commitment to developing breakthrough therapeutics for under-addressed markets, including mental health and substance use disorders, offers a credible and significant growth opportunity.

 

CEO's report

 

Since my appointment as CEO in May 2024, Graft Polymer has achieved important milestones that underscore our evolution into a biotechnology company focused on mental health and substance use disorders. Our initial target is trauma-related mental health conditions, including PTSD, which impacts approximately 13 million adults in the U.S. and 20 million in the US, UK, and key EU markets.

On 3 May 2024, we announced the disposal of Graft Polymer Slovenia D.O.O., a non-core, underperforming industrial plastics subsidiary. This divestment was essential in refocusing the Company on our core strengths in biotechnology.

Following this, we took several crucial steps to strengthen the Company's financial and strategic position:

 

·      3 July 2024: The Company successfully raised £1.8 million, providing the resources needed to fuel future growth.

 

·      18 July 2024: The Company entered into a commercial collaboration with Awakn Life Sciences Corp. to co-develop new therapeutics targeting trauma-related mental health disorders, including PTSD.

 

·      30 July 2024: The Company appointed Professor David Nutt as Senior Scientific Advisor, adding world-class expertise to our development programme.

 

·      28 August 2024: The Company and Awakn Life Sciences Corp. selected the co-lead series for our collaboration and engaged Charnwood Discovery as the synthesis partner to advance the programme.

 

With these steps, we are confident in our trajectory as a key player in the development of innovative treatments for mental health and substance use disorders. We look forward to keeping our shareholders updated as we continue to execute our strategy.

 

 

 

Enquiries:

Graft Polymer (UK) Plc
Anthony Tennyson, CEO and Executive Director
Email: anthonytennyson@graftpolymer.co.uk

 

Allenby Capital (Broker)

Nick Naylor / Liz Kirchner (Corporate Finance) | Guy McDougall (Sales) 

+44 (0) 20 3328 5656 

 

GRAFT POLYMER (UK) PLC - CONDENSED CONSOLIDATED INTERIM FINANCIAL STATEMENTS

CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME

FOR THE 6 MONTH PERIOD ENDING 30 JUNE 2024

 


 

 

Note

Unaudited

Six months to

30 Jun 2024

£'000

Unaudited

Six months to 30 Jun 2023
£'000

Continuing operations


 

 

  Revenue

5

  Cost of sales


-

(129)

Gross profit


-

111

  Operational costs

6

  Administrative expenses

6

  Gain on deconsolidation

14

139

-

Operating loss


(405)

(1,029)

  Depreciation


  Finance costs


(64)

(3)

Loss before taxation


  Income tax


-

-

Loss for the period from continuing operations


(469)

(1,126)

  Loss from discontinuing operations

14

(157)

-

Total loss for the period attributable to equity holders of the parent


(626)

(1,126)

Other comprehensive income




Foreign currency translation


76

38

Derecognition of foreign exchange reserve

14

(123)

-

Other comprehensive income (net of tax) for the year

 

(673)

38

Total comprehensive loss for the period attributable to equity holders of the parent


(673)

(1,088)



 

 

Loss per share (p)

7

(0.38)

(1.08)

 

The notes from an integral part of the Condensed Consolidated Interim Financial Statements.


CONSOLIDATED STATEMENT OF FINANNCIAL POSITION

FOR THE 6 MONTH PERIOD ENDING 30 JUNE 2024

 

 

 

 

Note

Unaudited

30 Jun 2024

£'000

Unaudited 30 Jun 2023

£'000

Audited

31 Dec 2023
£'000

Non-current assets





  Property, plant and equipment

8

-

805

-

  Intangible assets

9

2,068

2,068

2,068

  Other non-current assets


-

13

13

  Right of use assets


-

47

39

Total non-current assets


2,068

2,933

2,120

Current assets





  Cash and cash equivalents


27

522

155

  Trade and other receivables


44

136

108

  Inventory


-

114

51

Total current assets


71

772

314

TOTAL ASSETS


2,139

3,705

2,434

 





Non-current liabilities





  Lease liability


-

29

22

Total non-current liabilities


-

29

22

Current liabilities





  Trade and other payables


220

197

249

  Deferred Income


-

-

93

  Lease liability


-

13

12

  Loan note

11

264

-

-

  Provisions


-

-

32

Total current liabilities


484

210

386

Total liabilities


484

239

408

NET ASSETS


1,655

3,466

2,026

 





Equity





  Issued share capital

12

62

41

41

  Share premium

12

7,093

7,001

7,001

  Share capital to issue


358

-

175

  Share based payments reserve


1,233

858

1,227

  Capital reduction reserve


2,500

2,500

2,500

  Foreign exchange reserve

  Share based payments reserve


-

37

47

  Accumulated losses


(9,591)

(6,971)

(8,965)

TOTAL EQUITY


1,655

3,466

2,026

The notes from an integral part of the Condensed Consolidated Interim Financial Statements.

The Condensed Consolidated Interim Financial Statements were approved and authorised by the Board of Directors on 13 September 2024.

 Nicholas Nelson - Chairman



CONSOLIDATED STATEMENT OF CASHFLOWS

FOR THE 6 MONTH PERIOD ENDING 30 JUNE 2024


 

Unaudited

Six months to

30 Jun 2024

£'000

Unaudited

Six months to

30 Jun 2023
£'000

Cash flow from operating activities



 

  Loss before tax

(626)

(1,126)

 

Adjustments for:



 

Depreciation - property, plant & equipment

57

90

 

Depreciation - right of use asset

-

4

 

Finance charge

64

3

 

Share based payments

7

-

 

Gain on deconsolidation

(139)

-

 

Impairment of fixed asset

(57)

-

 

Foreign exchange movements

75

39

 

Changes in working capital:



 

Decrease in trade and other receivables

34

175

 

Increase / (decrease)  in in trade and other payables

123

(151)

 

Increase in inventories

39

73

 

Net cash outflow from operating activities

(423)

(893)

 




 

Cash flow from investing activities



 

Purchase of property, plant and equipment

-

(237)

 

Repayments on right of use assets

(4)

-

 

Disposed subsidiary cash balance

(13)

-

 

Net cash outflow from investing activities

(17)

(237)

 




 

Cash flows from financing activities



 

Net proceeds from issue of shares

112

-

 

Proceeds from issue of convertible note

200


 

Net cash inflow from financing activities

312

-

 




 

Net (decrease) in cash and cash equivalents

(128)

(1,130)

 

Cash and cash equivalents at beginning of period

155

1,640

 

Foreign exchange impact on cash

-

12

 

Cash and cash equivalents at the end of the period

27

522

 

 

 

 

 

 

CONSOLIDATED STATEMENT OF CHANGES IN EQUITY

AS AT 30 JUNE 2024


Share capital

Shares to be issued

Share premium

Capital Reduction reserve

SBP reserve

Foreign exchange Reserve

Retained earnings

Total equity


£'000

£'000

£'000

£'000

£'000

£'000

£'000

£'000

Balance at 31 December 2022

41

-

7,001

2,500

858

(1)

(5,845)

4,554

 









Loss for period

-

-

-

-

-

-

(1,126)

(1,126)

Other comprehensive income

-

-

-

-

-

38

-

38

Total comprehensive loss for year

-

-

-

-

-

38

(1,126)

(1,088)

Transactions with owners in own capacity

 








Transactions with owners in own capacity

-

-

-

-

-

-

-

-

Balance at 30 June 2023

41

-

7,001

2,500

858

37

(6,971)

3,466

 

 

 

 

 

 


 

 

Loss for period

-

-

-

-

-

-

(1,994)

(1,994)

Other comprehensive income

-

-

-

-

-

10

-

10

Total comprehensive loss for year

-

-

-

-

-

10

(1,994)

(1,984)

Transactions with owners in own capacity









Waiver of Director and advisor fees

-

175

-

-

-

-

-

175

Employee options

-

-

-

-

369

-

-

369

Transactions with owners in own capacity

-

175

-

-

369

-

-

544

Balance at 31 December 2023

41

175

7,001

2,500

1,227

47

(8,965)

2,026

 

 

 

 

 

 

 

 

 

Loss for period

-

-

-

-

-

-

(626)

(626)

Other comprehensive income

-

-

-

-

-

76

-

76

Total comprehensive loss for year

-

-

-

-

-

76

(626)

(551)

Transactions with owners in own capacity









Shares issued during the year

21

183

92

-

-

-

-

296

Disposal of subsidiary

-

-

-

-

-

(123)

-

(123)

Employee options

-

-

-

-

6

-

-

6

Transactions with owners in own capacity

21

183

92

-

6

(123)

-

179

Balance at 30 June 2024

62

358

7,093

2,500

1,233

-

(9,591)

1,655


NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

FOR THE 6 MONTH PERIOD ENDING 30 JUNE 2024

1.         GENERAL INFORMATION

Graft Polymer (UK) Plc ("the Company" or "Graft") was incorporated in England and Wales as a limited company on 18 May 2017 as Graft Polymer (UK) Limited and was re-registered as a public limited company on 1 July 2021. The Company is domiciled in England and Wales with its registered office at Eccleston Yards, 25 Eccleston Place, London, SW1W 9NF. The Company's registered number is 10776788.

At the beginning of the period the principal activities of the Company and all of its subsidiaries (collectively referred to as "the Group") were the research and development of polymer modification technologies and polymer modification techniques. However towards the end of the period the board of directors undertook a review of its business and operations, pursuant to which it was decided that Graft Polymer Slovenia ("Graft Polymer D.O.O") (principally, an industrial polymer products manufacturer) was considered no longer commercially viable due to forecasted negative cashflow as a result of falling sales and rising costs, with no immediate prospect of becoming profitable in the short to medium term and as a result the decision was made to dispose of Graft Polymer D.O.O on 2 May 2024.

Post the divestment the Company will focus its attention and resources on its Graft Bio division, which represents strong prospectivity through its intellectual property (IP), licensing agreements, and sales contracts.

The condensed consolidated interim financial statements ("interim financial statements") were approved for issue by the Board of Directors on 13 September 2024.

2.         ACCOUNTING POLICIES

IAS 8 requires that management shall use its judgement in developing and applying accounting policies that result in information which is relevant to the economic decision-making needs of users, that are reliable, free from bias, prudent, complete and represent faithfully the financial position, financial performance and cash flows of the entity.

3.         BASIS OF PREPARATION

The interim financial statements of Graft Polymer (UK) Plc for the six-month period ended 30 June 2024 have been prepared in accordance with Accounting Standard IAS 34 Interim Financial Reporting.

The interim report does not include all the notes of the type normally included in an annual financial report. Accordingly, this report is to be read in conjunction with the annual report for the year ended 31 December 2023, which was prepared in accordance with UK adopted International Accounting Standards (IFRS) and the Companies Act 2006, and any public announcements made by Graft Polymer (UK) plc during the interim reporting period and since.

These interim financial statements do not constitute statutory accounts as defined in Section 434 of the Companies Act 2006. The Group's statutory financial statements for the year ended 31 December 2023 prepared under IFRS have been filed with the Registrar of Companies. The auditor's report on those financial statements was unqualified and did not contain a statement under Section 498(2) of the Companies Act 2006.

The functional currency for each entity in the Group is determined as the currency of the primary economic environment in which it operates.  The functional currency of the Company's subsidiary (which was disposed of on 2 May 2024) was the Euro. The presentational currency of the Group is Pounds Sterling as this is the functional currency of the parent entity and also the currency in which equity fundraising has been facilitated. Amounts have been rounded to the nearest £'000.

The interim financial statements have not been audited.

The business is not considered to be seasonal in nature.

3.1       GOING CONCERN

These interim financial statements have been prepared on the going concern basis, which contemplates the continuity of normal business activities and the realisation of assets and settlement of liabilities in the normal course of business. 

As disclosed in the interim financial statements, the consolidated entity incurred a net loss before taxation for the period ended 30 June 2024 from continuing operations of approximately £469,000 (30 June 2023: approximately £1,126,000) and had net cash outflows of approximately £128,000 (30 June 2023: approximately £1,130,000) for the period ended 30 June 2024. As at period end, the consolidated entity had net current liabilities of approximately £413,000 (30 June 2023: net current assets of approximately £562,000) and had cash and cash equivalents equal to approximately £27,000 (30 June 2023: approximately £522,000). 

In the Group's last annual report the Group's auditors noted that there was a material uncertainty relating to going concern due to an uncertainty over a potential fundraise. Since period end, the Group has successfully raised £1.8m (before expenses) via a placing of new ordinary shares which has boosted the liquidity of the Group.

As a result, the Directors have assessed that the Group now has sufficient working capital to execute its operations over the next 12 months. Accordingly, the Directors believe that the Group will be able to continue as a going concern and that it is appropriate to adopt the going concern basis in the preparation of the interim financial statements. 

3.2       PRINCIPAL RISK AND UNCERTAINTIES

The principal risks and uncertainties of the Group have changed materially since the publication of the Group's last annual report. A new risk assessment was performed alongside the prospectus that was published on 3 July 2024 and the key risks are highlighted below:

-     The Group is currently loss making, recording a financial loss of approximately £469,000 (30 June 2023: approx. £1,126,000) for the period and the Group has no clear source of revenue.

-     The existing license of the Group's drug delivery systems may ultimately fail to deliver revenues through royalty and distribution payments in accordance with management's expectations or at all; and

-     A core asset of the Group is the intellectual property rights in its drug delivery system. A failure to protect those intellectual property rights and its portfolio of intellectual property rights, more generally, may have an adverse impact on the financial condition of the Group

These risks are deemed by the Directors to be within the normal risk appetite of the Group and are comfortable that the risks are properly mitigated where required.

3.3       CRITICAL ACCOUNTING ESTIMATES

The preparation of these interim financial statements requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, income and expenses, and disclosure of contingent assets and liabilities at the end of the reporting period.

In preparing these interim financial statements, the significant judgements made by management in applying the Group's accounting policies and the key sources of estimation uncertainty were similar to those that applied to the financial statements for the period ended 31 December 2023 (unless specifically detailed below) with the nature and amounts of such estimates have not changed significantly during the interim period. New critical accounting estimates considered by management for the interim period were:

Disposal of Graft Polymer D.O.O

On 2 May 2024, the board of directors undertook a review of its business and operations, pursuant to which it was decided to dispose of Graft Polymer D.O.O on 2 May 2024. On contemplation of various factors relating to Graft Polymer D.O.O the board decided there was not significant value in the subsidiary and hence decided to dispose of it for nominal consideration.

4.         SEGEMENT REPORTING

The Chief Operating Decision Maker is the Board of Directors. The Board reviews the Group's internal reporting in order to assess performance of the Group. Management has determined the operating segments based on the reports reviewed by the Board.

The Board considers that during the six month period ended 30 June 2024, the Group operated in two segments being the corporate function in the United Kingdom and polymer development and production in Slovenia.

However, due to the disposal of the Slovenian operations on 2 May 2024, the contributions from the Slovenian operating segment are not reported in the loss from continuing operations in the statement of comprehensive income. For details of the contribution of the Slovenian operations during the period up until the point of disposal, refer to Note 14.

 

5.         REVENUE


 

 

Period to

30 Jun 2024

£'000

Period to 30 Jun 2023 £'000

Sales revenue


-

240



-

240

For details of the revenue from the Slovenian operations during the period up until the point of disposal refer to Note 14.

 

6.         OPERATING LOSS

Operating loss from continued operations is stated after (charging):


 

 

Period to

30 Jun 2024

£'000

Period to

30 Jun 2023

£'000

Operational costs


(18)

(80)

Director and employee costs


(241)

(620)

Professional and consulting fees


(248)

(163)

Travel expenses


                     -

(2)

Corporate and administrative costs


(30)

(150)

Other expenses


(7)

(31)

Foreign exchange


-

(94)

Gain on deconsolidation


139

-



(405)

(1,140)

7.         EARNINGS PER SHARE

The calculation of the basic and diluted earnings per share is calculated by dividing the profit or loss for the period by the weighted average number of ordinary shares in issue during the period.


 

Unaudited Period to 30 Jun 2024

Unaudited  Period to 30 Jun 2023

Loss for the period from continuing operations - £ '000s


(469)

(1,126)

Weighted number of ordinary shares in issue


124,309,754

104,097,229

Loss per share from continuing operations - p


(0.38)

(1.08)

Share options and warrants could potentially dilute basic earnings per share in the future. These were not included in the calculation and no diluted earnings per share presented as the Group is loss making and additional equity instruments are anti-dilutive for the periods presented.

 

8.         PROPERTY, PLANT AND EQUIPMENT

 

 

Leasehold Improvements

£'000

Plant

& Equipment

£'000

Total

£'000

Cost




At 1 July 2023

90

1,135

1,225

Additions

14

6

20

Disposals

-

(27)

(27)

Impairment

(107)

(1,117)

(1,224)

Exchange impact

3

3

6

At 31 December 2023 (audited)

-

-

-

Impairment

107

1,117

1,224

Disposal on derecognition of subsidiary

(107)

(1,117)

(1,224)

At 30 June 2024 (unaudited)

-

-

-


 

 

 

Depreciation




At 1 July 2023

(48)

(372)

(420)

Charge for the year

-

(73)

(73)

Disposals

-

6

6

Impairment

40

463

503

Exchange impact

8

(24)

(16)

At 31 December 2023 (audited)

-

-

-

Impairment

(40)

(463)

(503)

Disposal on derecognition of subsidiary

40

463

503

At 30 June 2024 (unaudited)

-

-

-


 

 

 

Net book value at 31 December 2023 (audited)

-

-

-

Net book value at 30 June 2023 (unaudited)

42

763

805

Net book value at 30 June 2024 (unaudited)

-

-

-

 

9.         INTANGIBLE ASSETS

 


 

 

Unaudited 30 Jun 2024

£'000

Unaudited 30 Jun 2023
£'000

Audited

31 Dec 2023
£'000

Opening balance


2,068

2,068

2,068



2,068

2,068

2,068

Intangible assets relate to the issue of 22,500,000 shares to founding director Victor Bolduev on the acquisition of his "Know-how" and patents that have been transferred to the Group.

At each period end, the Directors assess the intangible assets for any indicators of impairment and have concluded no presence of such indicators. Consequently no impairment charge has been processed during the period (31 Dec 2023: £nil).

10.       INVESTMENTS

Company subsidiary undertakings

The Group owned interests in the following subsidiary undertakings, which are included in the financial statements:

 

Graft Polymer IP Limited

Intellectual property

England and Wales

Eccleston Yards, 25 Eccleston Place, London, SW1W 9NF

100%

 

11.       LOAN NOTE


 

 

Unaudited 30 Jun 2024

£'000

Unaudited 30 Jun 2023

£'000

Audited 31 Dec 2023

£'000

Opening balance


-

-

-

Principal drawn down


200

-

-

Interest charged


64

-

-

Principal repaid


-

-

-



264

-

-

On 15 March 2024, the Company entered into a £100,000 working capital loan facility, which was subsequently increased by a further £100,000 in April 2024. The facility has been drawn down in full and attracts an interest rate of 10% per month. The loan is repayable on demand, together with accumulated interest.

 

12.       SHARE CAPITAL


 

 

Unaudited

 30 Jun 2024

Unaudited

 30 Jun 2023

Audited

 31 Dec 2023

Number of shares


124,763,966

104,097,299

104,097,299

Nominal value (£'000)


62

41

41

 

Issued and fully paid ordinary shares with a nominal value of £0.001 (2023: £0.001)

 

Change in issued Share Capital and Share Premium:

 

Number of shares

Share     capital

Share premium

Total

Ordinary shares

 

£'000

£'000

£'000

Opening balance at 31 December 2023

104,097,299

41

7,001

7,042

Issue of shares at placing price of 0.6 pence

20,666,667

21

103

124

Share issue costs

-

-

(11)

(11)

Closing balance at 30 June 2024

124,763,966

62

7,093

7,155

 

13.       SHARE BASED PAYMENT RESERVE

Warrants

 

As at 30 June 2024

 

Weighted average exercise price

Number of warrants

Brought forward at 1 January 2024

22p

2,031,008

Granted in period

1p

10,333,333


0.6p

1,500,000

Expired during period

22p

(775,194)

Outstanding at 30 June 2024

2.9p

13,089,147

Exercisable at 30 June 2024

2.9p

13,089,147

The weighted average time to expiry of the warrants as at 30 June 2024 is 515 days.

The following table lists the Black Scholes inputs to the model used for valuation of the warrants:

 

1p warrants

0.6p warrants

Dividend yield (%)

0%

0%

Expected volatility (%)

92.4%

92.4%

Risk-free interest rate (%)

3.6%

3.6%

Time to maturity

2 years

2 years

Exercise price (£)

0.01

0.006

Share price at grant date (£)

0.006

0.006

 

14.       BUSINESS COMBINATIONS

Discontinued operations

A discontinued operation is a component of the Group that has been disposed of or classified as held for sale and that represents a separate major line of business or geographical area of operation, is part of a single co-ordinated plan to dispose of such a line of business or area of operations, or is a subsidiary acquired exclusively with a view to resale. The results of discontinued operations are presented separately on the face of the Statement of Comprehensive Income.

The Board recently undertook a review of its business and operations, pursuant to which it was decided that the Slovenian operation, Graft Polymer D.O.O (principally, an industrial polymer products manufacturer), was considered no longer commercially viable due to forecasted negative cashflow as a result of falling sales and rising costs, with no immediate prospect of becoming profitable in the short to medium term. The Group disposed of Graft Polymer D.O.O on 2 May 2024.

A gain on deconsolidation as at date of disposal of £139k was recognised and taken to the Statement of Comprehensive Income.

Gain on deconsolidation of Graft Polymer D.O.O


 

2 May 2024

£'000

Consideration received


 

 

  Cash


-


  Carrying amount of net liabilities sold


16




16

 

  Reclassification of foreign exchange reserve

123


  Gain on deconsolidation

 

139





Financial Performance for Graft Polymer D.O.O



Unaudited

Four months to 2 May 2024

£'000

Unaudited

Six months to 30 Jun 2023
£'000

  Revenue


221

240

  Cost of sales


(162)

(128)

Gross profit


59

112

  Operational costs


(17)

(80)

  Depreciation


(57)

(92)

  Administrative expenses


(141)

(288)

Operating loss


(156)

(348)

  Finance costs


(1)

(3)

Loss before taxation


(157)

(351)

  Income tax


-

-

Loss for the period from discontinuing operations

(157)

(351)

 

Assets and liabilities of Graft Polymer D.O.O



Unaudited

2 May 2024

£'000

Audited

31 Dec 2023
£'000

Non-current assets




  Right of use assets


38

39

  Other non-current assets


13

13

Total non-current assets


51

52

Current assets


 

 

  Cash and cash equivalents


13

143

  Trade and other receivables


44

78

  Inventory


11

50

Total current assets


68

271

TOTAL ASSETS


119

323

 




Non-current liabilities




  Lease liability


-

22

Total non-current liabilities


-

22

Current liabilities




  Trade and other payables


71

132

  Deferred Income


36

93

  Lease liability


28

12

Total current liabilities


135

237

Total liabilities


135

259

NET ASSETS


(16)

64

 

15.       RELATED PARTY TRANSACTIONS

Payments to Directors

In the period Directors accrued fees as per below which were outstanding at period end:


Fees accrued in the period

(£)

Outstanding Fees as at 30.06.24

(£)

Victor Bolduev          

84,870

135,175

Pavel Kobzev

22,270

52,160

Roby Zomer

30,050

66,666

Yifat Steuer

50,050

90,270

Alex Brooks

7,430

16,865

Anthony Tennyson

8,335

8,335

Nicholas Nelson

10,500

10,500

The outstanding fees were settled through a mix of cash and share consideration post period end.

16.       EVENTS SUBSEQUENT TO PERIOD END

Placement of New shares and issue of warrants

On 10 July 2024, the Company raised £1.8 million (before expenses) through a placing of 2,171,166,667 new ordinary shares. A breakdown of the placement is detailed below:

Type of shares

No. of shares

  Placing shares

1,800,000,000

  Conversion shares1

264,000,000

  Management shares2

59,666,667

  Fee shares3

47,500,000

Total

2,171,166,667

1 Shares issued as full repayment of working capital loan and accrued interest

2 Shares issued in satisfaction of fees owed to Directors as at 31 March in connection to the July 24    transaction

3 Shares issued to various directors and advisors in lieu of fees owed

In addition to the above, on 10 July 2024, 294,500,000 warrants were also issued.

Resignation of Pavel Kobzev

On 15 July 2024, Mr. Pavel Kobzev resigned from the board of directors with immediate effect. This followed the Company's recent divestiture of its industrial plastics business unit, Graft Polymer D.O.O., announced on 3 May 2024.

Resignation of Victor Bolduev

On 1 August 2024, Mr. Victor Bolduev resigned from the board of directors and from his role as the Company's Chief Technology Officer with immediate effect. This followed the Company's recent divestiture of its industrial plastics business unit, Graft Polymer D.O.O., announced on 3 May 2024.

Resignation of Yifat Steuer

On 12 August 2024, Ms. Yifat Steuer resigned from the board of directors and from her role as the Company's Chief Financial Officer with immediate effect.

Issue of options to Professor David Nutt

In consideration for becoming the Company's Senior Scientific Adviser, Professor Nutt was granted 10,000,000 nominal cost options (with an exercise price of £0.001 and expiry life of 3 years) over the Company's ordinary shares under the Company's Long Term Incentive Plan. The options vest in 3 equal tranches with one tranche vesting immediately and the remaining two tranches on the 1 and 2 year anniversary of grant date respectively.

Impairment of Intangible Assets

Subsequent to period end the board of directors reviewed the current financial position of the Company and, following the resignation of Victor Bolduev on 1 August 2024 the directors will assess the recoverability of intangible assets linked to his intellectual property and "Know-how." As there were no indicators of the potential resignation of Mr Bolduev at period end the Directors are comfortable that the assets were not impaired at this stage.

 

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