Trinity Biotech Announces Q2 2023 Financial Results
- Diabetes consumables revenue increased 10% over Q1, with a 70% increase in Asia.
- Clinical Chemistry and Syphilis product lines show positive momentum.
- Revenue outlook for Q3 is $14m to $15m.
- Haemoglobins franchise expects strong performance in H2 2023.
- Diabetes consumables expected to increase over 20% in H2.
- Strategic instrument placements and supply chain improvements aim to expand market.
- FDA clearance for Premier Resolution System.
- Partnership to maximize Sjogrens opportunity.
- TrinScreen HIV test launch in Kenya.
- Operational transformation initiatives for cashflow improvement.
- Headcount reduction of 20% by end of Q4 2023.
- Manufacturing optimization for Diabetes A1c consumables and instrument.
- Savings of over $1.5m expected.
- Supply chain optimization aims for 40%-50% savings in materials costs.
- Improved reagent column system in development.
- Revenue decreased 3% from Q1.
- Lower Infectious Disease revenues compared to Q1.
- Phased out non-core transplant activity at Buffalo lab.
- Legal challenges to HIV testing algorithm in Kenya.
DUBLIN, Ireland, Oct. 03, 2023 (GLOBE NEWSWIRE) -- Trinity Biotech plc (Nasdaq: TRIB), a leading developer and manufacturer of diagnostic products for the point-of-care and clinical laboratory markets, today announced the Company’s results for the quarter ended June 30, 2023.
Summary Highlights:
Revenue:
- Total revenue for fiscal Q2, 2023 was
$13.9m (excluding Fitzgerald Industries, which was disposed of in April 2023). Excluding our Covid focused PCR Viral Transport Media (“VTM”) products and Fitzgerald Industries, revenue for the quarter of$13.7m was3% lower than in Q1, 2023. - Our core franchise Diabetes consumables revenues increased
10% over Q1, 2023. - Recurring Diabetes consumables revenue rebounded strongly in Asia, increasing approximately
70% over Q1, led by demand recovery in China. We expect this level of demand to continue for the rest of 2023 in one of our most important markets. In addition, Diabetes revenues grew by over10% collectively in our direct distribution markets, namely the US and Brazil. - Clinical Chemistry, Chromsystems and Syphilis product lines continue to show positive revenue momentum despite key raw materials backorders in some Clinical Chemistry product lines.
- These revenue gains were offset by lower Infectious Disease revenues compared with Q1, 2023 and reflects the irregular order cycles in the business line. In addition, we phased out our non-core and difficult to scale transplant activity at our Buffalo, New York laboratory during the quarter.
- Revenue outlook for Q3 is expected to be approximately
$14m to$15m . In addition, order backlogs have increased substantially to approximately$1m (broadly double the run rate in the first half of 2023). - Significant commercial reorganization, customer engagement initiatives and service quality improvements have positioned the core Haemoglobins franchise for a strong second half and 2023 revenue performance. Strategic instrument placements and a focus on maximizing instrument utilization are gaining traction toward building an expanding, recurring revenue profile for the business. Diabetes consumables are expected to increase over
20% in the second half of 2023 vs the first half. - Diabetes Instrument placements for the second half of the year are accelerating and are expected to be up to double those placed in the first half of 2023.
Haemoglobins:
- In August, Trinity Biotech received U.S. FDA 510(k) clearance for the Premier Resolution System, the automated analyzer for accurate & precise quantification of haemoglobin variants. Our intention is to retake the market leader position in haemoglobin variants with this modern successor to the highly regarded Ultra2 platform. The Premier Resolution System builds on our Ion Exchange technology reputation of excellence and a market leading combination of accuracy, speed and value. We also expect this important clearance from the FDA to drive further penetration and increased utilization of the Premier Resolution System in key global markets, including Brazil (where there is substantial scale in blood bank screening), and allow us to begin the regulatory process for the Chinese market.
- The redevelopment of our flagship diabetes HbA1c platform, the Premier 9210, is on track for a phased roll-out in 2024. The final redeveloped system is expected to feature an improved, backward compatible column and reagent formulation that should feature up to 3 times the current injection capacity and reduced calibration frequency, with improved user interface and lab system integration. Launch of the new column and reagent will be the first step in a multi-generational product development plan aimed at expanding the target market into higher throughput segments, driving lower service downtime and cost, while significantly expanding operating margins.
- Our improved design, combined with a significant overhaul of supply chain strategy, are expected to yield significant reductions in instrument cost, cost of goods sold related to test volume, and cost of service and repair.
- These cost competitive actions are aimed at significantly expanding our total addressable market in the high growth global Diabetes space. We have initiated a program to manufacture a version of our core Diabetes instrument in China. In addition to optimizing supply chain benefits, we believe it will enable us to double our reach to a very significant proportion of the Chinese hospital market that is limited to domestic manufacturers. We plan to obtain regulatory approval for domestic market entry by late 2024.
Reference Lab:
- Efforts are at an advanced stage to significantly reposition and scale the commercial focus of our 50-state certified lab in Buffalo, New York. The Company continues to see significant potential in its proprietary Sjogrens bio-marker lab developed tests, despite limited commercialization activities to date, with approximately
20% average annual growth since 2020 and annual revenues approaching$4m . A serious Autoimmune complication of the broader dry-eye market, studies indicate that Sjogrens syndrome may affect over 3 million individuals in the US or1% of the US population. - We are entering into a strategic revenue-sharing partnership with Trusted Health Advisors to lead our commercial and business development activities aimed at maximizing the Sjogren’s opportunity. The team, comprising of ex-senior executives from Quest and Mayo Clinics, brings decades of experience and extensive network in the industry.
- The partners intend to explore the opportunity to leverage the Reference Lab’s Autoimmune capabilities to jointly target proprietary biomarkers library expansion opportunities and serve as a centre of excellence for therapeutic drug monitoring and companion diagnostics across multiple Autoimmune diseases.
TrinScreen HIV:
- The Company is focused executing on the launch and distribution of its TrinScreen HIV screening test, following the announcement by the Kenyan Ministry of Health of the adoption of the new HIV rapid testing algorithm. This algorithm establishes Trinity Biotech’s TrinScreen HIV as the standard screening test in Kenya under World Health Organisation (“WHO”) guidelines.
- Field evaluation of the algorithm was completed in June, the Ministry of Health has communicated procurement & use specifications to the procurement agencies, and we have shipped kits for training purposes.
- We, along with the Kenyan government, are addressing legal challenges to the HIV testing algorithm and related process changes introduced. We are anticipating resolution of court challenges in hearings being held in early October. Our expectation, and the government's actions, indicate that we will receive significant orders in the 4th quarter upon resolution of these legal matters.
- The Kenyan HIV screening program is one of the largest in Africa, with up to an estimated 10 million screening tests annually.
Operational Transformation & Cashflow Improvement Initiatives
Management continues to be very focused on driving significant operational transformation and optimisation to improve cashflow and allow our key products to gain a cost competitive advantage in certain market segments.
As the Company operates in a highly regulated healthcare sector, significant operational changes are typically subject to complex technical validation processes that can create time lags between initiation of the change process and final implementation & benefit realisation. In that context, many of the key operational transformation programs we initiated over the past 12-24 months are now starting to deliver significant benefits and are projected to deliver increased and recurring cashflow benefits while also allowing us to target growth in certain lower price markets, while maintaining our target margin.
Some of the key operational transformation projects include:
Ongoing Headcount Optimisation:
- In Q2 and Q3 2023, management accelerated headcount reductions as a result of:
- process simplification initiatives that have been ongoing for the past number of quarters,
- the implementation of new software tools in quality/regulatory compliance and production planning, and
- lower than expected revenues, particularly considering delays to the TrinScreen HIV roll out in Kenya.
- Excluding the impact of the disposal of Fitzgerald Industries and limited hiring to support TrinScreen HIV manufacturing, these changes are expected to deliver an approximately net
20% reduction in headcount by the end of Q4 2023 compared to Q1 2023, with a resultant annualised cashflow saving of over$4m . Overall, this would represent an over35% reduction in headcount compared to Q4 2020 when we started this optimisation journey. - The majority of these 2023 reductions are in back-office functions such as Finance, Quality Assurance/Regulatory, and Supply Chain, reflecting the impact of modernisation and simplification projects lead by the key senior functional leaders we have hired over the past few years.
- We expect the financial benefit of these reductions to make a meaningful impact from Q4 2023.
- To support TrinScreen HIV manufacturing we have hired approximately 15 additional staff.
- Average revenue per headcount is a key KPI for management and we intend to continue to transform and optimise our operations to improve this KPI overtime.
Diabetes A1c Consumables Manufacturing Optimisation
- We are now at the final validation stages of our revised manufacturing process for our key Diabetes A1c testing column, the key consumable for our Premier 9210 instrument.
- Bringing this process in-house in an optimised manner is projected to reduce the cost of goods of our Diabetes A1c testing column by over
30% . - Based upon our current run rate of production, this is estimated to deliver over
$1.5m in recurring annualised cashflow savings once we have fully transitioned to the revised manufacturing process and should also allow our Premier 9210 A1c testing system to be more competitive in lower price/high volume segments of the market. - We expect the financial benefit of these reductions to make a meaningful impact from Q4 2023 with an increased savings level in 2024 as we transition completely away from the legacy manufacturing process.
Diabetes A1c Instrument Supply Chain Optimisation
- Over 12 months ago, we initiated a supply chain optimisation programme for our Diabetes A1c testing instrument, with the intent of reducing the cost and optimising the quality of the instrument by moving to more competitive supply chain participants.
- This programme has progressed significantly, and we have already commenced securing materials savings of
20% per instrument. Given the success of this programme to date, we are now targeting savings of40% -50% in materials costs for our Premier 9210 instrument which based upon our expected production run rate would deliver recurring annualised cashflow savings of over$1.5m when fully completed. - These changes are already delivering a working capital benefit in terms of lower inventory costs and we expect the EBITDA impact to begin in late 2023 or early 2024 as inventory is converted into sold product.
- In addition, this lower cost of production should allow us competitively target growth in segments of the Diabetes A1c testing market that are lower price but higher volume than our traditional focus segments, whilst maintaining target margin.
- There is also significant component commonality between our Premier 9210 and our Haemoglobin variant instrument the Premier Resolution that recently achieved FDA 510k clearance – this means that many of the savings achieved for the Premier 9210 instrument can carry into a meaningful lower cost of production for the Premier Resolution.
Diabetes A1c Reagent Column System
- As previously announced, we are developing an improved, backward compatible reagent column system that we expect will feature up to 3 times the injection capacity of the current system.
- This programme is at its final stages of development and technical validation.
- Subject to successful validation, we expect to launch this new reagent column system in early 2024 and estimate that this system should deliver recurring annualised incremental cost of goods cashflow savings of over
$1m whilst again facilitating us competitively targeting growth in segments of the A1c testing market that are lower price but higher volume than our traditional focus segments, whilst maintaining target margin.
HIV Product Manufacturing Optimisation
- We have initiated a programme to optimise the location and cost of certain downstream manufacturing and supply chain activities related to our HIV products, Uni-gold and TrinScreen.
- Our initial assessment indicates that such a programme could well deliver several million dollars of annual cashflow savings while providing the Company with additional manufacturing capacity to meet increased demand for TrinScreen as we roll the product out to additional countries.
- We expect this key project to start to deliver recurring savings in late 2024 and we will provide further updates on this programme as it progresses.
These initiatives have contributed to increased SG&A expenditure over the past 12 months and will continue to require some further investment over the coming quarters. Management believes that the future profitability and growth of the Company is significantly dependent on optimising our cost competitiveness which makes these investments key to delivering significant returns over the medium term. We are prioritising investing in the delivery of recurring savings as they should deliver increased sustainable EBITDA and thus increased capital value within each of our core business areas.
Balance Sheet Optimisation & New Growth Opportunities
As can been seen from our results for the past 3 quarters, our SG&A has increased - a major driver for this increase is expenditure on third party market research and technical assessment consultancy services as we seek to identify next generation biotech opportunities for very significant growth in market segments with total addressable markets of real scale that can fuel Trinity Biotech’s growth into a much larger scale company.
As a result of this work, we have now identified and are pursuing a select number of investment areas and associated targets. In conjunction with pursuing these targets, we are also closely working with our existing lenders, Perceptive Advisors, to both improve the terms of our existing financing, considering our lower debt levels, and support investments in these high growth opportunity areas.
We continue our strategic review of some of our non-core business lines for potential capital reallocation to lower debt and/or higher growth opportunity areas. Our approach to improving cashflow through operational transformation and organic growth in our core business areas should also play a key role in providing cashflow for investment and availability to incrementally improved financing.
Second Quarter Results (Unaudited)
The results of the Fitzgerald Industries life sciences supply business, which was sold as of April 27, 2023, have been reported separately as discontinued operations in the Consolidated Income Statements for all periods presented. In the Consolidated Balance Sheet at March 31, 2023, the assets and liabilities attributable to Fitzgerald Industries were separately presented within “Assets included in disposal group held for sale” and “Liabilities included in disposal group held for sale”. The assets and liabilities attributable to Fitzgerald Industries have been removed in our Consolidated Balance Sheet as of June 30, 2023.
Total revenues for Q2, 2023 were
| 2023 Quarter 2 | 2022 Quarter 2 | Increase/ (decrease) | ||
| US$’000 | US$’000 | % | ||
| Clinical Laboratory | 11,812 | 13,576 | (13.0 | %) |
| Point-of-Care | 2,086 | 1,840 | 13.4 | % |
| Total | 13,898 | 15,416 | (9.8 | %) |
Clinical Laboratory revenues were
Point-of-Care revenues for Q2, 2023 were
In Q2, 2023, gross profit was
Other operating income is
Research and development expenses increased from
Selling, general and administrative (SG&A) expenses increased by
- A higher non-cash accounting charge for share-based payments, which increased by
$0.9m in Q2, 2023 compared to Q2, 2022, due to options granted since Q2, 2022. - An increase in foreign exchange losses largely related to the accounting driven requirement to mark-to-market Euro-denominated lease liabilities for right-of-use assets. In Q2, 2022, the foreign exchange gain on leases was just under
$0.6m while in Q2, 2023, a foreign exchange loss of$26 k was recorded, resulting in an unfavourable quarter-on-quarter variance of approximately$0.6m . - External advisory & professional services costs, including third party market research and technical assessment consultancy services, were higher by
$0.6m in Q2, 2023 as we seek to identify & pursue next generation biotech opportunities for very significant growth in market segments with total addressable markets of real scale that can fuel Trinity Biotech's growth into a truly scaled global biotech company.
An impairment charge of
Operating loss for the quarter was
Financial income for Q2, 2023 was
Financial expenses in Q2, 2023 were
| Q2, 2023 US$’m | Q2, 2022 US$’m | |
| Term loan interest | 2.5 | 4.0 |
| Penalty for early settlement of term loan | 0.9 | 3.5 |
| Convertible note interest | 0.3 | 0.2 |
| Notional interest on lease liabilities for Right-of-use assets | 0.2 | 0.2 |
| Fair value movement for derivative balances related to term loan | 0.0 | 0.4 |
| 3.8 | 8.3 |
Note: table contains rounded numbers.
As previously reported, in Q2, 2023 the Company used approximately
In Q2, 2023 the financial expense for the fair value movement for derivative balances related to the term loan was immaterial compared to an expense of
The tax credit in Q2, 2023 was
The loss after tax for continuing operations for the quarter was
Profit for the period on discontinued operations in Q2, 2023 is
Loss before interest, tax, depreciation, amortisation, share option expense, and impairment charges for continuing operations for Q2, 2023 (Adjusted EBITDASO) was
| $m | ||
| Operating loss | (14.9 | ) |
| Depreciation | 0.3 | |
| Amortisation | 0.2 | |
| Impairment charges | 10.8 | |
| Adjusted EBITDA for continuing operations | (3.6 | ) |
| Share option expense | 1.0 | |
| Adjusted EBITDASO for continuing operations | (2.6 | ) |
Note: table contains rounded numbers.
The basic loss per ADS for Q2, 2023 was
Use of Non-IFRS Financial Measures
The attached summary unaudited financial statements were prepared in accordance with International Financial Reporting Standards (IFRS). To supplement the consolidated financial statements presented in accordance with IFRS, the Company presents non-IFRS presentations of, Adjusted EBITDA and Adjusted EBITDASO. The adjustments to the Company's IFRS results are made with the intent of providing both management and investors a more complete understanding of the Company's underlying operational results, trends, and performance. Non-IFRS financial measures mainly exclude, if and when applicable, the effect of share-based payments, significant excess and obsolescence charges related to inventory, depreciation, amortization and impairment charges.
Adjusted EBITDA for continuing operations and Adjusted EBITDASO for continuing operations are presented to evaluate the Company's financial and operating results on a consistent basis from period to period. The Company also believes that these measures, when viewed in combination with the Company's financial results prepared in accordance with IFRS, provides useful information to investors to evaluate ongoing operating results and trends. Adjusted EBITDA for continuing operations and Adjusted EBITDASO for continuing operations, however, should not be considered as an alternative to operating income or net income for the period and may not be indicative of the historic operating results of the Company; nor is it meant to be predictive of potential future results. Adjusted EBITDA for continuing operations and Adjusted EBITDASO for continuing operations are not measures of financial performance under IFRS and may not be comparable to other similarly titled measures for other companies. Reconciliation between the Company's operating profit/(loss) and Adjusted EBITDA for continuing operations and Adjusted EBITDASO for continuing operations are presented.
Liquidity
The Group’s cash balance increased from
The disposal of the Fitzgerald Industries life sciences supply business in Q2, 2023 resulted in a net cash inflow of
Cash used by operating activities for Q2, 2023 was
Forward-Looking Statements
Certain statements made in this release that are not historical are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. The words “estimate”, “project”, “intend”, “expect”, “believe” and similar expressions are intended to identify forward-looking statements. These forward-looking statements involve known and unknown risks and uncertainties. Many factors could cause the actual results, performance or achievements of Trinity Biotech to be materially different from any future results, performance or achievements that may be expressed or implied by such forward-looking statements, including, but not limited to, the results of research and development efforts, risks associated with the outbreak and global spread of the coronavirus (COVID-19), the effect of regulation by the U.S. Food and Drug Administration and other agencies, the impact of competitive products, product development commercialization and technological difficulties. For additional information regarding these and other risks and uncertainties associated with Trinity Biotech’s business, reference is made to our reports filed from time to time with the U.S. Securities and Exchange Commission. We undertake no obligation to update or revise any forward-looking statements for any reason.
About Trinity Biotech
Trinity Biotech develops, acquires, manufactures and markets diagnostic systems, including both reagents and instrumentation, for the point-of-care and clinical laboratory segments of the diagnostic market. The products are used to detect infectious diseases and to quantify the level of Haemoglobin A1c and other chemistry parameters in serum, plasma and whole blood. Trinity Biotech sells direct in the United States, Germany, France and the U.K. and through a network of international distributors and strategic partners in over 75 countries worldwide. For further information, please see the Company's website: www.trinitybiotech.com
| Trinity Biotech plc Consolidated Income Statements | ||||||||
| (US | Three Months Ended June 30, 2023 US (unaudited) | Three Months Ended June 30, 2022 US (unaudited) | Six Months Ended June 30, 2023 US (unaudited) | Six Months Ended June 30, 2022 US (unaudited) | ||||
| Revenues | 13,898 | 15,416 | 28,727 | 31,090 | ||||
| Cost of sales | (8,868 | ) | (9,835 | ) | (18,124 | ) | (19,527 | ) |
| Gross profit | 5,030 | 5,581 | 10,603 | 11,563 | ||||
| Gross margin % | 36.2 | % | 36.2 | % | 36.9 | % | 37.2 | % |
| Other operating income | 71 | 1 | 71 | 1 | ||||
| Research & development expenses | (1,233 | ) | (984 | ) | (2,093 | ) | (1,949 | ) |
| Selling, general and administrative expenses | (7,905 | ) | (5,929 | ) | (16,537 | ) | (12,160 | ) |
| Impairment charges | (10,815 | ) | (519 | ) | (10,815 | ) | (519 | ) |
| Operating Loss | (14,852 | ) | (1,850 | ) | (18,771 | ) | (3,064 | ) |
| Financial income | 62 | - | 216 | - | ||||
| Financial expenses | (3,823 | ) | (8,300 | ) | (6,374 | ) | (20,303 | ) |
| Net financial expense | (3,761 | ) | (8,300 | ) | (6,158 | ) | (20,303 | ) |
| Loss before tax | (18,613 | ) | (10,150 | ) | (24,929 | ) | (23,367 | ) |
| Income tax credit | 267 | 32 | 278 | 183 | ||||
| Loss for the period on continuing operations | (18,346 | ) | (10,118 | ) | (24,651 | ) | (23,184 | ) |
| Profit for the period on discontinued operations | 12,358 | 412 | 12,854 | 1,199 | ||||
| Loss for the period (all attributable to owners of the parent) | (5,988 | ) | (9,706 | ) | (11,797 | ) | (21,985 | ) |
| Loss per ADS (US cents) | (15.6 | ) | (28.6 | ) | (30.9 | ) | (75.1 | ) |
| Diluted loss per ADS (US cents) | (15.6 | ) | (28.6 | ) | (30.9 | ) | (75.1 | ) |
| Weighted average no. of ADSs used in computing basic earnings per ADS | 38,283,367 | 33,952,095 | 38,221,258 | 29,289,617 | ||||
| Weighted average no. of ADSs used in computing diluted earnings per ADS | 38,283,367 | 33,952,095 | 38,221,258 | 29,289,617 | ||||
| Trinity Biotech plc Consolidated Balance Sheets | ||||||
| June 30, 2023 US$ ‘000 (unaudited) | March 31, 2023 US$ ‘000 (unaudited) | December 31, 2022 US$ ‘000 | ||||
| ASSETS | ||||||
| Non-current assets | ||||||
| Property, plant and equipment | 1,869 | 5,496 | 5,682 | |||
| Goodwill and intangible assets | 15,756 | 21,330 | 35,269 | |||
| Financial asset | - | 1,500 | – | |||
| Deferred tax assets | 1,125 | 4,297 | 4,218 | |||
| Derivative financial asset | 214 | 152 | 128 | |||
| Other assets | 108 | 120 | 139 | |||
| Total non-current assets | 19,072 | 32,895 | 45,436 | |||
| Current assets | ||||||
| Assets included in disposal group held for sale | - | 17,746 | – | |||
| Inventories | 22,584 | 21,532 | 22,503 | |||
| Trade and other receivables | 13,866 | 13,594 | 15,753 | |||
| Income tax receivable | 2,240 | 1,858 | 1,834 | |||
| Cash, cash equivalents and deposits | 14,228 | 3,532 | 6,578 | |||
| Total current assets | 52,918 | 58,262 | 46,668 | |||
| TOTAL ASSETS | 71,990 | 91,157 | 92,104 | |||
| EQUITY AND LIABILITIES | ||||||
| Equity attributable to the equity holders of the parent | ||||||
| Share capital | 1,972 | 1,967 | 1,963 | |||
| Share premium | 46,619 | 46,532 | 46,458 | |||
| Treasury shares | (24,922 | ) | (24,922 | ) | (24,922 | ) |
| Accumulated deficit | (36,153 | ) | (31,140 | ) | (26,695 | ) |
| Translation reserve | (5,628 | ) | (5,787 | ) | (5,775 | ) |
| Equity component of convertible note | 6,709 | 6,709 | 6,709 | |||
| Other reserves | 23 | 23 | 86 | |||
| Total deficit | (11,380 | ) | (6,618 | ) | (2,176 | ) |
| Current liabilities | ||||||
| Liabilities included in disposal group held for sale | - | 1,386 | – | |||
| Income tax payable | 287 | 33 | 28 | |||
| Trade and other payables | 12,570 | 12,910 | 15,375 | |||
| Exchangeable senior note payable | 210 | 210 | 210 | |||
| Provisions | 50 | 50 | 50 | |||
| Lease liabilities | 1,643 | 1,561 | 1,676 | |||
| Total current liabilities | 14,760 | 16,150 | 17,339 | |||
| Non-current liabilities | ||||||
| Senior secured term loan | 39,791 | 49,199 | 44,301 | |||
| Derivative financial liability | 1,526 | 1,517 | 1,569 | |||
| Convertible note | 14,137 | 13,936 | 13,746 | |||
| Lease liabilities | 11,547 | 12,026 | 12,267 | |||
| Deferred tax liabilities | 1,609 | 4,947 | 5,058 | |||
| Total non-current liabilities | 68,610 | 81,625 | 76,941 | |||
| TOTAL LIABILITIES | 83,370 | 97,775 | 94,280 | |||
| TOTAL EQUITY AND LIABILITIES | 71,990 | 91,157 | 92,104 | |||
| Trinity Biotech plc Consolidated Statement of Cash Flows | |||||||||||
| Three Months Ended June 30, 2023 US (unaudited) | Three Months Ended June 30, 2022 US (unaudited) | Six Months Ended June 30, 2023 US (unaudited) | Six Months Ended June 30, 2022 US (unaudited) | ||||||||
| Cash flows from operating activities | |||||||||||
| Loss for the period | (5,988 | ) | (9,706 | ) | (11,797 | ) | (21,985 | ) | |||
| Adjustments to reconcile loss to cash used in operating activities: | |||||||||||
| Depreciation | 305 | 47 | 656 | 479 | |||||||
| Amortisation | 179 | 214 | 430 | 442 | |||||||
| Income tax credit | (267 | ) | (29 | ) | (278 | ) | (180 | ) | |||
| Financial income | (62 | ) | - | (216 | ) | - | |||||
| Financial expense | 3,823 | 8,300 | 6,374 | 20,303 | |||||||
| Share-based payments | 975 | 122 | 2,339 | 319 | |||||||
| Foreign exchange gains on operating cash flows | (98 | ) | (191 | ) | (187 | ) | (149 | ) | |||
| Impairment charges | 10,815 | 519 | 10,815 | 519 | |||||||
| Gain on sale of business | (12,718 | ) | - | (12,718 | ) | - | |||||
| Other non-cash items | (65 | ) | 995 | 130 | 305 | ||||||
| Operating cash (outflows)/inflows before changes in working capital | (3,101 | ) | 271 | (4,452 | ) | 53 | |||||
| Net movement on working capital | (1,294 | ) | (2,217 | ) | (2,657 | ) | (3,481 | ) | |||
| Cash used in operations before income taxes | (4,395 | ) | (1,946 | ) | (7,109 | ) | (3,428 | ) | |||
| Interest paid | - | (1 | ) | - | (3 | ) | |||||
| Interest received | - | 2 | - | 2 | |||||||
| Income taxes (paid)/received | (23 | ) | 13 | (26 | ) | 1 | |||||
| Net cash used in operating activities | (4,418 | ) | (1,932 | ) | (7,135 | ) | (3,428 | ) | |||
| Cash flows from investing activities | |||||||||||
| Payments to acquire intangible assets | (413 | ) | (1,658 | ) | (768 | ) | (3,211 | ) | |||
| Payments to acquire financial asset | - | - | (700 | ) | - | ||||||
| Net proceeds from sale of business unit | 28,426 | - | 28,426 | - | |||||||
| Acquisition of property, plant and equipment | (151 | ) | (143 | ) | (425 | ) | (305 | ) | |||
| Net cash generated/(used) in investing activities | 27,862 | (1,801 | ) | 26,533 | (3,516 | ) | |||||
| Cash flows from financing activities | |||||||||||
| Net proceeds from issue of share capital including share premium | - | 25,019 | - | 25,019 | |||||||
| Net proceeds from new senior secured term loan | - | - | 5,000 | 80,014 | |||||||
| Proceeds for convertible note issued | - | 20,000 | - | 20,000 | |||||||
| Expenses paid in connection with debt financing | - | (40 | ) | (147 | ) | (2,356 | ) | ||||
| Repayment of senior secured term loan | (10,050 | ) | (34,500 | ) | (10,050 | ) | (34,500 | ) | |||
| Penalty for early settlement of term loan | (905 | ) | (3,450 | ) | (905 | ) | (3,450 | ) | |||
| Purchase of exchangeable notes | - | - | - | (86,730 | ) | ||||||
| Interest paid on senior secured term loan | (1,834 | ) | (1,920 | ) | (4,401 | ) | (3,706 | ) | |||
| Interest paid on convertible note | (75 | ) | (49 | ) | (150 | ) | (49 | ) | |||
| Interest paid on exchangeable notes | - | (4 | ) | (4 | ) | (1,289 | ) | ||||
| Payment of lease liabilities | (590 | ) | (729 | ) | (1,191 | ) | (1,500 | ) | |||
| Net cash provided by/(used in) financing activities | (13,454 | ) | 4,327 | (11,848 | ) | (8,547 | ) | ||||
| Increase in cash and cash equivalents | 9,990 | 594 | 7,550 | (15,491 | ) | ||||||
| Effects of exchange rate movements on cash held | 85 | (153 | ) | 100 | 34 | ||||||
| Cash and cash equivalents at beginning of period | 4,153 | 10,012 | 6,578 | 25,910 | |||||||
| Cash and cash equivalents at end of period | 14,228 | 10,453 | 14,228 | 10,453 | |||||||
The above financial statements have been prepared in accordance with the principles of International Financial Reporting Standards and the Company’s accounting policies but do not constitute an interim financial report as defined in IAS 34 (Interim Financial Reporting).
