TIDMTRLS
RNS Number : 5285M
Trellus Health PLC
22 September 2021
Trellus Health plc
("Trellus Health", the "Company" or the "Group")
Half-year Report
Trellus Health Plc (AIM: TRLS), the AIM listed provider of
scientifically validated, resilience-based, connected health
solutions for chronic condition management, announces its maiden
unaudited half-year report for the six months ended 30 June 2021
following admission to trading on AIM on 28 May 2021.
About Trellus Health
Trellus Health is a leading pioneer in resilience-driven care
and the first digital health company focused on the intersection of
chronic physical conditions and mental health. Trellus Health's
digital-first chronic care management solution integrates
convenient telehealth access to a licensed multidisciplinary care
team with a suite of tools for resilience assessment, education and
behaviour modification, remote monitoring, health maintenance and
prevention.
Through its TrellusElevate(TM) connected care platform and
companion App, the Company coordinates expert whole-person care,
addressing both clinical and behavioural health together, in
context, to improve outcomes and reduce healthcare costs for
patients, employers, and the healthcare system. The Company is
initially focused on Inflammatory bowel disease ("IBD"), which
includes the chronic incurable conditions of Crohn's Disease and
ulcerative colitis, but considers its approach to have potential
utility and demand across many chronic conditions.
Financial Highlights
-- Successful admission to AIM with fundraising of gross
proceeds of c. $40.4m (GBP28.5m) at the 40p issue price.
-- In-licensed IP underlying product technology for $0.5m.
-- Approximately $1.7m capital investment in technology platform
development at the end of June 2021.
-- Net cash of $39.7m (31 December 2020: $3.7m).
-- Adjusted EBITDA* loss of $1.36m (period from inception 15
July 2020 to 31 December 2020: $0.8m loss).
* Earnings before interest, tax, depreciation and amortisation
adjusted for exceptional items
Post-period end
-- First Demonstration contract with Mount Sinai Employee Health Plan announced in August 2021.
-- TrellusElevate (TM) Platform V1.0 launched in July; companion
App is available for download on the App Store and Google Play.
-- Over 150 proprietary digital behavioural skills modules
available through TrellusElevate (TM) .
-- Managed Services Organization Agreement executed with Connected Health Medicine PC to deliver resilience-based multidisciplinary care using licensed clinical professionals trained on the GRITT(TM) methodology via the TrellusElevate(TM) platform.
-- Appointment of Aled Stevenson as UK Managing Director to
complement key executive hires in product development, technology,
conversational AI, and clinical operations during H1 2021.
Commenting on recent developments and outlook, Julian Baines,
Non-executive Chairman of Trellus, said:
"We are very pleased with the rate of progress made since IPO
and remain confident in continuing to deliver against key
operational milestones in accordance with our plans. Our immediate
strategy is focused on developing and enhancing the
TrellusElevate(TM) platform, which was launched in July, and we
have already hit an early key milestone by securing our first
demonstration contract with the Mount Sinai Health system employee
health plan.
"We continue to anticipate signing contracts for additional new
demonstration programmes with health plans over the coming months.
These will not only assess feasibility, engagement and
satisfaction, but also demonstrate the health economics studies of
our solutions. Data from these projects are expected to reinforce
what we already know from previous studies, that IBD patients show
significant improvements in resilience and reductions in unplanned
healthcare by using our proprietary methodology and
resilience-driven multidisciplinary care model.
"We are also very pleased with the progression of our dialogue
with large organisations outside of health plans and employers,
including those within the pharmaceutical industry, who have
recognised the potential value of our platform to support their
goals, as well as third parties interested in applying our
methodology to other illnesses."
A copy of the investor presentation is available here:
https://trellushealth.com/investors/annual-interim-reports/
The Company will also host a live online presentation today at
4.30pm today through the digital platform Investor Meet Company .
Investors can sign up for free via:
https://www.investormeetcompany.com/trellus-health-plc/register-investor
A recording of the presentation and responses to the Q&A
sessions will also be available afterwards.
Trellus Health plc https://trellushealth.com/
Julian Baines, Non-executive Chairman Tel: +44 (0) 29 2071 0570
Monique Fayad, CEO
Salim Hamir, CFO
Singer Capital Markets Tel: 020 7496 3000
Aubrey Powell / Jennifer Boorer (Corporate
Finance)
Hannah Woodley (Corporate Broking)
Walbrook PR Limited Tel: +44 (0) 20 7933 8780 or trellus @walbrookpr.com
Paul McManus Mob: +44 (0) 7980 541 893
About Trellus Health plc ( www.trellushealth.com )
Trellus Health (LSE: TRLS) is a leading pioneer in
resilience-driven care and the first digital health company focused
on the intersection of chronic physical conditions and mental
health. Trellus Health's digital-first chronic care management
solution integrates convenient access to a licensed
multidisciplinary care team with a suite of tools for resilience
assessment, education and behavior modification, remote monitoring,
health maintenance and prevention. Through its TrellusElevate(TM)
connected care platform and companion App, the company coordinates
expert whole-person care, addressing both clinical and behavioral
health together, in context, to improve outcomes and reduce
healthcare costs for patients, employers, and the healthcare
system.
Trellus Health is commercialising the provision of digital
chronic condition management solutions for employers and health
plans that utilise the scientifically validated resilience-based
methodology and a proprietary HIPAA-compliant technology platform
called TrellusElevate(TM) to coordinate and deliver personalised
care remotely via telehealth. The Company is initially focused on
Inflammatory bowel disease ("IBD"), which includes the chronic
incurable conditions of Crohn's Disease and ulcerative colitis, but
considers its approach to have potential utility and demand across
many chronic conditions.
The TrellusElevate(TM) platform is the Company's proprietary
connected health platform that incorporates the proprietary
methodology and learnings on resilience from clinical research and
practice conducted at the Mount Sinai IBD Center for more than five
years. The proprietary methodology and resilience-driven
multidisciplinary care model have been scientifically validated to
demonstrate meaningful improvements in patient outcomes and over 85
per cent. reduction in unplanned healthcare utilisation (emergency
department visits and hospitalisations) which the directors of the
Company believe indicates the potential for significant cost
savings for healthcare payers.
The company was founded by Dr. Marla C. Dubinsky, MD and Dr.
Laurie Keefer, PhD, both with decades of combined experience in IBD
and psychogastroenterology, respectively. Trellus Health's
patent-pending GRITT(TM) resilience assessment and personalized
treatment methodology was developed and validated at the Mount
Sinai Health System to build resilience and wellness for improved
outcomes at lower cost.
Shares in Trellus Health were admitted to trading on AIM in May
2021, under the ticker TRLS. For more information on Trellus
Health, visit www.trellushealth.com .
CHAIRMAN'S STATEMENT
I am very pleased to present the inaugural interim report for
Trellus Health plc following our successful admission to AIM in May
2021.
Trellus Health was established in July 2020 to commercialise
digital chronic condition management solutions for employers and
health plans, using our proprietary technology platform,
TrellusElevate(TM), in combination with a scientifically validated,
resilience-based methodology based on more than five years of
clinical research and practice conducted on hundreds of patients at
the Mount Sinai IBD Center, in New York. Whilst the Company's
initial focus is on IBD, we believe that there is demand for this
solution to be used across many chronic conditions to deliver
meaningfully improved healthcare outcomes as well as reducing
expensive, unplanned care, such as emergency department visits and
hospitalisations.
We are confident that with modest incremental development to our
technology platform, we will be able to:
-- deliver coordinated multidisciplinary care from licensed health professionals via telehealth;
-- reinforce clinical plan adherence in partnership with specialist care providers (rather than disintermediating them);
-- modify behaviours to build patient resilience over time through proven interventions;
-- engage and educate patients and specialist care providers;
-- continually monitor and analyse clinical and behavioural markers; and
-- significantly improve healthcare outcomes and reduces expensive, unplanned care.
AIM Admission
On 28 May 2021, we concluded a successful fundraising and the
Company's shares were admitted to trading on the AIM market of the
London Stock Exchange. We were delighted that the fundraising was
significantly oversubscribed, generating around $38.5m in net funds
that will be deployed in driving the commercialisation of our
solutions, as we strive to enable and deliver personalised and more
cost-effective care for all people living with chronic
conditions.
We are hugely grateful to all of our shareholders for their
support in this endeavour. We were pleased to welcome new
institutional investors at our AIM IPO, and we continue to enjoy
the support of investors such as the Icahn School of Medicine at
Mount Sinai ("ISMMS"), as well as investors who became Trellus
Health shareholders via the distribution in specie undertaken by
EKF Diagnostics Holdings plc of its original investment in the
Company's share capital. Many of the latter increased their
shareholding via the Restricted Offer, which formed part of the IPO
fundraising and was also significantly oversubscribed. Having
raised funds at an issue price of 40 pence, I am very pleased to
note that the shares are currently over 50% higher, and we are
progressing well at this early stage of our AIM journey.
As we said in our AIM Admission Document, it is our intention to
deploy the funds raised for the following purposes:
-- to pay amounts due under the ISMMS licence agreement;
-- to continue the development and enhancement of the
TrellusElevate(TM) platform, including developing the
conversational artificial intelligence technology in managing and
providing support to patients;
-- for commercialisation, marketing and business development;
-- for general corporate overheads, including other planned capital expenditure;
-- for research and academic collaboration purposes and geographic expansion purposes;
-- to pursue scientific development and partnerships; and
-- for the balance to be made available as contingency and providing additional working capital.
Key Investment Strengths & Strategy
When we came to the public markets, we spoke extensively with
investors about the strong position that Trellus Health has in the
market to co-ordinate expert, whole-person care for people living
with chronic conditions, and in doing so demonstrate the compelling
economic case for Trellus Health's resilience-based, digital care
management solution. We believe this will drive wide-scale adoption
by self-insured employers and healthcare payers looking to reduce
the significant cost of unplanned healthcare utilisation associated
with the high-cost /high-need chronic condition patients. At the
time of our AIM IPO, we identified the key strengths of the Trellus
Health equity story and model and I believe it is helpful to set
them out again, below:
-- Large addressable markets of chronic and mental health
conditions and Inflammatory Bowel Disease (IBD), representing
respectively over $3 trillion and $30-50 Billion total annual costs
in the US.
-- Exclusive license with ISMMS , the medical school of the
Mount Sinai Health System, to commercialise the patent-pending
GRITT(TM) (Gaining Resilience Through Transitions) methodology for
IBD and seven other chronic disease categories.
-- Compelling health economics and societal benefits :
Scientifically validated GRITT(TM) methodology deployed at the IBD
Center at Mount Sinai resulted in patients achieving a 70 per cent.
increase in resilience and a corresponding 88-90 per cent.
reduction in emergency department visits and hospitalisations,
indicating significant potential cost savings for healthcare
payers.
-- Democratisation of access to expert resilience-driven care :
the Company's connected health solution and GRITT(TM) resilience
methodology will be delivered digitally via the TrellusElevate(TM)
platform and companion mobile app, and through convenient
telehealth interactions with a dedicated licensed multidisciplinary
care team that monitors and coordinates care in collaboration with
patients' clinical care Providers.
-- Rapid expected commercialisation with attractive business
model : the Company expects initial revenue in 2021 through
demonstration projects with healthcare payers, as its connected
care management solution and GRITT(TM) behavioral methodology are
not currently subject to FDA regulation. The Company's
digitally-delivered solution and value-based recurring revenue
model will present attractive unit economics, high margins, cash
generation, and forward visibility, [principally] as a function of
the number of engaged patients in the program.
-- Highly experienced leadership team and Scientific Advisory
Board : The Company's Founders and executive team have extensive
collective experience across clinical, commercial, and
technological areas, and are supported by the Scientific Advisory
Board (SAB) comprising ten pre-eminent experts consisting of IBD
clinicians, researchers, nutritionists, and experts on Positive
Psychology.
-- Data advantage : The Company's longitudinal database will
eventually provide a valuable source of predictive analytics for
improving care, measurement and improvement of its own services,
and the ability to inform drug discovery, development, and health
policy.
-- Strong growth potential : The Company expects to capitalise
rapidly on its existing qualified pipeline of payer and
pharmaceutical industry opportunities. Management believes that
relatively modest adaptations of its GRITT(TM) methodology and
technology platform will enable the Company to address other costly
and widespread chronic conditions and to expand
internationally.
Recent progress and outlook
Post-period end we were delighted to announce that we had
achieved our first key milestone, by signing an agreement with the
Mount Sinai Health System employee health plan, one of the largest
self-insured employer health plans in New York State, to provide an
IBD demonstration programme.
Not only does this allow Trellus Health to begin generating
revenues, it also provides an opportunity to build up important
data whilst assessing the feasibility, engagement and satisfaction
of our digital chronic condition management solution in a real-life
setting, using our resilience based digital care management
solution for Mount Sinai employees living with IBD. This initial
demonstration programme is expected to commence before the end of
2021 with conclusions from the final programme report expected in
2022.
Additional demonstration programmes are being designed to
illustrate the potential health economics and return on investment
to users of our digital chronic condition management solutions. We
believe that these studies will generate data to drive demand for
greater adoption, whilst simultaneously generating additional
revenues for the Company.
In July 2021, the Company launched its TrellusElevate(TM)
Platform V1.0. Access to the TrellusElevate(TM) platform and
companion App are now available to authorized subscribers via the
web, App Store and Google Play. V1.0 of the platform elegantly
digitizes the GRITT(TM) IP licensed from ISMMS last year, enabling
scalability and broad access to this scientifically-validated,
whole-person care management methodology. The platform enables care
coordination, communication, scheduling, and remote patient
monitoring, so our patients never feel alone in their journey to
improve their wellness. The platform also collects and monitors
clinical lab results and patient reported outcomes to notify
patients, their GI Providers, and the patient's care team of
indicators of rising risk of disease flares or other signals
important to their health, such as reduced resilience. Patients and
their GI Providers are also sent automated wellness and safety
reminders about vaccinations or necessary laboratory testing,
depending on their disease severity or therapeutic regimen.
In addition to software development, the Company has developed a
robust library of over 150 proprietary digital behavioural skills
modules available through the TrellusElevate(TM) platform. These
interactive skills modules complement and further educate patients
about behaviour modification and resilience building concepts they
review with their care team using Trellus technology. This library
is complemented by a rich collection of carefully curated "Featured
Content" for patients about topics such as diet and nutrition,
lifestyle, exercise and stress relief. All of the skills modules
and Featured Content are available to patients 24/7 via the
TrellusElevate(TM) platform.
Another important milestone achieved post-period end was the
execution of a Management Services Organization (MSO) Agreement
with Connected Health Medicine PC ("Connected Health"), a New York
state licensed Professional Corporation or PC that will provide
multidisciplinary patient care services via telehealth. Trellus
will provide Connected Health with the technology necessary to
offer digitally enabled chronic care management services through
PC's licensed multidisciplinary care team, utilizing GRITT(TM)
resilience assessment and methodology via TrellusElevate(TM).
--
This agreement represents the first in a series of partnerships
that will enable Trellus Health's proprietary technology platform
and resilience-building methodology to be scaled geographically for
licensed clinical care coordination and delivery across the United
States. The Company intends to secure similar agreements with the
goal of enabling licensed multidisciplinary care utilizing the
GRITT(TM) methodology and TrellusElevate(TM) Platform in several US
states before the end of 2021 in conjunction with potential
demonstration programmes with various health plans and employer
groups. The Company will engage in a continuous process of
geographic expansion across the US, with the goal of enabling
telehealth delivery of the GRITT Methodology via TrellusElevate
across the majority of the United States by the end of 2022.
Talent acquisition is essential to achieve our ambitious growth
targets, and we were fortunate to secure key executive hires in
product development, technology, conversational AI, and clinical
operations during the first half of 2021. Post-period end, we
appointed Aled as Managing Director, UK to oversee geographic
expansion through research and development initiatives. A 19-year
veteran of Astra Zeneca, Aled is based in Wales and has an
extensive network of professional contacts across Great Britain. He
has already commenced discussions with several NHS Trusts regarding
potential demonstration programmes.
We are very pleased with the rate of progress made since IPO and
remain confident in continuing to deliver against key operational
milestones in accordance with our plans. Our immediate strategy is
focused on developing and enhancing the TrellusElevate(TM)
platform, which was launched in July, and we have already hit an
early key milestone by securing our first demonstration contract
with the Mount Sinai Health system employee health plan.
We continue to anticipate signing contracts for additional new
demonstration programmes with health plans over the coming months.
These will not only assess feasibility, engagement and
satisfaction, but also demonstrate the positive health economic
impact of our solutions. Data from these projects are expected to
reinforce what we already know from previous studies, that IBD
patients show significant improvements in resilience and reductions
in unplanned healthcare by using our proprietary methodology and
resilience-driven multidisciplinary care model.
We are also very pleased with the progression of our dialogue
with large organisations outside of health plans and employers,
including those within the pharmaceutical industry, who have
recognised the potential value of our platform to support their
goals, as well as third parties interested in applying our
methodology to other illnesses.
We look forward to updating our shareholders as we make further
progress in commercialisation, and I thank you again for your
continued support.
Julian Baines, MBE
Non-Executive Chairman
22 September 2021
FINANCIAL REVIEW
The results presented cover the period from 1 January 2021 to 30
June 2020. The comparative information covers the period from
incorporation on 15 July 2020 to 31 December 2020.
Income Statement
The Group is currently in its development phase and therefore
has not yet commenced revenue earning. As this is the inaugural
reporting period, no comparative similar period has been given. The
Group's presentational currency is United States Dollar.
Administrative costs and operating loss
Administrative costs are $1.36m before exceptional items
including share-based payment. The major items of expenditure are
personnel costs of $1m after capitalisation of development costs,
legal, accounting and fees associated with the set-up of the group
of $0.17m and general and administrative expenses $0.19m. In
addition, the depreciation is $0.003m, share based payment charge
is $0.04m and exceptional item relating to listing costs if $0.17m.
Operating loss for the period is $1.57m.
Balance sheet
Non-current assets
Non-current assets represent property, plant and equipment of
$0.03m representing equipment and computers and intangibles of
$2.2m
The intangibles include $0.5m licence fee paid to Mount Sinai
which will be amortised from July 2021 and internally developed
Trellus Elevate platform $1,7m.
Cash
The Group had cash on hand at 30 June 2021 of $39.7m following
the completion of the fundraise on IPO.
Capital restructure
On 6 May 2021 the Company issued bonus shares to the holders of
the Ordinary Shares, the A Shares and the Golden Share of GBP0.0001
each, in each case on the basis of five additional shares for every
one share held by the shareholder on 6 May 2021 ("Bonus Issue").
Following the Bonus Issue, the issued share capital of the Company
consisted of 541,350,000 shares, consisting of (i) 373,350,000
Ordinary Shares, (ii) 167,999,994 A Shares and (iii) 6 Golden
Shares. As a result of the Bonus Issue, the Company's share premium
account increased by $64,000 which, when capitalised and added to
the existing share capital, gave a total nominal value of
GBP54,135. Following the Bonus Issue, the Company re-registered as
a public limited company on 12 May 2021. On 24 May 2021, the 6
Golden Shares and the 167,999,994 A Shares were converted into
Ordinary Shares, on a one-for-one basis, resulting in a share
capital of 541,350,000 ordinary shares of GBP0.0001 each
("Conversion"). The 541,350,000 ordinary shares of GBP0.0001 each
were then consolidated into 90,225,000 ordinary shares of GBP0.0006
on 24 May 2021.
New issue of share capital
The Company completed a public listing on the AIM market on 28
May 2021 and equity fundraising of $38.5m net of fees and related
charges. Following the placing, subscription and restricted offer,
on Admission the Enlarged Share Capital of the Company consisted of
161,475,000 ordinary shares.
Dividend
As we stated in our Admission Document, at present we believe
that it is more prudent to retain cash to fund the development of
the Company rather than pay a dividend.
Salim Hamir
CFO and Company Secretary
22 September 2021
CONSOLIDATED CONDENSED STATEMENT OF
COMPREHENSIVE
INCOME
FOR THE 6 MONTHSED 30 JUNE 2021
Period ended Period ended
30 June 31 December
2021 2020
Notes US$'000 US$'000
Continuing operations
Administrative expenses (1,358) (762)
Exceptional expense - share based
payments (39) -
Exceptional expense - listing
cost 3 (170) -
----------------- -----------------------------------------
Loss from operations (1,567) (762)
Income tax charge 4 - -
----------------- -----------------------------------------
Loss for the period attributable
to owners of the parent company (1,567) (762)
================= =========================================
Loss per ordinary share
attributable $ $
to the owners of the parent
during
the period 5
Basic and diluted (0.01) (0.01)
========================= =========================================
CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
FOR THE 6 MONTHSED 30 JUNE 2021
Period Period ended
ended 30 31 December
June 2021 2020
US$'000 US$'000
Loss for the period (1,567) (762)
Other comprehensive expense:
Currency translation differences (3) -
Other comprehensive loss for the period (3) -
--------------- ---------------------------------
Total comprehensive loss for the period (1,570) (762)
=============== =================================
CONSOLIDATED CONDENSED STATEMENT OF FINANCIAL
POSITION
AS AT 30 JUNE 2021
As at 30 As at 31 December
June 2021 2020
Notes US$'000 US$'000
Assets
Non-current assets
Property, plant and equipment 32 11
Intangible assets 6 2,214 662
Total non-current assets 2,246 673
--------------- ------------------------------
Current Assets
Trade and other receivables 319 11
Cash and cash equivalents 39,691 3,684
Total current assets 40,010 3,695
--------------- ------------------------------
Total assets 42,256 4,368
=============== ==============================
Equity attributable to
owners of the parent
Share capital 137 12
Share premium 43,380 4,996
Foreign currency reserves (3) -
Retained earnings (2,290) (762)
--------------- ------------------------------
Total equity 41,224 4,246
--------------- ------------------------------
Current liabilities
Trade and other payables 1,032 122
Total liabilities 1,032 122
--------------- ------------------------------
Total equity and liabilities 42,256 4,368
=============== ==============================
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
FOR THE 6 MONTHSED 30 JUNE 2021
Share Share Foreign Retained
Capital Premium Currency earnings Total
Reserve
US$'000 US$'000 US$'000 US$'000 US$'000
At 15 July 2020 - - - - -
Comprehensive income
Loss for the period - - - (762) (762)
Other comprehensive
income
Currency translation - - - - -
differences
------------- ------------- -------------- -------------- ------------
Total comprehensive
expense - - - (762) (762)
------------- ------------- -------------- -------------- ------------
Transactions with owners
Issue of ordinary shares 12 4,996 - - 5,008
Total contributions by
and distributions
to owners 12 4,996 - - 5,008
------------- ------------- -------------- -------------- ------------
At 31 December 2020 12 4,996 - (762) 4,246
------------- ------------- -------------- -------------- ------------
Comprehensive income
Loss for the period - - - (1,567) (1,567)
------------- ------------- -------------- -------------- ------------
Other comprehensive
expenses (1,567) (1,567)
Currency translation
differences - - (3) - (3)
------------- ------------- -------------- -------------- ------------
Total comprehensive
expense - - (3) (1,567) (1,570)
------------- ------------- -------------- -------------- ------------
Transactions with owners
Capital reconstruction 64 (64) - - -
Share based payments - - - 39 39
Issue of ordinary shares 61 38,448 - - 38,509
Total contributions by
and distributions
to owners 125 38,384 - 39 38,548
------------- ------------- -------------- -------------- ------------
At 30 June 2021 137 43,380 (3) (2,290) 41,224
============= ============= ============== ============== ============
CONSOLIDATED CONDENSED STATEMENT OF CASH
FLOWS
FOR THE 6 MONTHSED 30 JUNE 2021
Period ended
Period ended to 31 December
30 June 2021 2020
US$'000 US$'000
Cash flow from operating activities
Loss before income tax (1,567) (762)
Adjustments for
- Depreciation and amortisation 3 1
- Share-based payments 39
- Foreign exchange (3) -
Changes in working capital
- Trade and other receivables (308) (11)
- Trade and other payables 910 122
------------------ --------------------
Net cash used in operating activities (926) (650)
Cash flow from investing activities
Purchase of property, plant and
equipment (PPE) (24) (12)
Internally generated intangible
assets (1,552) (662)
------------------ --------------------
Net cash used in investing activities (1,576) (674)
------------------ --------------------
Cash flow from financing activities
Net proceeds from issue of ordinary
shares 38,509 5,008
Net cash used in financing activities 38,509 5,008
------------------ --------------------
Net increase in cash and cash equivalents 36,007 3,684
Cash and cash equivalents at beginning
of period 3,684 -
------------------ --------------------
Cash and cash equivalents at end
of period 39,691 3,684
================== ====================
NOTES FORMING PART OF THE INTERIM FINANCIAL STATEMENTS
1. General information and basis of presentation
Trellus Health plc is a public limited company incorporated in
the United Kingdom (Registration Number 12743489). The address of
the registered office is Avon House, 19 Stanwell Road, Penarth,
CF64 2EZ.
The Company was incorporated as Trellus Health Limited on 15
July 2020 as a private company. On 12 May 2021, the company was
registered as a public company and changed its name to Trellus
Health plc.
The Group's principal activity is that of digital health.
2. Summary of significant accounting policies
The principal accounting policies adopted in the preparation of
the historical financial information of the Company, which have
been applied consistently to the period presented, are set out
below:
Basis of preparation
The financial information in these interim results is that of
the holding company and all of its subsidiaries and are unaudited.
It has been prepared in accordance with the recognition and
measurement requirements of International Financial Reporting
Standards as adopted for use in the United Kingdom, IFRS IC
interpretations, and the Companies Act 2006 applicable to companies
reporting under IFRS.
The presentation currency of the Group is United States Dollars
("USD" or "US$") and this is the currency of the primary economic
environment that the main business operates in.
The accounting policies applied by the Group in this financial
information are the same as those applied by the Group in its
financial statements for the period ended 31 December 2020 and
which will form the basis of the 2021 financial statements except
for a number of new and amended standards which have become
effective since the beginning of the previous financial year. These
new and amended standards are not expected to materially affect the
Group.
Certain statements in this announcement constitute
forward-looking statements. Any statement in this announcement that
is not a statement of historical fact including, without
limitation, those regarding the Company's future expectations,
operations, financial performance, financial condition and business
is a forward-looking statement. Such forward-looking statements are
subject to risks and uncertainties that may cause actual results to
differ materially. These risks and uncertainties include, amongst
other factors, changing economic, financial, business or other
market conditions. These and other factors could adversely affect
the outcome and financial effects of the plans and events described
in this announcement and the Company undertakes no obligation to
update its view of such risks and uncertainties or to update the
forward-looking statements contained herein. Nothing in this
announcement should be construed as a profit forecast.
The financial information presented herein does not constitute
full statutory accounts under Section 434 of the Companies Act 2006
and was not subject to a formal review by the auditors. The
financial information in respect of the period ended 31 December
2020 has been extracted from the Admission Document which was
presented to shareholders on the fundraise and the admission of the
Company at London Stock Exchange AIM market. The Group's Reporting
accountant report on those accounts, for the purposes of the
Admission Document, was a true and fair view of the state of
affairs of the Group as at the dates stated and of its results,
cash flows and changes in equity for the periods then ended.
These interim accounts have not been prepared in accordance with
IAS 34, 'Interim financial reporting'. They have been prepared
under AIM Rules of UK companies and have been authorised for issue
by the Company's Board of directors on 22 September 2021.
Basis of consolidation
Where the company has control over an investee, it is classified
as a subsidiary. The company controls an investee if all three of
the following elements are present: power over the investee,
exposure to variable returns from the investee, and the ability of
the investor to use its power to affect those variable returns.
Control is reassessed whenever facts and circumstances indicate
that there may be a change in any of these elements of control.
De-facto control exists in situations where the company has the
practical ability to direct the relevant activities of the investee
without holding the majority of the voting rights. In determining
whether de-facto control exists the company considers all relevant
facts and circumstances, including:
-- The size of the company's voting rights relative to both the
size and dispersion of other parties who hold voting rights
-- Substantive potential voting rights held by the company and by other parties
-- Other contractual arrangements
-- Historic patterns in voting attendance.
The consolidated financial statements present the results of the
company and its subsidiaries ("the Group") as if they formed a
single entity. Intercompany transactions and balances between group
companies are therefore eliminated in full.
The consolidated financial statements incorporate the results of
business combinations using the acquisition method. In the
statement of financial position, the acquiree's identifiable
assets, liabilities and contingent liabilities are initially
recognised at their fair values at the acquisition date. The
results of acquired operations are included in the consolidated
statement of profit or loss and other comprehensive income from the
date on which control is obtained. They are deconsolidated from the
date on which control ceases.
Going concern
At the date of this historical financial information, the Group
has not generated any revenues. It has over $39.7 million in cash
for working capital requirements to cover the next 12 months.
The Board has considered the impact of the ongoing COVID-19
pandemic. There has been minimal impact on the Group to date. Given
the impact of COVID-19 in the economy generally, the Board has
performed a number of stress tests to assess the ability of the
Group to continue as a going concern.
The Directors have prepared cash flow forecasts for the Group
for a review period of 12 months from the date of approval of this
historical financial information. These forecasts reflect an
assessment of current and future market conditions and their impact
on the Group's future cash flow performance.
The forecasts have been sensitised for additional costs which
may be incurred in the review period. In the sensitised scenario,
the forecasts indicate the Group would still have sufficient cash
to continue as a going concern.
Having considered the points above, the Directors remain
confident in the long-term future prospects for the Group, and
their ability to continue as a going concern for the foreseeable
future. They therefore adopt the going concern basis in preparing
the historical financial information of the Group.
Taxation
Income tax expense represents the sum of the tax currently
payable and deferred tax.
Current tax
Current tax payable is based on taxable profit for the year.
Taxable profit differs from net profits as reported in the income
statement because it excludes items of income or expense that are
taxable or deductible in other years and it further excludes items
that are never taxable or deductible. The Group's liability for
current tax is calculated using tax rates that have been enacted or
substantially enacted by the reporting end date.
Deferred tax
Deferred tax is the tax expected to be payable or recoverable on
temporary differences between the carrying amounts of assets and
liabilities in the historical financial information and the
corresponding tax bases used in the computation of taxable profit,
and is accounted for using the balance sheet liability method.
Deferred tax liabilities are generally recognised for all taxable
temporary differences and deferred tax assets are recognised to the
extent that it is probable that taxable profits will be available
against which deductible temporary differences can be utilised.
Such assets and liabilities are not recognised if the temporary
differences arise from goodwill or from the initial recognition of
other assets and liabilities in a transaction that affects neither
the tax profit nor the accounting profit.
The carrying amount of deferred tax assets is reviewed at each
reporting end date and reduced to the extent that it is no longer
probable that sufficient taxable profits will be available to allow
all or part of the asset to be recovered. Deferred tax is
calculated at the tax rates that are expected to apply in the
period when the liability is settled or the asset is realised.
Deferred tax is charged or credited in the income statement, except
when it relates to items charged or credited directly to equity, in
which case the deferred tax is also dealt with in equity. Deferred
tax assets and liabilities are offset when the company has a
legally enforceable right to offset current tax assets and
liabilities and the deferred tax assets and liabilities relate to
taxes levied by the same tax authority.
Share-based payments
Where equity settled share options are awarded to employees, the
fair value of the options at the date of grant is charged to the
consolidated statement of comprehensive income over the vesting
period. Non-market vesting conditions are taken into account by
adjusting the number of equity instruments expected to vest at each
reporting date so that, ultimately, the cumulative amount
recognised over the vesting period is based on the number of
options that eventually vest. Non-vesting conditions and market
vesting conditions are factored into the fair value of the options
granted. As long as all other vesting conditions are satisfied, a
charge is made irrespective of whether the market vesting
conditions are satisfied. The cumulative expense is not adjusted
for failure to achieve a market vesting condition or where a
non-vesting condition is not satisfied.
Where equity instruments are granted to persons other than
employees, the consolidated statement of comprehensive income is
charged with the fair value of goods and services received.
Foreign currency translation
(a) Functional and presentation currency
Items included in the historical financial information of the
Group are measured using USD, the currency of the primary economic
environment in which the main trading entity operates.
(b) Transactions and balances
Foreign currency transactions are translated into the functional
currency using the exchange rates prevailing at the dates of the
transactions. Foreign exchange gains and losses resulting from the
settlement of such transactions and from the translation at
year-end exchange rates, of monetary assets and liabilities
denominated in foreign currencies to USD, are recognised in the
income statement.
Intangible assets
Intangible assets are measured at cost less accumulated
amortisation and any accumulated impairment losses.
Internally generated intangible assets arising from the
development of software solutions are recognised only if all of the
following conditions are met:
-- It is probable that the asset will generate future economic benefits;
-- The costs can be measured reliability;
-- The technical feasibility of completing the intangible asset can be demonstrated;
-- There is the intention to complete the asset and use or sell it; and
-- Adequate technical, financial and other resources to complete
the development and to use or sell the asset are available.
Research costs incurred that do not meet the above conditions
are expensed within cost of sales in the income statement.
Intangible assets are stated at costs less provision for
amortisation and impairment. Intangible assets relating to products
in development are subject to impairment testing annually. The
Group's intangible assets have not yet been brought into use and
therefore no amortisation has been recognised to date. The Group
expects the amortisation to start from next year.
The Group amortises intangible assets with a limited useful life
on a straight-line basis. The following rates are applied:
-- Development costs - over useful life of four years.
Tangible assets
Tangible fixed assets are stated at cost net of accumulated
depreciation and accumulated impairment losses. Costs comprise
purchase costs together with any incidental costs of
acquisition.
Depreciation is provided to write down the cost less the
estimated residual value of all tangible fixed assets by equal
instalments over their estimated useful economic lives on a
reducing balance basis. The following rates are applied:
-- Computer equipment - 25 per cent. reducing balance basis
The assets' residual values, useful lives and depreciation
methods are reviewed, and adjusted prospectively if appropriate, if
there is an indication of a significant change since the last
reporting date. Low value equipment including computers is expensed
as incurred.
Impairment of tangible and intangible assets
At each reporting end date, the Group reviews the carrying
amounts of its tangible and intangible assets to determine whether
there is any indication that those assets have suffered an
impairment loss. If any such indication exists, the recoverable
amount of the asset is estimated in order to determine the extent
of the impairment loss (if any). Where it is not possible to
estimate the recoverable amount of an individual asset, the Company
estimates the recoverable amount of the cash-generating unit to
which the asset belongs.
The recoverable amount is the higher of fair value less costs to
sell and value in use. In assessing value in use, the estimated
future cash flows are discounted to their present value using a
pre-tax discount rate that reflects current market assessments of
the time value of money and the risks specific to the asset for
which the estimates of future cash flows have not been
adjusted.
If the recoverable amount of an asset (or cash-generating unit)
is estimated to be less than its carrying amount, the carrying
amount of the asset (or cash-generating unit) is reduced to its
recoverable amount. An impairment loss is recognised immediately in
profit and loss, unless the relevant asset is carried at a revalued
amount, in which case the impairment loss is treated as a
revaluation decrease.
Where an impairment subsequently reverses, the carrying amount
of the asset (or cash-generating unit) is increased to the revised
estimate of its recoverable amount, but so that the increased
carrying amount does not exceed the carrying amount that would have
been determined had no impairment loss been recognised for the
asset (or cash-generating unit) in prior years. A reversal of an
impairment loss is recognised immediately in profit and loss.
Financial instruments
The Group classifies financial instruments, or their component
parts, on initial recognition as a financial asset, a financial
liability or an equity instrument in accordance with the substance
of the contractual arrangement. Financial assets and financial
liabilities are recognised on the statement of financial position
when the Group becomes a party to the contractual provisions of the
instrument.
(a) Financial assets
Financial assets are classified, at initial recognition, as
subsequently measured at amortised cost, fair value through other
comprehensive income (OCI), or fair value through profit or loss.
The classification of financial assets at initial recognition
depends on the financial asset's contractual cash flow
characteristics and the Group's business model for managing
them.
The classification depends on the purpose for which the
financial assets were acquired. Management determines the
classification of its financial assets at initial recognition and
re-evaluates this classification at every reporting date.
As at the reporting date, the Group did not have any financial
assets subsequently measured at fair value.
(b) Financial liabilities
All financial liabilities are initially measured at fair value
and, in the case of loans and borrowings, net of directly
attributable transaction costs. They are subsequently measured at
amortised cost, where applicable, using the effective interest
method, with interest expense recognised on an effective yield
basis.
(c) Cash and cash equivalent
Cash and cash equivalents comprise cash balances and
deposits.
Provisions
A provision is recognised in the statement of financial position
when the Group has a present legal or constructive obligation as a
result of a past event, that can be reliably measured and it is
probable that an outflow of economic benefits will be required to
the settle the obligation. Provisions are determined by discounting
the expected future cash flows at a pre-tax rate that reflects
risks specific to the liability.
Financing expenses
Financing expenses comprise interest payable classified as
liabilities. Foreign exchange gains and losses are reported within
administrative expenses in the statement of comprehensive
income.
Interest payable is recognised in the statement of comprehensive
income as it accrues, using the effective interest method.
Operating segments
The directors are of the opinion that the business of the Group
comprises a single activity, that of the proving digital health
solution. Consequently, all activities relate to this segment.
All the non-current assets of the Group are located in, or
primarily relate to, the USA.
Standards issued but not yet effective:
There were no standards and interpretations relevant to the
Group which were in issue but are not yet effective and which have
not been applied in the historical financial information expected
to have a material impact on the Group in the current or future
reporting periods and on foreseeable future transactions.
Employee benefits
(a) Pension obligations
Group companies operate various pension schemes all of which are
defined contribution plans. A defined contribution plan is a
pension plan under which the Group pays fixed contributions into a
separate entity with the pension cost charged to the income
statement as incurred. The Group has no further obligations once
the contributions have been paid.
The Group has no defined benefit schemes.
(b) Share-based compensation
The Group operates a number of equity-settled, share-based
compensation plans, under which the Group receives services from
employees and others as consideration for equity instruments of the
Group. Equity-settled share-based payments are measured at fair
value at the date of grant and are expensed over the vesting period
based on the number of instruments that are expected to vest. For
plans where vesting conditions are based on share price targets,
the fair value at the date of grant reflects these conditions.
Where applicable the Group recognises the impact of revisions to
original estimates in the income statement, with a corresponding
adjustment to equity for equity-settled schemes. Fair values are
measured using appropriate valuation models, taking into account
the terms and conditions of the awards.
When the share-based payment awards are exercised, the Company
issues new shares. The proceeds received net of any directly
attributable transaction costs are credited to share capital
(nominal value) and share premium.
The Group operates a cash-settled compensation plan for certain
senior employees. Cash-settled share-based payments are measured at
fair value at the date of grant and are expensed over the expected
vesting period. The fair value amount is recognised in
liabilities.
National insurance on share options
To the extent that the share price at the balance sheet date is
greater than the exercise price on options granted under unapproved
share-based payment compensation schemes, provision for any
National Insurance Contributions has been based on the prevailing
rate of National Insurance. The provision is accrued over the
performance period attaching to the award.
Exceptional items
Items considered of such significance to enable the reader to
better understand the results for the period presented as
separately disclosed as exceptional items on the face of the
statement of comprehensive income.
3. Income tax
Period ended Period ended
30 June 31 December
2021 2020
US$'000 US$'000
Current tax - -
Deferred tax - -
----------------- -----------------
Current tax charge for the period - -
================= =================
The Group has incurred indefinitely available tax losses of
approximately US$2m (2020 - US$0.7m) to carry forward against
future taxable income. No deferred tax asset has been recognised in
respect of such losses and temporary differences due to the
unpredictability of future profit streams. Such losses may be
carried forward indefinitely.
4. Loss per share
Basic loss per share is calculated by dividing the loss
attributable to equity holders of the parent by the weighted
average number of ordinary shares in issue during the period.
Diluted loss per share is calculated by adjusting the weighted
average number of ordinary shares outstanding assuming conversion
of all dilutive potential ordinary shares. The Company has one
category of dilutive potential ordinary share, being share options.
Currently the share options are anti- dilutive.
Period ended Period ended
30 June 2021 31 December
2020
US$'000 US$'000
Loss attributable to owners of
the parent (1,567) (762)
================== =================
Number Number
Weighted average number of ordinary
shares in issue 105,115,884 84,035,503
================== =================
US$ US$
Basic loss per share 0.01 0.01
================== =================
6. Intangible Fixed Assets
Software Development costs
US$'000 Licence costs Total
US$'000 US$'000
------------------------------- -------------------- --------------
Cost
On incorporation - - -
Additions 662 - 662
At 31 December 2020 662 - 662
Additions 1,052 500 1,552
At 30 June 2021 1,714 500 2,214
------------------------------- -------------------- --------------
Amortisation
On incorporation - - -
Charge for the period - - -
------------------------------- -------------------- --------------
At 31 December 2020 - - -
Charge for the period - - -
------------------------------- -------------------- --------------
At 30 June 2021 - - -
------------------------------- -------------------- --------------
Net book value
30 June 2021 1,714 500 2,214
---------- -------- ----------
31 December 2020 662 - 662
---------- -------- ----------
7. Dividends
No dividends to shareholders of the holding company were
provided or paid during the six months to 30 June 2021 (31 December
2020: GBPnil).
8. Availability of this announcement
This announcement is available from the Company's website,
https://trellushealth.com/. If you would like to receive a hard
copy of the interim report, please contact the Trellus Health plc's
investor relation team on +44 (0) 20 7933 8780.
9. Events after the reporting date
There have been no events subsequent to the period end that
require disclosure in these financial statements.
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END
IR FFFFFAAILFIL
(END) Dow Jones Newswires
September 22, 2021 02:00 ET (06:00 GMT)
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