Half Year Report

06 September 2021

Unaudited Interim Results for the 6 months ended 30 June 2021

Operational highlights

  • X-PLO2RTM received 510(k) Clearance from the Food and Drug Administration (“FDA”) on 2 March 2021
  • Admission to AIM on 28 May 2021
  • Oversubscribed equity fundraising of £17.5 million ($24.5 million) from new and existing investors
  • Strategic senior appointments made: Keith Cook, VP Operations and Jon Meneese, VP Marketing
  • First distribution agreement signed with an established nationwide distributor seller of supplemental oxygen equipment, located on the East Coast of the US

Post period end highlights

  • Commencement of manufacturing of the X-PLO2RTM product in the US
  • Pre-Market Evaluation reflected positive feedback on performance and attributes
  • Purchase orders received for the X-PLO2RTM
  • First X-PLO2RTM units distributed on 3 September 2021
  • Three further distribution agreements signed with:
    • A leading nationwide distributor of supplemental oxygen and respiratory equipment, located in the Midwest US
    • A durable medical equipment provider with multiple stores in several states and an online store, located in the upper Midwest US
    • A US Service-Disabled Veteran-Owned Small Business dealing exclusively with the US federal government in areas such as Veterans Affairs and The Department of Defense
  • Continued development of follow-on products: the X-PLO2R CXTM and the X-PLO2R DXTM

 

Bob Rauker, Chief Executive Officer Belluscura, commented:

“I am extremely pleased to announce that the Group has achieved its target timeframe and distributed the first X-PLO2RTM units off the production line to customers on 3 September 2021. “Initial demand for X-PLO2RTM has been strong. To date we have received orders that meet this year’s forecast unit sales and expect to exceed the forecast in the coming months. “Meanwhile the Group continues to work diligently on the completion of development and testing of our follow-on products, the X-PLO2R CXTM and the X-PLO2R DX TM. “With the Research and Markets updated Portable Oxygen Concentrator Market research report now forecasting a compound annual growth rate (“CAGR”) of 14.0% from 2019 to 2026, this is a very exciting time for Belluscura.”

Adam Reynolds, Chairman of Belluscura, commented:

“I am delighted with the progress the team at Belluscura has achieved this year, particularly taking into account all the disruption caused by the pandemic. “Receiving FDA 510(k) Clearance for the X-PLO2RTM was pivotal for the Group, followed by an oversubscribed placing and successful listing in May. To have brought the product to market so quickly is a tremendous achievement. “The initial response from the market is hugely positive. With four distribution agreements signed to date and many more enquiries both from within the US and globally, we expect substantial growth over the coming years and the Board is confident of what the future holds for Belluscura.”

 

For further information please contact:

Belluscura plc www.belluscura.com
Robert Rauker, Chief Executive Officer via Walbrook PR
Anthony Dyer, Chief Financial Officer
SPARK Advisory Partners Ltd (NOMAD) Tel: +44 (0)20 3368 3550
Neil Baldwin
Dowgate Capital Limited (Broker) Tel: +44 (0)20 3903 7715
James Serjeant / Nicholas Chambers
Walbrook PR Ltd (Media & Investor Relations) Tel: +44 (0)20 7933 8780 or belluscura@walbrookpr.com
Paul McManus / Sam Allen Mob: +44 (0)7980 541 893 / +44 (0)7502 558 258

 

Strategic report for the six months ended 30 June 2021

Chairman’s Statement

Introduction

I am delighted to present our maiden Half Year Report after listing on AIM in May 2021. By way of background, Belluscura (“the Group”) is a business founded on the principle of making healthcare both more affordable and more available while returning a strong profit to our shareholders. In February 2017, the Group entered into a co-exclusive license and development agreement with Separation Design Group (“SDG”) to complete the development of the X-PLO2RTM, a portable oxygen concentrator, used to deliver
concentrated oxygen to a patient requiring oxygen therapy. Belluscura and SDG delivered a working prototype within five months of acquiring the X-PLO2RTM license.  X-PLO2RTM received 510(k) clearance from the Food and Drug Administration (“FDA”) on 2 March 2021. Our products are currently manufactured in the US and the Group is delighted to have commercially launched the X-PLO2RTM in September 2021. The Group has also developed follow-on products in the X-PLO2RTM range of oxygen concentrators, the X-PLO2R CXTM and the X-PLO2R DXTM, which will target the same oxygen markets. The Group continues to work on other oxygen enrichment technologies in complementary markets.

Current Trading

My fellow directors and I believe that the major opportunities lie with the X-PLO2RTM and complementary technologies. We believe that X-PLO2RTM will provide significant growth for the Group. It is expected that the longer-term health impact of the COVID-19 pandemic will increase demand for long term oxygen therapy and accelerate the growth in the market. We have made solid progress in achieving our mission. Since Admission to AIM on 28 May 2021 the Group announced to shareholders that it has signed four distribution agreements. We have received pre-orders for our X-PLO2RTM product with first units leaving the production line to customers on 3 September 2021.

Financial review

The Group raised £17.5 million ($24.5 million) from investors in May when its shares were admitted to trading on AIM, before expenses of £1.4 million ($1.9 million); of which
£0.5 million ($0.6 million) were charged to the Income Statement and £0.9 million ($1.3 million) were charged to the Share Premium Account. These funds are being applied in
pursuing the Group’s strategic objectives. The Group did not make any sales in the period to 30 June 2021 (2020 H1: $nil; 2020 FY: $nil) and recorded losses after tax of US $2.9 million (2020 H1: $0.5 million; 2020 Full Year: $1.6 million). Group net assets at the end of the period were US $28.0 million (2020 H1: $5.0 million; 2020 Full Year: $4.7
million). Cash balances as at 30 June 2021 amounted to $22.65 million.

Outlook

Belluscura is well positioned and financed to achieve its expectations as laid out in the admission document and the Company has met all of its key milestones since its shares
started trading on AIM in May this year. Since we received FDA 510(k) Clearance for X-PLO2RTM, which was pivotal for the Group, we have signed four distribution agreements, plus a manufacturing arrangement in the US, and have shipped our first units. We will increase production commensurate with market demand which we expect to grow significantly, and the Company looks forward with optimism and will be updating shareholders on a regular basis.   Adam Reynolds Chairman

Group Unaudited
 6 months to
30/06/2021
Unaudited
 6 months to
30/06/2020
Audited
 12 months to
31/12/2020
Note US $ US $ US $
Continuing Operations
Revenue 5
Cost of sales
Gross Profit/(Loss)
 
Other operating income 6.1 84,253 11,493
Administrative expenses 6.2 (2,516,154) 23,099 (1,956,682)
Operating Loss (2,431,901) 23,099 (1,945,189)
Finance income 15
Finance costs (14,012) (16,820) (32,956)
Finance costs – net (13,997) (16,820) (32,956)
Loss before income tax (2,445,898) 6,279 (1,978,145)
Income tax expense 7
Loss after tax for the period (2,445,898) 6,279 (1,978,145)
Other comprehensive income 6.2
Items that are or may be reclassified subsequently to profit or loss:
Foreign currency translation differences – foreign operations (497,944) (487,568) 391,736
Total other comprehensive income (497,944) (487,568) 391,736
Total comprehensive loss for the period attributable to the equity holders (2,943,842) (481,289) (1,586,409)
Earnings per share
Basic: Loss per share 8 (0.039) (0.009) (0.029)
Diluted: Loss per share 8 (0.039) (0.009) (0.029)

 

Group Unaudited  30/06/2021 Unaudited 30/06/2020 Audited  31/12/2020
US $ US $ US $
Assets
Non-current assets
Tangible assets 31,407 17,833 13,818
Intangible assets
Product development 5,239,162 3,703,342 4,129,660
Right to use asset 326,828 424,876 375,852
Total non-current assets 5,597,397 4,146,051 4,519,330
 
Current assets  
Trade and other receivables 538,320 211,748 197,653
Cash and cash equivalents 22,652,724 1,526,412 520,070
Total current assets 23,191,044 1,738,160 717,723
Total assets 28,788,441 5,884,211 5,237,053
Current liabilities
Trade and other payables (371,805) (439,294) (230,136)
Total current liabilities (371,805) (439,294) (230,136)
Non-current liabilities
Trade and other payables (404,024) (414,435) (338,053)
Total non-current liabilities (404,024) (414,435) (338,053)
Total liabilities (775,829) (853,729) (568,189)
Net assets 28,012,612 5,030,482 4,668,864
  Equity attributable to the owners of the parent
Share capital 1,541,229 769,768 823,201
Share premium 25,969,371 7,344,832 556,683
Capital contribution 165,000 165,000 165,000
Retained earnings 398,337 (2,806,432) 2,687,361
Translation reserve (61,325) (442,686) 436,619
Total equity 28,012,612 5,030,482 4,668,864

 

Attributable to equity holders of the parent company
Group  
Ordinary Shares
US $
 
Share Premium
US $
 
Translation Reserve
US $
 
Capital Contribution
US $
 
Retained earnings
US $
 
Total
 
US $
Six months to 30 June 2020 (Unaudited)
Balance at 1 January 2020 648,298 5,714,678 44,882 165,000 (2,844,929) 3,727,929
Issue of ordinary shares 121,470 1,630,154 1,751,624
Reduction in capital
Profit for the period 6,279 6,279
Other comprehensive income (487,568) (487,568)
Total comprehensive income (487,568) 6,279 (481,289)
Share based payments   32,218 32,218
Balance at 30 June 2020 769,768 7,344,832 (442,686) 165,000 (2,806,432) 5,030,482
12 months to 31 December 2020 (Audited)
Balance at 1 January 2020 648,298 5,714,678 44,882 165,000 (2,844,929) 3,727,929
Issue of ordinary shares 174,903 2,233,896 2,408,799
Reduction in capital (7,391,891) 7,391,891
Loss for the period (1,978,145) (1,978,145)
Other comprehensive income 391,737 391,737
Total comprehensive income 391,737 (1,978,145) (1,586,408)
Share based payments   118,544 118,544
Balance at 31 December 2020 823,201 556,683 436,619 165,000 2,687,361 4,668,864
Six months to 30 June 2021 (Unaudited)
Balance at 1 January 2021 823,201 556,683 436,619 165,000 2,687,361 4,668,864
Issue of ordinary shares 718,028 25,412,688 26,130,716
Reduction in capital
Loss for the period (2,445,898) (2,445,898)
Other comprehensive income (497,944) (497,944)
Total comprehensive income (497,944) (2,445,898) (2,943,842)
Share based payments   156,874 156,874
Balance at 30 June 2021 1,541,229 25,969,371 (61,325) 165,000 398,337 28,012,612

 

Group  
 
Note
Unaudited
 6 months to
30/06/2021
Unaudited
 6 months to
30/06/2020
Audited
 12 months to
31/12/2020
US $ US $ US $
Cash flows from operating activities
Cash generated from operations 12 (2,263,194) (440,621) (1,470,773)
Taxation paid
Net cash used in operating activities (2,263,194) (440,621) (1,470,773)
Cash flows from investing activities
Purchases of property, plant and equipment (22,550)
Intangible assets under development (1,109,502) (768,114) (1,194,432)
Net cash used in investing activities (1,132,052) (768,114) (1,194,432)
Cash flows from financing activities
Proceeds from issuance of ordinary shares (net) 25,651,154 1,816,495 2,251,774
Lease Payments (48,961) (56,053) (118,859)
Net cash generated from financing activities 25,602,193 1,760,442 2,132,915
Net increase/ (decrease) in cash and cash equivalents 22,206,947 551,707 (532,290)
Cash and cash equivalents at beginning of period 520,070 1,033,512 1,033,512
Exchange loss on cash and cash equivalents (74,293) (58,807) 18,848
Cash and cash equivalents at end of period 22,652,724 1,526,412 520,070

 

The notes are available in the printable pdf of the results. To download it, please click here