Mainstay Medical Full Year 2015 Preliminary Results and Business Update
Business Highlights
We continue to make progress towards commercialization of ReActiv8. On 2
Following CE Marking, we plan to commence commercialization in
Positive results of the ReActiv8-A Clinical Trial were announced on 31
On
The ReActiv8-B Clinical Trial is an international, multi-center, prospective randomized sham controlled blinded trial with one-way crossover. In summary, eligible subjects will have baseline data collected and then following verification that the enrolment criteria are met, ReActiv8 will be implanted. At the 14-day post implant follow up visit, half the subjects will be randomized to receive appropriately programmed stimulation (the treatment arm), and half will be randomized to receive minimal stimulation (the control arm). Subjects will not be informed about their allocation to the treatment or control arm, and all subjects will be told that they may or may not feel something with stimulation, and all will be encouraged to continue using ReActiv8 at least until the 120-day primary outcome assessment visit. Subjects will be instructed to not use any other therapies for CLBP from the time of enrolment until after data collection at the primary outcome assessment visit. Subjects will also be instructed to keep constant the use of medications prescribed and used for low back pain until the primary outcome assessment visit. The primary efficacy endpoint of the Trial is a comparison of responder rates between the treatment and control arms. The Trial will be considered a success if there is a statistically significant difference in responder rates between the treatment and control arms. A responder is defined as having at least a 30% improvement in low back pain reported on a 100mm Visual Analog Scale (VAS) between baseline and the 120-day primary outcome assessment visit, with no increase in medications prescribed and taken for pain in the 14 days prior to the visit. Data for multiple secondary outcome measures will also be gathered. After the primary outcome assessment visit, subjects in the control arm will be crossed over to receive appropriately programmed full strength stimulation, and all subjects will continue to be followed.
The statistical design of the Trial requires data from 128 subjects at the 120-day primary outcome assessment visit. Additional subjects will likely be enrolled and implanted as part of the surgical roll-in phase and to achieve data from 128 subjects in the pivotal cohort. The Trial is designed with an “interim look” when primary outcome data are available from half the subjects, and if necessary the number of subjects in the pivotal cohort may be increased to achieve the targeted statistical significance. Up to 40 clinical trial sites may be involved in the Trial, some of which may be referring sites and some may be implanting sites.
A summary of the protocol can be found at https://clinicaltrials.gov/show/NCT02577354.
Based on our experience with enrolment in the ReActiv8-A Trial, we estimate that full enrolment of the pivotal cohort in the ReActiv8-B Trial will take 12-18 months from ramp up of enrolment, with results anticipated to be available approximately six months following full enrolment. The work required to complete a PMAA submission to the
The ReActiv8-B Trial, if successful, will provide what is referred to as Level 1 Evidence of safety and efficacy of ReActiv8, and Level 1 evidence may be used to support applications for favourable reimbursement in the US.
We plan to ramp up enrolment in the ReActiv8-B Trial once we determine that we have sufficient financial resources to complete the Trial through data availability. A small number of subjects may be enrolled in the ReActiv8-B Trial prior to securing such financial resources.
We are also pleased to announce the issuance of two new
-
U.S. Patent No. 9,186,501 entitled “Systems and Methods for Implanting Electrode Leads for Use with Implantable Neuromuscular Electrical Stimulator”; and -
U.S. Patent No. 9,248,278 entitled “Modular Stimulator for Treatment of Back Pain, Implantable RF Ablation System and Methods of Use”.
Corresponding applications have been filed for other countries. Mainstay continues to add to its portfolio of issued patents and pending patent applications.
Financial Update
On
Operating expenses were
Cash on hand at
Outlook and future developments
While we await CE Marking approval for ReActiv8, we are preparing for commercialization in
The principal risks and uncertainties faced by the Group remain substantially unchanged from the disclosures included in the 2014 Annual Report. Those risks and uncertainties should be read in conjunction with this announcement and the Company’s press releases and other public disclosures (copies of which can be found on the Company’s website) and could cause actual events to differ materially from those described in this announcement and our disclosures.
- End -
About Mainstay
Mainstay is a medical device company focused on bringing to market an innovative implantable neurostimulation system, ReActiv8®, for people with disabling Chronic Low Back Pain (CLBP). The Company is headquartered in
About the ReActiv8-A Trial
The ReActiv8-A Clinical Trial is a prospective single arm clinical trial with up to 96 subjects at sites in
About the ReActiv8-B Trial
The ReActiv8-B Clinical Trial is an international, multi-center, prospective randomized sham controlled blinded trial with one-way crossover conducted under an Investigational Device Exemption (IDE). The ReActiv8-B Clinical Trial is designed to generate data to form part of the Pre-Market Approval Application (PMAA) of ReActiv8 to the
About Chronic Low Back Pain (CLBP)
One of the recognised root causes of CLBP is disruption of control by the nervous system of the muscles that dynamically stabilise the spine in the lower back, and an unstable spine can result in back pain. ReActiv8 is designed to electrically stimulate the nerves responsible for contracting these muscles and thereby help to restore muscle control and improve dynamic spine stability, allowing the body to recover from CLBP.
People with CLBP usually have a greatly reduced quality of life and score significantly higher on scales for pain, disability, depression, anxiety and sleep disorders. Their pain and disability can persist despite the best available medical treatments, and only a small percentage of cases result from an identified pathological condition or anatomical defect that may be correctable with spine surgery. Their ability to work or be productive is seriously affected by CLBP and the resulting days lost from work, disability benefits and health resource utilisation put a significant burden on individuals, families, communities, industry, and governments.
Further information can be found at www.mainstay-medical.com
ReActiv8 is an investigational device and is not approved for commercialization anywhere in the world.
CAUTION – in
Forward looking statements
This announcement includes statements that are, or may be deemed to be, forward looking statements. These forward looking statements can be identified by the use of forward looking terminology, including the terms “anticipates”, “believes”, “estimates”, “expects”, “intends”, “may”, “plans”, “projects”, “should” or “will”, “explore” or, in each case, their negative or other variations or comparable terminology, or by discussions of strategy, plans, objectives, goals, future events or intentions. These forward looking statements include all matters that are not historical facts. They appear throughout this announcement and include, but are not limited to, statements regarding the Company’s intentions, beliefs or current expectations concerning, among other things, the Company’s results of operations, financial position, prospects, financing strategies, expectations for product design and development, regulatory applications and approvals, reimbursement arrangements, costs of sales and market penetration.
By their nature, forward looking statements involve risk and uncertainty because they relate to future events and circumstances. Forward looking statements are not guarantees of future performance and the actual results of the Company’s operations, and the development of its main product, the markets and the industry in which the Company operates, may differ materially from those described in, or suggested by, the forward looking statements contained in this announcement. In addition, even if the Company’s results of operations, financial position and growth, and the development of its main product and the markets and the industry in which the Company operates, are consistent with the forward looking statements contained in this announcement, those results or developments may not be indicative of results or developments in subsequent periods. A number of factors could cause results and developments of the Company to differ materially from those expressed or implied by the forward looking statements including, without limitation, the Company’s ability to obtain CE Marking for ReActiv8®, the initiation and success of the ReActiv8-B Clinical Trial, general economic and business conditions, the global medical device market conditions, industry trends, competition, changes in law or regulation, changes in taxation regimes, the availability and cost of capital, the time required to commence and complete clinical trials, the time and process required to obtain regulatory approvals, currency fluctuations, changes in its business strategy, political and economic uncertainty. The forward-looking statements herein speak only at the date of this announcement.
Directors’ responsibilities statement
Statement of the Directors in respect of the Preliminary Results
Each of the Directors of the Company (the “Directors”), whose names and functions are listed in the Corporate and Shareholder Information, confirm that, to the best of each person’s knowledge and belief:
(a) the unaudited condensed consolidated financial statements comprising the unaudited condensed consolidated statement of profit or loss and other comprehensive income, the unaudited condensed consolidated statement of financial position, the unaudited condensed consolidated statement of changes in shareholders’ equity, the unaudited condensed consolidated statement of cash flows and related notes have been prepared in accordance with IAS 34 Interim Financial Reporting as adopted by the EU.
(b) the preliminary results announcement includes a fair review of the information required by:
a. Regulation 8(2) of the Transparency (Directive 2004/109/EC) Regulations 2007, being an indication of important events that have occurred during the financial year and their impact on the unaudited condensed consolidated set of financial statements; and a description of the principal risks and uncertainties for the next six months; and
b. Regulation 8(3) of the Transparency (Directive 2004/109/EC) Regulations 2007, being related party transactions that have taken place in the current financial year and that have materially affected the financial position or performance of the entity during that year; and any changes in the related party transactions described in the last annual report that could do so.
INDEPENDENT STATUTORY AUDITOR’S REVIEW REPORT TO THE DIRECTORS OF
We have been engaged by
The directors’ responsibility for the financial statements
The directors are responsible for the preparation and fair presentation of these condensed consolidated financial statements in accordance with the International Accounting Standard 34 Interim Financial Reporting as adopted by the EU as applied by the TD Regulations and for such internal controls as management determines are necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error.
Our responsibility
Our responsibility is to express a conclusion on the accompanying condensed consolidated financial statements. We conducted our review in accordance with International Standard on Review Engagements (ISRE) 2400 (Revised), Engagements to Review Historical Financial Statements. ISRE 2400 (Revised) requires us to conclude whether anything has come to our attention that causes us to believe that the condensed consolidated financial statements, taken as a whole, are not prepared in all material respects in accordance with the applicable financial reporting framework. This Standard also requires us to comply with relevant ethical requirements.
A review of financial statements in accordance with ISRE 2400 (Revised) is a limited assurance engagement. We perform procedures, primarily consisting of making inquiries of management and others within the entity, as appropriate, and applying analytical procedures, and evaluates the evidence obtained.
The procedures performed in a review are substantially less than those performed in an audit conducted in accordance with International Standards on Auditing. Accordingly, we do not express an audit opinion on these financial statements.
Conclusion
Based on our review, nothing has come to our attention that causes us to believe that these condensed consolidated financial statements do not present fairly, in all material respects, the financial position of
Emphasis of matter
We are the statutory auditor of
Limitations
Our review report has been prepared for the directors solely in connection with assisting the Company in meeting the requirements of the TD Regulations with respect to its preliminary announcement.
Our review report was designed to meet the agreed requirements of the directors determined by the Company’s needs at the time. Our review report should not therefore be regarded as suitable to be used or relied on by any party wishing to acquire rights against us other than the Company for any purpose or in any context. Any party other than the Company who chooses to rely on our review report (or any part of it) will do so at its own risk. To the fullest extent permitted by law,
Sean O’Keefe
For and on behalf of
Chartered Accountants
Unaudited condensed consolidated statement of profit or loss and other comprehensive income
for the year ended
($'000) | Notes |
Year ended 31 December 2015 Unaudited |
Year ended 31 December 2014 Audited |
|||
Revenue | - | - | ||||
Operating expenses | 4 | (12,864) | (15,160) | |||
Operating loss | (12,864) | (15,160) | ||||
Finance income | 5 | - | - | |||
Finance expense | 5 | (323) | (67,247) | |||
Net finance expense | (323) | (67,247) | ||||
Loss before income taxes | (13,187) | (82,407) | ||||
Income taxes | (48) | (58) | ||||
Loss for the year and comprehensive loss for the year | (13,235) | (82,465) | ||||
Net loss attributable to equity holders | (13,235) | (82,465) | ||||
Basic and diluted loss per share (in $) | 6 | ( |
( |
The accompanying notes form an integral part of these condensed consolidated financial statements.
Unaudited condensed consolidated statement of financial position
at
($'000) | Notes |
31 December 2015 Unaudited |
31 December 2014 Audited |
|||
Non-current assets | ||||||
Property, plant and equipment | 242 | 72 | ||||
Current assets | ||||||
Prepayments and other receivables | 661 | 263 | ||||
Income tax receivable | 70 | 150 | ||||
Cash and cash equivalents | 16,624 | 18,283 | ||||
Total current assets | 17,355 | 18,696 | ||||
Total assets | 17,597 | 18,768 | ||||
Equity | ||||||
Share capital | 61 | 61 | ||||
Share premium | 72,588 | 72,584 | ||||
Share based payment reserve | 2,691 | 1,162 | ||||
Capital conversion reserve | 49,273 | 49,273 | ||||
Reorganisation reserve | (44,573) | (44,573) | ||||
Retained loss | (74,816) | (61,581) | ||||
Shareholders' equity | 5,224 | 16,926 | ||||
Non-current liabilities | ||||||
Loans and borrowings | 8 | 10,084 | - | |||
Total non-current liabilities | 10,084 | - | ||||
Current liabilities | ||||||
Loans and borrowings | 8 | 305 | - | |||
Income tax payable | 17 | 15 | ||||
Trade and other payables | 1,967 | 1,827 | ||||
Total current liabilities | 2,289 | 1,842 | ||||
Total liabilities | 12,373 | 1,842 | ||||
Total equity and liabilities | 17,597 | 18,768 |
The accompanying notes form an integral part of these condensed consolidated financial statements.
Unaudited condensed consolidated statement of changes in shareholders’ equity
for the year ended
($'000) |
Share capital |
Share premium |
Capital conversion reserve |
Reorganisation reserve |
Share based payment reserve |
Retained loss |
Total equity |
|||||||
Balance at |
1 | 250 | - | (9,609) | 534 | (13,146) | (21,970) | |||||||
Comprehensive loss for the year | - | - | - | - | - | (82,465) | (82,465) | |||||||
Transactions with the owners of the Company: | ||||||||||||||
Share based payments | - | - | - | - | 628 | - | 628 | |||||||
Effect of reorganisation | 55 | 879 | - | (34,964) | - | 34,030 | - | |||||||
Effect of IPO: | ||||||||||||||
Issue of shares | 1 | 23,922 | - | - | - | - | 23,923 | |||||||
Conversion of preference shares | 4 | 47,533 | 49,273 | - | - | - | 96,810 | |||||||
Balance at |
61 | 72,584 | 49,273 | (44,573) | 1,162 | (61,581) | 16,926 | |||||||
Balance as at |
61 | 72,584 | 49,273 | (44,573) | 1,162 | (61,581) | 16,926 | |||||||
Comprehensive loss for the year | - | - | - | - | - | (13,235) | (13,235) | |||||||
Transactions with the owners of the Company: | ||||||||||||||
Share based payments | - | - | - | - | 1,529 | - | 1,529 | |||||||
Issue of shares on exercise of share options | - | 4 | - | - | - | - | 4 | |||||||
Balance at |
61 | 72,588 | 49,273 | (44,573) | 2,691 | (74,816) | 5,224 |
The accompanying notes form an integral part of these condensed consolidated financial statements.
Unaudited condensed consolidated statement of cash flows
for the year ended 31
($'000) | Notes |
Year ended 31 December 2015 Unaudited |
Year ended 31 December 2014 Audited |
|||
Cash flow from operating activities | ||||||
Net loss attributable to equity holders | (13,235) | (82,465) | ||||
Add/(less) non-cash items | ||||||
Depreciation | 78 | 32 | ||||
Finance expense | 5 | 323 | 67,247 | |||
Share-based compensation | 11 | 1,529 | 628 | |||
Add/(less) reclassifications | ||||||
Initial public offering expenses reclassified to financing activities | - | 4,040 | ||||
Reorganisation costs recognised in equity reclassified to operating cash flows | - | (1,037) | ||||
Add/(less) changes in working capital | ||||||
Prepayments and other receivables | (391) | 27 | ||||
Trade and other payables | 142 | 297 | ||||
Taxes paid | 19 | (195) | ||||
Interest paid | (27) | (18) | ||||
Net cash used in operations | (11,562) | (11,444) | ||||
Cash flow from investing activities | ||||||
Acquisition of property and equipment | (248) | (36) | ||||
Net cash used in investing activities | (248) | (36) | ||||
Cash flow from financing activities | ||||||
Net proceeds from issue of shares | 4 | 20,973 | ||||
Net proceeds of borrowings | 10,147 | - | ||||
Repayment of borrowings | - | (800) | ||||
Net cash from financing activities | 10,151 | 20,173 | ||||
Net (decrease)/increase in cash and cash equivalents | (1,659) | 8,693 | ||||
Cash and cash equivalents at beginning of year | 18,283 | 9,590 | ||||
Cash and cash equivalents at end of year | 16,624 | 18,283 |
The accompanying notes form an integral part of these condensed consolidated financial statements.
Notes to the unaudited condensed consolidated Financial Statements
1 General information and reporting entity
The unaudited condensed consolidated preliminary financial statements (the “preliminary financial statements”) for the years ended
The Company’s shares are quoted on
Mainstay is a medical device company focused on bringing to market ReActiv8®, an implantable neurostimulation system to treat disabling Chronic Low Back Pain (CLBP).
2 Basis of preparation
Statement of compliance
These preliminary financial statements have been prepared in accordance with IAS 34 Interim Financial Reporting, as adopted by the EU. The preliminary financial statements set out in this document do not constitute full statutory financial statements. However, selected explanatory notes are included to explain events and transactions that are significant to an understanding of the changes in the Group’s financial position and performance since the last annual consolidated financial statements as at and for the year ended
The audited financial statements as required by statute have not yet been completed. Consequently, there is no absolute certainty that the final financial statements for the year ended
Except as described below, the preliminary financial statements have been prepared applying the accounting policies that were applied in the preparation of the Group’s published consolidated financial statements for the year ended
The comparative information provided in the preliminary financial statements relating to the year ended
The IFRSs applied by the Group in the preparation of these preliminary financial statements are those that were effective for accounting periods beginning on or after
- Annual improvements to IFRSs 2010-2012 (effective date
1 July 2014 ) - Annual improvements to IFRSs 2011-2013 (effective date
1 July 2014 ) - Amendments to IAS 19 - Defined Benefit Plans: Employee Contributions (effective date
1 July 2014 )
None of these have had any material impact on the Group’s implementation of accounting policies or on its reported results.
There are no significant or material changes to judgements or estimates used in these preliminary financial statements versus those used in the full financial statements for the year ended
The Board of Directors approved these preliminary financial statements on
Going concern
The preliminary financial statements have been prepared on the basis that the Group is a going concern. The Directors note the following relevant matters:
- The Group has an accumulated retained losses reserve of
$74.8 million and a reorganisation reserve of$44.6 million (which is in substance primarily retained losses). These losses include a non-cash expense of$66.5 million incurred in 2014 related to fair valuing of embedded derivatives arising on preference shares - The Group has not generated revenue from its operations to date and expects to continue to incur losses in the medium term
- The Group had operating cash out flows of
$11.6 million during the year ended 2015 (2014:$11.4 million ) - Regulatory approval for the commercialization of ReActiv8 in the US is not guaranteed and is dependent on the successful completion of the ReActiv8-B Clinical Trial and obtaining PMA approval from the
FDA
To fund the clinical trials and commercialization of ReActiv8 the Group has raised debt and equity and it continues to explore funding strategies (e.g.: equity, debt, partnering) to support the Group’s activities into the future. As at
After making enquiries and having considered the conditions noted above and the options available to the group, the Directors have a reasonable expectation that the Group can carefully monitor its cash flows and has the ability to consider alternative strategies and budgets to ensure that the Group will have sufficient funds to be able to meet its liabilities as they fall due for a period of at least 12 months from the date of this announcement and are satisfied that the preliminary financial statements should be prepared on a going concern basis.
Basis of measurement
The condensed consolidated financial statements are prepared on the historic cost method, except for:
- Share based payments, which are initially measured at grant date fair value;
- Derivative financial instruments, which are measured at fair value through profit or loss and other comprehensive income; and
- The issue of shares in the Company as part of the 2014 Corporate Reorganisation, which were accounted for at fair value at the date of the 2014 Corporate Reorganisation as required by the Irish Companies Act, 1963.
Currency
The Financial Statements are presented in US Dollars (“$”), which is the functional and presentational currency of the Company. Balances in the Financial Statements are rounded to the nearest thousand (“$’000”) except where otherwise indicated.
2014 Corporate Reorganisation
On
As the 2014 Corporate Reorganisation changed the parent company of the Group from a legal perspective only, no business combination in accordance with IFRS 3 was deemed to have occurred.
The Company accounted for this transaction as a continuation of the business of
The only exception to the carryover basis of accounting relates to the Company’s ordinary shares that were issued as part of the 2014 Corporate Reorganisation. The Irish Companies Act, 1963, requires that all shares issued by an Irish company must be issued at fair value. As a result, the Company recorded this required uplift in the fair value of the Company’s ordinary shares against their previous carrying value as an increase in Share Capital and Share Premium, with the corresponding entry recorded in the Reorganisation Reserve in equity, which resulted in no change to net equity.
3 Segment reporting
Due to the nature of the Group’s current activities, the Group considers there to be one operating segment, active implantable medical devices (AIMDs). The results of the Group are reported on a consolidated basis to the Chief Operating Decision Maker of the Group, the Chief Executive Officer. There are no reconciling items between the Group’s reported consolidated statement of profit or loss and other comprehensive income and statement of financial position and the results of the AIMDs segment.
The Group has operations in
($'000) |
31 December 2015 Unaudited |
31 December 2014 Audited |
||
|
207 | 35 | ||
|
35 | 37 | ||
|
- | - | ||
Total non-current assets | 242 | 72 |
4 Operating expenses
($'000) |
Year ended 31 December 2015 Unaudited |
Year ended 31 December 2014 Audited |
||
Research and development expenses | 2,694 | 2,601 | ||
Clinical and regulatory expenses | 4,376 | 3,978 | ||
General and administration expenses | 4,265 | 3,913 | ||
European IPO related expenses | - | 4,040 | ||
Share-based compensation expenses | 1,529 | 628 | ||
Total operating expenses | 12,864 | 15,160 |
Expenses directly associated with the Company listing its existing shares on the ESM and
5 Net finance expense
($'000) |
Year ended 31 December 2015 Unaudited |
Year ended 31 December 2014 Audited |
||
Finance income | ||||
Fair value gain on derivative financial instruments | - | - | ||
Foreign exchange gain | - | - | ||
Total finance income | - | - | ||
Finance expense | ||||
Foreign exchange loss | (53) | (45) | ||
Interest expense on borrowings | (270) | (33) | ||
Fair value loss on derivative financial instruments (Note (i)) | - | (66,468) | ||
Interest on preference shares | - | (701) | ||
Total finance expense | (323) | (67,247) | ||
Net finance expense | (323) | (67,247) |
Note (i):
The fair value loss on derivative financial instruments in 2014 represents the increase in the fair value of the embedded derivatives in the Group’s preference shares between
6 Earnings per share
As the Group is incurring operating losses, there is no difference between basic and diluted earnings per share.
Year ended 31 December 2015 Unaudited |
Year ended 31 December 2014 Audited |
|||
Weighted average number of ordinary shares in issue | 4,294,617 | 2,935,310 | ||
Loss per share | |
|
7 Taxes
Current income tax assets and liabilities for the current and prior year are measured at the amount expected to be recovered from or paid to the relevant taxation authorities. The tax rates and tax laws used to compute the amount are those used in
($'000) |
Year ended 31 December 2015 Unaudited |
Year ended 31 December 2014 Audited |
||
Irish tax | - | 146 | ||
Income tax in other jurisdictions | 48 | 8 | ||
Deferred tax | - | (96) | ||
Total income tax charge | 48 | 58 |
Certain companies within the Group provide services to other group companies, and consequently generate revenues and profits that are subject to corporation tax in
8 Interest bearing loans and borrowings and shares classified as debt
IPF Debt Financing
On
The initial tranche (“Tranche A”) of
A second tranche (“Tranche B”) of
Other expenses directly associated with the facility of
The facility is secured by a floating debenture over the assets and undertakings of
The terms of the agreement include a requirement that the
($'000) |
Year ended 31 December 2015 Unaudited |
Year ended 31 December 2014 Audited |
||
Loans and borrowings - current | ||||
Term loan | 225 | - | ||
Deferred finance cost | (71) | - | ||
Accrued interest | 151 | - | ||
Total current loans and borrowings | 305 | - | ||
Loans and borrowings – non-current | ||||
Term loan | 10,275 | - | ||
Deferred finance cost | (248) | - | ||
Accrued interest | 57 | - | ||
Total non-current loans and borrowings | 10,084 | - | ||
Total loans and borrowings | 10,389 | - |
9 Called up share capital
The Company’s ordinary shares are quoted in Euro and have been translated in US Dollars at the rates prevailing at the date of issue.
On
Authorised and Issued Share Capital of
The following table discloses the authorised and issued share capital of
Authorised |
31 December 2015 € |
31 December 2014 € |
||
20,000,000 (2014: 10,000,000) ordinary shares of €0.001 each (Note (i)) | 20,000 | 10,000 | ||
40,000 deferred shares of €1.00 each | 40,000 | 40,000 | ||
60,000 | 50,000 | |||
Issued, called up and fully paid |
2015 $ |
2014 $ |
||
4,298,203 (2014:4,294,141) ordinary shares of €0.001 each | 5,954 | 5,949 | ||
40,000 deferred shares of €1.00 each | 55,268 | 55,268 | ||
61,222 | 61,217 | |||
In $’000 | 61 | 61 |
Note (i):
At the Company’s 2015 AGM on
Details of movement in issued shares:
Movement of shares | ||||||||||||
Number of shares | ||||||||||||
Ordinary shares |
“A” Ordinary Shares |
Deferred shares |
Series A shares |
Series B shares |
Series Z shares |
|||||||
At |
1,628,000 | - | - | 15,868,520 | 39,343,640 | 10,000,000 | ||||||
Issue of |
- | 38,500 | - | - | - | - | ||||||
Issue of additional shares | 21,000 | - | - | - | 41,700 | - | ||||||
Issue of deferred shares and redemption of “A” ordinary shares | - | (38,500) | 40,000 | - | - | - | ||||||
Effect of reorganisation: | ||||||||||||
Exchange of |
(1,628,000) | - | - | (15,868,520) | (39,343,640) | (10,000,000) | ||||||
Issue of |
81,400 | - | - | 793,425 | 1,967,177 | 500,000 | ||||||
Effect of IPO | ||||||||||||
Issue of new shares | 889,439 | - | - | - | - | - | ||||||
Conversion of pref. shares to ordinary shares | 3,302,302 | - | - | (793,425) | (2,008,877) | (500,000) | ||||||
At |
4,294,141 | - | 40,000 | - | - | - | ||||||
At |
4,294,141 | - | 40,000 | - | - | - | ||||||
Issue of ordinary shares on exercise of share options | 4,062 | - | - | - | - | - | ||||||
At |
4,298,203 | - | 40,000 | - | - | - |
10 Financial instruments
Financial risk management
In terms of financial risks, the Group has exposure to credit risk, liquidity risk and market risk (comprising foreign currency risk and interest rate risk). This note presents information about the Group’s exposure to each of the above risks together with the Group’s objectives, policies and processes for measuring and managing those risks.
Risk management framework
Mainstay’s Board of Directors has overall responsibility for the establishment and oversight of the Group’s risk management framework. The Group’s risk management policies are established to identify and analyse the risks faced by the Group, to set appropriate risk limits and controls and to monitor risks and adherence to the limits. Risk management systems and policies will be reviewed regularly as the Group expands its activities and resource base to take account of changing conditions.
Due to the current pre-revenue nature of the Group’s activities, there are no significant concentrations of financial risk other than concentration of cash with individual banks and there has been no significant change during the financial year, or since the end of the year to the types or quantum of financial risks faced by the Group or the Group’s approach to the management of those risks.
Credit risk
Credit risk is the risk of financial loss to the Group if a customer or counterparty to a financial instrument fails to meet contractual obligations, and arises principally from the Group’s cash and cash equivalents.
The Group maintained its cash balances with its principal financial institutions throughout the year. The Group’s principal financial institutions have investment grade ratings at year end.
Liquidity risk
Liquidity risk is the risk that the Group will not be able to meet its financial obligations as they fall due.
Since inception the Group has funded its operations primarily through (i) the issuance of equity securities and (ii) debt funding. The Group continues to explore funding strategies (e.g.: equity, debt, partnering) to support its activities into the future. Adequate additional financing may not be available on acceptable terms, or at all. The Group’s inability to raise capital as and when needed would have a negative impact on the Group’s financial position and its ability to pursue its business strategy.
Foreign currency risk
The Group’s reporting currency is the US Dollar. The Group’s exposure to foreign currency risk arises through expenditure incurred in Euro and Australian Dollars. The Group’s Australian subsidiary has an Australian Dollar functional currency. The translation differences related to the consolidation of the Australian subsidiary are not material.
The Group did not have material asset or liability amounts in foreign currencies at year end other than trade payables and accruals of €394,000.
Interest rate risk
At
A 25 basis point increase in Euribor above zero would not have materially increased the loss for the year.
11 Share based payments
The terms and conditions of the employee share option plan are disclosed in the most recent, published, consolidated financial statements. The charge of €1.5 million for the year ended
12 Contingencies
The Directors and management are not aware of any contingencies that may have a significant impact on the financial position of the Group.
13 Related party transactions
During 2014, the Group purchased services of
There were no balances due to or from related parties as at
Key management compensation and Directors’ remuneration
The Group defines key management as its non-executive Directors, executive Directors and senior management. Details of remuneration for key management personnel are provided below:
($'000) |
31 December 2015 Unaudited |
31 December 2014 Audited |
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Salaries | 1,355 | 1,088 | ||
Non-executive Directors fees | 95 | 66 | ||
Other remuneration - fees | 818 | 786 | ||
Payroll taxes | 137 | 118 | ||
Share based payments | 1,248 | 496 | ||
Pension | 21 | 16 | ||
Total remuneration | 3,674 | 2,570 |
14 Events subsequent to
There were no events subsequent to
Corporate and shareholder information
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Secretary | |
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Registered office | Clonmel House | |
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Swords, K67F2K3 | ||
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Registered number | 539688 | |
Website | ||
ISIN / Symbol | IE00BJYS1G50 / MSTY.PA ( |
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Solicitors | |
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Riverside One | ||
Sir John Rogerson’s Quay | ||
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2, rue Saint-Florentin | ||
75001 |
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Independent Auditor | |
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Chartered Accountants | ||
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St Stephen’s Green | ||
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Principal Bankers | HSBC | |
Bank of Ireland | ||
ESM Adviser and Broker | |
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Registrar | |
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Paying Agent (in |
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1/3, Place Valhubert | ||
75013 Paris | ||
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