Psych Capital PLC - Interim Results to 31 October 2022

31 January 2023

PSYCH CAPITAL PLC

("Psych", "Psych Capital", or "the Company")

Unaudited Interim Results for the Six Months Ended 31 October 2022

We are pleased to present the unaudited interim results for Psych Capital plc (AQSE: PSY) for the period to 31 October 2022.

During the period, the Company was admitted to the AQSE Growth Market on 09 June 2022, the first listed pure-play psychedelic company in London, raising gross proceeds of £810,000.

The Company held its inaugural PSYCH Symposium at the National Gallery on 11 May 2022 in London, generating over £150,000 in revenue, and with over 350 delegates in attendance, incorporating thought leaders from science, advocacy, regulation, and finance.

We strengthened the depth and experience of our management and advisory teams; with the appointment of an independent non-executive director and a CFO, and the appointment of the Conservative Party Drug Policy Reform Group ("CDPRG"), represented by Crispin Blunt, to the Company's Psychedelic Medicines Technical Advisory Board ("PMTAB").

Our investee company, Awakn Life Sciences Corp. ("Awakn"), has expanded its clinic operations in North America (Canada and the US) and Norway, and obtained approval of Phase III of its Ketamine assisted therapy for alcohol use disorder program, with the National Institute for Health and Care Research (NIHR) providing funding of CA$2.5m. Awakn continue to strengthen their intellectual property strategy, via the licencing of a propriety patent pending oral thin film (S)-ketamine formulation. At 30 January 2023, the Company held a stake of approximately 1.3% in Awakn.   

The management teams and the PTMAB, have analysed potential disruptive psychedelic healthcare delivery models in the UK and Europe, and assessed M&A opportunities via the Company's network of experts, proprietary market intelligence, and access to deal flow.

Post period events

The Company has held positive discussions with the management team of an early-stage bio-tech company, who are developing a proprietary psychedelic therapeutic drug development program.  The Company signed an exclusivity agreement with the target on 29 November 2022, and has been conducting extensive due-diligence over the last number of months on the target's clinical research plans, intellectual property strategy, and their scientific and management team. We are in the final stages of a potentially transformational acquisition for Psych Capital, and we look forward to updating the market in the coming weeks.

In November PSYCH published the fourth 'Psychedelics as a Medicine Report', the flagship information source for the industry. The report has recorded almost 5,500 readers to date and featured contributions from the Medicines and Healthcare products Regulatory Agency ("MHRA"), the Oregon Health Authority and the CDPRG.  

On 17 November 2022, the Company hosted a PSYCH event in London for 'Emerging Innovations in Psychedelic Healthcare', attended by 60 industry leaders to evaluate milestones in the commercialisation of psychedelic medicine.  The event and fourth edition of the report generated a combined £25,000 in corporate sponsorship revenue and marked the launch of a new event series for PSYCH.

Financial Review

The Company achieved £157,021 of revenue in the period, due to the success of hosting the inaugural PSYCH Symposium. A pre-tax loss of £929,932 was reported, compared to a profit in £136,003 in the prior-period, driven by £334,277 of non-cash share-based payment charges relating to the grant of options upon admission to the AQSE Growth Market.  The Company also incurred £253,594 of fair value losses on the valuation of the investment in Awakn, and £439,760 of administrative expenses (£279,937 in the prior period).

The Company's cash position at the end of the period was £780,095.

The unaudited interim results to 31 October 2022 have not been reviewed by the Company's auditor.

Joseph Colliver

Non-Executive Chairman

The Directors of the Company accept responsibility for the contents of this announcement.

Enquiries:

Company:

Joseph Colliver: +44 20 3838 7621

William Potts: +44 20 3838 7621

info@psych.capital

https://psych.capital

Peterhouse Capital Limited:

Corporate Adviser:
Guy Miller /Narisha Ragoonanthun: + 44 (0) 20 7469 0930

Corporate Broker

Lucy Williams: +44 (0) 20 7469 0930
Duncan Vasey: +44 (0) 20 7220 9797 (Direct)

1.        GENERAL INFORMATION

The Company was incorporated on 22 April 2021 in England and Wales with Registered Number 13351629 under the Companies Act 2006. The principal activity of the business will be to identify, fund and build future leaders in psychedelic science and

healthcare, with a focus in UK and Europe.

The registered address of the Company is 17 Hanover Square, London, England, W1S 1BN.

2.        BASIS OF PREPARATION

These condensed interim financial statements for the period ended 31 October 2022 have been prepared in accordance with the AQSE rules for Companies.  As permitted, the Company has chosen not to adopt IAS 34 "Interim Financial Statements" in preparing this interim financial information. The condensed interim financial statements should be read in conjunction with the annual financial statements for the year ended 30 April 2022, which have been prepared in accordance with UK-adopted International Financial Reporting Standards (IFRS).

The directors are satisfied that, at the time of approving the condensed interim financial statements, it is appropriate to adopt a going concern basis of accounting and in accordance with the recognition and measurement principles of UK-adopted International Financial Reporting Standards (IFRS) adopted for use in the United Kingdom ("IFRS"). In reaching this conclusion the directors have considered the financial position of the Company, its cash, liquidity position and borrowing facilities together with its forecasts and projections for a period in excess of 12 months from the date of approval.

The interim financial information set out above does not constitute statutory accounts as defined by Section 434 of the Companies Act 2006.  Statutory financial statements for the year ended 30 April 2022 were approved by the Board of Directors on 31 October 2022 and delivered to the Registrar of Companies. The report of the independent auditor on those financial statements was unqualified.

3.        EARNINGS PER SHARE

Basic earnings per share is calculated by dividing the earnings attributable to shareholders by the weighted average number of ordinary shares ("WANS") outstanding in the period. Diluted loss per share has not been calculated as the options and warrants have no dilutive effect given the loss arising in the period.

The weighted average number of shares for the year ended 30 April 2022 was incorrectly calculated and has been restated in this interim report.

4.            SHARE CAPITAL AND RESERVES

On 9 June 2022, the Company admitted its shares to trading on the AQSE Growth Market. The Company raised gross proceeds of £810,000 from the issue and allotment of 16,200,000 Placing Shares, taking the total number of shares to 290,033,335. The issue of 16,200,000 shares gave rise to a share premium of £793,800 and a charge to share premium of £29,600 for transaction costs.

Share-based payments

The company issued 90,000,000 ordinary shares to acquire the PSYCH platform intangible assets from Prohibition Holdings Ltd, and 500,000 ordinary shares to CPDRG as a payment for consulting services received. These share-based payments gave rise to a share premium of £360,000 and £24,500 respectively.

Share options and broker warrants

On 23 May 2022, the Company granted 31,835,832 share options to 10 of its directors, consultants, and advisors. The options were exercisable upon a successful Admission to AQSE and lapse after two years from this date.

15,917,916 share options are exercisable at a strike price of 5p, 7,958,958 are exercisable at a strike price of 6p and 7,958,958 are exercisable at 8p.

 On 23 May 2022, the Company granted 14,501,667 warrants to its brokers at a strike price of 5p. The options were exercisable upon a successful Admission to AQSE and lapse after five years from this date.

The fair value of the share options and the broker warrants issued in the 6 months to 31 October 2022 was derived using a Black Scholes model. The following key assumptions were used in the calculations:

Expected volatility was determined by calculating the historical volatility of the company's share price between 9 June 2022 and 24 January 2023.

The expected lives used in the model are the relative terms of the share options and the broker warrants.

The risk-free rate used was the yield on 10-year UK Gilts on 6 June 2022.