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Feedback #FDBK – Interim Report for the six months ended 30 November 2017
Cambridge, UK – 26 February 2018: Feedback plc (AIM: FDBK), the specialist medical imaging technology company, announces its unaudited results for the six months ended 30 November 2017.
Operational highlights (including post-period end)1
· Exclusive TexRAD® distributor agreements signed in China and Korea
· CE marked release of TexRAD® Lung
· Three pilot TexRAD® Lung installations secured with existing research customers
· Significant TexRAD® research interest including 19 presentations at RSNA annual conference
· Certification received by CCI for ISO 13485:2016 quality management standard compliance
· Highly experienced Chief Executive Officer appointed to drive growth strategy
Financial highlights (including post-period end)
· Revenue for the six-month period £228,874 (2016: £203,000)
· Loss after tax for the six-month period £348,079 (2016: loss £126,000)
· Loss before interest, tax and amortisation for the six-month period £337,300 (2016: loss £115,000)
· Cash as at 30 November 2017 was £266,756 (30 November 2016: £63,000)
1. Cambridge Computed Imaging Limited (“CCI”) is a wholly owned subsidiary of Feedback plc.
David Crabb, Chief Executive Officer of Feedback plc, commented: “We continue to see strong demand for our technology across the global territories which has contributed to double-digit revenue growth during the period. As a small team, we experienced some operational delays over the past 12 months which slowed our commercial progress, however the first CE marked release of the TexRAD® technology in November was a major achievement for the Company and will underpin the next stage of growth.
“Our mission is to create evidence-based imaging software, arming clinicians with innovative tools to improve patient outcomes. Having joined the Company earlier this month, I will be refining the commercial strategy and growth ambitions to ensure that Feedback is well-positioned to deliver. In the near-term, with a CE marked product, distribution partners in key territories and ongoing discussions with global players, we are focused on developing our clinical evidence base and accelerating our market penetration in the rapidly growing medical imaging field.”
Notes to editors
About Feedback plc
Feedback plc is a specialist medical imaging technology company. It develops software and systems that provide innovative techniques and improved workflows for practitioners involved in medical research and treating patients. TexRAD®, the Company’s patented quantitative image texture analysis technology, has the potential to assist clinicians in diagnosis, prognosis and treatment of patients with cancer and is currently installed in over 40 of the world’s leading research institutions across Europe, North America, Asia and Australia. The Cadran platform provides a suite of medical imaging tools for decision support. The Cadran range includes the picture archiving communication system (PACS) to provide decision support for scan analysis, diagnostic workstations which provide secure remote access to view scans on demand, and products to securely share and transport patient data. Visit www.fbk.com.
For further information, please contact:
|
Feedback plc David Crabb, Chief Executive Officer Lara Mott, Investor Relations
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Tel: 01954 718072 IR@fbk.com |
|
Allenby Capital Limited (Nominated Adviser and Joint Broker) David Worlidge / Asha Chotai
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Tel: 020 3328 5656 |
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Northland Capital Partners Ltd (Joint Broker) David Hignell / John Howes
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Tel: 020 3861 6625 |
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Peterhouse Corporate Finance Ltd (Joint Broker) Lucy Williams / Duncan Vasey
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Tel: 020 7469 0936 |
Strategic and Operational Review
FINANCIAL REVIEW
In the six months ended 30 November 2017, the Group incurred a loss after tax of £348,079 (2016: loss £126,000) on revenue for the six-month period of £228,874 (2016: £203,000). TexRADÒ software contributed approximately 55% of the revenue with the remainder attributed to Cadran cardiology and radiology systems. The revenue growth of approximately 13% in the first half of the year reflects growing demand across global territories for TexRADÒ. Notably, we have seen an increase in purchase orders for TexRAD® from leading medical institutions in South Korea and we are receiving significant interest in China, underpinned by the exclusive distributor agreements signed during the period. We anticipate that the benefits of these agreements will be seen in the full financial year.
The loss before interest, tax and amortisation was £337,300 (2016: loss £115,000). The wider loss in comparison to the previous year is largely attributable to an increase in headcount and investment in staff, continued product development and increased marketing activities in order to generate prospective customer interest and develop longer-term revenue opportunities. The cash balance at 30 November 2017 was £266,756 (2016: £63,000).
OPERATIONAL PROGRESS
CCI signed exclusive distributor agreements with Korea Computer Motion ISG (“Korea ISG”) in June 2017 and Boya Digital Technology (Beijing) Co. Ltd. (“Boya”) in July 2017 for sales and distribution of TexRAD® in South Korea and the People’s Republic of China, respectively. These agreements represent a significant step in expanding TexRAD® sales to meet the fast-growing demand in Asian markets. By successfully identifying and engaging with distributors who are experts in the local market, we can leverage the TexRAD® brand to help build a regional sales pipeline. During the period, joint marketing and promotional activities were well-received and we have seen an increase in purchase orders for TexRAD® from leading medical institutions in South Korea and we are receiving significant interest in China. We also see strong demand for TexRAD® in India having increased our presence in this market.
Feedback is committed to offering its customers the highest quality service across all areas of its business and therefore compliance with international quality management standards is of paramount importance. CCI received certification for its compliance with the ISO 13485:2016 quality management standard in September 2017. Importantly, on 20 November 2017 Feedback announced the first CE marked release of the TexRAD® technology which represents a significant accomplishment for the Company. CCI affixed a CE mark to “TexRAD® Lung”; a “software only” Class 1 medical device providing additional information for the interpretation of computerised tomography (CT) and positron emission tomography (PET) scans of patients with lung cancer. The CE mark confirms that TexRAD® Lung meets the requirements of the Medical Device Directive (MDD – 93/42EEC) ensuring the technology satisfies the quality, safety and performance standards for medical devices in the European Union (EU).
This first TexRADÒ clinical product from Feedback is a significant step after building on six years of installing TexRADÒResearch in prestigious research centres worldwide, underpinned by 17 years of operational expertise in Medical Device Manufacturing and imaging management through our Cadran platform supplied by CCI. Post-period end in January 2018 the British Cardiovascular Intervention Society (BCIS) held its annual Advanced Cardiovascular Intervention conference. CCI’s cardiology viewing software, which facilitates interactive case review training sessions for cardiologists, has now been supporting this conference for 20 years, which illustrates the quality and longevity of the CCI platform technologies.
Post-period end, on 11 December 2017 StoneChecker® Software Ltd announced that it has affixed a CE mark to its first software product. The StoneChecker® software utilises TexRAD® technology to make detailed analyses of kidney stones. CCI granted an exclusive licence to StoneChecker® Software Ltd in July 2015 and is eligible to receive royalty payments upon future sales.
CLINICAL PROGRESS: TexRAD LungÒ
TexRAD® Research is currently installed in over 40 of the world’s leading research institutions across Europe, North America, Asia and Australasia. The CE mark for TexRAD® Lung allows Feedback to engage with organisations focused on clinical vs. research work and develop both the product and the application of its use in routine patient management. TexRAD® Lung is a hands-free quantitative software for use on existing medical imaging systems, designed to provide an objective assessment of the architecture/heterogeneity, evolution and prognosis of lung lesions based on texture analysis of PET/CT scans. Generating an additional set of data and images directly into existing radiology viewing systems, known as the picture archiving communication systems (PACS), it integrates seamlessly within a radiology department adding information to clinicians’ reporting workflow, thus improving efficiency and potential clinical utility.
TexRAD® Lung is capable of seamlessly integrating with hospital PACS and, in a matter of hours rather than months, review decades worth of data extracting information of lesion size, density, heterogeneity and a host of other features of potential clinical significance potentially missed by subjective review by radiologists or nuclear-medicine physicians. This ability to rapidly and consistently assemble an accurate, parameterised database is the first and arguably most important step in applying the emerging techniques of machine learning and artificial-intelligence (AI) to healthcare problems. The development of TexRAD® Lung is based on wider research using published medical information. Our technology can easily access and review thousands of data sets from existing medical scans, without further tests on patients, all within the CE regulated framework therefore reducing barriers to clinical implementation. This technique offers a significant advantage over traditional, prospective clinical trials where, for example, a study of 100 patients could be considered a large trial, requiring a longer timeframe and could have significant costs associated.
Building clinical confidence in a new device is of paramount importance. TexRAD® Lung will need to be configured to various hospital IT systems in order to embed the technology within routine clinical imaging workflow. This may involve workflow modifications or other enhancements to the software before TexRAD® Lung can be implemented in clinical practice, and particularly for a large-scale commercial roll-out. Accordingly, we are delighted to have secured three pilot TexRAD® Lung installations with existing UK customers who use TexRAD® for research purposes to further inform our configuration strategy. We are currently implementing these pilots and, are also working closely with Alliance Medical Group (“Alliance”) on the future integration of TexRAD® Lung into Alliance’s network of PET/CT scanners in UK hospitals.
RESEARCH AND DEVELOPMENT PROGRESS
Having invested in marketing activities in India, research demand for TexRAD® technology is increasing. We sponsored the American British Course in Neuroradiology in Mumbai, India in October 2017, which included a lunch-time symposium presentation on brain texture analysis using TexRAD® technology. Post-period end in January 2018, Dr Balaji Ganeshan gave a guest lecture at Dr D Y Patil Medical College in India and attended the 17th Asian Oceanian Congress of Radiology (AOCR) & 71st National Conference of the Indian Radiological and Imaging Association (IRIA).
In November 2017, Dr Balaji Ganeshan presented at the 103rd Scientific Assembly and Annual Meeting of the Radiological Society of North America (“RSNA 2017”) in Chicago (IL), USA, the premier global event for radiologists. Three additional papers co-authored by Dr Balaji Ganeshan were presented at RSNA 2017; one by Seoul National University and University College London focused on liver cancer (abstract SSK07-05), one by Cambridge University, the University of Rome and University College London focused on ischemic stroke (abstract SSQ15-02) and one by University College London focused on neuroendocrine tumours (abstract SSM13-06). Overall, RSNA 2017 included at least 19 scientific paper presentations featuring TexRAD® Computed Tomography Texture Analysis (CTTA) and Magnetic Resonance Texture Analysis (MRTA) and Positron Emission Tomography-Computed Tomography Texture Analysis (PET-CTTA), many of which won awards in the RSNA 2017 categories. TexRAD® research to date has shown great potential in many different oncological and non-oncological sites. In particular, the papers presented at RSNA 2017 focused on liver, pancreatic, kidney, cervical, oral, genitourinary, head & neck, thyroid, neuroendocrine and endometrial cancers, as well as gastrointestinal stromal tumours, gliomas, thymic-epithelial neoplasms and carotid-plaques. Further information can be found at https://rsna2017.rsna.org/program.
Post-period end, in December 2017, Dr Balaji Ganeshan presented at the Big-Data, Radiomics and A.I. Symposium in Italy and also secured a panel presentation at the prestigious Royal College of Radiologists annual conference which will be held in September 2018. In light of the first CE marked release of the TexRAD® technology, the theme for the panel session will be focused on the texture analysis of CT and MR data for routine clinical use.
We continue to receive significant TexRAD® research interest from prestigious institutions worldwide which has resulted in multiple articles in leading publications. For example, in October 2017 our customer at the International University of Health and Welfare Hospital in Tochigi, Japan published an article featuring TexRAD® analysis in liver cancer. The paper, entitled “Impact of hepatocellular carcinoma heterogeneity on computed tomography as a prognostic indicator” was published in the Nature affiliated journal; Scientific Reports. These research activities continue to support the potential future clinical application of TexRAD® in other disease indications. Post-period end, in February 2018, researchers at the Princess Alexandra Hospital (Australia) published a study demonstrating the potential for the clinical implementation of CT texture analysis (CTTA) in the assessment of tumour heterogeneity in lung cancer. The publication in Academic Radiologysuggests that there is a significant potential for the implementation of quantitative imaging in the assessment of tumour heterogeneity and engagement from radiologists is key to its success. The automated analysis capability of the CE marked TexRAD® Lung product aims to facilitate adoption by radiologists.
Our collaboration with Future Processing Sp. z o.o., a software development service provider based in Gliwice, Poland, to develop medical imaging software is fully underway. Both teams continue to work closely for new software products to be brought to market, with current concepts focused on artificial intelligence and machine learnings strategies.
BOARD AND ORGANISATION
On 8 June 2017, we announced that Trevor Brown had resigned as a non-executive Director in order to allow the Company to move rapidly to the next stage in its development. To further support the Company’s growth strategy, Tim Irish joined the Board on 8 June 2017 as Non-Executive Director. Tim is a Professor of Practice at Kings College London as well as a board member of Bournemouth University. He joined the board of the National Institute for Health and Care Excellence (NICE) in April 2015 and became its Senior Independent Director in May 2017. Tim has worked in the life sciences industry for 30 years. His career has spanned global health technology companies across Europe and North America, including GSK, GE and Philips the latter two in senior positions responsible for medical imaging. Tim also currently holds a number of non-executive positions in health and technology related entities.
Post-period end, on 14 February 2018 we announced the appointment of David Crabb as Chief Executive Officer and a director of Feedback to drive the growth strategy. Mr Crabb brings 20 years of experience as an effective business leader to Feedback. Most recently he was Chief Executive Officer of Cambridge Online Systems, a major software company providing services to UK and international customers, which was acquired by the global IT group Columbus in December 2016. Under Mr Crabb’s management in 2011, Cambridge Online Systems delivered strong growth from a loss-making organisation to one with top-quartile financial results and was voted as one of the “Sunday Times Top 100 Companies to work for” in two consecutive years. Previously, Mr Crabb held director-level roles in medium-sized technology and outsourced solutions companies with revenues from £50 million to over £1 billion, responsible for business optimisation, sales and marketing and workforce leadership.
We recognise that a small, multi-disciplinary team has its limitations, which resulted in some operational delays over the past 12 months, so we are delighted that Feedback has attracted Mr Crabb as a highly experienced executive to complement the strong technical and regulatory expertise within the Company.
MARKET OPPORTUNITY
The use of quantitative data derived from data contained in medical images, a technique known as “radiomics”, has the potential to uncover disease characteristics which are visually imperceptible to the naked eye. Radiomics uses algorithmic tools to provide objective and repeatable measurements of imaging biomarkers, such as size, texture, calcification, location in the organ and rate of growth. These distinctive imaging features identified during disease development and progression may be useful for predicting prognosis and therapeutic response for various conditions, potentially providing valuable information for personalised therapy. As a rapidly growing field, the quantitative imaging software market is expected to exceed US$500 million by 2021 (Signify Research 2017).
Radiologists are under significant pressure due to increasing patient numbers, more examinations required per patient and the need for earlier diagnosis. We are focused on the development of software to assist clinicians in the interpretation and analysis of medical images. Our mission is to create evidence-based imaging software, arming clinicians with innovative tools to improve patient outcomes. We do this by developing and supplying software platforms and solutions that have the potential to contribute to diagnosis, monitor therapy and assist in the cost-effective treatment of patients. We now have our first product targeted specifically for disease management, TexRADÒ Lung, which has been developed with the goal of improving the care of patients with lung cancer.
Lung cancer has been the most common cancer in the world for several decades, estimated at 13% of all cancer diagnoses globally. It is also the most common cause of death from cancer worldwide, estimated to be responsible for 1.59 million deaths annually. Furthermore, lung cancer places the highest economic burden of all cancers; in the EU this is estimated at €18.8 billion per annum and there are approximately 417,000 new cases of lung cancer in the EU every year. Our particular focus in on non-small cell lung cancer (NSCLC) which comprises 85% of all lung cancer cases. By analysing the texture features in routinely acquired CT scans, TexRAD® Lung’s quantitative imaging capabilities will provide clinicians with additional information to help them make better decisions in order to improve patient outcomes.
STRATEGY AND OUTLOOK
Our ambition is to leverage our leading research, image processing and analysis expertise to position TexRAD® technology for routine clinical use to drive future revenue growth. Our strategy comprises four areas of focus:
(i) Strategic partnerships with global players to expedite market penetration
Promotional activity and distribution planning for TexRAD® Lung continues, including discussions under the previously announced signed letter of intent with a leading global medical imaging company which would make TexRAD® Lung available for purchase on its diagnostic imaging solutions platform. This would, in due course, enable easy access to TexRAD® Lung for hundreds of potential users around the world on a subscription basis. We are also discussing our technology with other leading imaging companies to broaden the range of potential routes to market for clinical versions of TexRAD®.
(ii) Distributor agreements in key territories such as Asia
Our existing and future distributor agreements will continue to support the Company’s international expansion, ensuring that our technology continues to be used by the world’s leading institutions to expedite research in this important field.
(iii) Clinical evidence base for TexRAD® Lung
Our primary goal over 2018 is to undertake specific studies with TexRAD® Lung to build an evidence base from existing and new scans, across multiple customer sites, ahead of a large-scale commercial roll-out. These studies will also inform the wider opportunity for follow-on products. We have multiple strategic advantages in building clinical confidence, such as our relationships with world-leading institutions, our ability to access clinical collaborators through our existing research customer base and our industry-leading regulatory compliance. By the end of 2018 we expect to have early adopters using the technology in the UK and Europe.
(iv) New product opportunities
The development of any new product is a commercially confidential process. As announced on 20 November 2017, we expect that the rigorous regulatory review required for the CE mark will pave the way for TexRAD®‘s clinical use worldwide and we are now investigating the clinical application of TexRAD® in other indications. Initially we expected the focus to be on liver diseases and chronic obstructive pulmonary disease (COPD), however given the significant potential for the TexRD® technology across multiple disease indications our new Chief Executive Officer will be reviewing our clinical strategy over the coming months.
Our long-term vision is to lead global innovation in quantitative medical imaging analysis and we have strong foundations to position ourselves at the forefront of this important field. To leverage our platform technologies and domain expertise, we will need to continue to invest in staff and our product and business development activities to develop longer-term revenue opportunities. We expect to have access to adequate cash resources for at least the next twelve months, from both existing cash balances and by considering appropriate funding options, if required, to enable continued product development and international expansion.
Dr A J Riddell
Chairman
|
UNAUDITED INTERIM CONSOLIDATED INCOME STATEMENT |
|||||
|
unaudited |
unaudited |
audited |
|||
|
6 months to 30 November 2017 |
6 months to 30 November 2016 |
Year to 31 May 2017 |
|||
|
Note |
£’000 |
£’000 |
£’000 |
||
|
Revenue |
229 |
204 |
466 |
||
|
Cost of sales |
(6) |
(5) |
(11) |
||
|
Gross profit |
223 |
199 |
455 |
||
|
Other operating expenses |
(575) |
(329) |
(756) |
||
|
Operating loss
|
(352)
|
(130)
|
(301)
|
||
|
Net finance income |
– |
– |
– |
||
|
Loss before tax |
(352) |
(130) |
(301) |
||
|
Tax credit |
4 |
4 |
35 |
||
|
Loss for the period attributable to the equity shareholders of the parent Loss on ordinary activities after tax |
(348) |
(126) |
(266) |
||
|
Other comprehensive expense |
|||||
|
Translation differences on overseas operations |
– |
– |
– |
||
|
Total comprehensive expense for the period |
(348) |
(126) |
(266) |
||
|
Basic and diluted earnings per share |
2 |
(0.14p) |
(0.06p) |
(0.09p) |
|
|
UNAUDITED INTERIM CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
|
||||||||||
|
Share Capital |
Share Premium |
Capital Reserve |
Retained Earnings |
Translation Reserve |
Convertible Debt Option Reserve |
Total |
||||
|
£’000 |
£’000 |
£’000 |
£’000 |
£’000 |
£’000 |
£’000 |
||||
|
Balance at 31 May 2016 |
509 |
1,592 |
300 |
(2,251) |
(210) |
189 |
129 |
|||
|
New shares issued |
38 |
151 |
– |
– |
– |
(189) |
– |
|||
|
Total comprehensive income for the period |
– |
– |
– |
(126) |
– |
– |
(126) |
|||
|
Balance at 30 November 2016 |
547 |
1,743 |
300 |
(2,377) |
(210) |
– |
3 |
|||
|
New shares issued |
68 |
633 |
– |
– |
– |
– |
701 |
|||
|
Share option and warrant costs |
– |
– |
– |
6 |
– |
– |
6 |
|||
|
Total comprehensive expense for the period |
– |
– |
– |
(140) |
– |
– |
(140) |
|||
|
Balance at 31 May 2017 |
615 |
2,376 |
300 |
(2,511) |
(210) |
– |
570 |
|||
|
Total comprehensive income for the period |
– |
– |
– |
(348) |
– |
– |
(348) |
|||
|
Balance at 30 November 2017 |
615 |
2,376 |
300 |
(2,859) |
(210) |
– |
222 |
|||
|
UNAUDITED INTERIM CONSOLIDATED STATEMENT OF FINANCIAL POSITION
|
||||
|
unaudited |
unaudited |
audited |
||
|
30 November 2017 |
30 November 2016 |
31 May 2017 |
||
|
Note |
£’000 |
£’000 |
£’000 |
|
|
ASSETS |
||||
|
Non-current assets |
||||
|
Property, plant and equipment |
7 |
4 |
4 |
|
|
Intangible assets |
3 |
111 |
97 |
80 |
|
Investments |
– |
1 |
– |
|
|
118 |
102 |
84 |
||
|
Current assets |
||||
|
Trade receivables |
83 |
121 |
50 |
|
|
Other receivables |
59 |
50 |
62 |
|
|
Cash and cash equivalents |
267 |
63 |
697 |
|
|
409 |
234 |
809 |
||
|
Total assets |
527 |
336 |
893 |
|
|
EQUITY |
||||
|
Capital and reserves attributable to the Company’s equity shareholders |
||||
|
Called up share capital |
615 |
547 |
615 |
|
|
Share premium account |
2,376 |
1,743 |
2,376 |
|
|
Capital reserve |
300 |
300 |
300 |
|
|
Translation reserve |
(210) |
(210) |
(210) |
|
|
Retained earnings |
(2,859) |
(2,377) |
(2,511) |
|
|
Total equity |
222 |
3 |
570 |
|
|
LIABILITIES |
||||
|
Non-current liabilities |
||||
|
Deferred tax liabilities |
– |
10 |
4 |
|
|
Current liabilities |
||||
|
Trade payables |
78 |
67 |
69 |
|
|
Other payables |
227 |
256 |
250 |
|
|
305 |
323 |
319 |
||
|
Total liabilities |
305 |
333 |
323 |
|
|
Total equity and liabilities |
527 |
336 |
893 |
|
|
UNAUDITED INTERIM CONSOLIDATED STATEMENT OF CASH FLOWS
|
|||
|
unaudited |
unaudited |
audited |
|
|
6 months to 30 November 2017 |
6 months to 30 November 2016 |
Year to 31 May 2017 |
|
|
£’000 |
£’000 |
£’000 |
|
|
Cash flows from operating activities |
|||
|
Loss before tax |
(348) |
(130) |
(301) |
|
Adjustments for: |
|||
|
Share option and warrant costs |
– |
– |
5 |
|
Depreciation and amortisation |
26 |
23 |
48 |
|
Foreign exchange difference |
(5) |
1 |
|
|
Increase in trade receivables |
(33) |
(80) |
(9) |
|
Decrease/(increase) in other receivables |
3 |
14 |
(36) |
|
Increase in trade payables |
9 |
46 |
48 |
|
(Decrease)/increase in other payables |
(23) |
98 |
96 |
|
Corporation tax (paid)/repaid |
– |
(5) |
57 |
|
(23) |
96 |
210 |
|
|
Net cash used in operating activities |
(371) |
(34) |
(91) |
|
Cash flows from investing activities |
|||
|
Purchase of tangible fixed assets |
(4) |
(1) |
(3) |
|
Purchase of intangible assets |
(55) |
(8) |
(15) |
|
Net cash used in investing activities |
(59) |
(9) |
(18) |
|
Cash flows from financing activities |
|||
|
Net proceeds from share issues |
– |
– |
700 |
|
Net cash generated from financing activities |
– |
– |
700 |
|
Net (decrease)/increase in cash and cash equivalents |
(430) |
(43) |
591 |
|
Cash and cash equivalents at beginning of period |
697 |
106 |
106 |
|
Cash and cash equivalents at end of period |
267 |
63 |
697 |
FEEDBACK PLC
NOTES TO THE UNAUDITED INTERIM REPORT
1 BASIS OF PREPARATION
The consolidated interim financial statements have been prepared in accordance with the recognition and measurement principles of International Financial Reporting Standards as endorsed by the European Union (“IFRS”) and expected to be effective at the year end of 31 May 2018. The accounting policies are unchanged from the financial statements for the year ended 31 May 2017.
The information set out in this interim report for the six months ended 30 November 2017 does not comprise statutory accounts within the meaning of section 434 of The Companies Act 2006. The auditors’ report on the full statutory accounts for the year ended 31 May 2017 included an Emphasis of Matter paragraph in regard to Going Concern. The accounts for the year ended 31 May 2017 have been filed with the Registrar of Companies.
This interim report was approved by the directors on 23 February 2018.
2 LOSS PER SHARE
Basic earnings per share are calculated by reference to the loss on ordinary activities after and on the weighted average number of shares in issue.
|
unaudited |
unaudited |
audited |
||
|
As at 30 November 2017
|
As at 30 November 2016
|
As at 31 May 2017
|
||
|
£’000 |
£’000 |
£’000 |
||
|
Net loss attributable to ordinary equity holders |
(348) |
(126) |
(266) |
|
|
As at 30 November 2017
|
As at 30 November 2016
|
As at 31 May 2017 |
||
|
Weighted average number of ordinary shares for basic earnings per share |
246,066,584 |
203,733,005 |
232,879,709 |
|
|
Effect of dilution: |
||||
|
Share Options |
– |
– |
– |
|
|
Warrants |
– |
– |
– |
|
|
Weighted average number of ordinary shares adjusted for the effect of dilution |
246,066,584 |
203,733,005 |
232,879,709 |
|
|
Loss per share (pence) |
||||
|
Basic and Diluted |
(0.14) |
(0.06) |
(0.11) |
|
3 INTANGIBLE ASSETS
|
Software |
Customer relationships |
Patents |
Goodwill |
R & D |
Total |
|
|
£’000 |
£’000 |
£’000 |
£’000 |
£’000 |
£’000 |
|
|
Cost |
||||||
|
At 31 May 2016 |
563 |
100 |
88 |
272 |
– |
1,023 |
|
Additions |
– |
– |
8 |
– |
– |
8 |
|
At 30 November 2016 |
563 |
100 |
96 |
272 |
– |
1,031 |
|
Additions |
– |
– |
8 |
– |
– |
8 |
|
At 31 May 2017 |
563 |
100 |
104 |
272 |
1,039 |
|
|
Additions |
– |
– |
13 |
– |
41 |
54 |
|
At 30 November 2017 |
563 |
100 |
117 |
272 |
41 |
1,093 |
|
Amortisation |
||||||
|
At 31 May 2016 |
563 |
50 |
27 |
272 |
– |
912 |
|
Charge for the period |
– |
13 |
9 |
– |
– |
22 |
|
As at 30 November 2016 |
563 |
63 |
36 |
272 |
– |
934 |
|
Charge for the period |
– |
12 |
13 |
– |
– |
25 |
|
At 31 May 2017 |
563 |
75 |
49 |
272 |
– |
959 |
|
Charge for the period |
– |
11 |
12 |
– |
– |
23 |
|
At 30 November 2017 |
563 |
86 |
61 |
272 |
– |
982 |
|
Net Book Value |
||||||
|
At 30 November 2017 |
– |
14 |
56 |
– |
41 |
111 |
|
At 31 May 2017 |
– |
25 |
55 |
– |
– |
80 |
|
At 30 November 2016 |
– |
37 |
60 |
– |
– |
97 |
4 AVAILABILITY OF THE INTERIM REPORT
Copies of the report will be available from the Company’s office and also from the Company’s website www.fbk.com
Feedback plc #FDBK – First CE marked release of TexRAD® technology
Feedback plc (AIM: FDBK), the specialist medical imaging technology company, announces the first CE marked release of TexRAD®; the Company’s patented quantitative image texture analysis technology for diagnostic radiological scans.
TexRAD® has the potential to assist clinicians in diagnosis, prognosis and treatment of patients with cancer and is currently installed in over 40 of the world’s leading research institutions across Europe, North America, Asia and Australasia. Feedback’s subsidiary company, Cambridge Computed Imaging Ltd,
has affixed a CE mark to “TexRAD® Lung”; a “software only” Class 1 medical device providing additional information for the interpretation of computerised tomography (CT) and positron emission tomography (PET) scans of patients with lung cancer. The CE mark confirms that TexRAD® Lung meets the requirements of the Medical Device Directive (MDD – 93/42EEC) ensuring the technology satisfies the quality, safety and performance standards for medical devices in the European Union (EU).
Lung cancer has been the most common cancer in the world for several decades, estimated at 13% of all cancer diagnoses globally. It is also the most common cause of death from cancer worldwide, estimated to be responsible for nearly one in five. In the EU alone there are approximately 417,000 new cases of lung cancer every year. Radiologists are under significant pressure due to increasing patient numbers, more examinations required per patient and the need for earlier diagnosis. By analysing the texture features in CT scans, TexRAD®‘s quantitative imaging capabilities provide clinicians with additional information to make better decisions in order to improve patient outcomes.
Dr Alastair Riddell, Chairman at Feedback plc, said: “TexRAD® Lung is our first TexRAD® product with a CE mark which represents a significant accomplishment. This development will expedite TexRAD®‘s clinical use in the treatment of lung cancer across the EU, expand its market presence and support the Company’s ongoing commercial discussions for the technology. We expect that the rigorous regulatory review required for the CE mark will pave the way for TexRAD®‘s clinical use worldwide and we are now investigating the clinical application of TexRAD®in liver cancer and chronic obstructive pulmonary disease (COPD). By arming clinicians with disease-specific tools, we believe this technology has the potential to transform radiological decision making.”
– Ends –
Notes to editors
About Feedback plc
Feedback plc is a specialist medical imaging technology company. It develops software and systems that provide innovative techniques and improved workflows for practitioners involved in medical research and treating patients. TexRAD®, the Company’s patented quantitative image texture analysis technology, has the potential to assist clinicians in diagnosis, prognosis and treatment of patients with cancer and is currently installed in over 40 of the world’s leading research institutions across Europe, North America, Asia and Australasia. The Cadran platform provides a suite of medical imaging tools for decision support. The Cadran range includes the picture archiving communication system (PACS) to provide decision support for scan analysis, diagnostic workstations which provide secure remote access to view scans on demand, and products to securely share and transport patient data. Visit www.fbk.com.
About CE marking
CE marking (and compliance with the directive) is legally required before placing a device on the market in the EU. An appropriate quality management system and the preparation of a technical file are requirements for CE marking. The CE technical file is a comprehensive description of the device intended to demonstrate compliance with the Medical Device Directive and contains extensive documentation on the use, design, risk assessment, testing, clinical evaluation and manufacture of the device.
For further information, please contact:
|
Feedback plc Dr Alastair Riddell, Chairman Lara Mott, Investor Relations
|
Tel: 01954 718072 hello@fbk.com |
|
Allenby Capital Limited (Nominated Adviser and Joint Broker) David Worlidge / James Thomas
|
Tel: 020 3328 5656 |
|
Northland Capital Partners Ltd (Joint Broker) Patrick Claridge / David Hignell / John Howes
|
Tel: 020 3861 6625 |
|
Peterhouse Corporate Finance Ltd (Joint Broker) Lucy Williams / Duncan Vasey |
Feedback #FDBK – Final results, notice of AGM and TexRAD® Lung CE mark update.
Feedback plc (AIM: FDBK), the specialist medical imaging technology company, announces its final results for the year ended 31 May 2017.
Operational highlights (including post-period end)1
· Letter of Intent for TexRAD® Lung signed with a leading global medical imaging company
· Exclusive TexRAD® distributor agreements signed in China and Korea
· Prototype integration solution for TexRAD® demonstrated to Alliance Medical Group
· CCI collaboration with Future Processing Sp. z o.o. to develop medical imaging software
· Significant TexRAD® research interest including 19 presentations at RSNA annual conference
· Certification received by CCI for ISO 13485:2016 quality management standard compliance
· CE marked release of TexRAD® Lung expected by the end of November 2017
Financial highlights (including post-period end)
· Completion of a placing of 27,272,727 new ordinary shares of 0.25p each in the Company at a price of 2.75 pence per share to raise a total of £750,000 (gross) in April 2017
· Revenue for the year £465,885 (2016: £431,454)
· Loss after tax for the year £266,003 (2016: loss £183,156)
· Loss before interest, tax and amortisation was £252,750 (2016: loss £206,523)
· Cash as at 31 May 2017 was £696,811 (31 May 2016: £105,673)
1. Cambridge Computed Imaging Limited is a wholly owned subsidiary of Feedback plc.
Dr Alastair Riddell, Chairman at Feedback plc, said: “We delivered solid operational progress during the period and the increased international sales exposure is particularly encouraging. Our technical and regulatory team have been working diligently on the delivery of a CE marked release of TexRAD® Lung. We are acutely aware that this development has taken longer than originally expected, however we are confident that our rigorous regulatory review will pave the way for new products and therefore maximise the potential for TexRAD®‘s clinical use worldwide. We remain focused on applying our leading research expertise to the clinical setting to drive future revenue growth and would like to thank our shareholders, customers and partners for their continued support.”
Notes to editors
About Feedback plc
Feedback plc is a specialist medical imaging technology company. It develops software and systems that provide innovative techniques and improved workflows for practitioners involved in medical research and treating patients. TexRAD®, the Company’s patented quantitative image texture analysis technology, has the potential to assist clinicians in diagnosis, prognosis and treatment of patients with cancer and is currently installed in over 40 of the world’s leading research institutions across Europe, North America and Asia. The Cadran platform provides a suite of medical imaging tools for decision support. The Cadran range includes the picture archiving communication system (PACS) to provide decision support for scan analysis, diagnostic workstations which provide secure remote access to view scans on demand, and products to securely share and transport patient data. Visit www.fbk.com.
For further information, please contact:
|
Feedback plc Dr Alastair Riddell, Chairman Lara Mott, Investor Relations
|
Tel: 01954 718072 hello@fbk.com |
|
Allenby Capital Limited (Nominated Adviser and Joint Broker) David Worlidge / James Thomas
|
Tel: 020 3328 5656 |
|
Northland Capital Partners Ltd (Joint Broker) Patrick Claridge / David Hignell
|
Tel: 020 3861 6625 |
|
Peterhouse Corporate Finance Ltd (Joint Broker) Lucy Williams / Duncan Vasey
|
Tel: 020 7469 0936 |
Chairman’s statement
FINANCIAL PROGRESS
In the year ended 31 May 2017, the Group incurred a loss after tax of £266,003 (2016: loss £183,156) on revenue of £465,885 (2016: £431,454). The results show a continuation in revenue growth as more customers around the world adopt TexRAD® and Cadran products and associated support services. On 26 April 2017, we announced the completion of a placing of 27,272,727 new Ordinary Shares at a price of 2.75 pence per share to raise a total of £750,000 (before expenses). A proportion of the net proceeds from the share issue has been invested in product development, sales and marketing with the balance being utilised for general working capital purposes. This accelerated expenditure, including investing in the team and external activities, has contributed to the increase in the loss during the period, however the Directors expect that the benefits of this investment will be seen in the current financial year. Operational cash generation has been satisfactory and reflects customer payments for new purchases and contracts before the periods in which the revenue is recognised. The share issue, net of costs, has contributed to a healthy cash balance at the end of the year.
OPERATIONAL PROGRESS
As previously announced, Feedback’s subsidiary company, Cambridge Computed Imaging Ltd (“CCI”) is working towards a CE marked release of “TexRAD® Lung” for the clinical application of TexRAD® in the diagnosis, prognosis and treatment of lung cancer. CE marking is a claim by a medical device manufacturer that a product meets the essential requirements of the Medical Device Directive, which outlines the safety and performance requirements for medical devices in the European Union. TexRAD® Lung will be a “software only” medical device providing additional information for the interpretation of computerised tomography (CT) and positron emission tomography (PET) scans.
Feedback is committed to offering its customers the highest quality service across all areas of its business, and therefore compliance with international quality management standards is of paramount importance. CCI received certification for its compliance with the ISO 13485:2016 quality management standard in September 2017. In May 2017, Feedback announced that CCI had identified enhancements to improve the performance of TexRAD® which will further support the wider clinical application of the TexRAD® technology. Since then, CCI has successfully prepared a “release candidate” version of TexRAD® Lung, incorporating over 60 risk control measures to address the 50 potential clinical risk scenarios identified within the product. This in now in the final stages of testing, with an anticipated CE marked release by the end of November 2017.
On 30 March 2017, as part of the intended distribution arrangements, CCI signed a letter of intent with a leading global medical imaging company which would make TexRAD® Lung available for purchase on its diagnostic imaging solutions platform. This would, in due course, enable easy access to TexRAD® Lung for hundreds of potential users around the world on a subscription basis. We look forward to continuing our ongoing discussions with this company and other leading imaging companies to broaden the range of potential routes to market for clinical versions of TexRAD®.
Post-period end, CCI signed exclusive distributor agreements with Korea Computer Motion ISG in June 2017 and Boya Digital Technology (Beijing) Co. Ltd. in July 2017 for sales and distribution of TexRAD® in South Korea and the People’s Republic of China, respectively.
These agreements represent a significant step in expanding TexRAD® sales to meet the fast-growing demand in Asian markets. By successfully identifying and engaging with distributors who are experts in the local market, we can leverage the TexRAD® brand to help build a regional sales pipeline. Over the first few months of these agreements, joint marketing and promotional activities have been well-received, we have seen an increase in purchase orders for TexRAD® from leading medical institutions in South Korea and we are receiving significant interest in China.
In September 2016, we announced that we have developed a technical solution with Alliance Medical Group that would allow the integration of TexRAD® into Alliance’s network of PET/CT scanners in UK hospitals. A prototype version has been demonstrated to potential users and an abstract was presented at the Radiological Society of North America (RSNA) annual conference in November 2016. The poster, entitled “PET/CT in Lung Cancer: An Automated Imaging Tool for Decision Support”, highlighted results from a preliminary study which suggests that an automated PET/CT lung cancer tool may standardise clinical performance whilst allowing access to quantitative texture analysis to improve prognostication and fit within clinical workflow. We continue to work closely with Alliance on the future integration of TexRAD® Lung.
In March 2017, the Company announced that CCI was finalising arrangements for the secure transfer of patient data from Papworth Hospital NHS Foundation Trust to the new Cambridge Biomedical Campus which was expected to open in April 2018. Papworth Hospital has since extended the timeframe to September 2018 and therefore preparation for the transfer of the extensive archive of medical images is ongoing.
RESEARCH AND DEVELOPMENT PROGRESS
In July 2016, we announced a large-scale collaboration with Future Processing Sp. z o.o. (“Future Processing”), a software development service provider based in Gliwice, Poland to develop medical imaging software. The collaboration will entail a substantially increased development team working on new products and the sharing of intellectual property and future revenues. We believe that by CCI working jointly with the Future Processing healthcare team, CCI’s existing product portfolio can be improved and new products developed more rapidly including further applications for TexRAD®. The collaboration is fully underway and both teams are working towards agreeing formal licences for new software products to be brought to market in 2018.
We continue to receive significant TexRAD® research interest from prestigious institutions worldwide which has resulted in multiple articles in leading publications. In September 2016, University College London (“UCL”) published a retrospective study of 67 prostate cancer patients which demonstrated that TexRAD® analysis of multi-parametric MRI images may be able to identify the presence of clinically significant prostate cancers in the transition zone and therefore could potentially assist in optimising prostate radiologists’ workflow. In November 2016, we attended the 102nd Scientific Assembly and Annual Meeting of the Radiological Society of North America (RSNA 2016); the premier global event for radiologists. We had a strong presence at RSNA 2016, with 19 scientific paper presentations featuring TexRAD®analysis, further emphasising the significance of our technology across the healthcare industry. Further information on the papers presented at RSNA 2016 can be found at https://rsna2016.rsna.org/program/.
Post-period end in October 2017, our customer at the International University of Health and Welfare Hospital in Tochigi, Japan published article featuring TexRAD® analysis in liver cancer. The paper, entitled “Impact of hepatocellular carcinoma heterogeneity on computed tomography as a prognostic indicator” was published in the Nature affiliated journal; Scientific Reports. We also sponsored the American British Course in Neuroradiology in Mumbai, India in October 2017, which included a lunch-time symposium presentation on brain texture analysis using TexRAD® technology. These research activities continue to support the potential future clinical application of TexRAD® in these other disease indications.
In 2015, we announced the incorporation of a 50:50 joint venture company, Prostate Checker Ltd, with QUIBIM S.L. (“QUIBIM”). The Board has concluded that a joint venture vehicle is no longer required for the collaboration. The Company continues to work closely with QUIBIM to develop a specific application of TexRAD® texture analysis for the computer assisted detection and diagnosis of prostate cancer.
BOARD AND ORGANISATION
Tom Charlton stepped down as a director on 30 May 2017 in order to devote more time to his other investment activities. Post-period end, on 8 June 2017, we announced that Trevor Brown resigned as a non-executive Director in order to allow the Company to move rapidly to the next stage in its development. On behalf of the Board, I thank both Tom and Trevor for their invaluable support of the Company following its readmission in 2014 which has enabled it to achieve considerable progress to date.
To further support the Company’s growth strategy, Tim Irish joined the Board on 8 June 2017 as Non-Executive Director. Tim is a Professor of Practice at Kings College London as well as a board member of Bournemouth University. He joined the board of the National Institute for Health and Care Excellence (NICE) in April 2015 and became its Senior Independent Director in May 2017. Tim has worked in the life sciences industry for 30 years. His career has spanned global health technology companies across Europe and North America, including GSK, GE and Philips the latter two in senior positions responsible for medical imaging. Tim also currently holds a number of non-executive positions in health and technology related entities.
I would also like to recognise and thank the Group’s employees for the outstanding contribution they have made. Having completed the placing in April 2017, we are in strong position to continue to build and invest in a leading team to deliver our objectives.
STRATEGY AND OUTLOOK
Upon delivery of the first CE marked release of TexRAD® by the end of November 2017, our ambition is to leverage our leading research, image processing and analysis expertise to position TexRAD® technology for routine clinical use to drive future revenue growth. We look forward to continuing our ongoing discussions with leading imaging companies to broaden the range of potential routes to market for clinical versions of TexRAD®. Our existing and future distributor agreements will continue to support the Company’s international expansion, ensuring that our technology continues to be used by the world’s leading institutions to expedite research in this important field. With pioneering technology platforms and strong industry trends, we believe the Group is ideally placed to deliver continued growth.
Dr A J Riddell
Chairman
6 November 2017
STATEMENT OF COMPREHENSIVE INCOME FOR THE YEAR ENDED 31 MAY 2017
|
Note |
2017 |
2016 |
|||
|
£ |
£ |
||||
|
REVENUE |
465,885 |
431,454 |
|||
|
Cost of sales |
(11,007) |
(7,438) |
|||
|
GROSS PROFIT |
454,878 |
424,016 |
|||
|
Other income |
150 |
||||
|
Other operating expenses |
(755,960) |
(676,596) |
|||
|
OPERATING LOSS |
(300,932) |
(252,580) |
|||
|
Net finance income |
5 |
1,361 |
|||
|
Loss on ordinary activities before taxation |
(300,927) |
(251,219) |
|||
|
Tax credit |
34,924 |
23,063 |
|||
|
LOSS ON ORDINARY ACTIVITIES AFTER TAX |
(266,003) |
(228,156) |
|||
|
Profit on disposal of investment |
– |
45,000 |
|||
|
Loss for the year attributable to the equity shareholders of the Company |
(266,003) |
(183,156) |
|||
|
Other comprehensive income |
|||||
|
Translation differences on overseas operations |
– |
– |
|||
|
Total comprehensive expense for the year |
(266,003) |
(183,156) |
|||
|
LOSS PER SHARE (pence) |
|||||
|
Basic and diluted |
4 |
(0.11) |
(0.09) |
||
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY FOR THE YEAR ENDED 31 MAY 2017
|
Share Capital |
Share Premium |
Capital Reserve |
Retained Earnings |
Translation Reserve |
Convertible Debt Option Reserve |
Total |
|
|
£ |
£ |
£ |
£ |
£ |
£ |
£ |
|
|
At 1 June 2015 |
476,867 |
1,409,334 |
299,900 |
(2,076,483) |
(209,996) |
189,000 |
88,622 |
|
New shares issued |
32,318 |
190,382 |
222,700 |
||||
|
Costs associated with the raising of funds |
(6,580) |
(6,580) |
|||||
|
Share option and warrant costs |
– |
– |
– |
8,163 |
– |
– |
8,163 |
|
Total comprehensive expense for the year |
– |
– |
– |
(183,156) |
– |
– |
(183,156) |
|
At 31 May 2016 |
509,185 |
1,593,136 |
299,900 |
(2,251,476) |
(209,996) |
189,000 |
129,749 |
|
New Shares issued
|
105,982 |
833,018 |
– |
– |
– |
(189,000) |
750,000 |
|
Costs associated with the raising of funds
|
– |
(50,121) |
– |
– |
– |
– |
(50,121) |
|
Share option and warrant costs |
– |
– |
– |
5,726 |
– |
– |
5,726 |
|
Total comprehensive expense for the year |
– |
– |
– |
(266,003) |
– |
– |
(266,003) |
|
At 31 May 2017 |
615,167 |
2,376,033 |
299,900 |
(2,511,753) |
(209,996) |
– |
569,351 |
CONSOLIDATED BALANCE SHEET AT 31 MAY 2017
|
2017 |
2016 |
|||
|
Notes |
£ |
£ |
||
|
ASSETS |
||||
|
Non-current assets |
||||
|
Property, plant and equipment |
5 |
4,109 |
3,639 |
|
|
Intangible assets |
6 |
80,235 |
110,747 |
|
|
Investments |
– |
1,000 |
||
|
84,344 |
115,386 |
|||
|
Current assets |
||||
|
Trade receivables |
49,982 |
40,894 |
||
|
Other receivables |
7 |
62,328 |
63,910 |
|
|
Cash and cash equivalents |
696,811 |
105,673 |
||
|
809,121 |
210,477 |
|||
|
Total assets |
893,465 |
325,863 |
||
|
EQUITY |
||||
|
Capital and reserves attributable to the Company’s equity shareholders |
||||
|
Called up share capital |
9 |
615,167 |
509,185 |
|
|
Share premium account |
2,376,033 |
1,593,136 |
||
|
Capital reserve |
299,900 |
299,900 |
||
|
Translation reserve |
(209,996) |
(209,996) |
||
|
Retained earnings |
(2,511,753) |
(2,251,476) |
||
|
569,351 |
(59,251) |
|||
|
Convertible debt option reserve |
– |
189,000 |
||
|
TOTAL EQUITY |
569,351 |
129,749 |
||
|
LIABILITIES |
||||
|
Deferred tax liabilities |
4,250 |
19,378 |
||
|
4,250 |
19,378 |
|||
|
Current liabilities |
||||
|
Trade payables |
68,948 |
21,546 |
||
|
Other payables |
8 |
250,916 |
155,190 |
|
|
319,864 |
176,736 |
|||
|
Total liabilities |
324,114 |
196,114 |
||
|
TOTAL EQUITY AND LIABILITIES |
893,465 |
325,863 |
CONSOLIDATED CASH FLOW STATEMENT FOR THE YEAR ENDED 31 MAY 2017
|
2017 |
2016 |
|
|
£ |
£ |
|
|
Cash flows from operating activities |
||
|
Loss before tax |
(300,927) |
(251,219) |
|
Adjustments for: |
||
|
Share option costs |
5,726 |
8,163 |
|
Net finance income |
(5) |
(1,361) |
|
Depreciation and amortisation |
48,182 |
46,052 |
|
Impairment of investment |
1,000 |
– |
|
(Increase)/decrease in trade receivables |
(9,087) |
69,976 |
|
(Increase)/decrease in other receivables |
(36,246) |
42,402 |
|
Decrease/(increase) in trade payables |
47,400 |
(18,852) |
|
(Increase)/decrease in other payables |
95,728 |
(109,772) |
|
Corporation tax received |
57,624 |
9,506 |
|
210,322 |
46,114 |
|
|
Net cash used in operating activities |
(90,605) |
(205,105) |
|
Cash flows from investing activities |
||
|
Purchase of tangible fixed assets |
(2,941) |
(104) |
|
Purchase of intangible assets |
(15,200) |
(13,860) |
|
Net finance income received |
5 |
1,361 |
|
Proceeds from sale of joint venture |
– |
46,000 |
|
Purchase of shares in joint ventures |
– |
(2,000) |
|
Net cash (used by)/generated from investing activities |
(18,136) |
31,397 |
|
Cash flows from financing activities |
||
|
Net proceeds of share issue |
699,879 |
216,120 |
|
Net cash generated from financing activities |
699,879 |
216,120 |
|
Net increase in cash and cash equivalents |
591,138 |
42,412 |
|
Cash and cash equivalents at beginning of year |
105,673 |
63,261 |
|
Cash and cash equivalents at end of year |
696,811 |
105,673 |
NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 MAY 2017
1. General information
The Company is a public limited company domiciled in the United Kingdom and incorporated under registered number 00598696 in England and Wales. The Company’s registered office is Unit 5, Grange Park, Broadway, Bourn, Cambridgeshire, CB23 2TA.
The Company is listed on AIM of the London Stock Exchange. These Financial Statements were authorised for issue by the Board of Directors on the 6 November 2017.
While the financial information included in this preliminary announcement has been prepared in accordance with International Financial Reporting Standards (IFRSs), this announcement does not itself contain sufficient information to comply with IFRSs. The Group has also published full financial statements that comply with IFRSs available on its website and to be circulated shortly.
The financial information set out in the announcement does not constitute the company’s statutory accounts for the years ended 31 May 2017 or 2016. The financial information for the year ended 31 May 2016 is derived from the statutory accounts for that year, which were prepared under IFRSs, and which have been delivered to the Registrar of Companies.
The financial information for the year ended 31 May 2017 is derived from the audited statutory accounts for the year ended 31 May 2017 on which the auditors have given an unqualified report, that did not contain a statement under section 498(2) or 498(3) of the Companies Act 2006 and included the following paragraphs:
“Emphasis of matter – Going Concern
In forming our opinion, which is not modified, we have considered the adequacy of the disclosures made in Note 3c of the accounting policies regarding the group and parent company’s ability to continue as a going concern. The group incurred a loss of £266,003 in the year and may need to obtain further finance during the next twelve months which has not yet been obtained. These factors, along with the matters explained in note 3c of the accounting policies indicate the existence of a material uncertainty which may cast a significant doubt about the group and the company’s ability to continue as a going concern.
The financial statements do not include the adjustments that would result if the group and company were unable to operate as a going concern.”
The statutory accounts will be delivered to the Registrar of Companies following the Company’s annual general meeting.
2. Adoption of new and revised International Financial Reporting Standards
No new International Financial Reporting Standards (“IFRS”), amendments or interpretations became effective in the year ended 31 May 2017 which had a material effect on this financial information.
At the date of approval of this financial information, the following IFRS Standards and Interpretations, which have not been applied in these Financial Statements, were in issue but not yet effective. These new Standards, Amendments and Interpretations are those in issue but not yet effective which are expected to apply to the Group and are effective for accounting periods beginning on or after the dates shown below:
IFRS Standards and Interpretations issued (and EU adopted) but not yet effective:
Mandatory for accounting periods commencing on or after 1 January 2017:
· Amendments to IAS 12 – Recognition of Deferred Tax Assets for Unrealised Losses
· Amendments to IAS 7 – Disclosure Initiative
· Annual improvements to IFRS Standards 2014-2016 Cycle
Mandatory for accounting periods commencing on or after 1 January 2018:
· IFRS 9 – Financial Instruments
· IFRS 15 – Revenue from Contracts with Customers
· IFRIC Interpretation 22 – Foreign Currency Transactions and Advance Consideration
Mandatory for accounting periods commencing on or after 1 January 2019:
· IFRS 16 – Leases
Date of implementation in the European Union not yet known:
· IFRS 14 – Regulatory Deferral Accounts
The Group has not early adopted these amended standards and interpretations. The Directors do not anticipate that the adoption of these standards and interpretations will have a material impact on the reported results.
3. SIGNIFICANT ACCOUNTING POLICIES
(a) Basis of preparation
These financial statements have been prepared in accordance with those IFRS standards and IFRIC interpretations issued and effective or issued and early adopted as at the time of preparing these statements. The policies set out below have been consistently applied to all the years presented.
No separate income statement is presented for the parent Company as provided by Section 408, Companies Act 2006.
(b) Basis of consolidation
The Group financial statements consolidate the financial statements of Feedback plc and its subsidiaries (the “Group”) for the years ended 31 May 2017 and 2016 using the acquisition method.
The financial statements of subsidiaries are prepared for the same reporting year as the parent company, using consistent accounting policies. All inter-company balances and transactions, including unrealised profits arising from them, are eliminated. Subsidiaries are fully consolidated from the date on which control is transferred to the Group and cease to be consolidated from the date on which control is transferred out of the Group.
(c) Going Concern
On 26 April 2017 the Company raised a total of £750,000 (before expenses) through a placing to both invest further in the product development and sales and marketing of TexRAD, Feedback’s patented quantitative imaging software, and also for general working capital purposes.
Having updated the Group’s formal business plan the Directors consider that the Group and the Company are likely to have access to adequate cash resources for at least the next twelve months, from both existing cash balances and by obtaining further equity finance from the financial markets, or alternative funding, if required to enable continued product development and international expansion. Although this further finance has not yet been obtained, the Directors are confident that adequate additional finance will be forthcoming should it be required. Accordingly, the Directors believe that the Group and Company are a going concern and have therefore prepared the financial statements on a going concern basis.
4. LOSS PER SHARE
Basic earnings per share is calculated by reference to the loss on ordinary activities after taxation of £266,003 (2016: £183,156) and on the weighted average of 232,879,771 (2016: 203,514,709) shares in issue.
|
As at 31 May 2017
|
As at 31 May 2016
|
||
|
£ |
£ |
||
|
Net loss attributable to ordinary equity holders |
(266,003) |
(183,156) |
|
|
As at 31 May 2017
|
As at 31 May 2016 |
||
|
Weighted average number of ordinary shares for basic earnings per share |
232,879,771 |
203,514,709 |
|
|
Effect of dilution: |
|||
|
Share Options |
– |
– |
|
|
Warrants |
– |
– |
|
|
Weighted average number of ordinary shares adjusted for the effect of dilution |
232,879,771 |
203,514,709 |
|
|
Loss per share (pence) |
|||
|
Basic |
(0.11) |
(0.09) |
|
|
Diluted |
(0.11) |
(0.09) |
|
There is no dilutive effect of the share options and warrants as the dilution would be negative.
5. PROPERTY, PLANT AND EQUIPMENT
|
Plant and |
|||
|
Equipment |
Total |
||
|
£ |
£ |
||
|
Cost of valuation |
|||
|
At 31 May 2015 |
10,773 |
10,773 |
|
|
Additions |
104 |
104 |
|
|
At 31 May 2016 |
10,877 |
10,877 |
|
|
Additions |
2,941 |
2,941 |
|
|
As 31 May 2017 |
13,818 |
13,818 |
|
|
Depreciation |
|||
|
At 31 May 2015 |
3,858 |
3,858 |
|
|
Charge for the year |
3,380 |
3,380 |
|
|
At 31 May 2016 |
7,238 |
7,238 |
|
|
Charge for the year |
2,471 |
2,471 |
|
|
At 31 May 2017 |
9,709 |
9,709 |
|
|
Net Book Value |
|||
|
At 31 May 2017 |
4,109 |
4,109 |
|
|
At 31 May 2016 |
3,639 |
3,639 |
|
|
At 31 May 2015 |
6,915 |
6,915 |
6. INTANGIBLE ASSETS
|
Software |
Customer relationships |
Patents |
Goodwill |
Total |
|
|
£ |
£ |
£ |
£ |
£ |
|
|
Cost |
|||||
|
At 31 May 2015 |
563,099 |
100,000 |
74,498 |
271,415 |
1,009,012 |
|
Additions |
– |
– |
13,860 |
– |
13,860 |
|
At 31 May 2016 |
563,099 |
100,000 |
88,358 |
271,415 |
1,022,872 |
|
Additions |
– |
– |
15,200 |
– |
15,200 |
|
At 31 May 2017 |
563,099 |
100,000 |
103,558 |
271,415 |
1,038,072 |
|
Amortisation |
|||||
|
At 31 May 2015 |
563,099 |
25,000 |
9,940 |
271,415 |
869,454 |
|
Charge for the year |
– |
25,000 |
17,671 |
– |
42,671 |
|
At 31 May 2016 |
563,099 |
50,000 |
27,611 |
271,415 |
912,125 |
|
Charge for the year |
– |
25,000 |
20,712 |
– |
45,712 |
|
At 31 May 2017 |
563,099 |
75,000 |
48,323 |
271,415 |
957,837 |
|
Net Book Value |
|||||
|
At 31 May 2017 |
– |
25,000 |
55,235 |
– |
80,235
|
|
At 31 May 2016 |
– |
50,000 |
60,747 |
– |
110,747 |
|
At 31 May 2015 |
– |
75,000 |
64,558 |
– |
139,558 |
In accordance with the accounting policies and IFRS the Directors have assessed the carrying value of the intangible assets. In the year ended 31 May 2015, the Directors took the prudent decision to write down the carrying value of the software development costs in the balance sheet in order to meet the requirements of IFRS. During the years ended 31 May 2017 and 2016 all similar development costs have been expensed as the provisions of IFRS have not been met. However the Directors believe the Group’s technology has great potential and this write down does not reflect their commercial assessment of the value of the Group’s intellectual property. Expenditure on software development is being written off as incurred until the provisions of IFRS are met. The customer lists and patents are deemed to have ongoing value to the Group.
7. OTHER RECEIVABLES
|
2017 |
2016 |
|
|
£ |
£ |
|
|
Amounts falling due within one year |
||
|
Other receivables |
18,396 |
8,684 |
|
Corporation tax recoverable |
16,318 |
37,828 |
|
Prepayments |
27,614 |
17,398 |
|
62,328 |
63,910 |
|
8. OTHER PAYABLES
|
2017 |
2016 |
|
|
£ |
£ |
|
|
Amounts falling due within one year |
||
|
Other payables |
5,534 |
4,885 |
|
Other taxes and social security |
7,033 |
15,386 |
|
Accruals |
69,827 |
31,750 |
|
Deferred income |
168,522 |
103,169 |
|
250,916 |
155,190 |
|
9. SHARE CAPITAL AND RESERVES
|
2017 |
2016 |
||||||
|
£ |
£ |
||||||
|
Authorised and issued share capital |
|||||||
|
Ordinary shares of 0.25 pence each |
615,167 |
509,185 |
|||||
|
Allotted, called up and fully paid share capital: |
|||||||
|
Number |
Number |
||||||
|
As at 1 June 2016 |
203,673,857 |
190,746,746 |
|||||
|
Issued |
42,392,727 |
12,927,111 |
|||||
|
As at 31 May 2017 |
246,066,584 |
203,673,857 |
|||||
Share Options
Share options are granted to directors and employees. Options are conditional on the employee completing a specific length of service (the vesting period). The options are exercisable from the end of the vesting period and lapse after ten years after the grant date. The Group has no legal or constructive obligation to repurchase or settle the options in cash.
Share options are valued using the Black-Scholes option pricing model and no performance conditions are included in the fair value calculations. The risk free rate was 1.64%. The expected volatility is based on historical volatility over the last two years and is estimated to be 25%. The average share price during the year was 1.85 pence. During the year the Company had the following share options in issue:
|
Number of options |
|||||
|
At 1 June 2016 |
Lapsed |
Exercised |
At 31 May 2017 |
Exercise price (pence) |
Exercise date |
|
2,400,000 |
– |
– |
2,400,000 |
1.25 |
21/05/14 to19/05/24 |
|
4,000,000 |
– |
– |
4,000,000 |
3.00 |
21/05/15 to19/05/24 |
|
4,000,000 |
– |
– |
4,000,000 |
5.00 |
21/05/15 to19/05/24 |
|
10,400,000 |
– |
– |
10,400,000 |
||
All share options vest one year after the grant date. Each option can only be exercised from one year after the grant date to ten years after the date of grant.
Warrants
Warrants were issued to the vendors of TexRAD Limited at the time of acquisition. The warrants are exercisable from the end of the vesting period and lapse ten years after the grant date. The Group has no legal or constructive obligation to repurchase or settle the warrants in cash.
Warrants are valued using the Black-Scholes pricing model and no performance conditions are included in the fair value calculations. The risk free rate was 1.64%. The expected volatility is based on historical volatility over the last two years and is estimated to be 25%. The average share price during the year was 1.85 pence. During the year the Company had in existence the following warrants:
|
Number of warrants |
|||||
|
At 1 June 2016 |
Granted |
Cancelled |
At 31 May 2017 |
Exercise price (pence) |
Exercise date |
|
4,550,000 |
– |
– |
4,550,000 |
1.25 |
19/05/16 to 19/05/24 |
|
18,200,000 |
– |
– |
18,200,000 |
3.00 |
19/05/17 to 19/05/24 |
|
22,750,000 |
– |
– |
22,750,000 |
||
Reserves
The nature and purpose of each reserve within equity is as follows:
|
Share premium |
Amount subscribed for share capital in excess of nominal value. |
|
Capital reserve |
Reserve on consolidation of subsidiaries |
|
Translation reserve |
Gains and losses on the translation of overseas operations into G |
|
Retained earnings |
All other net gains and losses and transactions with owners not recognised elsewhere |
|
Convertible debt option reserve |
Amount of proceeds on issue of convertible debt relating to the equity component of the debt. |
10. NOTICE OF ANNUAL GENERAL MEETING (“AGM”) AND AVAILABILITY OF REPORT AND FINANCIAL STATEMENTS
The Company hereby announces that its AGM will be held at the offices of Mills & Reeve LLP at 4th Floor, 24 Monument St, London EC3R 8AJ at 3.00 p.m. on 30 November 2017.
The Company’s Annual Report and Financial Statements for the year ended 31 May 2017 are expected to be posted to shareholders, along with the Notice of AGM, on 7 November 2017 and will be available thereafter at the Company’s registered office, Unit 5 Grange Park, Broadway, Bourn, Cambridgeshire CB23 2TA and on its website: http://www.fbk.com/category/financial-reports/
Feedback (FDBK) subsidiary CCI signs exclusive agreement with Boya Digital Technology (Beijing) to distribute TexRAD in China
Feedback plc is pleased to announce that its subsidiary, Cambridge Computed Imaging Ltd, has signed an exclusive distributor agreement with Boya Digital Technology (Beijing) Co. Ltd., based in Beijing, China, for sales and distribution of its TexRAD® texture analysis research software in the People’s Republic of China. Boya is an approved vendor to GE Healthcare China, Beijing and is facilitating the purchase and installation process of TexRAD research software on behalf of GE in the PRC.
TexRAD will be used by customers for research purposes, performing advanced analysis of routinely acquired medical diagnostic images (e.g. CT, MRI). As in western countries, university hospitals and research institutions in China are increasingly using innovative software such as TexRAD to generate new knowledge and insights in the fight against cancer and other diseases. The Agreement ensures user access and customer support for TexRAD within the rapidly growing market for medical research in the PRC.
Feedback regards the completion of this Agreement as a significant step in the continuing development of its global sales and market presence as outlined in recent investor presentations.
Dr Balaji Ganeshan, CEO of TexRAD Ltd and Director of New Business at Feedback Plc said; “We are delighted to have formalised the business relationship with both Boya and GE. This follows discussions at the Beijing Society of Radiology in 2016 and involvement in the installation of TexRAD software in a leading medical institution, Peking Union Medical College Hospital, Beijing. I look forward to working with Boya and GE to develop awareness of the capabilities of TexRAD and sales to the medical research community in China.”
Ian McLellan, Commercial Director CCI Ltd commented; “The signing of this Agreement with Boya represents an excellent basis on which to develop our sales and presence in this exciting growth market using the expertise and customer reach of Boya Digital Technologies. We look forward to developing the TexRAD revenue potential and increasing the market reach to our users.”
Ni Xiaowei, President Boya Digital Technologies confirmed; “We are pleased with the addition of TexRAD to our software portfolio, and look forward to working with CCI to promote this texture analysis software to research institutes in leading hospitals within the People’s Republic of China. I anticipate a very successful business relationship, working closely with Dr Balaji Ganeshan and CCI. Boya Digital Technologies has developed a strong reputation for IT sales and support with our customers which we can offer to support the development of TexRAD sales in China.”
|
Feedback plc
|
Tel: 01954 718072 |
|
Allenby Capital Limited (Nominated Adviser and Joint Broker)
|
Tel: 020 3328 5656 |
|
Northland Capital Partners Ltd (Joint Broker)
|
Tel: 020 3861 6625 |
|
Peterhouse Corporate Finance Ltd (Joint Broker) |
Tel: 020 7469 0936 |
|
Brand Communications |
Tel: 07976 431608 |
About CCI
CCI Ltd is owned by AIM listed Feedback Plc (FDBK), based in Bourn, Cambridge UK. CCI focusses on the development and supply of advanced software including TexRAD, for texture analysis of medical images and storage and interpretation of imaging data.
About Boya
Boya Digital Technologies, founded in 2004 is based in Beijing, China and has been a manufacturer and supplier of computers, peripherals and software for over 10 years. It is a re-seller and vendor to a number of companies in China. Boya is part of the larger corporate organization, Boya Software Co Ltd, which aims to create value for its customers through technology and services.
About TexRAD
TexRAD is a highly advanced, patented image texture analysis software tool that analyses the textures in routinely acquired diagnostic medical images (e.g. CT, MRI) to reveal features that are not always evident to the human eye. The platform also comprises a novel data-mining tool to assist the research customer to undertake statistical analysis to identify interesting parameters demonstrating association with patient outcome and clinical parameters. A number of research studies published in numerous peer-reviewed journals and conference presentations show that TexRAD texture metrics may have the potential to predict prognosis, disease severity and treatment prediction/evaluation in a number of cancer applications. TexRAD is manufactured under licence by the ISO 13485 certified company Cambridge Computed Imaging Ltd, a subsidiary of Feedback plc.
Commercial Director appointed for CCI Ltd – Feedback (FDBK)
Feedback plc are pleased to welcome Ian McLellan as Commercial Director for CCI Ltd. This new role will develop the market and sales channels for our products, supporting sales growth including the launch of next generation TexRAD products as part our commitment to invest in our Brands.
Ian has joined CCI after working closely with the management team over the last six months in a consultancy role to develop our strategy and Commercial structure.
Experienced in both global Corporate and small company environments as well as the NHS, he brings international sales and strategic marketing expertise in nuclear medicine and imaging modalities acquired from GE Healthcare, where he had senior roles in market development and as UK Marketing Manager. Ian also brings a track record of successful licensing and distribution agreements to support our business growth, having in-licensed two ground-breaking nuclear imaging agents whilst at Amersham Healthcare.
His career has involved interaction with stakeholders and users at all levels and this appointment will provide significant additional resource and expertise as CCI seek relationships, local distributors and a widening customer base.
Ian McLellan commented “I have been impressed with the technology and expertise within CCI, and I am pleased to be joining at this exciting time in the Company history as we develop new growth opportunities through product innovation and wider sales channels.”
CCI Ltd CEO Mike Hayball observed “We welcome Ian to the management team. He has brought significant expertise to our strategy development and his experience of developing new markets and product launches will enhance our ability to generate growth and strengthen user awareness of our technology.”
Feedback (FDBK) subsidiary Cambridge Computed Imaging announces exclusive distributor arrangement with Korea Computer Motion ISG
Feedback plc subsidiary Cambridge Computed Imaging Ltd (CCI) is pleased to announce the signing of an Exclusive Distributor arrangement with Korea Computer Motion ISG (Korea ISG) based in Seoul, South Korea for sales and distribution of its TexRAD® texture analysis research software.
TexRAD will be used by customers for research purposes, performing advanced analysis of routinely acquired medical diagnostic images (e.g. CT, MRI) in South Korea.
As outlined in our recent investor presentations, this is a significant step for CCI Ltd as part of its plans to expand sales of TexRAD software to meet the fast-growing demand in Asian markets, identifying and engaging with distributors who are experts in the local market, and who can leverage the TexRAD brand awareness to help build a regional sales pipeline.
Dr Balaji Ganeshan, CEO of TexRAD Ltd and Director of New Business at Feedback Plc said; “We are pleased to sign this significant Distributorship agreement with Korea ISG to support the interest and acceptance of TexRAD in the rapidly growing and important South Korean medical imaging research market. We are confident that by working with an experienced team led by the CEO Jacob Woo, who has a great understanding of the market and customer base, we stand to increase the TexRAD revenue potential and market reach and meet our customer needs.”
Mr Jacob Woo, CEO of Korea ISG commented; “We are pleased to have started to work with CCI Ltd this year to promote the highly acclaimed TexRAD texture analysis software in South Korea which has attracted a lot of interest amongst the top University Hospitals who are also our potential-customers. Following a recent installation for research at the prestigious Korea University Hospital, I anticipate a very successful business relationship, rapidly increasing TexRAD software sales and working closely with Dr. Balaji Ganeshan and CCI. Our team has a first class reputation amongst researchers in the region, and offers unrivalled in-depth market-access and know-how in South Korea.”
About CCI
CCI Ltd is owned by AIM listed Feedback Plc (FDBK), based in Bourn, Cambridge UK. CCI focusses on the development and supply of advanced software including TexRAD, for texture analysis of medical images and storage and interpretation of imaging data.
About Korea Motion ISG
Korea ISG has installed and supported MRI/CT 3D processing imaging software to about 120 prominent Korean hospitals for 23 years, and is the largest medical imaging software distribution (sales and service/support) company in South Korea. They are experienced distributors of medical software from other world leading suppliers, with a wide customer base.
About TexRAD
TexRAD is a highly advanced, patented image texture analysis software tool that analyses routinely acquired diagnostic medical images (e.g. CT, MRI) to reveal features that are not always evident to the human eye. The platform also comprises a novel data-mining tool to assist the research customer to undertake statistical analysis to identify interesting parameters demonstrating association with patient outcome and clinical parameters. A number of research studies published in numerous peer-reviewed journals and conference presentations show that TexRAD texture metrics may have the potential to predict prognosis, disease severity and treatment prediction/evaluation in a number of cancer applications.
Contact for press enquiries
CCI Ltd: Mike Hayball, CEO Tel: 01954 718055
TexRAD Ltd: Dr. Balaji Ganeshan, CEO Tel: 01954 718072
Feedback plc: Alastair Riddell, Chairman Tel: 01954 718072
Brand Communications: Alan Green Tel: 07976 431608
Feedback (FDBK) – Progress with CE mark and trading update
Feedback plc (AIM: FDBK), the medical imaging software company, is pleased to update shareholders on obtaining the CE Mark for TexRAD. The Group had previously announced its expectation of obtaining the CE mark for TexRAD Lung by a target date of end May 2017. In the course of development and review in compliance with ISO 13485:2016, enhancements have been identified which will improve the performance of this version of TexRAD and which will assist in the progression of future versions to wider clinical usage. The introduction of these modifications will result in a delay of several weeks before the CE Mark for TexRAD Lung is obtained. This is not expected to have any effect on the commercial negotiations which are underway or on future sales of TexRAD.
The CE mark will allow the sale of TexRAD Lung in the EU and certain other markets as a medical device that provides analysis of PET/CT images of lung cancer for clinical use. As previously announced, Feedback’s subsidiary company, Cambridge Computed Imaging Ltd, has signed a Letter of Intent with a leading global medical imaging company which would make TexRAD Lung available for purchase on its diagnostic imaging solutions platform. The schedule for release on this platform remains unaffected.
CCI continues to pursue its ongoing discussions with other leading imaging companies to broaden the range of potential routes to market for clinical versions of TexRAD. The funds raised from the recent placing have enabled the Company to initiate recruitment for business development and customer relations positions as well as scaling up the software development collaboration with Future Processing.
Note on CE Marking
CE marking is a claim by a medical device manufacturer that a product meets the essential requirements of relevant Medical Device Directives, which outline the safety and performance requirements for medical devices in the EU. CE marking (and compliance with the directives) is legally required before placing a device on the market in the EU. CCI has obtained certification to ISO 13485, the International Standard relating to quality management systems for organisations involved in the manufacture of medical devices. An appropriate quality management system and the preparation of a technical file are requirements for CE marking. The CE technical file is a comprehensive description of the device intended to demonstrate compliance with the Medical Device Directives and contains extensive documentation on the use, design, risk assessment, testing, clinical evaluation and manufacture of the device.
For further information contact:
|
Feedback plc |
Tel: 01954 718072 |
|
Allenby Capital Limited (Nominated Adviser and Joint Broker) |
Tel: 020 3328 5656 |
|
Northland Capital Partners Ltd (Joint Broker) |
Tel: 020 3861 6625 |
|
Peterhouse Corporate Finance Ltd (Joint Broker) |
Feedback Chairman Dr Alastair Riddell discusses TexRAD Lung and other developments with Proactive’s Andrew Scott
Dr Alastair Riddell, chairman of Feedback (LON:FDBK) tells Proactive Investor’s Andrew Scott their TexRAD Lung product could soon be available on the diagnostic imaging platform of a leading global imaging company.
Feedback Plc (FDBK) – Letter of Intent signed and trading update
Letter of Intent signed with leading global medical imaging company and trading update
Feedback plc (AIM: FDBK), the medical imaging software company, is pleased to update shareholders on current developments.
The Group’s efforts are being concentrated on obtaining the CE mark for TexRAD Lung by the target date of May 2017. The CE mark will allow the sale of TexRAD Lung in the EU and certain other markets as a medical device which provides analysis of PET/CT images for clinical use. As part of the intended distribution arrangements, Feedback’s subsidiary company, Cambridge Computed Imaging Ltd, has signed a Letter of Intent with a leading global medical imaging company which would make TexRAD Lung available for purchase on its diagnostic imaging solutions platform. This would, in due course, enable easy access to TexRAD Lung for hundreds of potential users around the world on a subscription basis.
CCI continues to pursue its ongoing discussions with other leading imaging companies to broaden the range of potential routes to market for clinical versions of TexRAD. CCI has also been very active in finalising arrangements for the secure transfer of patient data from Papworth Hospital NHS Foundation Trust to the new Cambridge Biomedical Campus ahead of the move there in April 2018. CCI has provided and maintained the software to store and display medical images at Papworth Hospital since 2001 and is excited at the challenge of transferring the extensive archive of medical images.
New purchase orders for the well-established TexRAD research version are continuing at a good rate ahead of the impending release of the first clinical version with keen interest being shown in India, the US and the UK. There remain significant opportunities for TexRAD in China and South Korea and some additional professional and legal costs have been incurred regarding advice on new distribution and licensing agreements which could substantially increase future revenues. As previously indicated, TexRAD-related revenue in the second half of the Company’s financial year is expected to be substantially ahead of that reported for the first half and the Company is on track to report increased revenue for the financial year as a whole.
For further information contact:
|
Feedback plc |
Tel: 01954 718072 |
|
Allenby Capital Limited (Nominated Adviser and Joint Broker) |
Tel: 020 3328 5656 |
|
Northland Capital Partners Ltd (Joint Broker) |
Tel: 020 3861 6625 |
|
Peterhouse Corporate Finance Ltd (Joint Broker) |
Tel: 020 7469 0936 |
|
Brand Communications |
Tel: 07976 431608 |
Feedback Plc (FDBK) – Interim Report for six months ended 30 November 2016
Feedback plc – Interim Report for the six months ended 30 November 2016
Chairman’s Statement
We are pleased to present the interim results for the six months ended 30 November 2016. Revenue for the six months period was £203,000 (2015: £225,000) and the loss after tax was £126,000 (2015: Loss £143,000). The loss before interest, tax and amortisation was £115,000 (2015: Loss £132,000). The cash balance at 30 November 2016 was £63,000 (30 November 2015: £164,000).
As previously announced, we received a significant number of purchase orders for TexRAD research versions during the period, the majority of which were installed shortly before the period end. Accordingly, these sales only made a modest contribution to revenue in the period. We are continuing to install the remaining orders and have received additional new orders from customers in Singapore and Korea. We therefore expect there to be a substantial increase in TexRAD-related revenue in the second half of the current financial year and growth in our revenue for the year as a whole. Cambridge Computed Imaging again performed steadily during the period.
In November 2015 the Company announced that it had signed a Memorandum of Understanding with Alliance Medical Group with the intention of integrating Feedback’s TexRAD texture analysis software into Alliance’s PET-CT lung cancer imaging service. The Company has made good progress on a technical solution that would allow the integration of TexRAD into Alliance’s network of PET/CT scanners in UK hospitals and a prototype version has been demonstrated to potential users. An abstract was accepted by the Radiological Society of North America (RSNA) for presentation at its annual conference in November 2016 which highlighted the results from the technical and clinical evaluation. The next steps include applying for a CE mark for a medical device which provides analysis of lung PET/CT images with added prognostication through TexRAD. We hope to gain the CE mark before the end of the current financial year. Thereafter the plan is to expand our customer base significantly by developing relationships with imaging hardware companies as well as Alliance to ensure wide market access. This will be linked to a changed business model from a one-off access fee to one of pay-per-use.
During the period Feedback announced a large-scale collaboration with Future Processing Sp. z o.o., a software development service provider based in Gliwice, Poland to develop medical imaging software. Feedback’s assistance has resulted in another successful EU grant application made by Future Processing. The directors of Feedback consider that by CCI working jointly with the Future Processing healthcare team, CCI’s product portfolio can be updated and improved and new products developed more rapidly including further applications for TexRAD. The intention is for the Company to agree formal licences for new software products to be brought to market in 2017/18 under a shared revenue arrangement. Under this collaboration with Future Processing, the Company is currently making substantial savings in software development costs although there could be some strategic advantage in re-establishing some UK-based software development capability.
We are encouraged by the continued strong interest shown in TexRAD and the number of research papers being published which highlight its numerous potential applications, particularly in areas such as liver, prostate and adrenal cancers. We are seeing new opportunities in Asia to make further sales of TexRAD research versions by partnering with companies with a strong local presence. In addition to the TexRAD sales, Feedback is well placed to grow its revenues through the collaboration with Future Processing and the development of a CE marked product for analysis of lung PET/CT images. After several years of relying on very limited resources we have plans to invest in product development, regulatory and marketing resource to step up our activity and take full advantage of our very positive growth prospects. We are excited by the developments in our marketplace in machine learning and artificial intelligence applied to medical images. We have extensive experience in machine learning and the prospects of combining TexRAD with other companies’ proprietary technologies could lead to exciting opportunities.
Dr AJ Riddell
Chairman
Enquiries:
Feedback plc
Dr AJ Riddell – Chairman Tel: 01954 718072
Allenby Capital Limited (Nominated Adviser and Joint Broker)
David Worlidge / James Thomas / Graham Bell Tel: 020 3328 5656
Peterhouse Corporate Finance Ltd (Joint Broker)
Lucy Williams / Duncan Vasey Tel: 020 7469 0936
Brand Communications
Alan Green Tel: 07976 431608
|
UNAUDITED INTERIM CONSOLIDATED INCOME STATEMENT |
|||||
|
6 months to 30 November 2016 |
6 months to 30 November 2015 |
Year to 31 May 2016 |
|||
|
(unaudited) |
(unaudited) |
(audited) |
|||
|
£’000 |
£’000 |
£’000 |
|||
|
Revenue |
204 |
225 |
431 |
||
|
Cost of sales |
(5) |
(2) |
(7) |
||
|
Gross profit |
199 |
223 |
424 |
||
|
Other operating expenses |
(329) |
(378) |
(677) |
||
|
Total operating expenses |
(329) |
(378) |
(677) |
||
|
Operating loss
|
(130)
|
(155)
|
(253)
|
||
|
Net finance income |
– |
– |
1 |
||
|
Loss before tax |
(130) |
(155) |
(252) |
||
|
Tax credit |
4 |
12 |
23 |
||
|
Loss for the period attributable to the equity shareholders of the parent Loss on ordinary activities after tax |
(126) |
(143) |
(229) |
||
|
Profit on disposal of investments |
– |
– |
45 |
||
|
Other comprehensive expense |
|||||
|
Translation differences on overseas operations |
– |
– |
– |
||
|
Total comprehensive expense for the period |
(126) |
(143) |
(184) |
||
|
Basic and diluted earnings per share |
2 |
(0.06p) |
(0.07p) |
(0.09p) |
|
|
UNAUDITED INTERIM CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
|
|||||||
|
Share Capital |
Share Premium |
Capital Reserve |
Retained Earnings |
Translation Reserve |
Convertible Debt Option Reserve |
Total |
|
|
£’000 |
£’000 |
£’000 |
£’000 |
£’000 |
£’000 |
£’000 |
|
|
Balance at 31 May 2015 |
477 |
1,409 |
300 |
(2,076) |
(210) |
189 |
89 |
|
New shares issued |
32 |
190 |
– |
– |
– |
– |
222 |
|
Costs associated with the raising of funds |
– |
(7) |
– |
– |
– |
– |
(7) |
|
Share option and warrant costs |
– |
– |
– |
4 |
– |
– |
4 |
|
Total comprehensive expense for the period |
– |
– |
– |
(143) |
– |
– |
(143) |
|
Balance at 30 November 2015 |
509 |
1,592 |
300 |
(2,215) |
(210) |
189 |
165 |
|
Total comprehensive expense for the period |
– |
– |
– |
(36) |
– |
– |
– |
|
Balance at 31 May 2016 |
509 |
1,592 |
300 |
(2,251) |
(210) |
189 |
129 |
|
New shares issued |
38 |
151 |
– |
– |
– |
(189) |
– |
|
Total comprehensive expense for the period |
– |
– |
– |
(126) |
– |
– |
(126) |
|
Balance at 30 November 2016 |
547 |
1,743 |
300 |
(2,377) |
(210) |
– |
3 |
|
UNAUDITED INTERIM CONSOLIDATED STATEMENT OF FINANCIAL POSITION
|
||||
|
30 November 2016 |
30 November 2015 |
31 May 2016 |
||
|
(unaudited) |
(unaudited) |
(audited) |
||
|
£’000 |
£’000 |
£’000 |
||
|
ASSETS |
||||
|
Non-current assets |
||||
|
Property, plant and equipment |
4 |
5 |
4 |
|
|
Intangible assets |
97 |
125 |
111 |
|
|
Investments |
1 |
5 |
1 |
|
|
102 |
135 |
116 |
||
|
Current assets |
||||
|
Trade receivables |
121 |
70 |
41 |
|
|
Other receivables |
50 |
83 |
64 |
|
|
Cash and cash equivalents |
63 |
164 |
106 |
|
|
234 |
317 |
211 |
||
|
Total assets |
336 |
452 |
327 |
|
|
EQUITY |
||||
|
Capital and reserves attributable to the Company’s equity shareholders |
||||
|
Called up share capital |
547 |
509 |
509 |
|
|
Share premium account |
1,743 |
1,592 |
1,592 |
|
|
Capital reserve |
300 |
300 |
300 |
|
|
Translation reserve |
(210) |
(210) |
(210) |
|
|
Retained earnings |
(2,377) |
(2,215) |
(2,251) |
|
|
3 |
(24) |
(60) |
||
|
Convertible debt option reserve |
– |
189 |
189 |
|
|
Total equity |
3 |
165 |
129 |
|
|
LIABILITIES |
||||
|
Non-current liabilities |
||||
|
Deferred tax liabilities |
10 |
24 |
20 |
|
|
Current liabilities |
||||
|
Trade payables |
67 |
43 |
22 |
|
|
Other payables |
256 |
220 |
156 |
|
|
323 |
263 |
178 |
||
|
Total liabilities |
333 |
287 |
198 |
|
|
Total equity and liabilities |
336 |
452 |
327 |
|
|
UNAUDITED INTERIM CONSOLIDATED STATEMENT OF CASH FLOWS
|
|||
|
6 months to 30 November 2016 |
6 months to 30 November 2015 |
Year to 31 May 2016 |
|
|
(unaudited) |
(unaudited) |
(audited) |
|
|
£’000 |
£’000 |
£’000 |
|
|
Cash flows from operating activities |
|||
|
Loss before tax |
(130) |
(155) |
(251) |
|
Adjustments for: |
|||
|
Share option and warrant costs |
– |
4 |
8 |
|
Net finance income |
– |
– |
(1) |
|
Depreciation and amortisation |
23 |
23 |
46 |
|
(Increase)/Decrease in trade receivables |
(80) |
41 |
70 |
|
Decrease in other receivables |
14 |
26 |
43 |
|
Increase/(Decrease) in trade payables |
46 |
3 |
(19) |
|
Increase/(Decrease) in other payables |
98 |
(45) |
(110) |
|
Corporation tax |
(5) |
– |
10 |
|
96 |
52 |
47 |
|
|
Net cash used in operating activities |
(34) |
(103) |
(204) |
|
Cash flows from investing activities |
|||
|
Purchase of tangible fixed assets |
(1) |
– |
– |
|
Purchase of intangible assets |
(8) |
(6) |
(14) |
|
Proceeds from sale of assets held for resale |
– |
– |
1 |
|
Purchase of share in joint venture |
– |
(5) |
(2) |
|
Proceed from sale of joint venture |
– |
46 |
|
|
Net cash used in investing activities |
(9) |
(11) |
31 |
|
Cash flows from financing activities |
|||
|
Net proceeds from share issues |
– |
215 |
216 |
|
Net cash generated from financing activities |
– |
215 |
216 |
|
Net (Decrease)/Increase in cash and cash equivalents |
(43) |
101 |
43 |
|
Cash and cash equivalents at beginning of period |
106 |
63 |
63 |
|
Cash and cash equivalents at end of period |
63 |
164 |
106 |
FEEDBACK PLC
NOTES TO THE UNAUDITED INTERIM REPORT
1 BASIS OF PREPARATION
The consolidated interim financial statements have been prepared in accordance with the recognition and measurement principles of International Financial Reporting Standards as endorsed by the European Union (“IFRS”) and expected to be effective for the year ending 31 May 2017. The accounting policies are unchanged from the financial statements for the year ended 31 May 2016.
The information set out in this interim report for the six months ended 30 November 2016 does not comprise statutory accounts within the meaning of section 434 of The Companies Act 2006. The auditors’ report on the full statutory accounts for the period ended 31 May 2016 included an Emphasis of Matter paragraph in regard to Going Concern. The accounts for the period ended 31 May 2016 have been filed with the Registrar of Companies.
This interim report was approved by the directors on 17 February 2017.
2 LOSS PER SHARE
Basic earnings per share are calculated by reference to the loss on ordinary activities after and on the weighted average number of shares in issue.
|
6 months to 30 November 2016
|
6 months to 30 November 2015
|
Year ended 31 May 2016
|
||
|
(unaudited) |
(unaudited) |
(audited) |
||
|
£’000 |
£’000 |
£’000 |
||
|
Net loss attributable to ordinary equity holders |
(126) |
(143) |
(184) |
|
|
Weighted average number of ordinary shares for basic earnings per share |
203,733,005 |
203,355,562 |
203,514,709 |
|
|
Effect of dilution: |
||||
|
Share Options |
– |
– |
– |
|
|
Warrants |
– |
– |
– |
|
|
Weighted average number of ordinary shares adjusted for the effect of dilution |
203,733,005 |
203,355,562 |
203,514,709 |
|
|
Loss per share (pence) |
||||
|
Basic and Diluted |
(0.06) |
(0.07) |
(0.09) |
|
3 INTANGIBLE ASSETS
|
Software |
Customer relationships |
Patents |
Goodwill |
Total |
|
|
£’000 |
£’000 |
£’000 |
£’000 |
£’000 |
|
|
Cost |
|||||
|
At 31 May 2015 |
563 |
100 |
74 |
272 |
1,009 |
|
Additions |
– |
– |
6 |
– |
6 |
|
At 30 November 2015 |
563 |
100 |
80 |
272 |
1,015 |
|
Additions |
– |
– |
8 |
– |
8 |
|
At 31 May 2016 |
563 |
100 |
88 |
272 |
1,023 |
|
Additions |
– |
– |
8 |
– |
|
|
At 30 November 2016 |
563 |
100 |
96 |
272 |
1,031 |
|
Amortisation |
|||||
|
At 31 May 2015 |
563 |
25 |
10 |
272 |
870 |
|
Charge for the period |
– |
13 |
7 |
– |
20 |
|
As at 30 November 2015 |
563 |
38 |
17 |
272 |
890 |
|
Charge for the period |
– |
12 |
10 |
– |
22 |
|
At 31 May 2016 |
563 |
50 |
27 |
272 |
912 |
|
Charge for the period |
– |
13 |
9 |
– |
22 |
|
At 30 November 2016 |
563 |
63 |
36 |
272 |
934 |
|
Net Book Value |
|||||
|
At 30 November 2016 |
– |
37 |
60 |
– |
97 |
|
At 31 May 2016 |
– |
50 |
61 |
– |
111 |
|
At 30 November 2015 |
– |
62 |
63 |
– |
125 |
4 AVAILABILITY OF THE INTERIM REPORT
Copies of the report will be available from the Company’s office and also from the Company’s website www.fbk.com