TIDMNGG

RNS Number : 9854N

NextGen Group PLC

09 September 2011

NextGen Group PLC

Interim Results to 30 June 2011

NextGen Group plc, (AIM: NGG, 'the Group', 'NextGen'), a provider of biomarker discovery and qualification (testing) services using mass spectrometry technology, announces its interim results for the six months ended 30 June 2011. NextGen's biomarker services are provided through its wholly owned US-subsidiary, NextGen Sciences Inc. (NGS).

Highlights

-- New business plan written to focus on scalable and profitable products that will enable the business to increase its therapeutic relevance as a route to promoting market access and growing sales. Core product focus on protein biomarker discovery, assay development and biomarker qualification

-- Operational restructure of NGS completed to enable effective development and launch of products defined with the business plan

-- Focus on Oncology and CNS (central nervous system) therapeutic areas. The first stages in developing two new product lines have been achieved.

o plasmadiscovery41 assay panel for biomarker discovery and qualification (testing) targeting oncology (prostate, colorectal and breast cancer as focus areas) was launched in March 2011.

o csfdiscovery43 assay panel for biomarker discovery and qualification targeting CNS diseases (Alzheimer's, Parkinson's and multiple sclerosis as focus areas) was launched in June 2011.

-- Core market focus is on pharma, biotech and translational medicine centers for developing diagnostic, predictive and stratification (personalized) biomarkers

-- Multiple custom biomarker discovery, assay development and biomarker qualification projects delivered and in progress

-- NGS delivers its qualification (testing) services under a controlled quality environment (document change control system and standard operating procedures). This is the first phase in an on-going progression in being able to offer services to a GLP/GCP standard.

-- Sales in the period were $948,279 (2010: $708,831).

-- Funding of $1.5 million received in January through share issue.

For further details please contact:

Klaus Rosenau

CEO, NextGen Group PLC +49 160 551 6756

Nicola Marrin/Freddy Crossley

Seymour Pierce Limited +44 20 7107 8000

CEO's Statement

Overview and general information

In Q3 2010 the business initiated an operational restructure of NGS to bring into the business the technical skill sets necessary to develop and deliver the products defined within its business plan. This restructuring was completed in Q1 2011 and has successfully delivered the first phases of two new assay products focused on the Oncology and CNS therapeutic areas. These 'off-the-shelf' products for biomarker discovery and/or qualification have established commercial traction in the first half of 2011 and are core to the strategy for driving the revenue growth of the business. The custom protein biomarker discovery, assay development and qualification (testing) products offered on a CRO basis remain core to the business.

The Group's chief operations provided through US-subsidiary, NextGen Sciences Inc (NGS) remain in Ann Arbor, Michigan. Thus the Group reports in US dollars.

These consolidated, condensed interim financial statements have been approved for issue by the Board of Directors on 9(th) September 2011.

Financial review

The loss after tax was $1,591,937 for the six months ended 30(th) June 2011 compared to $1,742,008 for the period ended 30(th) June 2010. This translates to a loss per share from continuing operations of $0.0002 for the six month period ended 30(th) June 2011 compared to a loss per share of $0.0004 for the period ended 30(th) June 2010.

Group turnover (excluding turnover for discontinued operations) for the six months ended 30(th) June 2011 was $948,279 compared to $708,831 for the period ended 30(th) June 2010, an increase of 33.7%. Total operating charges including Cost of Goods increased by 4.6% from $2,348,247 for the period ended 30(th) June 2010 to $2,455,178 for the six months ended 30(th) June 2011 (excluding operating charges for discontinued operations).

In the six months ended 30(th) June 2011 the Company has completed a placing of new ordinary shares of 0.1 pence each raising GBP927,410 ($1.5 million). This funding provided general working capital for the Company, which the Directors believe would be sufficient for its current requirements.

The shares issued in the year were under a placing of 927,410,000 ordinary shares of 0.1 pence each (the "Placing Shares") with an existing shareholder in the Company at par value. In addition, for every Placing Share issued pursuant to the Placing, the Company has granted a warrant over 1 ordinary share of 0.1 pence each (the "Ordinary Shares") with an exercise price of 0.1 pence per share. The Warrants shall be exercisable for 3 years from the date of grant.

Biomarker business operating review

The biomarker discovery, assay development and qualification (testing) products offered on a CRO (Contract Research Organization) basis remain core to the business. However, as part of the custom assay development and qualification deals, the company seeks to negotiate 'freedom to operate' with the assayable proteins. This enables NextGen to develop its own 'off-the-shelf' assays for marketing to therapeutically targeted market segments. Application of this model was demonstrated with the release in March 2011 of the plasmadiscovery41 assay panel for biomarker discovery and qualification targeting oncology (prostate, colorectal and breast cancer as focus areas). Further, the csfdiscovery43 assay panel for biomarker discovery and qualification targeting CNS diseases (Alzheimer's, Parkinson's and multiple sclerosis as focus areas) was launched in June 2011.

The plasmadiscovery41 assay product has achieved significant commercial traction with the signing of a $700,000 deal for biomarker qualification (testing) in June 2011.

The business rationale for this strategy is;

1. The company addresses therapeutically relevant 'problems' and so gains market presence across all segments (pharma, biotech, academic);

2. Through sample testing, these 'assay panels' attract quick turnaround revenue;

3. Having its own 'assay panels' proves the technology and removes the technology hurdle from the selling process and enables discussion of the solution. Thus the own 'assay panels' drive custom assay project wins; and

4. Creates a virtuous circle where custom projects negotiated with freedom to operate enables growth of own 'assay panels' which enables the company to be more therapeutically relevant, demonstrate the technology and attract further custom assay projects.

The company has the infrastructure and expertise necessary to develop and apply these assays in a commercial CRO setting.

The company now has the operational structure and instrument infrastructure necessary to take advantage of potential opportunities arising from the discovery, development and exploitation of diagnostic, disease progression and patient stratification (personalization) biomarkers. The Company now has a track record for delivering the highest quality data to the client while meeting deadlines and providing excellent support through all stages of the projects.

The Company's market focus in the immediate term will be on pharma and biotech companies engaged in the discovery and development of small molecule and biologic drugs. Further focus will be on those engaged in Oncology (Breast, Prostate and Colorectal) and CNS (Alzheimer's, Parkinson's and multiple sclerosis) therapeutic areas.

Seasonal fluctuations and the market

DNA and protein biomarkers (molecules that provide information about biological and disease processes, as well as responses to drugs) have enormous potential in the diagnosis and prognosis of disease, in the discovery and development of drugs, and in the development of companion diagnostics to accompany drugs and guide treatment. They therefore are expected to play a key role in the development of personalized or stratified medicine, in which the right patient is given the right medicine at the right time.

Driven by these factors, the biomarker market is growing strongly, and is anticipated in a 2011 BCC Research report to be worth almost $30bn by 2015. For NextGen Sciences' areas of therapeutic focus, the global CNS biomarker market is expected to reach close to $3.2 billion by 2015 (BCC Research, 2010), and the global oncology biomarker market is expected to grow to $5.7 billion by 2014 (Goliath, 2010).

Concerning seasonal fluctuations; the demand for biomarker services increases in the second-half in comparison to the first-half.

NextGen Group products and services are directly sold to the pharmaceutical and biotech industry. The trend in declined productivity and decreased drug approval rates has lead to many large pharmaceutical and biotech companies to restructure, merge and/or downsize. The Group's results are dependent on the levels of outsourcing activities in this sector. This sector and the diversity of the Group's customer base provide a degree of protection in an ever changing market.

With increasing consolidation and rationalization with the pharma and biotech markets, current evidence indicates that outsourcing from the pharma and biotech markets will grow significantly and it is a crucial time to become an accepted partner for these markets. NextGen is aware of the criticality of the timing now in demonstrating the value of its technology.

Competitive pressures

Biomarkers in the drug discovery, diagnostic and personalized medicine space traverse a number of technology areas e.g. proteomics (NextGen's space), genomics, transcriptomics and metabolonomics. Each of these alternative technologies will be evaluated by the market and could serve as a substitute to NextGen's offering and will take market share.

In the proteomic space there are direct competitors employing the same technology and direct competitors employing alternative technologies. NextGen is well positioned against same technology competitors in terms of its ability to demonstrate and deliver value with our technology. NextGen is the first company using its technology to release 'off-the-shelf' assays for both plasma and CSF (cerebrospinal fluid).

Price competition is not seen as a major factor currently affecting the company's offering and demonstration of the value proposition will enable high revenue projects. However, as competition increases, competitive pricing in the market will emerge. NextGen will continue to offer a premium service to mitigate against this market pressure whilst maintaining tight control over its underlying cost base. Pricing pressures can be mitigated by providing services under a documented quality system and by ensuring unique and relevant protein content in 'off-the-shelf' assay products.

The biomarker discovery and validation market and its comprehensive inclusion in the drug discovery path is in the early stages and NextGen is positioned as one of the early to market companies.

There are a few direct competitors in the space at present but many more may be established as the market grows. The Group actively works with its customers to find new and innovative ways to meet their changing needs in order to remain at the forefront of its' chosen market. Our continued investment in people, technology and logistics is designed to support the Group's competitive position.

Current Trading and Outlook

In H1 2011, NextGen has completed multiple biomarker projects and has further projects in the pipeline. The company has begun to introduce to the market its 'off-the-shelf' assays targeting Oncology and CNS diseases.

A key element to gaining market presence and overcoming the technology adoption hurdles is the release and marketing of our own 'assay panels'. It is clear from orders received that the plasmadiscovery41 assay panel is enabling the business to derive high margin revenues. We anticipate a similar response to the csfdiscovery43 product. These products are also enabling the business to open doors and gain traction within the target market segments. The key next stage will be to deliver further discovery and qualification (testing) projects to customers with our 'off-the-shelf' assays' and to publish/present that work in the public domain so as to clearly demonstrate the value proposition.

Delivery of our 'off-the-shelf' assays' and demonstration of value through delivering qualification projects will enable the company to present a strong argument to the pharmaceutical and biotech market regarding the 'niche' role the company's technology can play in their pre-clinical and clinical development programs and also in their drive to develop companion diagnostics for their drug products. NextGen's ability to narrow the funnel from large numbers of potential biomarkers to small, manageable number of qualified biomarkers in a 6-month time window presents a real competitive advantage.

This capability also presents NextGen with the opportunity to identify, play a role in and invest in projects that will develop and deliver diagnostic, stratification and progression biomarker assays. NextGen is currently evaluating opportunities to create a 'diagnostics' business that can utilize the technical expertise of the current business to enable development of an Intellectual Property (IP) portfolio and to access revenues through licensing of IP and assays.

Currently, because of the nature and stage of the Group's business and the services it seeks to provide, the timing of cash inflows continues to be unpredictable. This, together with the Group's plans for growth, may necessitate alternative funding levels and the directors constantly review the need for such additional funds.

During the period ending 30(th) June 2011, $1.5 million was raised in order to strengthen the funds in the Company and to allow the Company to fulfill its commercial strategies, by the issuance of 927 million shares.

The convertible loan of EUR500,000 originally expired 31(th) July 2011. The loan period has been extended until 31(th) March 2012.

Consolidated interim income statement

 
                                        Unaudited     Unaudited      Audited 
                                         6 month       6 month     Year to 31 
                                       to 30 June    to 30 June     December 
                                          2011          2010          2010 
                                                 $             $             $ 
 
 Revenue                                   948,279       708,831     1,215,554 
 Cost of sales                           (683,453)     (818,709)   (1,229,460) 
                                      ------------  ------------  ------------ 
 Gross profit/(loss)                       264,826     (109,878)      (13,906) 
 
 Other operating expenses              (1,771,725)   (1,529,538)   (3,193,424) 
 Impairment of non-financial 
  assets                                         -             -             - 
                                      ------------  ------------  ------------ 
 Loss from operating activities        (1,506,899)   (1,639,416)   (3,207,330) 
 
 Finance income                                  -           129         3,482 
 Finance costs                            (84,625)     (102,721)     (137,120) 
                                      ------------  ------------  ------------ 
 Loss before income tax                (1,591,524)   (1,742,008)   (3,340,968) 
 
 Income tax expense                          (413)             -         (196) 
                                      ------------  ------------  ------------ 
 Loss for the period                   (1,591,937)   (1,742,008)   (3,341,164) 
------------------------------------  ------------  ------------  ------------ 
 
 
 Basic loss per share                     (0.0002)      (0.0004)      (0.0006) 
 Basic loss per share from 
  continuing operations                   (0.0002)      (0.0004)      (0.0006) 
 

Consolidated interim statement of comprehensive income

 
                                          Unaudited    Unaudited     Audited 
                                                                      Year 
                                           6 month      6 month       to 31 
                                            to 30        to 30 
                                             June         June      December 
                                            2011         2010         2010 
                                              $            $            $ 
Net loss attributable to shareholders' 
 equity                                  (1,591,937)  (1,742,008)  (3,341,164) 
Currency retranslation losses               (61,267)      (3,994)     (80,625) 
---------------------------------------  -----------  -----------  ----------- 
Total recognized income and expense 
 attributable to shareholder' equity     (1,653,204)  (1,746,002)  (3,421,789) 
---------------------------------------  -----------  -----------  ----------- 
 
 

Consolidated interim statement of financial position

 
                                  Unaudited    Unaudited     Audited 
                                   6 month      6 month     Year to 31 
                                  to 30 June   to 30 June    December 
                                     2011         2010         2010 
                                           $            $            $ 
 Non-current assets 
 Property, plant and equipment       703,789      285,753      742,440 
 Goodwill                            507,862      507,862      507,862 
 Investments                               -           35           35 
                                 -----------  -----------  ----------- 
 Total Non-current assets          1,211,651      793,650    1,250,337 
                                 -----------  -----------  ----------- 
 
 Current assets 
 Trade and other receivables         982,572      244,758      308,829 
 Cash and cash equivalents            28,533    1,027,435       21,255 
                                 -----------  -----------  ----------- 
 Total Current Assets              1,011,105    1,272,193      330,084 
                                 -----------  -----------  ----------- 
 
 Total assets                      2,222,756    2,065,843    1,580,421 
-------------------------------  -----------  -----------  ----------- 
 

Consolidated interim statement of financial position (continued)

 
                                     Unaudited      Unaudited       Audited 
                                      6 month        6 month       Year to 31 
                                     to 30 June     to 30 June      December 
                                        2011           2010           2010 
                                               $              $              $ 
 Equity 
 Share capital                        12,101,225      9,590,302     10,615,514 
 Share premium account                10,276,362     10,276,362     10,276,362 
 Merger reserve                       10,026,450     10,026,450     10,026,450 
 Other reserves                        1,052,748        938,329        938,329 
 Foreign currency translation 
  reserve                              (658,058)      (520,160)      (596,791) 
 Retained earnings                  (33,472,381)   (30,281,288)   (31,880,444) 
                                   -------------  -------------  ------------- 
 Total equity                          (673,654)         29,995      (620,580) 
                                   -------------  -------------  ------------- 
 
 Liabilities 
 Non-current liabilities 
 Finance lease                           255,998         30,518        296,131 
 Total non-current liabilities           255,998         30,518        296,131 
 
 Current liabilities 
 Trade payables and other current 
  liabilities                          1,323,627        751,237        770,639 
 Finance lease                           183,840        143,292        147,693 
 Provisions                                    -          1,162              - 
 Borrowings                            1,132,945      1,109,639        986,538 
 Total current liabilities             2,640,412      2,005,330      1,904,870 
 
 Total liabilities                     2,896,410      2,035,848      2,201,001 
                                   -------------  -------------  ------------- 
 
 Total equity and liabilities          2,222,756      2,065,843      1,580,421 
---------------------------------  -------------  -------------  ------------- 
 

Consolidated interim statement of changes in equity

 
                                                                       Foreign 
                                                                      currency                       Total 
                    Share        Share        Merger       Other     translation     Retained     shareholder 
 Unaudited         Capital      premium      reserve     reserves      reserve       earnings        funds 
                           $            $            $           $             $              $             $ 
 Balance at 1 
  January 2011    10,615,514   10,276,362   10,026,450     938,329     (596,791)   (31,880,444)     (620,580) 
 Issue of share 
  capital          1,485,711            -            -           -             -              -    1,485,711 
 Share-issue 
 costs                     -            -            -           -             -              -        - 
 Share-based 
  payments                 -            -            -     114,419             -              -       114,419 
 Transactions 
  with owners      1,485,711            -            -     114,419             -              -    1,600,130 
 Total 
  Comprehensive 
  Income/Loss              -            -            -           -      (61,267)    (1,591,937)   (1,653,204) 
---------------  -----------  -----------  -----------  ----------  ------------  -------------  ------------ 
 Balance at 30 
  June 2011       12,101,225   10,276,362   10,026,450   1,052,748     (658,058)   (33,472,381)    (673,654) 
---------------  -----------  -----------  -----------  ----------  ------------  -------------  ------------ 
 
 
                                                                     Foreign 
                                                                    currency                       Total 
                    Share       Share        Merger      Other     translation     Retained     shareholder 
 Unaudited         Capital     premium      reserve     reserves     reserve       earnings        funds 
                          $            $            $          $             $              $             $ 
 Balance at 1 
  January 2010    8,339,409   10,276,362   10,026,450    938,329     (516,166)   (28,539,280)       525,104 
 Issue of share 
  capital         1,250,893            -            -          -             -              -    1,250,893 
 Share-issue 
 costs                    -            -            -          -             -              -             - 
 Share-based 
 payments                 -            -            -          -             -              -             - 
 Transactions 
  with owners     1,250,893            -            -      -                 -              -    1,250,893 
 Total 
  Comprehensive 
  Income/Loss             -            -            -          -       (3,994)    (1,742,008)   (1,746,002) 
---------------  ----------  -----------  -----------  ---------  ------------  -------------  ------------ 
 Balance at 30 
  June 2010       9,590,302   10,276,362   10,026,450    938,329     (520,160)   (30,281,288)        29,995 
---------------  ----------  -----------  -----------  ---------  ------------  -------------  ------------ 
 

Consolidated interim statement of changes in equity (continued)

 
                                                                                                           Foreign 
                                                                                                          currency                       Total 
                                                         Share        Share        Merger      Other     translation     Retained     shareholder 
                                                  A     Capital      premium      reserve     reserves     reserve       earnings        funds 
 Audited                                                        $            $            $          $             $              $             $ 
 Balance at 1 January 2010                              8,339,409   10,276,362   10,026,450    938,329     (516,166)   (28,539,280)       525,104 
 Issue of share capital                                 2,276,105            -            -          -             -              -     2,276,105 
 Share-issue costs                                              -            -            -          -             -              -             - 
 Share-based payments                                           -            -            -          -             -              -             - 
 Transactions with owners                               2,276,105            -            -          -             -              -     2,276,105 
 Total Comprehensive Income/Loss                                -            -            -          -      (80,625)    (3,341,164)   (3,421,789) 
----------------------------------------------------  -----------  -----------  -----------  ---------  ------------  -------------  ------------ 
 Balance at 31 December 2010                           10,615,514   10,276,362   10,026,450    938,329     (596,791)   (31,880,444)     (620,580) 
----------------------------------------------------  -----------  -----------  -----------  ---------  ------------  -------------  ------------ 
 

Consolidated interim statement of cash flows

 
                                          Unaudited    Unaudited     Audited 
                                           6 month      6 month    Year to 31 
                                         to 30 June   to 30 June    December 
                                            2011         2010         2010 
                                              $            $            $ 
 
Net loss                                 (1,591,937)  (1,742,008)  (3,341,164) 
Taxation                                         413            -          196 
Finance income                                     -        (129)      (3,482) 
Finance cost                                  84,625      102,721      137,120 
Depreciation of property, plant and 
 equipment                                   137,229      135,855      303,886 
Impairment of intangible assets                    -            -            - 
Loss/(profit) on sales of property, 
 plant and equipment                               -            -     (63,066) 
Profit from disposal of business                   -            -            - 
Share issue costs                            102,364       85,581      257,933 
---------------------------------------  -----------  -----------  ----------- 
Trade and other receivables                (673,743)       51,434     (12,637) 
Provisions                                         -            -      (1,162) 
Trade payables and other current 
 liabilities                                 552,989       76,104       96,666 
---------------------------------------  -----------  -----------  ----------- 
Changes in working capital                 (120,754)      127,538       82,867 
Share option charges                         114,419            -            - 
Effect of exchange rate fluctuations          25,806      (2,406)     (40,767) 
---------------------------------------  -----------  -----------  ----------- 
Cash flow from operating activities      (1,247,836)  (1,292,848)  (2,666,477) 
---------------------------------------  -----------  -----------  ----------- 
 
Taxation                                       (413)            -        (196) 
---------------------------------------  -----------  -----------  ----------- 
Net cash from operating activities       (1,248,249)  (1,292,848)  (2,666,673) 
---------------------------------------  -----------  -----------  ----------- 
 

Consolidated statement of cash flows (continued)

 
                                        Unaudited    Unaudited     Audited 
                                                                   Year to 
                                         6 month      6 month         31 
                                          to 30     to 30 June    December 
                                        June 2011       2010         2010 
                                            $            $            $ 
Net cash from operating activities     (1,248,249)  (1,292,848)  (2,666,673) 
 
Cash flows from investing activities 
Interest received                                -          129        3,482 
Purchase of property, plant 
 and equipment                                   -            -    (136,009) 
Net cash used in investing 
 activities                                      -          129    (132,527) 
                                       -----------  -----------  ----------- 
 
Cash flows from financing activities 
Interest paid                              (4,965)     (82,500)     (13,363) 
Finance lease paid                        (21,673)     (20,221)     (40,387) 
Loan interest paid                               -            -     (31,890) 
Proceeds from borrowings                         -    1,109,639    1,370,500 
Repayment of borrowings                          -            -    (475,300) 
Capital element of finance 
 lease rentals                           (101,182)    (181,152)    (336,353) 
Issues of shares/debentures              1,485,711    1,250,893    2,276,105 
Share issue costs recognized 
 in operating expenditures               (102,364)     (85,581)    (257,933) 
                                       -----------  -----------  ----------- 
Net cash used in financing 
 activities                              1,255,527    1,991,078    2,491,379 
                                       -----------  -----------  ----------- 
 
Net increase in cash and cash 
 equivalents                                 7,278      698,359    (307,821) 
 
Cash and cash equivalents at 
 beginning of period                        21,255      329,076      329,076 
 
Cash and cash equivalents at 
 end of period                              28,533    1,027,435       21,255 
-------------------------------------  -----------  -----------  ----------- 
 

Notes to the Consolidated Financial Statements

1. Nature of operations and General information

NextGen Group plc and its subsidiaries (together the 'Group') offers the highest quality proteomic services with a strategic focus on protein biomarker discovery, assay development, validation and testing that gives researchers the ability to characterize and measure proteins in biological samples with accurate, precise and robust assays.

NextGen Group plc is the Group's ultimate parent company. The company is incorporated in the United Kingdom. The address of NextGen Group's registered office is 8th Floor, Kildare House, 3 Dorset Rise, London, EC4Y 8EN. NextGen Group plc's shares are listed on the AIM Market of the London Stock Exchange.

NextGen Group plc's consolidated interim financial statements are presented in US Dollars.

The financial information set out in this interim report does not constitute statutory accounts as defined in Section 434 of the Companies Act 2006. The Group's statutory financial statements for the year ended 31 December 2010, prepared under International Financial Reporting Standards (IFRS), have been filed with the Registrar of Companies. The auditor's report on those financial statements was unqualified and did not contain statements under Section 498(2) or Section 498(3) of the Companies Act 2006.

Basis of preparation

These interim condensed consolidated financial statements have been prepared using accounting policies consistent with International Financial Reporting Standards (IFRS) as adopted by the European Union. This interim report is condensed with respect to IFRS requirements. As permitted, this interim report has been prepared in accordance with AIM rules for companies and not in accordance with IAS 34 "Interim Financial Reporting".

These financial statements have been prepared under the historical cost convention on a going concern basis, which assumes the group will continue in operational existence for the foreseeable future. The key assumptions underpinning the cash flow forecasts are growth in revenue and the recent injection of further financial support from within its existing shareholder base. The accounting policies are the same as those applied by the Group in its consolidated financial statements for the year ended 31 December 2010 and have been applied consistently throughout the Group for the purpose of the preparation of these condensed consolidated interim financial statements.

2. Segment analysis

NextGen's main business is within the Biomarker and Proteomic Services markets. The activities undertaken are within one business segment, Biomarker and Proteomic Services. The activities are carried out by the Company's internal Research and Development Group.

3. Shares in issue

During the period ending 30(th) June 2011, 927 million shares were issued in order to strengthen the funds in the Company and to allow the Company to fulfill it's commercial strategies. Shares issued for the period to 30(th) June 2011 may be summarized as follows:

 
 6 months to 30 June 2011, Unaudited           Number            $ 
 Beginning of the year                  6,316,978,644   10,615,514 
 Share issue                              927,410,000    1,485,711 
-------------------------------------  --------------  ----------- 
 End of period                          7,244,388,644   12,101,225 
-------------------------------------  --------------  ----------- 
 
 6 months to 30 June 2010, Unaudited           Number            $ 
 Beginning of year                      4,796,978,644    8,339,409 
 Issue of shares                          830,000,000    1,250,893 
-------------------------------------  --------------  ----------- 
 End of period                          5,626,978,644    9,590,302 
-------------------------------------  --------------  ----------- 
 
 Year to 31 December 2010, Audited             Number            $ 
 Beginning of year                      4,796,978,644    8,339,409 
 Issue of shares                        1,520,000,000    2,276,105 
-------------------------------------  --------------  ----------- 
 End of year                            6,316,978,644   10,615,514 
-------------------------------------  --------------  ----------- 
 

The share issue yielded $1,485,711 in cash and increased equity by GBP927,410. The share price at the placing was nominal value.

4. Loss per share

Basic loss per share is calculated by dividing the profit attributable to equity holders of the Company by the weighted average of ordinary share in issue during the period.

A number of shares existed in the period that could potentially dilute basic earnings per share in the future but were not included in the calculation of diluted earnings per share since they are anti-dilutive for all periods.

 
                                  Unaudited        Unaudited        Audited 
                                   6 month          6 month       Year to 31 
                                  to 30 June      to 30 June       December 
                                     2011            2010            2010 
 Operations                                  $               $               $ 
 Loss after tax and earnings 
  attributable to ordinary 
  shareholders                     (1,591,937)     (1,742,008)     (3,341,164) 
 Weighted average number of 
  shares (used for basic 
  earnings per share)            7,111,169,528   4,801,564,279   5,510,677,274 
 Diluted weighted average 
  number of shares (used for 
  diluted earnings per 
  share)                        12,406,846,439   7,573,405,637   9,014,432,066 
 
 Basic and diluted loss per 
  share                               (0.0002)        (0.0004)        (0.0006) 
 
 

This information is provided by RNS

The company news service from the London Stock Exchange

END

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