RNS Number : 6259E
Meldex International PLC
30 September 2008
For Immediate Release 30 September 2008
Meldex International plc
("Meldex", the "Company" or the "Group")
Interim Results for the six month period ended 30 June 2008
London / Cambridge, UK, 30 September 2008: Meldex (AIM: MDX), the specialty pharma and OTC company, is pleased to announce its interim
results for the six months ended 30 June 2008.
Highlights
* Turnover increased to �23.7m (H1 2007: �8.7m)
* Substantial increase in adjusted operating profit* to �3.2m (H1 2007: �760k)
* Profit before tax of �2.8m (H1 2007: �831k)
* EPS of 0.8p (H1 2007: 0.0p)
Post-Period Events
* Management and Board re-structuring and re-focusing of the business
* Launch of Ranbaxy OTC products in Germany and Austria
* adjusted operating profit is operating profit before non-recurring items, amortisation, depreciation and share option charges
Commenting on the results, Dr Jim Murray, Interim Executive Chairman, said:
"The period under review has been one of intense change and activity within Meldex. In spite of the undoubted impact of the prolonged
offer period, we have achieved significant growth in turnover and improved profits. With the newly revised management team and Executive
Board, we feel that Meldex is well placed to capitalise on growth opportunities going forward."
For further information:
Buchanan Communications + 44 (0) 20 7466 5000
Rebecca Skye Dietrich
FinnCap, NOMAD + 44 (0) 20 7600 1658
Geoff Nash
Chairman's Statement
Overview and Strategy
In my first statement as Interim Executive Chairman, I would like to take this opportunity to extend my thanks to all current and long
standing shareholders. This has been a transitional period in the Company's history and the Board greatly appreciates the support you have
given.
The Company has undertaken a thorough review of the business to focus on the main contributors to building sustainable value. This will
involve some changing of development and marketing priorities to ensure Meldex has a balanced portfolio of short, medium and long term
opportunities optimised for risk and commercial potential. The Board has been greatly strengthened by the addition of Klaus Kuehne (COO) and
Helmut Kerschbaumer (Interim Finance Director).
We have also commissioned a remuneration consultant to review salary, bonus and long term incentive plans to ensure that the interests
of management and shareholders are aligned with rewards linked to long term performance.
As I am sure many of you will be aware, the Company entered an offer period in January 2008, which lasted until August 2008. This had
the net effect of delaying growth during this period due to the restrictions imposed on the Company and the uncertainty that the offer
period created.
However, despite the disruption of the offer period the Company increased its turnover to �23.7m and achieved pre-tax profit of �2.8m, a
significant improvement on the same period last year.
The business
From it origins as a pure technology based company, a series of acquisitions have transformed Meldex into a profitable, specialty pharma
company.
Meldex now has a straight forward business model: it sells prescription pharmaceuticals through its Dexo subsidiary, and over the
counter (OTC) pharmaceuticals, vitamins, minerals and supplements thorough its Melbrosin subsidiary. A development function applies a
proprietary formulation technology to create novel products with improved characteristics. The Company is now well advanced in the
integration of these units to produce a vibrant, dynamic and highly motivated organisation.
There are three components to Meldex's strategy of building a profitable, and sustainable speciality pharmaceutical company.
* Sales and marketing of Meldex's own and in-licensed products;
* Royalties from sales of out-licensed products in other territories; and
* Product development for partners on a fee for service basis with milestone payment and royalties.
I would also like to take the opportunity as part of the focused review of the Company to address communications through the use of
regulatory news statements (RNSs) and the Company's website. It is our intention to use these methods to ensure regular and concise newsflow
of information for shareholders. In particular, the Meldex website will be used to update users of the site on non-price sensitive
developments within the Company such as early stage product development updates, exhibitions and other information relevant to shareholders.
RNSs will continue to be used to announce more material information equally to all shareholders and so as to ensure compliance with our
ongoing regulatory obligations.
Due to several value enhancing acquisitions occurring over the previous 12 to 18 months, the Company has a requirement for working
capital to expand and grow the business. The offer period for much of 2008 has considerably hindered the Company's ability to raise funds
for such working capital. However, the Company is currently in detailed discussions with multiple providers of capital, and hope to be in a
position to update the market in the very near future in relation to the outcome of these discussions.
The period under review has been one of intense change and activity within Meldex. With the newly strengthened management team and Board
in place, we feel that Meldex is well placed to capitalise on growth opportunities going forward, and we look forward to the future with
confidence.
Trading Overview
Melbrosin
Melbrosin is our OTC division which was acquired in July 2007. It has a highly professional and experienced team based in Vienna.
Expertise clearly established in this group is being integrated into the Company Management structure.
Turnover from this division was �10.9m. The key products sold through this division are under the trade marks Menoflavon, Daosin,
SlimCup/Slimthru, Crescina and Botoina.
A strong sales infrastructure has been steadily built in major European territories including France, Austria, Germany and Italy, with
capacity to handle additional products without significantly increasing costs.
Vitabiotics(UK)
Melbrosin will sell Perfectil, the UK's No. 1 brand for skin, hair and nails in Germany and Austria. The Vitabiotics range of products
were presented by Melbrosin at its stand at the Expopharm in Munich from the 18 - 21 September 2008, and were well received by visiting
pharmacists.
The pre sell-in campaign is planned to start from November 2008 onwards. Besides Perfectil, Melbrosin will distribute Vitabiotics
Tricologic brand of products in both territories. We expect products to be available to consumers by February 2009.
Ranbaxy OTC products to be distributed by Melbrosin in Germany
Melbrosin has finalised an agreement for the launch of a range of Ranbaxy OTC products in Germany, with an option of extension into
Austria. A probiotic and a multivitamin product will be made available through Melbrosin Germany within Q1 2009. Both products are easy to
use, dissolve in the mouth powder forms.
Melbrosin is delighted to have been able to complete distribution agreements with Vitabiotics and Ranbaxy for Germany and Austria. These
prestigious agreements with these well known companies is acknowledgement of our efforts of having established a professional and
competitive sales and distribution infrastructure in the territories.
The Melbrosin sales and distribution infrastructure is a very valued asset and will be vital in carrying forward the upcoming launches
successfully. This infrastructure makes Melbrosin a very attractive partner for third parties looking for a distribution infrastructure in
the territories.
Dexo
Dexo is our division which sells prescription pharmaceuticals. Turnover for the division was �12.1m. Key products sold through this
division are Alfatil, Rocgel, Ceporex, and Ah Chew Suspension sold throughout France, Italy and USA.
During the period Floract, Antisterol and Antoxil have been launched with early indications of good take-up. Value drivers for the
second half and beyond are the cross fertilisation of products in Italy and the prescription Soluleaves* cough cold products in USA.
Board and Management Structure
On 4 September, 2008, Richard Trevillion CEO departed the Company with the intention of spending more time with his family. The current
Executive Board of Meldex consists of Interim Executive Chairman Dr Jim Murray, Interim Finance Director Helmut Kerschbaumer, COO Klaus
Kuehne, and CDO Steve Martin.
The remainder of the Board is comprised of Stewart Adkins, Non-Executive Director and Alan Clarke, Senior Non Executive Director. The
Board is supported by strong operational management including Keith Hemming as the Head of Dexo Operations, Steve Lee as Group Technology
and Systems Director and Jayne Cooper as Deputy Finance Director.
The Company is currently in the process of identifying the right profile of individuals to enhance and complement the current Board and
Management structure including a new CEO and new CFO. Announcements will be made when appropriate candidates are appointed.
Current Trading and Outlook
Since the period end, the Company has experienced solid trading driven by organic growth, increased sales of existing products and
launches of new products by Meldex and its distributors.
We are particularly excited by the prospects of several key developments which we believe have the potential to drive revenue in the
medium to long term.
Whilst the offer period during the first eight months of 2008 has undoubtedly held back development projects and product sales growth
during this time, with a newly focused Board, management team, and focused prioritisation, Meldex is in a good position to capitalise on
future opportunities.
I would also like to take this opportunity to thank the hard working and loyal staff of Meldex International who are working very hard
to build a creative, dynamic and highly motivated Company. Equally as important, I wish to again thank and acknowledge the continuing
loyalty and support of the shareholders of the Company.
Interim Executive Chairman
Dr Jim Murray
30 September 2008
Development Project Overview
Meldex has a broad portfolio of intellectual property based upon a number of different enabling technologies. Due to the breadth of
technology within Meldex, and as part of the focused review of the Company post the period end, Meldex is now focusing on exploiting a range
of technologies in order to create marketable products that can be sold at premium prices. Any non-core developments or technologies will be
either out-licensed or divested.
The technologies being focused on are:
* TabWrap*
* Meltums*
* SoluPol
* Soluleaves*
Key Development projects being focused on are:
* DBP167 - analgesic
* DBP117 - triptan
* DBP272/274 - Gastric Reflux
* DBP118 - Anti-emesis
* DBP149 - Oral Pain
* DBP121 - Smoking Cessation Therapy - licensed
Tabwrap*
Tabwrap is focused upon solving traditional pharmaceutical formulation problems and is being targeted towards the generic industry where
it can potentially be utilised as a patent busting technology, and to the traditional pharmaceutical industry where it can be used as a
generic defence strategy.
During 2008, Meldex has worked on two compounds, Ibuprofen and Paracetamol. These have been developed as its main proof of concept
products. Data has been generated to show that novel formulations can be generated using moisture sensitive ingredients to create products
that have some unique advantages including rapid dissolution.
These products are predominately OTC medicines operating within a high volume, low cost market. Therefore it is the intention of Meldex
to partner these products with third party companies who have far greater marketing power to maximise the potential of these products.
Meldex is utilising the information gathered from this work and is applying it to strategically important premium priced products, that
it will be able to market itself.
The Company has worked previously with third party companies on a fee generating basis to utilise the technology to solve manufacturing
or formulation issues. Although there are no current products coming to market in the near term, the Company anticipates a future steady
stream of significant cash generating products.
Meltums*
Meltums* was a dormant technology within Meldex that was reviewed in early 2007. The Company recognised the commercial potential of this
Meltums* technology. The patents for the technology were brought back in-house from a previous relationship with Boots Healthcare
International, and a new development program initiated.
The technology was initially targeted as a novel sore throat lozenge using a fondant-style filling. Building on the original concept,
new forms of fill have been developed in order to have a broader application to the pharmaceutical market. The initial compounds used for
validation of the technology include benzocaine for sore throats, and nicotine for smoking cessation.
New proof of concept work has led to the use of technology in delivering beadlets of active drug, both as a taste masking system and as
a delivery of sustained release product. The technology is being assessed by a number of potential partners in the area of pain, Parkinsons
Disease and other therapeutic areas where swallowing is difficult.
Meltums* is a natural choice for paediatric formulations. The Company is working with a third party in the area of Alzheimer's Disease
taking existing drugs and producing both instant and sustained release melt-in-the mouth versions. The products are being developed prior to
main brand patent expiration and will be commercialised as a new branded product.
SoluPol
SoluPol is a liquid soluble polymer system which is able to carry active ingredients. Meldex is currently working on of incorporating
gastro-intestinal drugs into the system.
SoluPol is a technology that uses soluble polymers to create either liquid or semi solid products using the Company's wide knowledge of
polymer technology.
The technology can be adapted for medical devices, wound management, liquids, mucoadhesive gels, and as a mechanism to improve stability
or taste making in liquid products.
Early stage development is being conducted in areas such as pain, terminal agitation and oro-mucosol conditions.
Soluleaves*
Soluleaves* is the technology used for melt-in-the-mouth films. Using a water based system, the technology is restricted to low dose
treatments. Rather than focusing on low margin manufacture of nutritional films, Meldex is concentrating its development to target high
value niche markets for pharmaceutical products. The Company has launched a Melatonin version of Soluleaves* for the Italian market in
2008.
The Company has signed a commercial development agreement with a major pharmaceutical company for the development of a unique
Soluleaves* version of an existing product. The third party will pay for all development costs and clinical studies. Meldex will be
responsible for the long term manufacturing of the product. The product is expected to gain regulatory approval during 2011 within the EU
region.
In addition to the above developments, Meldex is working on a unique Soluleaves* version of a currently marketed branded anti-migraine
product. The main brand is due to come off patent in Western Europe in early 2013. Meldex has a strategic policy of partnering such
developments at an early stage to generate income ahead of patent expiration. In addition, it is the intention of the Company to seek a
switch from prescription only status to OTC status opening patient access to the product and thus greatly expanding potential sales for the
product.
DBP167 - Analgesic family based around ibuprofen lysinate
Meldex is developing a family of pharmaceutical products based around a patented ibuprofen lysinate polymer complex with unique
properties such as clinically proven speed of onset of action and novel taste making.
DBP167 is a dried sachet mix that when rehydrated produces a rapid onset of action analgesic. It will be available in 200mg, 400mg and
600mg strengths with the latter being targeted at migraine patients. The product is also being evaluated as a potential product for
breakthrough pain.
The product was filed in September 2008 with the UK Medicines and Healthcare Regulatory Authority; regulatory approval is expected by
the end of 2009.
In addition to the sachets, other formulations of the ibuprofen lysinate polymer complex are being developed. These include a paediatric
liquid version, a combination with a decongestant as a hot/cold flu drink, a Meltums version, and a solid oral dose version utilising
TabWrap*. Meldex is looking to file for registration of these line extensions in 2009 and 2010.
DBP117 Migraine Products
Meldex is developing a novel migraine product using modified Soluleaves* technology. The product contains an active drug in a category
usually referred to as 'triptans'. The product is being targeted for regulatory filing in 2011 within the EU.
In addition to the prescription market, Meldex is planning to apply to individual countries for a change in regulatory status from
prescription to over the counter medicine. This strategy includes the US market where it is envisaged that such a switch will be done in
partnership with a large OTC manufacturer.
DBP272/4
Meldex is developing a unique product for the treatment and relief of symptoms associated with gastrointestinal reflux, more commonly
known as heartburn.
The company is focussing on liquid versions of the products with one version containing a long acting Histamine H2 antagonist that
creates both speed of onset of action providing relief of symptoms, but also improves duration of action.
The key product in this area, named RocGel Advance, is undergoing pharmaceutical scale up during Q4 2008. Subject to regulatory approval
the product will be available in the EU to prescribing physicians and consumers by 2010. It is intended that DBP274 (RocGel Advance) will
be marketed by Meldex with DBP272 partnered to an existing third party brand.
DBP118
Meldex has a joint development and commercialisation agreement with Uluru Inc. to develop a novel patented buccal disc form of
Granesitron, a potent anti-emetic targeted at cancer patients. Currently, there is no melt-in-the-mouth or easy to use dosage forms, on the
market for this widely used product.
The product has undergone initial formulation with the Company now looking to conduct pilot clinical studies in early 2009, including
the possibility of dose ranging studies. This is a longer term development program but partnering programmes are currently being discussed
with third parties.
DBP149
Benzocaine Oradisc* is a novel local anaesthetic patch used for the treatment of aphthous ulcers, the product is currently in
registration with expected regulatory approval in five EU countries (UK, France, Germany, Spain and Italy) by the end of 2009.
The product is being targeted in two areas, firstly in the OTC arena for the treatment of mouth ulcers, and secondly for palliative care
for cancer patients, we are also exploring possibilities in the dental market. The Company is working with other partners to expand the
territories for marketing.
DBP121
In relation to DBP121, Meldex is focussing on licensed formulations of its technology and is still pursuing its Soluleaves* technology
with nicotine as a licensed product for smoking cessation. The non-licensed version of nicotine is subject to local rules and regulations as
a method of smokeless tobacco based products.
The Company has previously announced relationships in countries including Poland, China and India. The product is currently with local
government authorities awaiting approval for it to be sold in these markets. Currently, the Company does not have a defined time when such
approval will be granted. The Company estimates that consumer launch would be 3-6 months after local approval.
With potential changes in regulations regarding smokeless tobacco products, the Company is seeking to partner out all such products to
third parties and does not intend to sell the product itself. Meldex however, is strongly placed to concentrate on the development of high
value pharmaceutically registered nicotine based products utilising its proprietary technology.
DBP216 - Family of Analgesics
This range of analgesics is based around the FastWrap technology and paracetamol (acetaminophen). The range includes products with
decongestants and other combinations for sinus or allergy pain and are targeted towards the US market using the OTC monograph regulatory
route. Meldex is currently reviewing its strategy with regards to the launch/partnering of these products.
NRobe* and other technologies
NRobe* is a technology that has been exclusively licensed to FMC Magenta, a division of the FMC Corporation. In 2006, the license was
re-negotiated to reflect the business model of FMC whereby Meldex would receive escalating royalty rates dependent upon the business
development and commercialisation targets as agreed by both parties.
Under the agreement Meldex was required to complete the development of a pilot machine which occurred in 2007. FMC Magenta are fully
responsible for the commercialisation of the machine which is currently being developed and all the business development activities related
to products developed from it.
Meldex is concentrating on its core technologies that are able to generate near term revenue. The Company is currently reviewing all
non-core technology and patents and looking to either divest or out license its interests in these technologies.
Other Developments
Meldex is concentrating on the above developments as these offer substantial returns on investment with the ability for multiple sales
and marketing revenue streams, either through the Company's own operating divisions and currently established sales and marketing
infrastructure or via third party partnerships.
Meldex will use the following key milestones in relation to its technology and products: regulatory filing dates, regulatory approval
and market launch, the latter being when products are able to be prescribed by a physician or purchased by a customer.
With recent changes in the regulatory environment in the US with regards to DESI-based medicines (products that do not require Food and
Drug Administration approval), Meldex has put on hold developments in this area pending clarity of the regulations.
The Company has developed a wide range of nutritional and OTC products for sale within the US. It has taken the decision to make these
products available to specialist sales and marketing companies. Additional developments will be incorporated into existing distribution
agreements.
Meldex is working on other developments at an early stage, looking both at patient-busting opportunities and product lifecycle extension
opportunities. These opportunities will only progress in partnership with other companies thereby becoming revenue generating and reducing
cost exposure to the business.
Financial Overview
Revenue increased significantly for the six month period to 30 June 2008 to �23.7m (2007: �8.7m) reflecting strong organic growth.
The gross margins across the business decreased to 49% during the period under compared to 62% over the same period last year. This
decrease is explained by the fact that as the group sales mix has changed since the acquisition of a significant range of OTC products which
have lower margins, but have a higher volume of sales.
Despite the decrease in gross margins, the Company's key measure of performance is operating profit before non-recurring items,
amortisation, depreciation and share option charges. At this level the Company achieved a profit of �3.2m compared to �760k for the six
months to June 2007. This profit represents 13% of turnover, a margin increase of 4 percentage points against the same period last year.
This increase in performance reflects the benefits gained from the successful integration of acquisitions made by the Company.
Sales and distribution costs have increased to �6.4m (2007: �2.2m) which reflects increased marketing spend to effectively market key
products in the European markets. This increase very much reflects the mirrored three fold increase in turnover.
Administrative expenses excluding non-recurring items have slightly decreased in the period to �1.9m (2007: �2.2m). The decrease has
resulted due to streamlining of certain cost areas and the benefit of resources obtained and economies achieved through previous
acquisitions.
Net cash outflow from operating activities has decreased from �1.8m in 2007 to �1.3m in 2008 due to the strong trading position. Cash
balances at 30 June 2008 are �500k compared to �1.9m at 31 December 2007. Due to the trading position the investment in receivables has
increased along with development costs incurred on projects.
As a result of the strong trading position coupled with the development projects the Company recognises that there are additional
demands for working capital and facilities are in the process of being reviewed However, the Company is currently in detailed discussions
with multiple providers of capital, and hope to be in a position to update the market in the very near future in relation to the outcome of
these discussions.
Overall, despite the prolonged offer period the Company has performed well, continuing the move into profitability from a break even
position at the end of June 2007 to a profit of �1.7m for the six months ended 30 June 2008. The Company has the foundations in place to
enable it to expect future growth.
MELDEX INTERNATIONAL PLC
consolidated statement of changes in equity (unaudited)
For the six months ended 30 June 2008
6 months to 30 June 2008 6 months to 30 June 2007
Year to 31 December 2007
Before amortisation, Before amortisation,
Before amortisation,
depreciation, Amortisation, depreciation Amortisation,
depreciation Amortisation,
non-recurring items depreciation, non-recurring items depreciation,
non-recurring items depreciation,
and share options non-recurring items and share options non-recurring items
and share options non-recurring items
charge and share options charge and share options
charge and share options
charge charge
charge
Total Total
Total
�'000 �'000 �'000 �'000 �'000 �'000
�'000 �'000 �'000
Revenue 23,694 - 23,694 8,686 - 8,686
27,133 - 27,133
Cost of sales (12,035) - (12,035) (3,344) - (3,344)
(12,154) - (12,154)
Gross profit 11,659 - 11,659 5,342 - 5,342
14,979 - 14,979
Other operating expenses
Sales and distribution (6,438) - (6,438) (2,356) - (2,356)
(9,620) - (9,620)
expenses
Administrative expenses
Administrative expenses (1,990) (174) (2,164) (2,226) (259) (2,485)
(3,642) (442) (4,084)
excluding amort-isation,
depreciation and share options
charge
Amortisation and depreciation - (762) (762) - (417) (417)
- (1,135) (1,135)
Share options charge - (199) (199) - (169) (169)
- (371) (371)
(8,428) (1,135) (9,563) (4,582) (845) (5,427)
(13,262) (1,948) (15,210)
Operating result 3,231 (1,135) 2,096 760 (845) (85)
1,717 (1,948) (231)
Finance income 4 - 4 77 - 77
113 - 113
Finance expense (401) - (401) (6) - (6)
(237) - (237)
Net finance income/(expense) (397) - (397) 71 - 71
(124) - (124)
Profit/(loss) before taxation 2,834 (1,135) 1,699 831 (845) (14)
1,593 (1,948) (355)
Taxation (40) - (40) (6) - (6)
1,335 - 1,335
Profit/(loss) for the year 2,794 (1,135) 1,659 825 (845) (20)
2,928 (1,948) 980
attributable to equity holders
of the parent
Profit/(loss) per ordinary
share
Basic 0.8p (0.0)p
0.6p
Diluted 0.7p (0.0)p
0.5p
consolidated statement of changes in equity (unaudited)
For the six months ended 30 June 2008
Share Share Retained Other Shares To Total
Capital Premium Earnings Reserves Be Issued Equity
�'000 �'000 �'000 �'000 �'000 �'000
At 1 January 2007 1,558 46,065 (18,716) 3,531 1,051 33,489
Result for period - - (20) - - (20)
Issue of shares 270 14,997 - 36 (1,051) 14,252
Exchange differences - - - (214) - (214)
Share option charge - - 169 - - 169
Shares to be issued - - - - 9,525 9,525
At 30 June 2007 1,828 61,062 (18,567) 3,353 9,525 57,201
Result for period - - 1,000 - - 1,000
Issue of shares 174 4,286 - 6,346 - 10,806
Exchange differences - - - 503 - 503
Share option charge - - 202 - - 202
Shares to be issued - - - - 436 436
At 31 December 2007 2,002 65,348 (17,365) 10,202 9,961 70,148
Result for period - - 1,659 - - 1,659
Issue of shares 137 6,673 - - (3,771) 3,039
Exchange differences - - - 977 - 977
Share option charge - - 199 - - 199
Shares to be issued - - - - - -
At 30 June 2008 2,139 72,021 (15,507) 11,179 6,190 76,022
Other reserves includes a translation reserve of �252,000 a merger reserve of �9,520,000, �36,000 in respect of cash received for
warrants transferred, a balance of �239,000 relating to the fair value of warrants issued in 2004 based on the estimated market value of the
services provided and �1,078,000 which arose upon the redemption of the unsecured convertible bond.
CONSOLIDATED BALANCE SHEET AT 30 JUNE 2008 (UNAUDITED)
31 December
30 June 2008 30 June 2007 2007
�'000 �'000 �'000
Non-current assets
Goodwill 34,899 25,001 34,010
Other intangible assets 43,956 28,704 40,804
Property, plant and equipment 1,551 1,642 1,674
Deferred tax assets 2,605 521 2,506
83,011 55,868 78,994
Current assets
Inventories 3,786 2,057 4,047
Trade and other receivables 21,417 8,768 14,953
Cash and cash equivalents 509 2,308 1,949
25,712 13,133 20,949
TOTAL ASSETS 108,723 69,001 99,943
Current liabilities
Financial liabilities (3,290) (1,090) (2,122)
Trade and other payables (16,833) (6,042) (16,915)
Deferred consideration - (1,887) -
(20,123) (9,019) (19,037)
Non-current liabilities
Financial liabilities (3,337) - (3,337)
Provisions (8,189) (2,781) (7,421)
Other payables (1,052) - -
(12,578) (2,781) (10,758)
TOTAL LIABILITIES (32,701) (11,800) (29,795)
NET ASSETS 76,022 57,201 70,148
Equity
Issued share capital 2,139 1,828 2,002
Share premium 72,021 61,062 65,348
Retained earnings (15,507) (18,567) (17,365)
Other reserves 11,179 3,353 10,202
Shares to be issued 6,190 9,525 9,961
TOTAL EQUITY ATTRIBUTABLE TO 76,022 57,201 70,148
EQUITY HOLDERS OF THE PARENT
CONSOLIDATED CASH FLOW STATEMENT (UNAUDITED)
For the six months ended 30 June 2008
6 months to 6 months to Year to 31 December
30 June 30 June 2007 2007
2008
�'000 �'000 �'000
Cash outflow from operating
activities
Operating result for the 1,659 (85) 980
period
Adjustments for:
Finance income (4) - (113)
Finance expense 401 - 237
Taxation - - (1,335)
Depreciation 101 126 260
Amortisation 661 291 875
Loss on disposal of fixed - 9 -
assets
(Increase)/decrease in stocks 261 (91) (1,877)
(Increase)/decrease in debtors (6,464) (1,957) (7,536)
(Decrease)/increase in 1,738 (352) 3,585
creditors
Equity-settled share-based 199 169 371
payments
Foreign exchange - 34 (1,142)
Cash outflow from operating (1,448) (1,856) (5,695)
activities
Income taxes paid - - (424)
Net cash outflow from (1,448) (1,856) (6,119)
operating activities
Cash outflow from investing
activities
Payments to acquire plant and (29) (148) (270)
equipment
Proceeds from sales of plant - - 10
and equipment
Payments to acquire intangible (1,142) (1,994) (7,000)
assets
Proceeds from sales of - - 390
intangible assets
Interest received 4 77 113
Payments to acquire subsidiary
undertakings and businesses - (2,338) (3,238)
(net of cash acquired)
Net cash outflow from (1,167) (4,403) (9,995)
investing activities
Cash inflow from financing
activities
Proceeds from issue of share - 1,055 6,321
capital
Interest paid (401) (6) (237)
Receipt/(repayment) of amounts - (56) 3,281
borrowed
Net cash inflow from financing (401) 993 9,365
Net (decrease)/increase in (6,749)
cash and cash equivalents (3,016) (5,266)
Exchange movements 408 (12) 80
(2,608) (5,278) (6,669)
Cash and cash equivalents (173) 6,496 6,496
brought forward
Cash and cash equivalents (2,781) 1,218 (173)
carried forward
1. accounting policies
European Union ('EU') law requires that the annual consolidated financial statements of the group for the year ending 31 December 2008
be prepared in accordance with International Financial Reporting Standards adopted for use within the EU ('adopted IFRS').
The accounting policies used in the preparation of this interim report are based on those expected to be included in the group's
financial statements for the year ended 31 December 2008
This interim report, for the six months ended 30 June 2008, does not constitute statutory financial statements as defined in section 240
of the Companies Act 1985. As permitted, the group has not adopted 'IAS 34 - Interim Financial Reporting'.
2. Taxation
Taxation for the period has been provided for at the estimated effective tax rate for the year ending 31 December 2008.
3. EARNINGS per share
Year to
6 months to 6 months to 31 December 2007
30 June 2008 30 June 2007
�'000 �'000 �'000
Basic profit/(loss) per share
Net profit/(loss) attributable 1,659 (20) 980
to ordinary shareholders
Year to
6 months to 6 months to 31 December 2007
30 June 2008 30 June
2007
Number Number Number
Thousands Thousands Thousands
Weighted average number of 212,085 162,160 181,166
ordinary shares in issue during
the period
Basic profit/(loss) per share 0.8p (0.0)p 0.6p
Diluted profit/(loss) per share 0.7p (0.0)p 0.5p
4. Comparative information
Comparative annual figures for the year ended 31 December 2006 set out within this report have been extracted from the Interim Results
as published by the group in September 2007. Statutory consolidated financial statements for the group for the year ended 31 December 2007,
prepared in accordance with IFRS, on which the auditors gave an unqualified opinion and did not contain a statement under Section 237 (2) or
(3) of the Companies Act 1985 and have been delivered to the registrar of companies.
5. ADDITIONAL INFORMATION
Our website address is www.meldexinternational.com. From this site you may access this report and other financial reports and
presentations, recent press releases and details about the Company and its operations.
Further copies may be obtained from the Company's registered office, 15-17 Cambridge Science Park, Milton Road, Cambridge, CB4 0FQ.
This information is provided by RNS
The company news service from the London Stock Exchange
END
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