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Clarify Pharma PLC - Interim results


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31/08/2022 07:00

Clarify Pharma PLC - Interim results
RNS Number : 6274X
Clarify Pharma PLC
31 August 2022
 

The information contained within this announcement is deemed by the Company to constitute inside information stipulated under the Market Abuse Regulation (EU) No. 596/2014, as retained as part of the law of England and Wales. Upon the publication of this announcement via the Regulatory Information Service, this inside information is now considered to be in the public domain.

 

Press Release

31 August 2022

Clarify Pharma PLC

("Clarify Pharma" or "The Company")

Interim results

Clarify Pharma (AQSE: PSYC), an investment vehicle specialising in biotech and life sciences companies seeking to prove the safety and efficacy of psychedelic-based substances, announces its unaudited financial results for the six months ended 31 May 2022.

Executive Director's Statement

Introduction

I am delighted to report the Company's interim set of results for the six months ended 31 May 2022

The Company held cash and cash equivalents of £1.21 million as at 31 May 2022, reflecting proceeds from the £1.29 million pre-IPO fundraising. Cash and cash equivalents amounted to £1.09 million as at 26 August 2022.

The potential benefits of psychedelic drugs have been recognised in both the UK and the US and the medical use of psychedelics is progressively emerging as an alternative candidate to conventional therapies for individuals suffering from elusive maladies like PTSD, addiction, Alzheimer's and depression.

We see opportunities for investing in companies with the required expertise and potential to become pioneers in the market. Psychedelic assisted therapy is in its earliest days of development, particularly in the UK. There is a new window of opportunity as the industry continues to gain more traction and credibility as a result of new scientific research and evidence. We look forward to capitalising on these promising long-term trends in this cutting-edge medical frontier.

I would also like to take this opportunity to thank all our shareholders for their support.

Jonathan Bixby, Executive Director

Principal risks and uncertainties

 

The directors have assessed the operational environment of the Company and concluded that the principal risks and uncertainties have not materially changed since the most recent annual reporting date.

 

Responsibility Statement

 

We confirm that to the best of our knowledge:

 

·   

the Interim Report has been prepared in accordance with International Accounting Standards 34, Interim Financial Reporting, as adopted by the EU; and

·   

gives a true and fair view of the assets, liabilities, financial position and profit/loss of the Company; and

·   

the Interim Report includes a fair review of the information required by DTR 4.2.7R of the Disclosure and Transparency Rules, being an indication of important events that have occurred during the first six months of the financial year and their impact on the set of interim financial statements; and a description  of the principal risks and uncertainties for the remaining six months of the year.

·   

the Interim Report includes a fair review of the information required by DTR 4.2.8R of the Disclosure and Transparency Rules, being the information required on related party transactions.

 

The Interim Report was approved by the Board of Directors and the above responsibility statement was signed on 22 August 2022.

 

For further information please contact:

 

Clarify Pharma

 

Jon Bixby

 

Executive Chairman

via Tancredi +44 207 887 7633

 

 

 

First Sentinel

 

Corporate Adviser

 

Brian Stockbridge

 

+44 7876 888 011

Tennyson Securities

 

Corporate Broker

 

Peter Krens

+44 207 186 9030

Tancredi Intelligent Communication

 

Media Relations

 

Catrina Daly

 

Salamander Davoudi

 

clarifypharma@tancredigroup.com

 

 

+44 7727 153 868

 

+44 7957 549 906

 

 

 

About Clarify Pharma PLC:

Listed on the Aquis Stock Exchange in London, Clarify Pharma is an investment vehicle focusing on investing in biotech and life sciences companies seeking to prove the safety and efficacy of psychedelic-based substances. The Company looks to identify investment opportunities in the life sciences sector within the UK, Canada and other growing markets, with the objective of generating long-term capital growth and building investments in an R&D pipeline of companies which are discovering, developing, or deploying safe and evidence-based psychedelic inspired medicines and experiential therapies that alleviate mental health problems and enhance wellbeing.

The Company's Directors have an established track record, experience and networks in the psychedelic, cannabinoid and media industries, to drive value creation.

https://www.clarifypharma.com/


STATEMENT OF COMPREHENSIVE INCOME

FOR THE 6 MONTH PERIOD ENDING 31 MAY 2022

 

 

 

 


Period ending
31 May
2022

Period ending
31 May
2021

Year ending
30 November
2021

 





Total comprehensive loss for the year attributable to shareholders from continuing operations


         (271,045)

          (472,748)

       (1,231,862)

 

 

 

 

 

 

The notes on page 8-11 form an integral part of the condensed interim financial statements.


STATEMENT OF FINANCIAL POSITION

AS AT 31 MAY 2022

 

 



Unaudited

Unaudited

Audited

 


As At
31 May
2022

As At
31 May
2021

As At
30 November
2021

 

Note

£

£

£

NON-CURRENT ASSETS

 




Investments


                554,499

                            -

                528,375

TOTAL NON-CURRENT ASSETS

 

                554,499

                            -

                528,375

CURRENT ASSETS

 




Cash and cash equivalents


             1,213,568

             1,155,870

             1,523,665

Trade and other receivables


                508,500

                            -

                508,000

TOTAL CURRENT ASSETS

 

             1,722,068

             1,155,870

             2,031,665

TOTAL ASSETS

 

             2,276,567

             1,155,870

             2,560,040

 


 

 

 

EQUITY

 

 

 

 

Share capital

5

                297,195

                218,775

                297,195

Share Premium

5

             2,859,005

                807,159

             2,859,005

Share Based Payment Reserve

6

                575,024

                360,096

                575,024

Retained Earnings


           (1,502,907)

              (472,748)

           (1,231,862)

TOTAL EQUITY

 

             2,228,317

                913,282

             2,499,362

 


 

 

 

CURRENT LIABILITIES

 




Trade and other payables


                  48,250

                242,588

                  60,678

TOTAL CURRENT LIABILITIES

 

                  48,250

                242,588

                  60,678

TOTAL LIABILITIES

 

                  48,250

                242,588

                  60,678

TOTAL EQUITY AND LIABILITIES

 

             2,276,567

             1,155,870

             2,560,040

 

The notes on page 8-11 form an integral part of the condensed interim financial statements.

 

 

The condensed interim financial statements were approved and authorised by the Board of Directors on

22 August 2022 and were signed on its behalf by:

 

Nicholas Lyth

 

Director


STATEMENT OF CHANGES IN EQUITY

FOR THE 6 MONTH PERIOD ENDING 31 MAY 2022

 

 

 


Share Capital
£

Share Premium
£

Share based payment reserve
£

Retained Earnings
£

Total Equity
£

Loss for period

                 -

                 -

                 -

     (472,748)

  (472,748)

Other comprehensive income

 -

 -

                 -

                    -

                 -

Total comprehensive income for year

                 -

                 -

                 -

     (472,748)

  (472,748)

 





                 -

Transactions with owners in own capacity





                 -

Ordinary shares issued

    218,775

    807,159

                 -

                    -

 1,025,934

Advisor warrants issued

                 -

                 -

    360,096

                    -

    360,096

Transactions with owners in own capacity

    218,775

    807,159

    360,096

                    -

 1,386,030

Balance at 31 May 2021

    218,775

    807,159

    360,096

     (472,748)

    913,282

 






Loss for period

 -

 -

 -

     (782,745)

  (782,745)

Other comprehensive income

 -

 -

 -

         23,631

      23,631

Total comprehensive income for year

                 -

                 -

                 -

     (759,114)

  (759,114)

 






Transactions with owners in own capacity






Ordinary shares issued

      78,420

 2,143,806

                 -

                    -

 2,222,226

Advisor warrants issued

                 -

      60,930

    214,928

                    -

    275,858

Share issue costs

                 -

  (152,890)

                 -

                    -

  (152,890)

Transactions with owners in own capacity

      78,420

 2,051,846

    214,928

                    -

 2,345,194

Balance at 30 November 2021

    297,195

 2,859,005

    575,024

  (1,231,862)

 2,499,362

 






Loss for period

 -

 -

 -

     (297,169)

  (297,169)

Other comprehensive income

 -

 -

 -

         26,124

      26,124

Total comprehensive income for year

                 -

                 -

                 -

     (271,045)

  (271,045)

 






Transactions with owners in own capacity






Transactions with owners in own capacity

                 -

                 -

                 -

                    -

                 -

Balance at 31 May 2022

    297,195

 2,859,005

    575,024

  (1,502,907)

 2,228,317

 

 

 


STATEMENT OF CASHFLOWS

FOR THE 6 MONTH PERIOD ENDING 31 MAY 2022

 

 

 

 



Unaudited

Unaudited

Audited

 


6 month period ended
31 May
2022

6 month period ended
31 May
2021

12 month period ended
30 November
2021


Note

£

£

£

Cash flow from operating activities





 Loss for the financial year


           (271,045)

           (472,748)

        (1,231,862)

Adjustments for:

 




Share based payments


                          -

            360,096

            635,954

Foreign exchange movements


             (26,124)

                          -

             (23,631)

Changes in working capital:

 




Decrease / (increase) in trade and other receivables


                   (500)

                         1

           (507,999)

Increase / (decrease) in trade and other payables


             (12,429)

            242,566

               60,678

Net cash outflow from operating activities

 

           (310,098)

            129,915

        (1,066,860)

 





Cash flows from investing activities





Interest received


                          -

                      22

                          -

Investments in unlisted companies


                          -

                          -

           (504,744)

Net cash flow from investing activities

 

                          -

                      22

           (504,744)

 





Cash flows from financing activities





Proceeds from Issue of Shares


                          -

         1,025,933

         3,248,249

Share Issue Costs


                          -

                          -

           (152,980)

Net cash flow from financing activities

 

                          -

         1,025,933

         3,095,269

 





Net increase in cash and cash equivalents

 

           (310,098)

         1,155,870

         1,523,665

Cash and cash equivalents at beginning of the period


         1,523,665

 -

 -

Foreign exchange impact on cash


                          -

 -

 -

Cash and cash equivalents at end of the period

 

         1,213,567

         1,155,870

         1,523,665


NOTES TO THE FINANCIAL STATEMENTS

FOR THE 6 MONTH PERIOD ENDING 31 MAY 2022

 

 

1              General information

Clarify Pharma Plc was incorporated on 1 November 2019 in England and Wales and remains domiciled there with Registered Number 12294271 under the Companies Act 2006. The company was originally incorporated under the name Mena Esports Plc and subsequently changed its name to Clarify Pharma Plc on 4 February 2021.

The address of its registered office is 9th Floor 16, Great Queen Street, London, England, WC2B5DG.

The principal activity of the company during the period under review was that of the incubation of and investment in companies that are developing therapeutic remedies using compounds with certain psychedelic properties.

2              Accounting policies

 

IAS 8 requires that management shall use its judgement in developing and applying accounting policies that result in information which is relevant to the economic decision-making needs of users, that are reliable, free from bias, prudent, complete and represent faithfully the financial position, financial performance and cash flows of the entity.

2.1          Basis of preparation

 

The condensed interim financial statements ("interim financial statements") have been prepared in accordance with International Accounting Standard 34 "Interim Financial Reporting" (IAS 34) as adopted by the European Union (EU). The interim financial statements have been prepared on the historical cost basis, except for assets and liabilities measured at fair value through profit and loss, and are presented in pounds sterling (£). All amounts have been rounded to the nearest pound, unless otherwise stated.

 

The interim financial statements have not been audited.  The interim financial statements do not constitute statutory accounts within the meaning of section 434 of the Companies Act 2006. The figures have been prepared using applicable accounting policies and practices consistent with those adopted in the audited annual financial statements ("annual financial statements") for the year ended 30 November 2021.

 

The interim financial statements are for the six months to 31 May 2022, being six months from the financial year end for the Company being 30 November 2021. The interim financial statements do not include all the information and disclosures required in the annual financial statements and should be read in conjunction with the Company's annual financial statements for the period ended 30 November 2021. The Company has disclosed comparative data for the period from 1 December 2020 to 31 May 2021 as required for disclosure by accounting standards as well audited figures from the annual financial statements.

 

The functional currency for the Company is determined as the currency of the primary economic environment in which it operates. Both the function and presentational currency of the Company  Pounds Sterling (£).

 

The business is not considered to be seasonal in nature.

 

New standards, amendments and interpretations adopted by the Company

During the current period the Company adopted all the new and revised standards, amendments and interpretations that are relevant to its operations and are effective for accounting periods beginning on 1 December 2021.  This adoption did not have a material effect on the accounting policies of the Company. New standards, amendments and interpretations not yet adopted by the Company

The standards and interpretations that are relevant to the Company, issued, but not yet effective, up to the date of these interim financial statements have been evaluated by the directors and they do not consider that there will be a material impact of transition on the financial statements.

 

2.2          Going concern

 

The directors have assessed the Company's ability to adopt the going concern basis of accounting and consider the adoption to be appropriate in the preparation of the interim financial statements. As the Company exists currently it operates as a cash shell looking for potential opportunities in the life sciences sector. As a result of these limited operations the Company's monthly cash burn has historically been around £35,000/month. At period end the Company had cash and cash equivalents of £1,213,568 which at current cash burn rate is more than sufficient to last for at least 12 months and supports the adoption of the going concern.

 

2.3          Risks and uncertainties

The principal risks and uncertainties relevant to the Company have not changed materially since the release of the annual financial statements for the period ending 30 November 2021. These risks can be referenced in the strategic report contained within the annual financial statements.

 

3             Critical accounting estimates and judgements

 

In the application of the Company's accounting policies, the directors are required to make judgements, estimates and assumptions about the carrying amount of assets and liabilities that are not readily apparent from other sources. The estimates and associated   assumptions are based on historical experience and other factors that are considered to be relevant. Actual results may differ from these estimates.

 

The estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognised in the period in which the estimate is revised, if the revision affects only that period, or in the period of the revision and future periods if the revision affects both current and future periods. The areas involving a higher degree of judgement or complexity, or areas where assumptions and estimates are significant to the financial statements, are disclosed below:

 

Share Based Payments

The Company measures the cost of equity-settled transactions by reference to the fair value of the equity instruments at the date at which they are granted. The fair value is determined by using the Black-Scholes model taking into account the terms and conditions upon which the instruments were granted. The accounting estimates and assumptions relating to equity-settled share-based payments would have no impact on the carrying amounts of assets and liabilities within the next annual reporting period but may impact profit or loss and equity. There have been no dilutive instruments issued in the period and the value remains equal to that in the annual financial statements as at the last reporting period.

Investments

Investments are classified as listed or unlisted. The valuation of listed investments is determined with reference to published share prices. The valuation of unlisted investments is assessed by the directors at each reporting date using any available financial information or reports available to them at that time. The directors' assessment of these valuations is subjective and may therefore impact profit and loss and equity in future period. The directors do not assess that the underlying value of the investments have fluctuated relative to the last reporting date however they have been re-valued to reflect the most recent foreign exchange rate fluctuations.

 

4              Earnings per share

 

The calculation for basic and diluted earnings per ordinary share is based on the total comprehensive loss after income tax attributable to equity shareholders for the period and is as follows:

 

 


Unaudited

Unaudited

Audited

 


31 May
2022


31 May
2021


30 November
2021

Net loss for the period attributable to ordinary equity holders for continuing operations (£)

                 (271,045)

                 (472,748)

              (1,231,862)

Weighted average number of ordinary shares in issue

            297,196,000

              44,841,665

            219,707,652

Basic and diluted earnings per share for continuing operations (pence)

                   (0.0912)

                    (1.054)

                    (0.561)

 

Earnings per ordinary share are calculated using the weighted average number of ordinary shares in issue during the period.  A loss was made during the period and therefore basic EPS is equal to the diluted EPS.

 

 

5              Share capital and share premium

 


Ordinary Shares

Share       Capital

Share Premium

Total


#

£

£

£

At 30 November 2021

297,196,000

297,195

2,859,005

3,156,200

 

 

 

 

 

At 31 May 2022

297,196,000

297,195

2,859,005

3,156,200

 

There were no shares issued in the 6 months ending 31 May 2022.

 

 

6              Share based payments reserve

 

 

As at 31

May 2022

£

As at 31

May 2021

£

Advisor warrants

575,024

360,096

Total

575,024

360,096

 

 

 

 

The following warrants over ordinary shares have been granted by the Company and are outstanding at 31 May 2022:

 

 

Number of Warrants

Exercise Price

Expiry date

On incorporation

-

-

-

Issued on 19 March 2021

20,500,000

£0.01

18 Mar 2024

Issued on 11 June 2021

6,187,950

£0.025

10 Jun 2026

Issued on 11 June 2021

10,000,000

£0.01

10 Jun 2024

Issued on 11 June 2021

5,000,000

£0.025

10 Jun 2024

Issued on 11 June 2021

39,210,000

£0.025

10 Jun 2023

At 31 May 2022

80,897,950

 

 

 

There were no dilutive instruments issued in the 6 month period ending 31 May 2022.

 

The fair value of the share warrant rights granted are valued using the Black-Scholes option pricing model. The option pricing model assumptions can be referenced in the annual financial statements.

 

7              Financial commitments & contingent liabilities

 

There were no capital commitments or contingent liabilities pertaining to the Company at 31 May 2022.

 

8              Related party transactions

 

Service Agreements

The Company has the following service agreements with directors of the Company:

1)    Toro Consulting Ltd

On April 5th 2021 the Company entered into a consultancy agreement with Toro Consulting Ltd, a company owned and controlled by Jonathan Bixby. During the period £60,000 was paid to Toro with an amount of £10,000 owed to Toro Consulting Ltd in relation to consulting & administrative operations for the month of May 2022.

2)    Dark Peak Services Limited

 

On 4 June 2021 the Company entered into a consultancy agreement with Dark Peak Services Limited, (Dark Peak), a company owned and controlled by Nicholas Lyth. During the period £18,000 was paid to Dark Peak.

3)    Marallo Holdings Inc

On 5 February 2021 the Company entered into a consultancy agreement with Marallo Holdings Inc ("Marallo"), a company owned and controlled by director Michael Edwards and his wife Julie Hamilton. During the period £35,000 was paid to Marallo.

 

9              Events subsequent to period end

 

There were no material events subsequent to period end that require disclosure.

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