Title of each class | Trading Symbol | Name of each exchange on which registered |
American Depositary Shares (each representing 4 ‘A’ Ordinary Shares, par value US$0.0109) | TRIB | NASDAQ Global Market |
U.S. GAAP ☐ | International Financial Reporting Standards as issued by the International Accounting Standards Board ☒ | Other ☐ |
Page | ||
1 | ||
1 | ||
1 | ||
PART I | ||
2 | ||
2 | ||
2 | ||
A. | [Reserved] | 2 |
B. | Capitalization and Indebtedness | 2 |
C. | Reasons for the Offer and Use of Proceeds | 2 |
D. | Risk Factors | 3 |
29 | ||
A. | History and Development of the Company | 29 |
B. | Business Overview | 29 |
C. | Organizational Structure | 45 |
D. | Property, Plants and Equipment | 45 |
47 | ||
47 | ||
A. | Operating Results | 47 |
B. | Liquidity and Capital Resources | 57 |
C. | Research and Development, Patents and Licenses,etc. | 59 |
D. | Trend Information | 60 |
E. | Critical Accounting Estimates | 60 |
65 | ||
A. | Directors and Senior Management | 65 |
B. | Compensation | 67 |
C. | Board Practices | 67 |
D. | Employees | 69 |
E. | Share Ownership | 69 |
73 | ||
A. | Major Shareholders | 73 |
B. | Related Party Transactions | 74 |
C. | Interests of Experts and Counsel | 75 |
75 | ||
A. | Consolidated Statements and Other Financial Information | 75 |
B. | Significant Changes | 75 |
75 | ||
A. | Offer and Listing Details | 75 |
B. | Plan of Distribution | 75 |
C. | Markets | 76 |
D. | Selling Shareholders | 76 |
E. | Dilution | 76 |
F. | Expense of the Issue | 76 |
76 | ||
A. | Share Capital | 76 |
B. | Memorandum and Articles of Association | 76 |
C. | Material Contracts | 77 |
D. | Exchange Controls | 78 |
E. | Taxation | 78 |
F. | Dividends and Paying Agents | 84 |
G. | Statement by Experts | 84 |
H. | Documents on Display | 84 |
I. | Subsidiary Information | 84 |
85 | ||
86 |
PART II | ||
87 | ||
87 | ||
87 | ||
88 | ||
88 | ||
88 | ||
88 | ||
89 | ||
89 | ||
89 | ||
89 | ||
89 | ||
89 | ||
PART III | ||
90 | ||
90 | ||
171 |
• | the development of our products; |
• | the potential attributes and benefit of our products and their competitive position; |
• | our ability to successfully commercialize, or enter into strategic relationships with third parties to commercialize, our products; |
• | our estimates regarding expenses, future revenues, capital requirements and our need for additional financing; |
• | our ability to acquire or in-licence new product candidates; |
• | potential strategic relationships; and |
• | the duration of our patent portfolio. |
Item 1. | Identity of Directors, Senior Management and Advisers |
Item 2. | Offer Statistics and Expected Timetable |
Item 3. | Key Information |
A. | Selected Financial Data |
B. | Capitalization and Indebtedness |
C. | Reasons for the Offer and Use of Proceeds |
• | Competition and trading conditions - our ability to sell products could be adversely affected by competition from new and existing diagnostic products, changing conditions in the diagnostic market, including, inter alia, reductions in government funding and sector consolidation. |
• | New product development - our long-term success depends upon the successful development and commercialization of new products. |
• | Capital structure - we may require future additional capital. |
• | Borrowings - we have incurred substantial debt, which could impair our flexibility and access to capital and adversely affect our financial position. To the extent we are unable to repay our debt as it becomes due with cash on hand or from other sources, we will need to refinance our debt, sell assets or repay the debt with the proceeds from equity offerings in order to continue in business. Our ability to obtain additional funding may determine our ability to continue as a going concern. Failure to comply with the terms of the credit agreement for our term loan could result in a default under its terms and, if uncured, could result in action against our pledged assets. |
• | Product recalls and claims - our products may in the future be subject to product recalls that could harm our reputation, business and financial results. If our products cause or contribute to a death or a serious injury, or malfunction in certain ways, we will be subject to medical device reporting regulations, which can result in voluntary corrective actions or regulatory agency enforcement actions. We may be subject to liability resulting from our products or services. |
• | Corporate strategy - failure to achieve our financial and strategic objectives could have a material adverse impact on our business prospects. |
• | Global economic conditions – changes in global economic conditions may have a material adverse impact on our results. |
• | Pandemic impact - the Covid-19 outbreak could significantly disrupt our operations and adversely affect our results of operations. |
• | People - we are highly dependent on our senior management team and other key employees, and the loss of one or more of these employees or the inability to attract and retain qualified personnel as necessary could adversely affect our operations. |
• | Supply chains - significant interruptions in production at our principal manufacturing facilities and/or third-party manufacturing facilities would adversely affect our business and operating results. We are dependent on third-party suppliers for certain critical components and the primary raw materials required for our test kits. Our inability to manufacture products in accordance with applicable specifications, performance standards or quality requirements could adversely affect our business. |
• | Distributor network - our revenues are highly dependent on a network of distributors worldwide. Our success depends on our ability to service and support our products directly or in collaboration with our strategic partners. |
• | Cyber security - our ability to protect our information systems and electronic transmissions of sensitive data from data corruption, cyber-based attacks, security breaches or privacy violations is critical to the success of our business. |
• | Foreign exchange - our sales and operations are subject to the risks of fluctuations in currency exchange rates. |
• | Financial impairment - the large amount of intangible assets and goodwill recorded on our balance sheet may lead to significant impairment charges in the future. |
• | Taxation - tax matters, including disagreements with taxing authorities, the changes in corporate tax rates and imposition of new taxes could impact our results of operations and financial condition. |
• | Acquisitions - future acquisitions may be less successful than expected, not generate the expected benefits, disrupt our ongoing business, distract our management, increase our expenses and adversely affect our business, and therefore, growth may be limited. |
• | Brexit - the United Kingdom’s withdrawal from the European Union could potentially impact our supply chains and the market for our products in the United Kingdom. |
• | Environmental, Social and Governance - increasing scrutiny and changing expectations from investors, lenders, customers and other market participants with respect to our Environmental, Social and Governance, or ESG, policies may impose additional costs on us or expose us to additional risks. |
• | Clinical trials - clinical trials necessary to support future premarket submissions will be expensive and will require enrolment of suitable patients who may be difficult to identify and recruit. Delays or failures in our clinical trials will prevent us from commercializing any modified or new products and will adversely affect our business, operating results and prospects. If the third parties on whom we rely to conduct our pre-clinical studies and clinical trials and to assist in pre-clinical development do not perform as contractually required or expected, we may not be able to obtain regulatory approval or commercialize our products. The results of our clinical trials may not support our product candidate claims. |
• | Regulatory compliance - we may be subject to fines, penalties or injunctions if we are determined to be promoting the use of our products for unapproved or “off-label” uses. If the FDA were to modify its policy of enforcement discretion with respect to our laboratory developed tests, we could incur substantial costs and delays associated with trying to obtain premarket clearance or other approvals. |
• | Product approvals - if we fail to maintain regulatory approvals and clearances our ability to commercially distribute and market these products could suffer. Failure to comply with FDA or other regulatory requirements may require us to suspend production of our products or institute a recall which could result in higher costs and a loss of revenues. Modifications to our products may require new 510(k) clearances or pre-market approvals, or may require us to cease marketing or recall the modified products until clearances or approvals are obtained. Our laboratory business could be harmed from the loss or suspension of a licence or imposition of a fine or penalties under, or future changes in, the law or regulations of the Clinical Laboratory Improvement Amendments of 1988 (“CLIA”), or those of other state or local agencies. |
• | International regulations - we face risks relating to our international sales and business operations, including regulatory risks, which could impact our current business operations and growth strategy. |
• | Healthcare industry laws - we are subject to various laws targeting fraud and abuse in the healthcare industry. Changes in healthcare regulation could affect our revenues, costs and financial condition. |
• | Public company regulations - compliance with regulations governing public company corporate governance and reporting is complex and expensive. |
• | Proprietary rights - we may be unable to protect or obtain proprietary rights that we utilise or intend to utilise. |
• | Patent protection – our patent protection may not be sufficiently broad to compete effectively, the existing patents could be challenged; and trade secrets and confidential know-how could be obtained by competitors. Our patent protection could be reduced or eliminated for non-compliance with various procedural requirements or due to changes in patent law. We may be involved in lawsuits to enforce our patents, the patents of our licensors or our other intellectual property rights, which could be expensive, time consuming and unsuccessful. Product infringement claims by other companies could result in costly disputes and could limit our ability to sell our products. |
• | Information - as a foreign private issuer we are exempt from a number of reporting requirements under the Exchange Act and are permitted to file less information with the SEC than a domestic U.S. reporting company. |
• | Passive foreign investment company - we may be classified as a passive foreign investment company, or PFIC, which would subject our U.S. investors to adverse tax rules. |
• | Volatility - the market price of our ADSs has been, and may continue to be, highly volatile. Future sales of our ADSs could reduce the market price of the ADSs. |
• | Capital - we expect we will need additional capital in the future. |
• | Dilution - the conversion of our outstanding employee share options, any new employee share options and existing warrants would dilute the ownership interest of existing shareholders. |
• | Governed by Irish law - it could be difficult for U.S. holders of ADSs to enforce any securities laws claims against Trinity Biotech, its officers or directors in Irish Courts. |
• | Dividends - we have no plans to pay dividends on our ADSs, and you may not receive funds without selling the ADSs. |
• | Voting rights of holders of ADSs – the terms of the deposit agreement limit the voting rights of holders of ADSs. |
• | NASDAQ listing standards - our securities could be delisted from Nasdaq if we do not comply with Nasdaq’s listing standards. |
• | require us to use a substantial portion of our cash flow from operations to make debt service payments; |
• | limit our ability to use our cash flow or obtain additional financing for working capital, capital expenditures, acquisitions or other general business purposes; |
• | limit our flexibility to plan for, or react to, changes in our business and industry; |
• | result in dilution to our existing shareholders in the event we issue equity to fund our debt obligations; |
• | place us at a competitive disadvantage compared to our less leveraged competitors; and |
• | increase our vulnerability to the impact of adverse economic and industry conditions. |
• | incur, assume or guarantee additional indebtedness; or |
• | repurchase capital stock; |
• | make other restricted payments, including paying dividends and making investments; |
• | create liens; |
• | sell or otherwise dispose of assets, including capital stock of subsidiaries; |
• | enter into agreements that restrict dividends from subsidiaries; |
• | acquire another company or business or enter into mergers or consolidations; |
• | enter into certain inbound and outbound licenses of intellectual property, subject to certain exceptions; and |
• | enter into transactions with affiliates. |
• | The costs and timing of expansion of sales and marketing activities; |
• | The timing and size of any repayment requirements for existing debt obligations; |
• | The timing and success of the commercial launch of new products; |
• | The extent to which we gain or expand market acceptance for existing, new or enhanced products; |
• | The costs and timing of the expansion of our manufacturing capacity; |
• | The success of our research and product development efforts; |
• | The time, cost and degree of success of conducting clinical trials and obtaining regulatory approvals; |
• | The magnitude of capital expenditures; |
• | Changes in existing and potential relationships with distributors and other business partners; |
• | The costs involved in obtaining and enforcing patents, proprietary rights and necessary licences; |
• | The costs and liability associated with patent infringement or other types of litigation; |
• | Competing technological and market developments; and |
• | The scope and timing of strategic acquisitions. |
• | Decreased demand for our products; |
• | Lost revenues; |
• | Damage to our image or reputation; |
• | Costs related to litigation; and |
• | Diversion of management time and attention; |
• | contract manufacturers or suppliers may fail to comply with regulatory requirements or make errors in manufacturing that could negatively affect the efficacy or safety of our products or cause delays in shipments of our products; |
• | we or our contract manufacturers and suppliers may not be able to respond to unanticipated changes in customer orders, and if orders do not match forecasts, we or our suppliers may have excess or inadequate inventory of materials and components; |
• | we or our contract manufacturers and suppliers may be subject to price fluctuations due to a lack of long-term supply arrangements for key components; |
• | we or our contract manufacturers and suppliers may lose access to critical services and components, resulting in an interruption in the manufacture, assembly and shipment of our systems; |
• | we may experience delays in delivery by our contract manufacturers and suppliers due to changes in demand from us or their other customers; |
• | fluctuations in demand for products that our contract manufacturers and suppliers manufacture for others may affect their ability or willingness to deliver components to us in a timely manner; |
• | our suppliers or those of our contract manufacturer may wish to discontinue supplying components or services to us for risk management reasons; |
• | we may not be able to find new or alternative components or reconfigure our system and manufacturing processes in a timely manner if the necessary components become unavailable; and |
• | our contract manufacturers and suppliers may encounter financial hardships unrelated to our demand, which could inhibit their ability to fulfill our orders and meet our requirements. |
• | Suitable acquisitions or investments may not be found or consummated on terms or schedules that are satisfactory to us or consistent with our objectives; |
• | The benefits expected to be derived from an acquisition may not materialize and could be affected by numerous factors, such as regulatory developments, insurance reimbursement, general economic conditions and increased competition; |
• | We may be unable to successfully integrate an acquired company’s personnel, assets, management systems, products and/or technology into our business; |
• | Worse than expected performance of an acquired business may result in the impairment of intangible assets; |
• | Acquisitions may require substantial expense and management time and could disrupt our business; |
• | We may not be able to accurately forecast the performance or ultimate impact of an acquired business; |
• | An acquisition and subsequent integration activities may require greater capital and other resources than originally anticipated at the time of acquisition; |
• | An acquisition may result in the incurrence of unexpected expenses, the dilution of our earnings or our existing stockholders’ percentage ownership, or potential losses from undiscovered liabilities not covered by an indemnification from the seller(s) of the acquired business; |
• | An acquisition may result in the loss of our or the acquired company’s key personnel, customers, distributors or suppliers; |
• | An acquisition of a foreign business may involve additional risks, including, but not limited to, foreign currency exposure, liability or restrictions under foreign laws or regulations, and our inability to successfully assimilate differences in foreign business practices or overcome language or cultural barriers; and |
• | Our ability to integrate future acquisitions may be adversely affected by inexperience in dealing with new technologies. |
• | WMA Declaration of Helsinki – Ethical Principles for Medical Research Involving Human Subjects (2008); |
• | ICH Harmonised Guidelines - Integrated Addendum to ICH E6 (R2) Guideline for Good Clinical Practice (Nov 2016); |
• | ISO 20916:2019 In vitro diagnostic medical devices — Clinical performance studies using specimens from human subjects — Good study practice; |
• | ISO 14155:2011: Clinical investigation of medical devices for human subjects – Good clinical practice. |
• | our inability to demonstrate to the FDA’s satisfaction that our products are safe and effective for their intended users; |
• | insufficient data from our pre-clinical studies and clinical trials to support clearance or approval, where required; and |
• | the failure of the manufacturing process or facilities we use to meet applicable requirements. |
• | untitled letters, warning letters, fines, injunctions, consent decrees and civil penalties; |
• | unanticipated expenditures to address or defend such actions; |
• | customer notifications for repair, replacement and refunds; |
• | recall, detention or seizure of our products; |
• | operating restrictions or partial suspension or total shutdown of production; |
• | refusing or delaying our requests for 510(k) clearance or premarket approval of new products or modified products; |
• | operating restrictions; |
• | withdrawing 510(k) clearances on PMA approvals that have already been granted; |
• | refusal to grant export approval for our products; or |
• | criminal prosecution. |
• | the federal Anti-Kickback Statute, which prohibits, among other things, persons from knowingly and wilfully soliciting, receiving, offering or paying remuneration, directly or indirectly, in exchange for or to induce either the referral of an individual for, or the purchase, order or recommendation of, any good or service for which payment may be made under federal healthcare programs, such as the Medicare and Medicaid programs. A person or entity does not need to have actual knowledge of the federal Anti-Kickback Statute or specific intent to violate it to have committed a violation; in addition, the government may assert that a claim including items or services resulting from a violation of the federal Anti-Kickback Statute constitutes a false or fraudulent claim for purposes of the False Claims Act; |
• | the Physician Self-Referral Law, also known as the “Stark Law”, which provides for strict liability for referrals by physicians to entities with which they or their immediate family members have a financial arrangement for certain designated health services, including clinical laboratory services provided by our CLIA-certified laboratory owned and operated by our subsidiary Immco Diagnostics Inc., that are reimbursable by federal healthcare programs, unless an exception applies. Penalties for violating the Stark Law include denial of payment, civil monetary penalties of up to fifteen thousand dollars per claim submitted, and exclusion from federal health care programs, as well as a penalty of up to one-hundred thousand dollars for attempts to circumvent the law; |
• | federal false claims laws which prohibit, among other things, individuals or entities from knowingly presenting, or causing to be presented, claims for payment from Medicare, Medicaid or other federal third-party payers that are false or fraudulent. Suits filed under the False Claims Act, known as “qui tam” actions, can be brought by any individual on behalf of the government and such individuals, commonly known as “whistleblowers”, may share in any amounts paid by the entity to the government in fines or settlement. When an entity is determined to have violated the False Claims Act, it may be required to pay up to three times the actual damages sustained by the government, plus civil penalties for each separate false claim. Often, to avoid the threat of treble damages and penalties under the False Claims Act, which in 2020 were $11,665 to $23,331 per false claim, companies will resolve allegations in a settlement without admitting liability to avoid the potential treble damages. Any such settlement could materially affect our business, financial operations, and reputation; |
• | the federal Civil Monetary Penalties Law, which prohibits, among other things, offering or transferring remuneration to a federal healthcare beneficiary that a person knows or should know is likely to influence the beneficiary’s decision to order or receive items or services reimbursable by the government from a particular provider or supplier; |
• | federal criminal laws that prohibit executing a scheme to defraud any federal healthcare benefit program or making false statements relating to healthcare matters. Similar to the federal Anti-Kickback Statute, a person or entity does not need to have actual knowledge of the statute or specific intent to violate it to have committed a violation; |
• | the federal Health Insurance Portability and Accountability Act of 1996, as amended by the Health Information Technology for Economic and Clinical Health Act, which governs the conduct of certain electronic healthcare transactions and protects the security and privacy of protected health information; |
• | the federal Physician Payment Sunshine Act, which requires manufacturers of drugs, devices, biologics and medical supplies for which payment is available under Medicare, Medicaid or the Children’s Health Insurance Program (with certain exceptions) to report annually to the CMS, information related to payments or other “transfers of value” made to physicians (defined to include doctors, dentists, optometrists, podiatrists and chiropractors) and teaching hospitals, and requires applicable manufacturers to report annually to the government ownership and investment interests held by the physicians described above and their immediate family members and payments or other “transfers of value” to such physician owners. Manufacturers are required to submit reports to CMS by the 90th day of each calendar year. We cannot assure you that we have and will successfully report all transfers of value by us, and any failure to comply could result in significant fines and penalties. Failure to submit the required information may result in civil monetary penalties up to an aggregate of $150,000 per year (and up to an aggregate of $1 million per year for “knowing failures”) for all payments, transfers of value or ownership or investment interests not reported in an annual submission, and may result in liability under other federal laws or regulations; |
• | federal and state laws governing the certification and licensing of clinical laboratories, including operational, personnel and quality requirements designed to ensure that testing services are accurate and timely, and federal and state laws governing the health and safety of clinical laboratory employees; |
• | the U.S. Foreign Corrupt Practices Act, or the FCPA, which prohibits corporations and individuals from paying, offering to pay or authorising the payment of anything of value to any foreign government official, government staff member, political party or political candidate in an attempt to obtain or retain business or to otherwise influence a person working in an official capacity; the UK Bribery Act, which prohibits both domestic and international bribery, as well as bribery across both public and private sectors; and bribery provisions contained in the German Criminal Code, which makes the corruption and corruptibility of physicians in private practice and other healthcare professionals a criminal offense; and |
• | analogous state and foreign law equivalents of each of the above federal laws, such as anti-kickback and false claims laws which may apply to items or services reimbursed by any payor, including commercial insurers; state laws that require device companies to comply with the industry’s voluntary compliance guidelines and the applicable compliance guidance promulgated by the federal government or otherwise restrict payments that may be made to healthcare providers and other potential referral sources; state laws that require device manufacturers to report information related to payments and other transfers of value to physicians and other healthcare providers or marketing expenditures; and state laws governing the privacy and security of health information in certain circumstances, many of which differ from each other in significant ways and may not have the same effect, thus complicating compliance efforts. |
● | announcements of new products by us or others; | |
● | announcements by us of significant acquisitions, strategic partnerships, in-licensing, joint ventures or capital commitments; | |
● | the developments of the businesses and projects of our various subsidiaries; | |
● | expiration or terminations of licences, research contracts or other collaboration agreements; | |
● | public concern as to the safety of the products we sell; | |
● | the volatility of market prices for shares of companies with whom we compete; |
● | developments concerning intellectual property rights or regulatory approvals; | |
● | variations in our and our competitors’ results of operations; | |
● | changes in revenues, gross profits and earnings announced by us; | |
● | changes in estimates or recommendations by securities analysts, if the ADSs are covered by analysts; | |
● | fluctuations in the share price of our publicly traded subsidiaries; | |
● | changes in government regulations or patent decisions; and | |
● | general market conditions and other factors, including factors unrelated to our operating performance. |
A. | History and Development of the Company |
• | Trinity Biotech Manufacturing Limited, based in Bray, Ireland; |
• | Clark Laboratories Inc, based in Jamestown, New York; |
• | Primus Corporation, based in Kansas City; |
• | Biopool US Inc (trading as Trinity Biotech USA), based in Jamestown, New York; |
• | Immco Diagnostics Inc, based in Amherst and Buffalo, New York; |
• | Nova Century Scientific Inc, based in Burlington, Canada; and |
• | Trinity Biotech Brazil based in Sao Paulo, Brazil. |
Point-Of-Care | Clinical Laboratory | |||||||||
Infectious Diseases | Infectious Diseases | Haemoglobin | Autoimmune | Clinical Chemistry | Blood Bank Screening | |||||
UniGold | MarDx | Premier | ImmuBlot | EZ | Captia | |||||
Recombigen | FlexTrans | Ultra | ImmuGlo | |||||||
ImmuLisa | ||||||||||
OTOblot |
• | Infectious diseases; |
• | Glycated haemoglobin (for diabetes monitoring and diagnosis) and haemoglobin variants for the detection of haemoglobinopathies (haemoglobin abnormalities); |
• | Autoimmune diseases |
• | Sexually transmitted diseases, including Syphilis and Herpes; |
• | Markers for Epstein Barr, Measles, Mumps, Toxoplasmosis, Cytomegalovirus, Rubella, Varicella and other viral pathogens; |
• | Lyme disease; and |
• | SARS-CoV-2. |
• | Immunofluorescence Assay (“IFA”); |
• | Enzyme-linked immunosorbent (“ELISA”); |
• | Western Blot (“WB”); and |
• | Line immunoassay (“LIA”). |
• | Its Clinical Chemistry product range directly to hospitals and laboratories in Germany and France; |
• | Infectious Diseases and Clinical Chemistry product ranges directly to hospitals and laboratories in the UK; and |
• | All product lines through independent distributors and strategic partners in a further approximately 100 countries. |
2021 | 2020 | Total project costs to December 31, 2021¹ | ||||||||||
Product Name | US$’000 | US$’000 | US$’000 | |||||||||
Premier Instrument for Haemoglobin A1c testing | 2,538 | 1,359 | 35,924 | |||||||||
HIV screening rapid test | 1,488 | 2,278 | 12,240 | |||||||||
Covid tests | 1,320 | 467 | 1,787 | |||||||||
Autoimmune Smart Reader | 550 | 666 | 3,287 | |||||||||
Mid-tier haemoglobins instrument | 303 | 243 | 609 | |||||||||
Tri-stat Point-of-Care instrument | 245 | 203 | 9,477 | |||||||||
Uni-Gold antigen improvement | - | 556 | 2,918 | |||||||||
Syphilis point-of-care test | - | 618 | 1,942 |
¹ Cumulative costs to December 31, 2021 are shown before deduction of amortization and impairment losses.
• | untitled letters, warning letters, fines, injunctions, consent decrees and civil penalties; |
• | unanticipated expenditures to address or defend such actions |
• | customer notifications for repair, replacement, refunds; |
• | recall, detention or seizure of our products; |
• | operating restrictions or partial suspension or total shutdown of production; |
• | refusing or delaying our requests for 510(k) clearance or premarket approval of new products or modified products; |
• | operating restrictions; |
• | withdrawing 510(k) clearances or PMA approvals that have already been granted; |
• | refusal to grant export approval for our products; or |
• | criminal prosecution. |
• | product design, development and manufacture; |
• | product safety, testing, labelling and storage; |
• | record keeping procedures; |
• | product marketing, sales and distribution; and |
• | post-marketing surveillance, complaint handling, medical device reporting, reporting of deaths, serious injuries or device malfunctions and repair or recall of products. |
• | Are non-invasive; |
• | Do not require an invasive sampling procedure that poses a significant risk; |
• | Do not introduce energy into a subject by design or intention; |
• | Are not to be used as a diagnostic procedure without confirmation of the diagnosis by another medically established diagnostic product or procedure; and |
• | Comply with the labelling requirements for IUO devices, as outlined in 21 C.F.R. § 812.2(c)(3). |
• | product listing and establishment registration, which helps facilitate FDA inspections and other regulatory action; |
• | Quality System Regulation, (“QSR”), which requires manufacturers, including third-party manufacturers, to follow stringent design, testing, control, documentation and other quality assurance procedures during all aspects of the manufacturing process; |
• | labelling regulations and FDA prohibitions against the promotion of products for uncleared, unapproved or off-label use or indication; |
• | clearance of product modifications that could significantly affect safety or efficacy or that would constitute a major change in intended use of one of our cleared devices; |
• | approval of product modifications that affect the safety or effectiveness of one of our approved devices; |
• | medical device reporting regulations, which require that manufacturers comply with FDA requirements to report if their device may have caused or contributed to a death or serious injury, or has malfunctioned in a way that would likely cause or contribute to a death or serious injury if the malfunction of the device or a similar device were to recur; |
• | post-approval restrictions or conditions, including post-approval study commitments; |
• | post-market surveillance regulations, which apply when necessary to protect the public health or to provide additional safety and effectiveness data for the device; |
• | the FDA's recall authority, whereby it can ask, or under certain conditions order, device manufacturers to recall from the market a product that is in violation of governing laws and regulations; |
• | regulations pertaining to voluntary recalls; and |
• | notices of corrections or removals. |
• | includes a reduction in the annual update factor used to adjust payments under the CLFS for inflation. This update factor reflects the consumer price index for all urban consumers, or CPI-U, and the ACA reduces the CPI-U by 1.75% for the years 2011 through 2015. The Affordable Care Act also imposes a multifactor productivity adjustment in addition to the CPI-U, which may further reduce payment rates; |
• | requires certain medical device manufacturers to pay an excise tax in an amount equal to 2.3% of the price for which such manufacturer sells its medical devices that are listed with the FDA; and |
• | requires the coordination and promotion of research on comparative clinical effectiveness of different technologies and procedures, initiatives to revise Medicare payment methodologies, such as bundling of payments across the continuum of care by providers and clinicians and initiatives to promote quality indicators in payment methodologies. |
• | day-to-day operation of a clinical laboratory, including training and skill levels required of laboratory personnel; |
• | physical requirements of a facility; |
• | equipment; and |
• | validation and quality control. |
Item 4A. | Unresolved Staff Comments |
Year ended December 31, | ||||||||||||
2021 US$’000 | 2020 US$’000 | % Change | ||||||||||
Revenues | ||||||||||||
Clinical laboratory goods | 74,700 | 84,280 | (11.4 | )% | ||||||||
Clinical laboratory services | 7,928 | 8,485 | (6.6 | )% | ||||||||
Point-of-Care | 10,337 | 9,215 | 12.2 | % | ||||||||
92,965 | 101,980 | (8.8 | )% |
Year ended December 31, | ||||||||||||
2021 US$‘000 | 2020 US$‘000 | % Change | ||||||||||
Revenues | ||||||||||||
Americas | 57,799 | 70,408 | (17.9 | )% | ||||||||
Asia/Africa | 25,504 | 22,567 | 13.0 | % | ||||||||
Europe | 9,662 | 9,005 | 7.3 | % | ||||||||
Total | 92,965 | 101,980 | (8.8 | )% |
Year ended December 31, | ||||||||||||
2020 US$’000 | $ | 2019 US$’000 | % Change | |||||||||
Revenues | ||||||||||||
Clinical laboratory goods | 84,280 | 68,127 | 23.7 | % | ||||||||
Clinical laboratory services | 8,485 | 10,915 | (22.3 | )% | ||||||||
Point-of-Care | 9,215 | 11,393 | (19.1 | )% | ||||||||
101,980 | 90,435 | 12.8 | % |
Year ended December 31, | ||||||||||||
2020 US$‘000 | 2019 US$‘000 | % Change | ||||||||||
Revenues | ||||||||||||
Americas | 70,408 | 52,183 | 34.9 | % | ||||||||
Asia/Africa | 22,567 | 27,686 | (18.5 | )% | ||||||||
Europe | 9,005 | 10,566 | (14.8 | )% | ||||||||
Total | 101,980 | 90,435 | 12.8 | % |
• | A range of cost saving measures implemented in response to the Covid-19 pandemic including the furloughing of employees in the second quarter of 2020, the receipt of government payroll subsidies, significantly reduced travel costs and the cancellation of trade shows and other marketing activities. |
• | Partially offsetting these savings were increased foreign currency losses mainly due to the re-translation of Euro-denominated lease liabilities for right-of-use assets and increased performance-related pay due to higher revenues and profits. |
B. | Liquidity and Capital Resources |
• | The ability of the Group to continue to generate revenue growth from its existing product lines and from new products following the successful completion of its development projects; |
• | The ability of the Group to mitigate the negative impacts of the Covid-19 pandemic and maximize the opportunities to sell our Covid-19 related portfolio of products; |
• | The extent to which capital expenditure is incurred on additional property plant and equipment; |
• | The level of investment required to undertake both new and existing development projects; and |
Year ended December 31, | ||||||||
2021 US$‘000 | 2020 US$‘000 | |||||||
Net cash inflow from operating activities | 13,238 | 23,755 | ||||||
Net cash outflow from investing activities | (8,691 | ) | (10,198 | ) | ||||
Net cash outflow from financing activities | (6,019 | ) | (2,716 | ) | ||||
Net (decrease)/increase in cash and cash equivalents and short-term investments | (1,472 | ) | 10,841 |
• | Payments to acquire intangible assets of US$6.9 million (2020: US$7.0 million), which principally related to development expenditure capitalised as part of the Group’s on-going product development activities; and |
• | Acquisition of property, plant and equipment of US$1.8 million (2020: US$3.2 million) incurred as part of the Group’s investment programme for its manufacturing and distributing activities, and placement of instruments. |
• | Significant underperformance relative to expected, historical or projected future operating results; |
• | Significant changes in the manner of our use of the acquired assets or the strategy for our overall business; |
• | Obsolescence of products; |
• | Significant decline in our stock price for a sustained period; and |
• | Our market capitalisation relative to net book value. |
• | In the event that there was a reduction of 10% in the assumed level of future growth in revenue growth rate, which would represent a reasonably likely range of outcomes, there would be no additional impairment loss recorded at December 31, 2021. |
• | In the event there was a 10% increase in the discount rate used to calculate the potential impairment of the carrying values, which would represent a reasonably likely range of outcomes, there would be no additional impairment loss recorded at December 31, 2021. |
Name | Age | Title |
Directors | ||
Ronan O’Caoimh | 66 | Chairman and Chief Executive Officer |
Jim Walsh, PhD | 63 | Executive Director |
John Gillard | 41 | Chief Financial Officer, Company Secretary and Executive Director |
Kevin Tansley | 51 | Executive Director |
Clint Severson | 73 | Non-Executive Director/Lead Director |
James D. Merselis | 68 | Non-Executive Director |
Senior Management | ||
Simon Dunne | 48 | Chief Accounting Officer |
Fernando Devia | 59 | Executive Vice President Sales |
Sanjiv Suri | 63 | Senior Vice President Global Sales and General Manager North America |
Terence Dunne, PhD | 41 | Business Development Director |
Eibhlín Kelly | 38 | Chief Information Officer |
Dan Goldsand | 66 | Vice President of Autoimmunity |
Director | Title | Salary/ Benefits US$’000 | Performance related bonus US$’000 | Defined contribution pension US$’000 | Total 2021 US$’000 | Total 2020 US$’000 | |||||||||||||||||
Ronan O’Caoimh | Chairman and CEO | 643 | — | — | 643 | 1,052 | |||||||||||||||||
Jim Walsh | Executive Director | 20 | — | — | 20 | 38 | |||||||||||||||||
John Gillard | Chief Financial Officer | 346 | 227 | 20 | 593 | 52 | |||||||||||||||||
Kevin Tansley | Executive Director | 56 | — | 4 | 60 | 757 | |||||||||||||||||
Denis R. Burger | Non-Executive director | — | — | — | — | 48 | |||||||||||||||||
James Merselis | Non-Executive director | 49 | — | — | 49 | 57 | |||||||||||||||||
Clint Severson | Non-Executive director | 49 | — | — | 49 | 57 | |||||||||||||||||
1,163 | 227 | 24 | 1,414 | 2,061 |
- | incurred by the person in his or her capacity as an officer of our company or a subsidiary of our company provided that the liability does not arise out of a conduct involving a wilful breach of duty in relation to our company or a subsidiary of our company; or |
- | for costs and expenses incurred by that person defending proceedings, whatever their outcome. |
Year Ended December 31, | ||||||||||||
2021 | 2020 | 2019 | ||||||||||
Numbers of employees by geographic location | ||||||||||||
United States | 237 | 310 | 334 | |||||||||
Ireland | 211 | 199 | 215 | |||||||||
United Kingdom | 2 | 3 | 2 | |||||||||
Brazil | 27 | 31 | 28 | |||||||||
Total workforce | 477 | 543 | 579 | |||||||||
Numbers of employees by category of activity | ||||||||||||
Research scientists & technicians | 41 | 52 | 57 | |||||||||
Manufacturing/Operations | 239 | 280 | 303 | |||||||||
Quality Assurance | 63 | 63 | 60 | |||||||||
Finance/Administration | 68 | 65 | 66 | |||||||||
Sales & Marketing | 66 | 83 | 93 | |||||||||
Total workforce | 477 | 543 | 579 |
Name | Number of ‘A’ Ordinary Shares Beneficially Owned (1) | Percentage of Ownership (2) | ||||||
Ronan O’Caoimh (3) | 17,228,160 | 15.0 | % | |||||
Jim Walsh (4) | 2,863,612 | 2.6 | % | |||||
John Gillard (5) | 150,000 | * | ||||||
Kevin Tansley (6) | 1,547,336 | 1.4 | % | |||||
Clint Severson (7) | 878,000 | * | ||||||
James Merselis (8) | 778,600 | * | ||||||
Simon Dunne (9) | 210,000 | * | ||||||
Fernando Devia (10) | 330,000 | * | ||||||
Sanjiv Suri (11) | 280,000 | * | ||||||
Terence Dunne (12) | 283,336 | * | ||||||
Dan Goldsand | - | * | ||||||
Eibhlín Kelly | - | * | ||||||
Executive officers and directors as a group (12 persons) | 24,549,044 | 20.4 | % |
* | Less than 1% |
(1) | Beneficial ownership is determined in accordance with the rules of the SEC and generally includes voting or investment power with respect to securities. Ordinary Shares relating to options currently exercisable or exercisable within 60 days of the date of this table are deemed outstanding for computing the percentage of the person holding such securities but are not deemed outstanding for computing the percentage of any other person. Except as indicated by footnote, and subject to community property laws where applicable, the persons named in the table above have sole voting and investment power with respect to all shares shown as beneficially owned by them. |
(2) | The percentages shown are based on ‘A’ Ordinary Shares issued and outstanding as of April 15, 2022. |
(3) | Represents (a) 9,724,160 ‘A’ ordinary shares and (b) 7,504,000 ‘A’ ordinary shares underlying options that are currently vested and exercisable or that vest within sixty days of April 15, 2022. Includes options issued to Darnick Company which in the past provided Trinity Biotech with the services of Mr. O’Caoimh as Chief Executive Officer. |
(4) | Represents (a) 1,393,612 ‘A’ ordinary shares and (b) 1,470,000 ‘A’ ordinary shares underlying options that are currently vested and exercisable or that vest within sixty days of April 15, 2022. Note that 1,393,612 ‘A’ ordinary shares of Dr Walsh’s shares are held in trust for the benefit of Dr Walsh’s immediate family. |
(5) | Represents 150,000 ‘A’ ordinary shares underlying options that are currently vested and exercisable or that vest within sixty days of April 15, 2022. |
(6 | Represents (a) 150,000 ‘A’ ordinary shares and (b) 1,397,336 ‘A’ ordinary shares underlying options that are currently vested and exercisable or that vest within sixty days of April 15, 2022. |
(7) | Represents (a) 288,000 ‘A’ ordinary shares and (b) 590,000 ‘A’ ordinary shares underlying options that are currently vested and exercisable or that vest within sixty days of April 15, 2022. |
(8) | Represents (a) 188,600 ‘A’ ordinary shares and (b) 590,000 ‘A’ ordinary shares underlying options that are currently vested and exercisable or that vest within sixty days of April 15, 2022. |
(9) | Represents 210,000 ‘A’ ordinary shares underlying options that are currently vested and exercisable or that vest within sixty days of April 15, 2022. |
(10) | Represents 330,000 ‘A’ ordinary shares underlying options that are currently vested and exercisable or that vest within sixty days of April 15, 2022. |
(11) | Represents 280,000 ‘A’ ordinary shares underlying options that are currently vested and exercisable or that vest within sixty days of April 15, 2022. |
(12) | Represents 283,336 ‘A’ ordinary shares underlying options that are currently vested and exercisable or that vest within sixty days of April 15, 2022. |
Director/Company Secretary | Number of Options ‘A’ Shares | Number of Options ADS Equivalent | Exercise Price (Per ‘A’ Share) | Exercise Price (Per ADS) | Expiration Date of Options | ||||||||||||
Ronan O’Caoimh* | 1,000,000 | 250,000 | 1.34 | 5.35 | 07/09/2024 | ||||||||||||
1,000,000 | 250,000 | 1.34 | 5.35 | 07/09/2024 | |||||||||||||
244,000 | 61,000 | 1.34 | 5.35 | 07/09/2024 | |||||||||||||
2,030,000 | 507,500 | 0.69 | 2.74 | 14/06/2026 | |||||||||||||
2,030,000 | 507,500 | 0.69 | 2.74 | 14/06/2026 | |||||||||||||
333,336 | 83,334 | 0.19 | 0.77 | 20/03/2027 | |||||||||||||
1,200,000 | 300,000 | 0.73 | 2.90 | 17/11/2027 | |||||||||||||
1,200,000 | 300,000 | 0.73 | 2.90 | 17/11/2027 | |||||||||||||
Jim Walsh | 53,333 | 13,333 | 2.43 | 9.73 | 24/02/2023 | ||||||||||||
53,333 | 13,333 | 2.43 | 9.73 | 24/02/2023 | |||||||||||||
53,334 | 13,334 | 2.43 | 9.73 | 24/02/2023 | |||||||||||||
360,000 | 90,000 | 1.34 | 5.35 | 07/09/2024 | |||||||||||||
360,000 | 90,000 | 1.34 | 5.35 | 07/09/2024 | |||||||||||||
30,000 | 7,500 | 1.34 | 5.35 | 07/09/2024 | |||||||||||||
280,000 | 70,000 | 0.19 | 0.77 | 20/03/2027 | |||||||||||||
280,000 | 70,000 | 0.19 | 0.77 | 20/03/2027 | |||||||||||||
40,000 | 10,000 | 0.19 | 0.77 | 20/03/2027 | |||||||||||||
Kevin Tansley | 340,000 | 85,000 | 1.34 | 5.35 | 07/09/2024 | ||||||||||||
340,000 | 85,000 | 1.34 | 5.35 | 07/09/2024 | |||||||||||||
184,000 | 46,000 | 1.34 | 5.35 | 07/09/2024 | |||||||||||||
266,668 | 66,667 | 0.19 | 0.77 | 20/03/2027 | |||||||||||||
266,668 | 66,667 | 0.19 | 0.77 | 20/03/2027 | |||||||||||||
266,664 | 66,666 | 0.19 | 0.77 | 20/03/2027 |
Director/Company Secretary | Number of Options ‘A’ Shares | Number of Options ADS Equivalent | Exercise Price (Per ‘A’ Share) | Exercise Price (Per ADS) | Expiration Date of Options | ||||||||||||
Jim Merselis | 20,000 | 5,000 | 2.43 | 9.73 | 24/02/2023 | ||||||||||||
20,000 | 5,000 | 2.43 | 9.73 | 24/02/2023 | |||||||||||||
20,000 | 5,000 | 2.43 | 9.73 | 24/02/2023 | |||||||||||||
95,000 | 23,750 | 1.34 | 5.35 | 07/09/2024 | |||||||||||||
95,000 | 23,750 | 1.34 | 5.35 | 07/09/2024 | |||||||||||||
20,000 | 5,000 | 1.34 | 5.35 | 07/09/2024 | |||||||||||||
160,000 | 40,000 | 0.19 | 0.77 | 20/03/2027 | |||||||||||||
160,000 | 40,000 | 0.19 | 0.77 | 20/03/2027 | |||||||||||||
40,000 | 10,000 | 0.19 | 0.77 | 20/03/2027 | |||||||||||||
Clint Severson | 20,000 | 5,000 | 2.43 | 9.73 | 24/02/2023 | ||||||||||||
20,000 | 5,000 | 2.43 | 9.73 | 24/02/2023 | |||||||||||||
20,000 | 5,000 | 2.43 | 9.73 | 24/02/2023 | |||||||||||||
95,000 | 23,750 | 1.34 | 5.35 | 07/09/2024 | |||||||||||||
95,000 | 23,750 | 1.34 | 5.35 | 07/09/2024 | |||||||||||||
20,000 | 5,000 | 1.34 | 5.35 | 07/09/2024 | |||||||||||||
160,000 | 40,000 | 0.19 | 0.77 | 20/03/2027 | |||||||||||||
160,000 | 40,000 | 0.19 | 0.77 | 20/03/2027 | |||||||||||||
40,000 | 10,000 | 0.19 | 0.77 | 20/03/2027 | |||||||||||||
John Gillard | 150,000 | 37,500 | 0.67 | 2.69 | 23/10/2027 | ||||||||||||
150,000 | 37,500 | 0.67 | 2.69 | 23/10/2027 | |||||||||||||
150,000 | 37,500 | 0.67 | 2.69 | 23/10/2027 | |||||||||||||
150,000 | 37,500 | 0.67 | 2.69 | 23/10/2027 |
Number of ‘A’ Ordinary Shares Subject to Option | Range of Exercise Price per Ordinary Share | Range of Exercise Price per ADS | ||||||||||
Total options outstanding | 15,964,662 | US$0.19-US$4.36 | US$0.76-US$17.44 |
A. | Major Shareholders |
Number of ‘A’ Ordinary Shares Beneficially Owned | Number of ADSs Beneficially Owned (1) | Percentage ‘A’ Ordinary Shares (2) | Percentage Total Voting Power | |||||||||||||
Renaissance Technologies LLC | 6,274,220 | (3) | 1,568,555 | 5.8 | % | 5.8 | % | |||||||||
Paradice Investment Management, LLC | 6,172,460 | (4) | 1,543,115 | 5.7 | % | 5.7 | % | |||||||||
Ronan O’Caoimh | 17,228,160 | (5) | 4,307,040 | 15.0 | % | 15.0 | % | |||||||||
Stonehill Capital Management LLC | 9,272,872 | (6) | 2,318,218 | 8.6 | % | 8.6 | % | |||||||||
Perceptive Credit Holdings III, LP | 10,000,000 | (7) | 2,500,000 | 8.5 | % | 8.5 | % |
(1) | Beneficial ownership is determined in accordance with the rules of the SEC and generally includes voting or investment power with respect to securities. Ordinary Shares relating to options currently exercisable or exercisable within 60 days of the date of this table are deemed outstanding for computing the percentage of the person holding such securities but are not deemed outstanding for computing the percentage of any other person. Except as indicated by footnote, and subject to community property laws where applicable, the persons named in the table above have sole voting and investment power with respect to all shares shown as beneficially owned by them. |
(2) | The percentages shown are based on ‘A’ Ordinary Shares outstanding (excluding treasury shares). | |
(3) | Based on a Schedule 13G/A filed on February 11, 2022, with the SEC by Renaissance Technologies LLC and Renaissance Technologies Holdings Corporation. The principal business address of each of these entities is 800 Third Avenue, New York, NY 10022 United States. | |
(4) | Based on a Schedule 13G/A filed on February 7, 2020 by Paradice Investment Management, LLC with the SEC. The principal business address of Paradice Investment Management, LLC is 257 Fillmore Street, Suite 200, Denver, Colorado 80206 United States. | |
(5) | Based on information provided to the Company, the above total includes ‘A’ Ordinary shares issuable upon exercise of options issued to Darnick Company. The address of Mr. O’Caoimh is c/o Trinity Biotech plc, Bray, Co. Wicklow, Ireland. | |
(6) | Based on a Schedule 13G/A filed on February 4, 2022 by Stonehill Capital Management, LLC with the SEC. The principal business address of Stonehill Capital Management, LLC is 320 Park Ave., 26th Floor, New York, NY 10022 United States. | |
(7) | Based upon warrant agreement issued to Perceptive Credit Holdings III, LP in January 2022 in respect of 10,000,000 ‘A’ Ordinary Shares (2,500,000 ADSs). |
Number of ‘A’ Ordinary Shares Beneficially Owned | Number of ADSs Beneficially Owned (1) | Percentage ‘A’ Ordinary Shares (2) | Percentage Total Voting Power | Date of Filing | |||||||||||||
Whitefort Capital Master Fund, LP | 2,342,280 | 585,570 | 2.2 | % | 2.2 | % | February 16, 2021 | ||||||||||
Highbridge Capital Management, LLC | 675,064 | 168,766 | 0.6 | % | 0.6 | % | April 14, 2022 |
• | an individual resident in the U.S. (or certain other countries with which Ireland has a double taxation treaty) and who is neither resident nor ordinarily resident in Ireland; or |
• | a U.S. tax resident corporation not under the control of Irish residents; or |
• | a corporation that is not resident in Ireland and which is ultimately controlled by persons resident in the U.S. (or certain other countries with which Ireland has a double taxation treaty), with such person or persons not under the control of persons who are not so resident; or |
• | a corporation that is not resident in Ireland and the principal class of whose shares (or its 75% parent’s principal class of shares) is substantially or regularly traded on a recognised stock exchange; or |
• | is otherwise entitled to an exemption from DWT. |
• | the recipient is the direct beneficial owner of the shares, and |
• | the depository bank’s ADS register shows that the direct beneficial owner of the dividends has a U.S. address on the register, and |
• | there is an intermediary between the depository bank and the beneficial shareholder and the depository bank receives confirmation from the intermediary that the beneficial shareholder’s address in the intermediary’s records is in the U.S. |
Service | Rate | By whom paid |
(1) Issuance of ADSs upon deposit of ordinary shares. | Up to $10.00 per 100 ADSs (or portion thereof) issued. | Persons depositing ordinary shares or person receiving ADSs. |
(2) Delivery of deposited securities against surrender of ADSs. | Up to $10.00 per 100 ADSs (or portion thereof) issued. | Persons surrendering ADSs for the purpose of withdrawal of deposited securities or persons to whom deposited securities are delivered. |
(3) Issuance of ADSs in connection with a distribution of shares. | Up to $10.00 per 100 ADSs (or portion thereof) issued. | Person to whom distribution is made. |
(4) Distribution of cash dividends or other cash distributions, including distribution of cash proceeds following the sale of rights, shares or other property in accordance with the deposit agreement | Up to $0.02 per 1 ADS | Person to whom distribution is made. |
(5) Transfer of ADSs | Up to $1.50 per certificate for ADRs or ADRs transferred | Person to whom Receipt is transferred. |
• | transfer and registration fees of securities on Trinity Biotech’s securities register to or from the name of the depositary or its agent when ADS holders deposit or withdrawal securities; |
• | expenses for cable, telex and fax transmissions and for delivery of securities; |
• | expenses incurred for converting foreign currency into U.S. dollars; and |
• | taxes and duties upon the transfer of securities (i.e., when ordinary shares are deposited or withdrawn from deposit, other than taxes for which Trinity Biotech is liable). |
Item 13. | Defaults, Dividend Arrearages and Delinquencies |
Item 14. | Material Modifications to the Rights of Security Holders and Use of Proceeds |
Item 15. | Controls and Procedures |
Year ended December 31, 2021 | Year ended December 31, 2020 | |||||||||||||||
US$’000 | % | US$’000 | % | |||||||||||||
Audit | 477 | 72 | % | 495 | 80 | % | ||||||||||
Audit-related | 94 | 14 | % | - | - | |||||||||||
Tax | 89 | 14 | % | 124 | 20 | % | ||||||||||
Total | 660 | 619 |
• | The Rule requiring maintaining a majority of independent directors (Rule 5605(b)(1)). Instead, under Irish law and practice, we are not required to appoint a majority of independent directors. |
• | The Rule requiring that our independent directors have regularly scheduled meetings at which only independent directors are present (Rule 5605(b)(2)). Instead, we follow Irish law according to which independent directors are not required to hold executive sessions. |
• | The Rule regarding independent director oversight of director nominations process for directors (Rule 5605(e)). Instead, we follow Irish law and practice according to which our board of directors recommends directors for election/re-election by our shareholders. |
• | The requirement to obtain shareholder approval for the establishment or amendment of certain equity based compensation plans (Rule 5635(c)), an issuance that will result in a change of control of the company (Rule 5635(b)), certain transactions other than a public offering involving issuances of a 20% or more interest in the company (Rule 5635(d)) and certain acquisitions of the stock or assets of another company (Rule 5635(a)). Instead, we follow Irish law and practice in approving such procedures, according to which Board approval may suffice in certain circumstances, depending on the extent existing general authorities to issue shares are in place. |
• | The Rule requiring maintaining an audit committee consisting of at least three independent directors (Rule 5605(c)(2). Instead, we follow Irish law that requires that an audit committee have at least one independent director. Our audit committee consists of two independent directors. | |
• | The Rule requiring a compensation committee consisting of at least two independent directors (Rule 5605(d)(2). We have a compensation committee, which we refer to as the remuneration committee, and although it consists of two independent directors, we may follow Irish law in the future, which does not require us to have an independent compensation committee. | |
• | The Rule requiring a quorum of 33 1/3% at any meeting of shareholders (Rule 5620(c)). Instead, we follow the provisions of our Articles of Association which require a quorum of 40%> If a quorum is not present, unless the meeting has been convened by shareholders in which case the meeting shall be dissolved, the meeting will be adjourned to another date. If a quorum is not present within 15 minutes of the time set for the adjourned meeting, the meeting may commence so long as there are two shareholders present. |
Item 17 | Financial Statements |
The audited consolidated financial statements as required under Item 18 are attached hereto starting on page 94 of this Annual Report. The audit report of Grant Thornton (PCAOB ID 1402), independent registered public accounting firm, is included herein preceding the audited consolidated financial statements.
• | We evaluated the design effectiveness of controls over management’s selection of the discount rates, short-term forecasts of future revenues and margins, and long-term growth rates used to determine the recoverable amount of each selected CGU. |
• | We agreed the underlying cash flow forecasts to the Board-approved projections and we evaluated management’s ability to accurately forecast future revenues and margins by: |
• | performing a look-back analysis and comparing actual results to management’s historical forecasts; and |
• | assessing the reasonableness of the impact of new products, the COVID-19 pandemic, and other macroeconomic activity on short-term cash flows. |
• | We assessed the reasonableness of the valuation model used by the Company compared to generally accepted valuation practices and accounting standards. |
• | We tested the source information underlying the determination of the discount rates through use of observable inputs from independent external sources. |
• | We developed independent estimates and compared those to the discount rates selected by management. |
• | We compared the long-term growth rates, used by management to grow cash flows in order to calculate a terminal value, to independent external sources to assess the reasonableness of these rates. |
• | We examined the supporting documents of internally generated development costs additions in the financial year to ensure they constituted development phase costs allowable for capitalization as stipulated by accounting standards. |
• | We tested the key assumptions used by management in concluding that development projects capitalized during the financial year demonstrate the required characteristics to permit capitalization, particularly the commercial and technical feasibility of on-going development projects. |
• | We conducted detailed discussions with senior project personnel in charge of the developments to understand their rationale for concluding on the appropriateness of capitalization of the development phase costs and, where necessary, challenged the underlying reasoning. |
• | We obtained a detailed understanding of the role of the employees in the development of the relevant projects whose salaries are capitalized. |
• | We tested the design and operating effectiveness of operational controls (including specific controls for review of revenue recognition and year end cut-off analyses). |
• | We selected a statistical sample of revenue transactions to vouch to underlying documents. |
• | We examined contracts specific to samples selected and assessed revenue recognition in accordance with the accounting standards. |
• | We evaluated management assumptions in recognising revenue related to the performance obligation of certain contracts with high subjectivity. |
Year ended December 31 | |||||||||||||||
Notes | 2021 Total US$‘000 | 2020 Total US$‘000 | 2019 Total US$‘000 | ||||||||||||
Revenues | 2 | 92,965 | 101,980 | 90,435 | |||||||||||
Cost of sales | (54,888 | ) | (53,400 | ) | (52,315 | ) | |||||||||
Gross profit | 38,077 | 48,580 | 38,120 | ||||||||||||
Other operating income | 4 | 4,672 | 1,860 | 91 | |||||||||||
Research and development expenses | (4,497 | ) | (5,080 | ) | (5,325 | ) | |||||||||
Selling, general and administrative expenses | (24,683 | ) | (26,390 | ) | (27,661 | ) | |||||||||
Selling, general and administrative expenses – recognition of contingent asset | 26 | 0 | 1,316 | 0 | |||||||||||
Selling, general and administrative expenses – closure costs | 5 | 0 | (2,425 | ) | 0 | ||||||||||
Selling, general and administrative expenses – tax audit settlement | 6 | 0 | 0 | (5,042 | ) | ||||||||||
Impairment charges | 7 | (6,944 | ) | (17,779 | ) | (24,295 | ) | ||||||||
Operating profit/(loss) | 6,625 | 82 | (24,112 | ) | |||||||||||
Financial income | 2,8 | 1,223 | 36 | 697 | |||||||||||
Financial expenses | 2, 8 | (7,097 | ) | (6,751 | ) | (6,582 | ) | ||||||||
Net financing expense | (5,874 | ) | (6,715 | ) | (5,885 | ) | |||||||||
Profit/(Loss) before tax | 11 | 751 | (6,633 | ) | (29,997 | ) | |||||||||
Total income tax credit | 2, 9 | 178 | 620 | 1,006 | |||||||||||
Profit/(Loss) for the year on continuing operations | 2 | 929 | (6,013 | ) | (28,991 | ) | |||||||||
(Loss)/Profit for the year on discontinued operations | 10 | (54 | ) | (375 | ) | 77 | |||||||||
Profit(Loss) for the year (all attributable to owners of the parent) | 2 | 875 | (6,388 | ) | (28,914 | ) | |||||||||
Basic profit/(loss) per ADS (US Dollars) – continuing operations | 12 | 0.04 | (0.29 | ) | (1.39 | ) | |||||||||
Diluted profit/(loss) per ADS (US Dollars) – continuing operations | 12 | 0.04 | (0.29 | ) | (1.39 | ) | |||||||||
Basic profit/(loss) per ‘A’ ordinary share (US Dollars) –continuing operations | 12 | 0.01 | (0.07 | ) | (0.35 | ) | |||||||||
Diluted profit/(loss) per ‘A’ ordinary share (US Dollars) – continuing operations | 12 | 0.01 | (0.07 | ) | (0.35 | ) | |||||||||
Basic profit/(loss) per ADS (US Dollars) – group | 12 | 0.04 | (0.31 | ) | (1.38 | ) | |||||||||
Diluted profit/(loss) per ADS (US Dollars) – group | 12 | 0.04 | (0.31 | ) | (1.38 | ) | |||||||||
Basic profit/(loss) per ‘A’ ordinary share (US Dollars) – group | 12 | 0.01 | (0.08 | ) | (0.35 | ) | |||||||||
Diluted profit/(loss) per ‘A’ ordinary share (US Dollars) – group | 12 | 0.01 | (0.08 | ) | (0.35 | ) |
94
Year ended December 31 | |||||||||||||||
Notes | 2021 US$‘000 | 2020 US$‘000 | 2019 US$‘000 | ||||||||||||
Profit/(Loss) for the year | 2 | 875 | (6,388 | ) | (28,914 | ) | |||||||||
Other comprehensive loss | |||||||||||||||
Items that will be reclassified subsequently to profit or loss | |||||||||||||||
Foreign exchange translation differences | (86 | ) | (1,360 | ) | (167 | ) | |||||||||
Other comprehensive loss | (86 | ) | (1,360 | ) | (167 | ) | |||||||||
Total Comprehensive Profit/(Loss) (all attributable to owners of the parent) | 789 | (7,748 | ) | (29,081 | ) |
95
At December 31 | |||||||||||
Notes | 2021 US$‘000 | 2020 US$‘000 | |||||||||
ASSETS | |||||||||||
Non-current assets | |||||||||||
Property, plant and equipment | 13 | 5,918 | 8,547 | ||||||||
Goodwill and intangible assets | 14 | 35,981 | 33,860 | ||||||||
Deferred tax assets | 15 | 4,101 | 4,185 | ||||||||
Derivative financial instruments | 24 | 0 | 150 | ||||||||
Other assets | 16 | 207 | 355 | ||||||||
Total non-current assets | 46,207 | 47,097 | |||||||||
Current assets | |||||||||||
Inventories | 17 | 29,123 | 30,219 | ||||||||
Trade and other receivables | 18 | 16,116 | 22,668 | ||||||||
Income tax receivable | 1,539 | 3,086 | |||||||||
Cash and cash equivalents | 19 | 25,910 | 27,327 | ||||||||
Total current assets | 72,688 | 83,300 | |||||||||
TOTAL ASSETS | 2 | 118,895 | 130,397 | ||||||||
EQUITY AND LIABILITIES | |||||||||||
Equity attributable to the equity holders of the parent | |||||||||||
Share capital | 20 | 1,213 | 1,213 | ||||||||
Share premium | 20 | 16,187 | 16,187 | ||||||||
Treasury shares | 20 | (24,922 | ) | (24,922 | ) | ||||||
Accumulated surplus | 20 | 12,559 | 10,573 | ||||||||
Translation reserve | 20 | (5,379 | ) | (5,293 | ) | ||||||
Other reserves | 20 | 23 | 23 | ||||||||
Total deficit | (319 | ) | (2,219 | ) | |||||||
Current liabilities | |||||||||||
Income tax payable | 22 | 154 | |||||||||
Trade and other payables | 22 | 15,127 | 24,335 | ||||||||
Provisions | 23 | 50 | 416 | ||||||||
Exchangeable notes and other borrowings | 24 | 83,312 | 0 | ||||||||
Lease liabilities | 25 | 1,980 | 2,153 | ||||||||
Total current liabilities | 100,491 | 27,058 | |||||||||
Non-current liabilities | |||||||||||
Exchangeable notes and other borrowings | 24 | 0 | 82,695 | ||||||||
Derivative financial instruments | 24 | 0 | 1,370 | ||||||||
Lease liabilities | 25 | 13,865 | 16,588 | ||||||||
Deferred tax liabilities | 15 | 4,858 | 4,905 | ||||||||
Total non-current liabilities | 18,723 | 105,558 | |||||||||
TOTAL LIABILITIES | 2 | 119,214 | 132,616 | ||||||||
TOTAL EQUITY AND LIABILITIES | 118,895 | 130,397 |
96
Share capital ‘A’ ordinary shares US$’000 | Share premium US$’000 | Treasury Shares US$’000 | Translation reserve US$’000 | Hedging reserves US$’000 | Accumulated surplus US$’000 | Total US$’000 | ||||||||||||||||||||||
Balance at January 1, 2019 | 1,213 | 16,187 | (24,922 | ) | (3,766 | ) | 23 | 55,319 | 44,054 | |||||||||||||||||||
Loss for the period | - | - | - | - | - | (28,914 | ) | (28,914 | ) | |||||||||||||||||||
Other comprehensive income | - | - | - | (167 | ) | - | - | (167 | ) | |||||||||||||||||||
Total comprehensive loss | - | - | - | (167 | ) | - | (28,914 | ) | (29,081 | ) | ||||||||||||||||||
Share-based payments | - | - | - | - | - | 839 | 839 | |||||||||||||||||||||
Adjustment on transition to IFRS 16 (Note 13) | - | - | - | - | - | (11,099 | ) | (11,099 | ) | |||||||||||||||||||
Balance at December 31, 2019 | 1,213 | 16,187 | (24,922 | ) | (3,933 | ) | 23 | 16,145 | 4,713 | |||||||||||||||||||
Balance at January 1, 2020 | 1,213 | 16,187 | (24,922 | ) | (3,933 | ) | 23 | 16,145 | 4,713 | |||||||||||||||||||
Loss for the period | - | - | - | - | - | (6,388 | ) | (6,388 | ) | |||||||||||||||||||
Other comprehensive income | - | - | - | (1,360 | ) | - | - | (1,360 | ) | |||||||||||||||||||
Total comprehensive loss | - | - | - | (1,360 | ) | - | (6,388 | ) | (7,748 | ) | ||||||||||||||||||
Share-based payments (Note 21) | - | - | - | - | - | 816 | 816 | |||||||||||||||||||||
Balance at December 31, 2020 | 1,213 | 16,187 | (24,922 | ) | (5,293 | ) | 23 | 10,573 | (2,219 | ) | ||||||||||||||||||
Balance at January 1, 2021 | 1,213 | 16,187 | (24,922 | ) | (5,293 | ) | 23 | 10,573 | (2,219 | ) | ||||||||||||||||||
Profit for the period | - | - | - | - | - | 875 | 875 | |||||||||||||||||||||
Other comprehensive income | - | - | - | (86 | ) | - | - | (86 | ) | |||||||||||||||||||
Total comprehensive profit/(loss) | - | - | - | (86 | ) | - | 875 | 789 | ||||||||||||||||||||
Share-based payments (Note 21) | - | - | - | - | - | 1,111 | 1,111 | |||||||||||||||||||||
Balance at December 31, 2021 | 1,213 | 16,187 | (24,922 | ) | (5,379 | ) | 23 | 12,559 | (319 | ) |
97
Year ended December 31, | |||||||||||||||
Notes | 2021 US$‘000 | 2020 US$‘000 | 2019 US$‘000 | ||||||||||||
Cash flows from operating activities | |||||||||||||||
Profit/(Loss) for the year | 875 | (6,388 | ) | (28,914 | ) | ||||||||||
Adjustments to reconcile net profit/(loss) to cash provided by operating activities: | |||||||||||||||
Depreciation | 11 | 1,827 | 1,674 | 2,526 | |||||||||||
Amortisation | 11,14 | 917 | 1,403 | 2,368 | |||||||||||
Income tax credit | 9 | (167 | ) | (182 | ) | (1,006 | ) | ||||||||
Financial income | 8 | (1,223 | ) | (36 | ) | (697 | ) | ||||||||
Financial expense | 8 | 7,097 | 6,751 | 6,582 | |||||||||||
Share-based payments (net of capitalized amounts) | 21 | 1,100 | 792 | 758 | |||||||||||
Foreign exchange gains on operating cash flows | (251 | ) | (663 | ) | (93 | ) | |||||||||
(Gain)/Loss on disposal or retirement of property, plant and equipment | 11 | (1 | ) | 30 | 17 | ||||||||||
Movement in inventory provision | 17 | 5,589 | 5,059 | 1,567 | |||||||||||
Impairment of prepayments | 7, 18 | 583 | 562 | 1,376 | |||||||||||
Impairment of property, plant and equipment | 7, 13 | 2,508 | 1,795 | 6,349 | |||||||||||
Impairment of intangible assets | 7, 14 | 3,853 | 15,422 | 16,570 | |||||||||||
Other non-cash items | (5,317 | ) | (634 | ) | 835 | ||||||||||
Operating cash flows before changes in working capital | 17,390 | 25,585 | 8,238 | ||||||||||||
Decrease / (Increase) in trade and other receivables | 6,236 | (2,489 | ) | 445 | |||||||||||
(Increase) in inventories | (4,406 | ) | (3,419 | ) | (2,959 | ) | |||||||||
(Decrease) / Increase in trade and other payables | (7,591 | ) | 4,994 | 151 | |||||||||||
Cash generated from operations | 11,629 | 24,671 | 5,875 | ||||||||||||
Interest paid | (11 | ) | (48 | ) | (1,000 | ) | |||||||||
Interest received | 1 | 104 | 560 | ||||||||||||
Income taxes received / (paid) | 1,619 | (972 | ) | (18 | ) | ||||||||||
Net cash generated by operating activities | 13,238 | 23,755 | 5,417 | ||||||||||||
Cash flows from investing activities | |||||||||||||||
Payments to acquire intangible assets | (6,879 | ) | (6,990 | ) | (9,718 | ) | |||||||||
Acquisition of property, plant and equipment | (1,812 | ) | (3,178 | ) | (2,118 | ) | |||||||||
Disposal of property, plant and equipment | 0 | (30 | ) | (17 | ) | ||||||||||
Net cash used in investing activities | (8,691 | ) | (10,198 | ) | (11,853 | ) | |||||||||
Cash flows from financing activities | |||||||||||||||
Proceeds from Paycheck Protection loans | 1,764 | 4,520 | 0 | ||||||||||||
Interest payment on exchangeable notes | 29 | (3,996 | ) | (3,996 | ) | (3,996 | ) | ||||||||
Loan Origination Costs | (848 | ) | 0 | 0 | |||||||||||
Payment of lease liabilities | 29 | (2,939 | ) | (3,240 | ) | (3,533 | ) | ||||||||
Net cash used in financing activities | (6,019 | ) | (2,716 | ) | (7,529 | ) | |||||||||
(Decrease) / Increase in cash and cash equivalents and short term investments | (1,472 | ) | 10,841 | (13,965 | ) | ||||||||||
Effects of exchange rate movements on cash held | 55 | 86 | 88 | ||||||||||||
Cash and cash equivalents and short-term investments at beginning of year | 27,327 | 16,400 | 30,277 | ||||||||||||
Cash and cash equivalents and short-term investments at end of year | 19 | 25,910 | 27,327 | 16,400 |
98
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
1. | BASIS OF PREPARATION AND SIGNIFICANT ACCOUNTING POLICIES |
i) | General information |
ii) | Statement of compliance |
iii) | Basis of preparation |
At December 31, 2021, the Group had net currently liabilities. However, at the date of this report the Group’s financial position has substantially improved following the successful re-financing of the Group’s debt in early 2022. This has significantly improved the Group’s capital structure by reducing gross debt by approximately US$19 million and there are no material debt maturities until 2026. Furthermore, the investment by MiCo Group will facilitate an early repayment of a substantial portion of the debt due to Perceptive Advisors and will also facilitate the Group exploring lower cost debt funding options, in the short term, with the aim of further reducing the Group’s interest expense through refinancing the balance of the Group’s term loan at substantially lower interest rates.
99
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
The accounting policies set out below have been applied consistently to all periods presented in these consolidated financial statements. The accounting policies have been applied consistently by all Group entities. |
iv) | Basis of consolidation |
v) | Property, plant and equipment |
• Leasehold improvements | 5-15 years | |
• Buildings | 50 years | |
• Office equipment and fittings | 10 years | |
• Computer equipment | 3-5 years | |
• Plant and equipment | 2-15 years |
100
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
• | the contract contains an identified asset, which is either explicitly identified in the contract or implicitly specified by being identified at the time the asset is made available to the Group |
• | the Group has the right to obtain substantially all of the economic benefits from use of the identified asset throughout the period of use, considering its rights within the defined scope of the contract |
• | the Group has the right to direct the use of the identified asset throughout the period of use. The Group assess whether it has the right to direct ‘how and for what purpose’ the asset is used throughout the period of use. |
101
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
vi) | Goodwill |
vii) | Intangibles, including research and development (other than goodwill) |
102
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
1. | BASIS OF PREPARATION AND SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) |
• Capitalised development costs | 15 years | |
• Patents and licences | 6-15 years | |
• Other (including acquired customer and supplier lists) | 6-15 years |
(a) | once a diagnostic test becomes established, customers are reluctant to change to new technology until it is fully proven, thus resulting in relatively long product life cycles. There is also reluctance in customers to change to a new product as it can be costly both in terms of the initial changeover cost and as new technology is typically more expensive. |
(b) | demand for the diagnostic tests is enduring and robust within a wide geographic base. The diseases that the products diagnose are widely prevalent (HIV, Diabetes and Chlamydia being just three examples) in many countries. There is a general consensus that these diseases will continue to be widely prevalent in the future. |
(c) | there are significant barriers to new entrants in this industry. Patents and/or licences are in place for several of our products, though this is not the only barrier to entry. There is a significant cost and time to develop new products, it is necessary to obtain regulatory approval and tests are protected by proprietary know-how, manufacturing techniques and trade secrets. |
103
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
1. | BASIS OF PREPARATION AND SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) |
viii) | Impairment |
104
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
1. | BASIS OF PREPARATION AND SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) |
ix) | Inventories |
x) | Trade and other receivables |
xi) | Trade and other payables |
xii) | Cash and cash equivalents |
xiii) | Short-term investments |
xiv) | Share-based payments |
105
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
1. | BASIS OF PREPARATION AND SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) |
xv) | Government grants and financial support |
xvi) | Revenue recognition |
106
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
1. | BASIS OF PREPARATION AND SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) |
xvii) | Employee benefits |
xviii) | Foreign currency |
107
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
1. | BASIS OF PREPARATION AND SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) |
xix) | Hedging |
xx) | Exchangeable notes and derivative financial instruments |
xxi) | Segment reporting |
108
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
1. | BASIS OF PREPARATION AND SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) |
xxii) | Tax (current and deferred) |
i. | Where the deferred tax liability arises from goodwill not deductible for tax purposes or the initial recognition of an asset or a liability in a transaction that is not a business combination and affects neither the accounting profit nor the taxable profit or loss at the time of the transaction; and |
ii. | Where, in respect of temporary differences associated with investments in subsidiary undertakings, the timing of the reversal of the temporary difference is subject to control and it is probable that the temporary difference will not reverse in the foreseeable future. |
xxiii) | Provisions |
xxiv) | Cost of sales |
xxv) | Finance income and costs |
109
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
1. | BASIS OF PREPARATION AND SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) |
xxvi) | Treasury shares |
xxvii) | Equity |
xxviii) | Profit or loss from discontinued operations |
xxix) | Fair values |
xxx) | New IFRS Standards and Interpretations not applied |
• | Amendments IFRS 9 Financial Instruments, IAS 39 Financial Instruments: Recognition and measurement |
• | IFRS 7 Financial Instruments: Disclosures |
• | IFRS 4 Insurance Contracts |
• | IFRS 16 Leases – Interest Rate Benchmark Reform – Phase 2 |
• | Amendments to IFRS 16 – COVID-19-Related Rent Concessions beyond 30 June 2021. The amendment was adopted effective 1 January 2021 and did not result in a material impact on the Group’s results. |
110
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
2. | SEGMENT INFORMATION |
i) | The distribution of revenue by geographical area based on location of assets was as follows: |
Rest of World | ||||||||||||||||||||
Revenue | Americas | Ireland | Other | Eliminations | Total | |||||||||||||||
Year ended December 31, 2021 | US$‘000 | US$‘000 | US$‘000 | US$’000 | US$‘000 | |||||||||||||||
Revenue from external customers | 67,249 | 25,716 | 0 | 0 | 92,965 | |||||||||||||||
Inter-segment revenue | 49,059 | 2,517 | 0 | (51,576 | ) | 0 | ||||||||||||||
Total revenue | 116,308 | 28,233 | 0 | (51,576 | ) | 92,965 |
Rest of World | ||||||||||||||||||||
Revenue | Americas | Ireland | Other | Eliminations | Total | |||||||||||||||
Year ended December 31, 2020 | US$‘000 | US$‘000 | US$‘000 | US$’000 | US$‘000 | |||||||||||||||
Revenue from external customers | 77,688 | 24,292 | 0 | 0 | 101,980 | |||||||||||||||
Inter-segment revenue | 59,304 | 1,095 | 0 | (60,399 | ) | 0 | ||||||||||||||
Total revenue | 136,992 | 25,387 | 0 | (60,399 | ) | 101,980 |
111
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
2. | SEGMENT INFORMATION (CONTINUED) |
Rest of World | ||||||||||||||||||||
Americas | Ireland | Other | Eliminations | Total | ||||||||||||||||
Year ended December 31, 2019 | US$‘000 | US$‘000 | US$‘000 | US$’000 | US$‘000 | |||||||||||||||
Revenue from external customers | 64,045 | 26,390 | 0 | 0 | 90,435 | |||||||||||||||
Inter-segment revenue | 39,563 | 1,629 | 0 | (41,192 | ) | 0 | ||||||||||||||
Total revenue | 103,608 | 28,019 | 0 | (41,192 | ) | 90,435 |
ii) | The distribution of revenue by customers’ geographical area was as follows: |
Revenue | December 31, 2021 US$‘000 | December 31, 2020 US$‘000 | December 31, 2019 US$‘000 | |||||||||
Americas | 57,799 | 70,408 | 52,183 | |||||||||
Asia / Africa | 25,504 | 22,567 | 27,686 | |||||||||
Europe (including Ireland) * | 9,662 | 9,005 | 10,566 | |||||||||
92,965 | 101,980 | 90,435 |
* | Revenue from customers in Ireland is not disclosed separately due to the immateriality of these revenues. |
iii) | The distribution of revenue by major product group was as follows: |
Revenue | December 31, 2021 US$‘000 | December 31, 2020 US$‘000 | December 31, 2019 US$‘000 | |||||||||
Clinical laboratory goods | 74,700 | 84,280 | 68,127 | |||||||||
Clinical laboratory services | 7,928 | 8,485 | 10,915 | |||||||||
Point-of-Care | 10,337 | 9,215 | 11,393 | |||||||||
92,965 | 101,980 | 90,435 |
iv) | The group has recognised the following amounts relating to revenue in the consolidated statement of operations: |
Revenue | December 31, 2021 US$‘000 | December 31, 2020 US$‘000 | December 31, 2019 US$‘000 | |||||||||
Revenue from contracts with customers (a) | 92,965 | 101,980 | 90,435 | |||||||||
Revenue from other sources | 0 | 0 | 0 | |||||||||
92,965 | 101,980 | 90,435 |
112
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
(a) | Disaggregation of revenue from contracts with customers: |
Timing of revenue recognition | Americas | Ireland | Other | Total | ||||||||||||
Year ended December 31, 2021 | US$‘000 | US$‘000 | US$‘000 | US$‘000 | ||||||||||||
At a point in time | 66,806 | 25,716 | 0 | 92,522 | ||||||||||||
Over time | 443 | 0 | 0 | 443 | ||||||||||||
Total | 67,249 | 25,716 | 0 | 92,965 |
Timing of revenue recognition | Americas | Ireland | Other | Total | ||||||||||||
Year ended December 31, 2020 | US$‘000 | US$‘000 | US$‘000 | US$‘000 | ||||||||||||
At a point in time | 77,060 | 24,292 | 0 | 101,352 | ||||||||||||
Over time | 628 | 0 | 0 | 628 | ||||||||||||
Total | 77,688 | 24,292 | 0 | 101,980 |
Timing of revenue recognition | Americas | Ireland | Other | Total | ||||||||||||
Year ended December 31, 2019 | US$‘000 | US$‘000 | US$‘000 | US$‘000 | ||||||||||||
At a point in time | 63,300 | 26,390 | 0 | 89,690 | ||||||||||||
Over time | 745 | 0 | 0 | 745 | ||||||||||||
Total | 64,045 | 26,390 | 0 | 90,435 |
(b) | The Group derives revenue from the transfer of goods and services over time and at a point in time based on customers’ geographical area as follows: |
Timing of revenue recognition | Americas | Asia / Africa | Europe | Total | ||||||||||||
Year ended December 31, 2021 | US$‘000 | US$‘000 | US$‘000 | US$‘000 | ||||||||||||
At a point in time | 57,356 | 25,504 | 9,662 | 92,522 | ||||||||||||
Over time | 443 | 0 | 0 | 443 | ||||||||||||
Total | 57,799 | 25,504 | 9,662 | 92,965 |
113
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
2. | SEGMENT INFORMATION (CONTINUED) |
Timing of revenue recognition | Americas | Asia / Africa | Europe | Total | ||||||||||||
Year ended December 31, 2020 | US$‘000 | US$‘000 | US$‘000 | US$‘000 | ||||||||||||
At a point in time | 69,780 | 22,567 | 9,005 | 101,352 | ||||||||||||
Over time | 628 | 0 | 0 | 628 | ||||||||||||
Total | 70,408 | 22,567 | 9,005 | 101,980 |
Timing of revenue recognition | Americas | Asia / Africa | Europe | Total | ||||||||||||
Year ended December 31, 2019 | US$‘000 | US$‘000 | US$‘000 | US$‘000 | ||||||||||||
At a point in time | 51,438 | 27,686 | 10,566 | 89,690 | ||||||||||||
Over time | 745 | 0 | 0 | 745 | ||||||||||||
Total | 52,183 | 27,686 | 10,566 | 90,435 |
Rest of World | ||||||||||||||||
Americas | Ireland | Other | Total | |||||||||||||
Year ended December 31, 2021 | US$‘000 | US$‘000 | US$‘000 | US$‘000 | ||||||||||||
Result before impairment and unallocated expenses | 9,276 | 5,084 | (12 | ) | 14,348 | |||||||||||
Impairment | (6,088 | ) | (856 | ) | 0 | (6,944 | ) | |||||||||
Result after impairment | 3,188 | 4,228 | (12 | ) | 7,404 | |||||||||||
Unallocated expenses * | (779 | ) | ||||||||||||||
Operating profit | 6,625 | |||||||||||||||
Net financing expense (Note 8) | (5,874 | ) | ||||||||||||||
Profit before tax | 751 | |||||||||||||||
Income tax credit (Note 9) | 178 | |||||||||||||||
Profit for the year on continuing operations | 929 | |||||||||||||||
Loss for the year on discontinued operations (Note 10) | (54 | ) | ||||||||||||||
Profit for the year | 875 |
Rest of World | ||||||||||||||||
Americas | Ireland | Other | Total | |||||||||||||
Year ended December 31, 2020 | US$‘000 | US$‘000 | US$‘000 | US$‘000 | ||||||||||||
Result before impairment and unallocated expenses | 14,495 | 4,264 | (71 | ) | 18,688 | |||||||||||
Impairment | (17,779 | ) | 0 | 0 | (17,779 | ) | ||||||||||
Result after impairment | (3,284 | ) | 4,264 | (71 | ) | 909 | ||||||||||
Unallocated expenses * | (827 | ) | ||||||||||||||
Operating profit | 82 | |||||||||||||||
Net financing expense (Note 8) | (6,715 | ) | ||||||||||||||
Loss before tax | (6,633 | ) | ||||||||||||||
Income tax credit (Note 9) | 620 | |||||||||||||||
Loss for the year on continuing operations | (6,013 | ) | ||||||||||||||
Loss for the year on discontinued operations (Note 10) | (375 | ) | ||||||||||||||
Loss for the year | (6,388 | ) |
114
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
2. | SEGMENT INFORMATION (CONTINUED) |
Rest of World | ||||||||||||||||
Americas | Ireland | Other | Total | |||||||||||||
Year ended December 31, 2019 | US$‘000 | US$‘000 | US$‘000 | US$‘000 | ||||||||||||
Result before impairment and unallocated expenses | 5,239 | (4,334 | ) | (108 | ) | 797 | ||||||||||
Impairment | (14,562 | ) | (9,733 | ) | 0 | (24,295 | ) | |||||||||
Result after impairment | (9,323 | ) | (14,067 | ) | (108 | ) | (23,498 | ) | ||||||||
Unallocated expenses * | (614 | ) | ||||||||||||||
Operating loss | (24,112 | ) | ||||||||||||||
Net financing expense (Note 8) | (5,885 | ) | ||||||||||||||
Loss before tax | (29,997 | ) | ||||||||||||||
Income tax credit (Note 9) | 1,006 | |||||||||||||||
Loss for the year on continuing operations | (28,991 | ) | ||||||||||||||
Profit for the year on discontinued operations (Note 10) | 77 | |||||||||||||||
Loss for the year | (28,914 | ) |
* | Unallocated expenses represent head office general and administration costs of the Group, which cannot be allocated to the results of any specific geographical area. |
vi) | The distribution of segment assets and segment liabilities by geographical area was as follows: |
Rest of World | ||||||||||||||||
Americas | Ireland | Other | Total | |||||||||||||
As at December 31, 2021 | US$‘000 | US$‘000 | US$‘000 | US$‘000 | ||||||||||||
Assets and liabilities | ||||||||||||||||
Segment assets | 45,891 | 41,453 | 1 | 87,345 | ||||||||||||
Unallocated assets: | ||||||||||||||||
Income tax assets (current and deferred) | 5,640 | |||||||||||||||
Cash and cash equivalents and short-term investments | 25,910 | |||||||||||||||
Total assets as reported in the Group balance sheet | 118,895 | |||||||||||||||
Segment liabilities | 12,382 | 101,927 | 25 | 114,334 | ||||||||||||
Unallocated liabilities: | ||||||||||||||||
Income tax liabilities (current and deferred) | 4,880 | |||||||||||||||
Total liabilities as reported in the Group balance sheet | 119,214 |
115
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
2. | SEGMENT INFORMATION (CONTINUED) |
Rest of World | ||||||||||||||||
Americas | Ireland | Other | Total | |||||||||||||
As at December 31, 2020 | US$‘000 | US$‘000 | US$‘000 | US$‘000 | ||||||||||||
Assets and liabilities | ||||||||||||||||
Segment assets | 58,164 | 37,632 | 3 | 95,799 | ||||||||||||
Unallocated assets: | ||||||||||||||||
Income tax assets (current and deferred) | 7,271 | |||||||||||||||
Cash and cash equivalents and short-term investments | 27,327 | |||||||||||||||
Total assets as reported in the Group balance sheet | 130,397 | |||||||||||||||
Segment liabilities | 20,431 | 107,080 | 46 | 127,557 | ||||||||||||
Unallocated liabilities: | ||||||||||||||||
Income tax liabilities (current and deferred) | 5,059 | |||||||||||||||
Total liabilities as reported in the Group balance sheet | 132,616 |
vii) | The distribution of long-lived assets, which are property, plant and equipment, goodwill and intangible assets and other non-current assets (excluding deferred tax assets and derivative financial instruments), by geographical area was as follows: |
December 31, 2021 US$‘000 | December 31, 2020 US$‘000 | |||||||
Rest of World – Ireland | 22,617 | 19,927 | ||||||
Americas | 19,489 | 22,835 | ||||||
42,106 | 42,762 |
viii) | The distribution of depreciation and amortisation by geographical area was as follows: |
December 31, 2021 US$‘000 | December 31, 2020 US$‘000 | December 31, 2019 US$‘000 | ||||||||||
Depreciation: | ||||||||||||
Rest of World – Ireland | 204 | 127 | 322 | |||||||||
Americas | 1,662 | 1,587 | 2,208 | |||||||||
1,866 | 1,714 | 2,530 | ||||||||||
Amortisation: | ||||||||||||
Rest of World – Ireland | 69 | 32 | 642 | |||||||||
Americas | 848 | 1,371 | 1,726 | |||||||||
917 | 1,403 | 2,368 |
ix) | The distribution of share-based payment expense by geographical area was as follows: |
December 31, 2021 US$‘000 | December 31, 2020 US$‘000 | December 31, 2019 US$‘000 | ||||||||||
Rest of World – Ireland | 1,072 | 722 | 659 | |||||||||
Americas | 28 | 70 | 99 | |||||||||
1,100 | 792 | 758 |
116
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
2. | SEGMENT INFORMATION (CONTINUED) |
x) | The distribution of taxation (expense)/credit by geographical area was as follows: |
December 31, 2021 US$‘000 | December 31, 2020 US$‘000 | December 31, 2019 US$‘000 | ||||||||||
Rest of World – Ireland | 540 | 293 | 831 | |||||||||
Rest of World – Other | (2 | ) | (8 | ) | 0 | |||||||
Americas | (360 | ) | 335 | 175 | ||||||||
178 | 620 | 1,006 |
xi) | During 2020 and 2019 there were no customers generating 10% or more of total revenues. In 2021, one customer accounted for more than 10% of total revenues. |
xii) | The distribution of capital expenditure by geographical area was as follows: |
December 31, 2021 US$‘000 | December 31, 2020 US$‘000 | |||||||
Rest of World – Ireland | 3,826 | 5,609 | ||||||
Rest of World – Other | 0 | 0 | ||||||
Americas | 4,776 | 4,317 | ||||||
8,602 | 9,926 |
3. | EMPLOYMENT |
December 31, 2021 | December 31, 2020 | December 31, 2019 | ||||||||||
Research and development | 41 | 52 | 57 | |||||||||
Administration and sales | 134 | 148 | 159 | |||||||||
Manufacturing and quality | 302 | 343 | 363 | |||||||||
477 | 543 | 579 |
December 31, 2021 US$‘000 | December 31, 2020 US$‘000 | December 31, 2019 US$‘000 | ||||||||||
Wages and salaries | 26,561 | 26,187 | 25,885 | |||||||||
Social welfare costs | 2,403 | 2,195 | 2,538 | |||||||||
Pension costs | 352 | 447 | 503 | |||||||||
Tax settlement (Note 6) | 0 | 0 | 5,094 | |||||||||
Share-based payments | 1,100 | 792 | 758 | |||||||||
Restructuring Cost | 270 | 388 | 0 | |||||||||
Recognition of contingent asset (Note 26) | 0 | (1,316 | ) | 0 | ||||||||
30,686 | 28,693 | 34,778 |
117
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
3. | EMPLOYMENT (CONTINUED) |
4. | OTHER OPERATING INCOME |
December 31, 2021 US$‘000 | December 31, 2020 US$‘000 | December 31, 2019 US$‘000 | ||||||||||
Government supports - COVID-19 | 4,668 | 1,840 | 0 | |||||||||
Other income | 0 | 17 | 88 | |||||||||
Rental income from premises | 4 | 3 | 3 | |||||||||
4,672 | 1,860 | 91 |
5. | SELLING, GENERAL AND ADMINISTRATIVE EXPENSES – CLOSURE COSTS |
6. | SELLING, GENERAL AND ADMINISTRATIVE EXPENSES – TAX AUDIT SETTLEMENT |
118
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
6. | SELLING, GENERAL AND ADMINISTRATIVE EXPENSES – TAX AUDIT SETTLEMENT (CONTINUED) |
Darnick Company agreed to contribute US$1,231,000 to the above settlement and this amount was outstanding at December 31, 2019 and was treated as a contingent asset and not recognized in the 2019 financial statements. This balance was settled in the year ended December 31, 2020 and has been credited to the Statement of Operations within Selling, General and Administrative Expenses. The underlying amount was denominated in Euro. Due to a depreciation in the US Dollar since 2019, the US Dollar equivalent amount increased from US$1,231,000 to US$1,316,000. The settlement amount received by the Company was US$177,000 more than the balance owed and this overpayment is recorded as a related party current liability for the benefit of Ronan O’Caoimh as at December 31, 2020. The amount was settled by the Group in January 2021.
7. | IMPAIRMENT CHARGES |
December | December | December | ||||||||||
31, 2021 | 31, 2020 | 31, 2019 | ||||||||||
US$’000 | US$’000 | US$’000 | ||||||||||
Selling, general & administration expenses | ||||||||||||
Impairment of PP&E (Note 13) | 2,508 | 1,795 | 6,349 | |||||||||
Impairment of goodwill and other intangible assets (Note 14) | 3,853 | 15,422 | 16,570 | |||||||||
Impairment of prepayments (Note 18) | 583 | 562 | 1,376 | |||||||||
Total impairment loss | 6,944 | 17,779 | 24,295 | |||||||||
Income tax impact of impairment loss | 0 | 0 | 148 | |||||||||
Total impairment loss after tax | 6,944 | 17,779 | 24,443 |
8. | FINANCIAL INCOME AND EXPENSES |
December 31, 2021 US$‘000 | December 31, 2020 US$‘000 | December 31, 2019 US$‘000 | ||||||||||
Financial income: | ||||||||||||
Non-cash financial income | 1,220 | 0 | 233 | |||||||||
Interest income | 3 | 36 | 464 | |||||||||
1,223 | 36 | 697 | ||||||||||
Financial expense: | ||||||||||||
Interest on leases | (815 | ) | (896 | ) | (947 | ) | ||||||
Interest on tax audit settlement (Note 6) | 0 | 0 | (1,000 | ) | ||||||||
Cash interest on exchangeable notes | (3,996 | ) | (3,996 | ) | (3,996 | ) | ||||||
Loan origination costs | (1,638 | ) | 0 | 0 | ||||||||
Non-cash interest on exchangeable notes (Note 24) | (648 | ) | (643 | ) | (639 | ) | ||||||
Non-cash financial expense | 0 | (1,216 | ) | 0 | ||||||||
(7,097 | ) | (6,751 | ) | (6,582 | ) | |||||||
Net Financing Expense | (5,874 | ) | (6,715 | ) | (5,885 | ) |
119
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
9. | INCOME TAX CREDIT |
December 31, 2021 US$‘000 | December 31, 2020 US$‘000 | December 31, 2019 US$‘000 | ||||||||||
Current tax (credit)/expense | ||||||||||||
Irish Corporation tax | (511 | ) | (480 | ) | (312 | ) | ||||||
Foreign taxes (a) | 296 | 179 | 197 | |||||||||
Adjustment in respect of prior years | 0 | (152 | ) | (50 | ) | |||||||
Total current tax credit | (215 | ) | (453 | ) | (165 | ) | ||||||
Deferred tax credit (b) | ||||||||||||
Origination and reversal of temporary differences (see Note 15) | 620 | 48 | (625 | ) | ||||||||
Origination and reversal of net operating losses (see Note 15) | (583 | ) | (215 | ) | (216 | ) | ||||||
Total deferred tax credit | 37 | (167 | ) | (841 | ) | |||||||
Total income tax credit on continuing operations in statement of operations | (178 | ) | (620 | ) | (1,006 | ) | ||||||
Tax charge on discontinued operations (see Note 10) | 12 | 438 | 0 | |||||||||
Total tax credit | (166 | ) | (182 | ) | (1,006 | ) |
(a) | In 2021, the foreign taxes relate primarily to USA and Canada. |
(b) | In 2021, there was a deferred tax charge of US$118,000 (2020: charge of US$53,000; 2019: credit of US$444,000) recognised in respect of Ireland and a deferred tax credit of US$81,000 (2020: credit of US$220,000;2019: credit of US$397,000) recognised in respect of overseas tax jurisdictions. |
Effective tax rate | December 31, 2021 | December 31, 2020 | December 31, 2019 | |||||||||
Profit/(Loss) before taxation – continuing operations (US$‘000) | 751 | (6,633 | ) | (29,997 | ) | |||||||
As a percentage of loss before tax: | ||||||||||||
Current tax % | 28.63 | % | (6.83 | )% | (0.55 | )% | ||||||
Total (current and deferred) % | (23.70 | )% | (9.35 | )% | (3.36 | )% |
120
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
9. | INCOME TAX CREDIT (CONTINUED) |
December 31, 2021 | December 31, 2020 | December 31, 2019 | ||||||||||
Irish corporation tax | 12.5 | % | (12.5 | )% | (12.5 | )% | ||||||
Effect of current year net operating losses and temporary differences for which no deferred tax asset was recognised (a) | 49.63 | % | 24.13 | % | 13.21 | % | ||||||
Effect of tax rates on overseas earnings | (0.22 | )% | (9.92 | )% | (3.05 | )% | ||||||
Effect of Irish income taxable at higher tax rate | 98.68 | % | 5.92 | % | 0.04 | % | ||||||
Adjustments in respect of prior years | (0.01 | )% | (10.66 | )% | (0.17 | )% | ||||||
R&D tax credits | (79.22 | )% | (11.00 | )% | (2.69 | )% | ||||||
Other items (b) | (105.06 | )% | 4.68 | % | 1.80 | % | ||||||
Effective tax rate | (23.70 | )% | (9.35 | )% | (3.36 | )% |
(a) | No deferred tax asset was recognised because there was no reversing deferred tax liability in the same jurisdiction reversing in the same period and insufficient future projected taxable income in the same jurisdiction. |
(b) | Other items comprise items not chargeable to tax/expenses not deductible for tax purposes. In 2021, this mainly comprises the income from the Paycheck Protection Program loans which is not chargeable for tax purposes. |
December 31, 2021 US$‘000 | December 31, 2020 US$‘000 | December 31, 2019 US$‘000 | ||||||||||
Rest of World – Ireland | 1,862 | 296 | (20,318 | ) | ||||||||
Rest of World – Other | 3,939 | 3,304 | 4,760 | |||||||||
Americas | (5,050 | ) | (10,233 | ) | (14,439 | ) | ||||||
751 | (6,633 | ) | (29,997 | ) |
December 31, 2021 US$‘000 | December 31, 2020 US$‘000 | December 31, 2019 US$‘000 | ||||||||||
Rest of World – Ireland | 68,132 | 78,700 | 73,754 | |||||||||
Rest of World – Other | 1,000 | 2,185 | 0 | |||||||||
Americas | 4,761 | 4,313 | 6,823 | |||||||||
73,893 | 85,198 | 80,577 |
121
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
9. | INCOME TAX CREDIT (CONTINUED) |
December 31, 2021 US$‘000 | December 31, 2020 US$‘000 | December 31, 2019 US$‘000 | ||||||||||
Rest of World – Ireland – unused tax losses | 9,272 | 12,514 | 12,062 | |||||||||
Rest of World – Other – unused tax losses | 279 | 546 | 0 | |||||||||
Americas – unused tax losses | 5,891 | 1,466 | 5,259 | |||||||||
Americas – unused tax credits | 3,368 | 2,862 | 493 | |||||||||
Unrecognised deferred tax asset | 18,810 | 17,388 | 17,814 |
10. | (LOSS)/PROFIT FOR THE YEAR ON DISCONTINUED OPERATION |
122
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
10. | (LOSS)/PROFIT FOR THE YEAR ON DISCONTINUED OPERATION (CONTINUED) |
December 31, 2021 US$‘000 | December 31, 2020 US$‘000 | December 31, 2019 US$‘000 | ||||||||||
(Loss)/Profit on re-measurement of assets and liabilities: | ||||||||||||
Closure provision | (42 | ) | 127 | (8 | ) | |||||||
Foreign currency translation reserve | 0 | (64 | ) | 85 | ||||||||
Tax (expense)/credit | (12 | ) | (438 | ) | 0 | |||||||
Total (loss)/profit | (54 | ) | (375 | ) | 77 | |||||||
(Loss)/Profit for the year from discontinued operations | (54 | ) | (375 | ) | 77 |
Basic (loss)/earnings per ADS for discontinued operations is computed by dividing the loss after taxation on discontinued operations of US$54,000 (2020: loss US$375,000) (2019: profit US$77,000) for the financial year by the weighted average number of ADS in issue of 20,901,703 (2020: 20,901,703) (2019: 20,901,703), see note 12 for further details.
123
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
10. | (LOSS)/PROFIT FOR THE YEAR ON DISCONTINUED OPERATION (CONTINUED) |
December 31, 2021 | December 31, 2020 | December 31, 2019 | ||||||||||
Basic earnings/(loss) per ADS (US Dollars) – discontinued operations | 0.00 | (0.02 | ) | 0.00 | ||||||||
Diluted earnings/(loss) per ADS (US Dollars) – discontinued operations | 0.00 | (0.02 | ) | 0.00 | ||||||||
Basic earnings/(loss) per ‘A’ share (US Dollars) – discontinued operations | 0.00 | 0.00 | 0.00 | |||||||||
Diluted earnings/(loss) per ‘A’ share (US Dollars) – discontinued operations | 0.00 | 0.00 | 0.00 |
December 31, 2021 | December 31, 2020 | December 31, 2019 | ||||||||||
US$000 | US$000 | US$000 | ||||||||||
Cash flows from operating activities | (40 | ) | (22 | ) | (5 | ) |
11. | PROFIT/LOSS BEFORE TAX |
December 31, 2021 US$‘000 | December 31, 2020 US$‘000 | December 31, 2019 US$‘000 | ||||||||||
Directors’ emoluments (including non- executive directors): | ||||||||||||
Remuneration | 1,390 | 2,020 | 1,238 | |||||||||
Pension | 24 | 41 | 42 | |||||||||
Share based payments | 986 | 678 | 624 | |||||||||
Auditor’s remuneration | ||||||||||||
Audit fees | 549 | 533 | 523 | |||||||||
Tax fees | 77 | 146 | 172 | |||||||||
Other non-audit fees | 31 | 25 | 0 | |||||||||
Depreciation* | 1,827 | 1,674 | 2,526 | |||||||||
Amortisation (Note 14) | 917 | 1,403 | 2,368 | |||||||||
(Gain)/Loss on the disposal of property, plant and equipment | (1 | ) | 30 | 17 | ||||||||
Net foreign exchange differences | (789 | ) | 583 | (179 | ) |
* | Note that US$39,000 (2020: US$40,000) (2019: US$4,000) of depreciation was capitalised to research and development projects during 2021 in line with the Group’s capitalisation policy for Intangible projects. |
124
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
12. | PROFIT/(LOSS) PER SHARE |
December 31, 2021 | December 31, 2020 | December 31, 2019 | ||||||||||
‘A’ ordinary shares | 83,606,810 | 83,606,810 | 83,606,810 | |||||||||
Basic earnings per share denominator | 83,606,810 | 83,606,810 | 83,606,810 | |||||||||
Reconciliation to weighted average earnings per share denominator: | ||||||||||||
Number of ‘A’ ordinary shares at January 1 (Note 20) | 96,162,410 | 96,162,410 | 96,162,410 | |||||||||
Weighted average number of shares issued during the year* | 0 | 0 | 0 | |||||||||
Weighted average number of treasury shares | (12,555,600 | ) | (12,555,600 | ) | (12,555,600 | ) | ||||||
Basic earnings per share denominator | 83,606,810 | 83,606,810 | 83,606,810 |
Under IAS 33 Earnings per Share, diluted earnings per share cannot be anti-dilutive. Therefore, diluted loss per ordinary share in accordance with IFRS would be equal to basic loss per ordinary share when a loss occurs.
December 31, 2021 | December 31, 2020 | December 31, 2019 | ||||||||||
Basic earnings per share denominator (see above) | 83,606,810 | 83,606,810 | 83,606,810 | |||||||||
Issuable on exercise of options and warrants | 4,648,586 | 3,154,668 | 0 | |||||||||
Issuable on conversion of exchangeable notes | 18,263,254 | 18,263,254 | 18,263,254 | |||||||||
Diluted earnings per share denominator | 106,518,650 | 105,024,732 | 101,870,064 |
125
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
12. | PROFIT/(LOSS) PER SHARE (CONTINUED) |
December 31, 2021 US$‘000 | December 31, 2020 US$‘000 | December 31, 2019 US$‘000 | ||||||||||
Profit/(Loss) after tax for the year | 875 | (6,388 | ) | (28,914 | ) | |||||||
Non-cash financial (income)/expense (Note 8) | (1,220 | ) | 1,216 | (233 | ) | |||||||
Cash interest expense (Note 8) | 3,996 | 3,996 | 3,996 | |||||||||
Non-cash interest on exchangeable notes (Note 8) | 648 | 643 | 639 | |||||||||
Adjusted profit/(loss) after tax | 4,299 | (533 | ) | (24,512 | ) |
December 31, 2021 | December 31, 2020 | December 31, 2019 | ||||||||||
ADS | 20,901,703 | 20,901,703 | 20,901,703 | |||||||||
Basic earnings per share denominator | 20,901,703 | 20,901,703 | 20,901,703 | |||||||||
Reconciliation to weighted average earnings per share denominator: | ||||||||||||
Number of ADS at January 1 (Note 20) | 24,040,602 | 24,040,602 | 24,040,602 | |||||||||
Weighted average number of shares issued during the year* | 0 | 0 | 0 | |||||||||
Weighted average number of treasury shares | (3,138,899 | ) | (3,138,899 | ) | (3,138,899 | ) | ||||||
Basic earnings per share denominator | 20,901,703 | 20,901,703 | 20,901,703 |
Under IAS 33 Earnings per Share, diluted earnings per share cannot be anti-dilutive. Therefore, diluted earnings/(loss) per ADS in accordance with IFRS would be equal to basic loss per ADS when a loss occurs.
December 31, 2021 | December 31, 2020 | December 31, 2019 | ||||||||||
Basic earnings per share denominator (see above) | 20,901,703 | 20,901,703 | 20,901,703 | |||||||||
Issuable on exercise of options and warrants | 1,162,146 | 788,666 | 0 | |||||||||
Issuable on conversion of exchangeable notes | 4,565,814 | 4,565,814 | 4,565,814 | |||||||||
Diluted earnings per share denominator | 26,629,663 | 26,256,183 | 25,467,517 |
126
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
13. | PROPERTY, PLANT AND EQUIPMENT |
Land & Buildings US$‘000 | Leasehold Improvements US$‘000 | Computer & Office Equipment US$‘000 | Plant & Equipment US$‘000 | Total US$‘000 | ||||||||||||||||
Cost | ||||||||||||||||||||
At January 1, 2020 | 24,269 | 3,005 | 4,292 | 38,676 | 70,242 | |||||||||||||||
Additions | 8 | 41 | 96 | 2,766 | 2,911 | |||||||||||||||
Disposals or retirements | 0 | (299 | ) | (66 | ) | (5,758 | ) | (6,123 | ) | |||||||||||
Exchange adjustments | 10 | (77 | ) | (13 | ) | (1,845 | ) | (1,925 | ) | |||||||||||
At December 31, 2020 | 24,287 | 2,670 | 4,309 | 33,839 | 65,105 | |||||||||||||||
At January 1, 2021 | 24,287 | 2,670 | 4,309 | 33,839 | 65,105 | |||||||||||||||
Additions | 46 | 126 | 144 | 1,392 | 1,708 | |||||||||||||||
Disposals or retirements | 0 | (186 | ) | (255 | ) | (2,410 | ) | (2,851 | ) | |||||||||||
Reallocations/ reclassifications | 0 | 0 | 0 | 0 | 0 | |||||||||||||||
Exchange adjustments | 1 | (18 | ) | 2 | (484 | ) | (499 | ) | ||||||||||||
At December 31, 2021 | 24,334 | 2,592 | 4,200 | 32,337 | 63,463 | |||||||||||||||
Accumulated amortisation and Impairment losses | ||||||||||||||||||||
At January 1, 2020 | (18,493 | ) | (2,037 | ) | (3,682 | ) | (36,740 | ) | (60,952 | ) | ||||||||||
Charge for the year | (783 | ) | (146 | ) | (181 | ) | (604 | ) | (1,714 | ) | ||||||||||
Impairment losses as at December 31, 2020 | (347 | ) | (78 | ) | (180 | ) | (1,190 | ) | (1,795 | ) | ||||||||||
Disposals or retirements | 0 | 299 | 84 | 5,590 | 5,973 | |||||||||||||||
Exchange adjustments | (6 | ) | 78 | 13 | 1,845 | 1,930 | ||||||||||||||
At December 31, 2020 | (19,629 | ) | (1,884 | ) | (3,946 | ) | (31,099 | ) | (56,558 | ) | ||||||||||
At January 1, 2021 | (19,629 | ) | (1,884 | ) | (3,946 | ) | (31,099 | ) | (56,558 | ) | ||||||||||
Charge for the year | (628 | ) | (149 | ) | (115 | ) | (974 | ) | (1,866 | ) | ||||||||||
Disposals or retirements | 0 | 186 | 255 | 2,410 | 2,851 | |||||||||||||||
Impairment losses | (1,196 | ) | (279 | ) | (98 | ) | (935 | ) | (2,508 | ) | ||||||||||
Reallocations/ reclassifications | 0 | 0 | 0 | 0 | 0 | |||||||||||||||
Exchange adjustments | 21 | (5 | ) | (46 | ) | 566 | 536 | |||||||||||||
At December 31, 2021 | (21,432 | ) | (2,131 | ) | (3,950 | ) | (30,032 | ) | (57,545 | ) | ||||||||||
Carrying amounts | ||||||||||||||||||||
At December 31, 2021 | 2,902 | 461 | 250 | 2,305 | 5,918 | |||||||||||||||
At December 31, 2020 | 4,658 | 786 | 363 | 2,740 | 8,547 |
127
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
13. | PROPERTY, PLANT AND EQUIPMENT (CONTINUED) |
US$000 | ||||
Right-of-use assets cost at transition before impairment | 21,185 | |||
Impairment adjustment on transition | (11,099 | ) | ||
Right-of-use assets value at transition after impairment | 10,086 |
Carrying amount | Depreciation Charge | Impairment Charge | ||||||||||
At December 31, 2021 | Year ended December 31, 2021 | Year ended December 31, 2021 | ||||||||||
US$000 | US$000 | US$000 | ||||||||||
Buildings | 2,549 | (609 | ) | (1,089 | ) | |||||||
Computer equipment | 23 | (5 | ) | 0 | ||||||||
Plant and Equipment | 0 | 0 | 0 | |||||||||
2,572 | (614 | ) | (1,089 | ) |
Carrying amount | Depreciation Charge | Impairment Charge | ||||||||||
At December 31, 2020 | Year ended December 31, 2020 | Year ended December 31, 2020 | ||||||||||
US$000 | US$000 | US$000 | ||||||||||
Buildings | 4,200 | (673 | ) | (347 | ) | |||||||
Computer equipment | 3 | (4 | ) | 0 | ||||||||
Plant and Equipment | 0 | (70 | ) | (154 | ) | |||||||
4,203 | (747 | ) | (501 | ) |
Right-of-Use assets at 31 December 2021 | No. of Right-of-Use leased assets | Range of remaining term in years | Average remaining lease term (years) | No. of Leases with extension options | No. of Leases with options to purchase | No. of leases with variable payments linked to index | No. of leases with termination options | ||||||||||||||||||
Building | 11 | 1 to 12 | 3 | 1 | 0 | 2 | 4 | ||||||||||||||||||
Vehicle | 16 | 1 to 3 | 2 | 0 | 16 | 0 | 16 | ||||||||||||||||||
I.T. and office equipment | 2 | 1 to 5 | 4 | 0 | 0 | 0 | 0 |
128
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
13. | PROPERTY, PLANT AND EQUIPMENT (CONTINUED) |
Right-of-Use assets at 31 December 2020 | No. of Right-of-Use leased assets | Range of remaining term in years | Average remaining lease term (years) | No. of Leases with extension options | No. of Leases with options to purchase | No. of leases with variable payments linked to index | No. of leases with termination options | ||||||||||||||||||
Building | 12 | 1 to 13 | 4 | 1 | 0 | 2 | 4 | ||||||||||||||||||
Vehicle | 16 | 1 to 3 | 2 | 0 | 16 | 0 | 16 | ||||||||||||||||||
I.T. and office equipment | 10 | 1 to 2 | 1 | 0 | 0 | 0 | 1 |
129
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
14. | GOODWILL AND INTANGIBLE ASSETS |
Goodwill US$‘000 | Development costs US$‘000 | Patents and licences US$‘000 | Other US$‘000 | Total US$‘000 | ||||||||||||||||
Cost | ||||||||||||||||||||
At January 1, 2020 | 81,689 | 156,377 | 9,951 | 34,266 | 282,283 | |||||||||||||||
Additions | 0 | 6,896 | 30 | 89 | 7,015 | |||||||||||||||
Disposals or retirements | (2,507 | ) | (34,318 | ) | (1,034 | ) | (1,044 | ) | (38,903 | ) | ||||||||||
Exchange adjustments | 0 | 22 | 0 | 0 | 22 | |||||||||||||||
At December 31, 2020 | 79,182 | 128,977 | 8,947 | 33,311 | 250,417 | |||||||||||||||
At January 1, 2021 | 79,182 | 128,977 | 8,947 | 33,311 | 250,417 | |||||||||||||||
Additions | 0 | 6,771 | 102 | 21 | 6,894 | |||||||||||||||
Disposals or retirements | 0 | (14,576 | ) | (342 | ) | (134 | ) | (15,052 | ) | |||||||||||
Exchange adjustments | 0 | 1 | 0 | 0 | 1 | |||||||||||||||
At December 31, 2021 | 79,182 | 121,173 | 8,707 | 33,198 | 242,260 | |||||||||||||||
Accumulated amortisation and Impairment losses | ||||||||||||||||||||
At January 1, 2020 | (69,098 | ) | (133,599 | ) | (9,819 | ) | (26,113 | ) | (238,629 | ) | ||||||||||
Charge for the year | 0 | (959 | ) | (5 | ) | (439 | ) | (1,403 | ) | |||||||||||
Disposals or retirements | 2,507 | 34,318 | 1,034 | 1,044 | 38,903 | |||||||||||||||
Impairment losses | 0 | (15,287 | ) | 0 | (135 | ) | (15,422 | ) | ||||||||||||
Exchange adjustments | 0 | (6 | ) | 0 | 0 | (6 | ) | |||||||||||||
At December 31, 2020 | (66,591 | ) | (115,533 | ) | (8,790 | ) | (25,643 | ) | (216,557 | ) | ||||||||||
At January 1, 2021 | (66,591 | ) | (115,533 | ) | (8,790 | ) | (25,643 | ) | (216,557 | ) | ||||||||||
Charge for the year | 0 | (482 | ) | (7 | ) | (428 | ) | (917 | ) | |||||||||||
Disposals or retirements | 0 | 14,573 | 342 | 132 | 15,047 | |||||||||||||||
Impairment losses | (54 | ) | (2,053 | ) | (106 | ) | (1,640 | ) | (3,853 | ) | ||||||||||
Exchange adjustments | 0 | 1 | 0 | 0 | 1 | |||||||||||||||
At December 31, 2021 | (66,645 | ) | (103,494 | ) | (8,561 | ) | (27,579 | ) | (206,279 | ) | ||||||||||
Carrying amounts | ||||||||||||||||||||
At December 31, 2021 | 12,537 | 17,679 | 146 | 5,619 | 35,981 | |||||||||||||||
At December 31, 2020 | 12,591 | 13,444 | 157 | 7,668 | 33,860 |
130
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
14. | GOODWILL AND INTANGIBLE ASSETS (CONTINUED) |
The following represents the costs incurred during each period presented for each of the principal development projects:
Product Name | 2021 US$’000 | 2020 US$’000 | ||||||
Premier Instrument for Haemoglobin A1c testing | 2,538 | 1,359 | ||||||
HIV screening rapid test | 1,488 | 2,278 | ||||||
COVID tests | 1,320 | 467 | ||||||
Autoimmune Smart Reader | 550 | 666 | ||||||
Mid-tier haemoglobins instrument | 303 | 243 | ||||||
Tri-stat point-of-care instrument | 245 | 203 | ||||||
Uni-gold raw material stabilisation | 144 | 0 | ||||||
Sjögrens tests | 88 | 99 | ||||||
Uni-Gold antigen improvement | 0 | 556 | ||||||
Syphilis point-of-care test | 0 | 618 | ||||||
Column enhancement | 0 | 151 | ||||||
Other projects | 95 | 256 | ||||||
Total capitalised development costs | 6,771 | 6,896 |
(a) | The Group only develops products within its field of expertise. The R&D team is experienced in developing new products in this field and this experience means that only products which have a high probability of technical success are put forward for consideration as potential new products. |
(b) | A technical feasibility study is undertaken in advance of every project. The feasibility study for each project is reviewed by the R&D team leader, and by other senior management depending on the size of the project. The feasibility study occurs in the initial research phase of the project and costs in this phase are not capitalised. |
(c) | Nearly all of our new product developments involve the transfer of our existing product know-how to a new application. The Group does not engage in pure research. Every development project is undertaken with the intention of bringing a particular new product to market for which there is an expected demand. |
(d) | The commercial feasibility of each new product is established prior to commencement of a project by ensuring it is projected to achieve an acceptable income after applying appropriate discount rates. |
131
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
14. | GOODWILL AND INTANGIBLE ASSETS (CONTINUED) |
December 31, 2021 | December 31, 2020 | |||||||
US$’000 | US$’000 | |||||||
Immco Diagnostics Inc | 4,979 | 0 | ||||||
Trinity Biotech Manufacturing Limited | 856 | 0 | ||||||
Trinity Biotech Do Brasil | 956 | 919 | ||||||
Biopool US Inc. | 153 | 154 | ||||||
Primus Corp | 0 | 16,706 | ||||||
Total impairment loss | 6,944 | 17,779 |
132
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
14. | GOODWILL AND INTANGIBLE ASSETS (CONTINUED) |
December 31, 2021 | December 31, 2020 | |||||||
US$’000 | US$’000 | |||||||
Goodwill and other intangible assets (see Note 14) | 3,853 | 15,422 | ||||||
Property, plant and equipment (see Note 13) | 2,508 | 1,795 | ||||||
Prepayments (see Note 18) | 583 | 562 | ||||||
Total impairment loss | 6,944 | 17,779 |
• | In the event that there was a reduction of 10% in the assumed level of future growth in revenue growth rate, which would represent a reasonably likely range of outcomes, there would be no additional impairment loss recorded at December 31, 2021. |
• | In the event there was a 10% increase in the discount rate used to calculate the potential impairment of the carrying values, which would represent a reasonably likely range of outcomes, there would be no additional impairment loss recorded at December 31, 2021. |
133
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
14. | GOODWILL AND INTANGIBLE ASSETS (CONTINUED) |
Fitzgerald Industries | December 31, 2021 | December 31, 2020 | ||||||
Carrying amount of goodwill (US$’000) | 12,591 | 12,591 | ||||||
Discount rate applied (real pre-tax) | 19.66 | % | 19.98 | % | ||||
Excess value-in-use over carrying amount (US$’000) | 3,496 | 7,915 | ||||||
% EBITDA would need to decrease for an impairment to arise | 18.15 | % | 31.98 | % | ||||
Long-term growth rate | 2.0 | % | 2.0 | % |
Intangible Assets with Indefinite Useful lives (included in other intangibles) | December 31, 2021 US$‘000 | December 31, 2020 US$‘000 | ||||||
Fitzgerald Industries International CGU | ||||||||
Fitzgerald trade name | 970 | 970 | ||||||
RDI trade name | 560 | 560 | ||||||
Primus Corporation CGU | ||||||||
Primus trade name | 365 | 365 | ||||||
Immco Diagnostic CGU | ||||||||
Immco Diagnostic trade name | 2,069 | 2,938 | ||||||
Total | 3,964 | 4,833 |
134
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
Assets | Liabilities | Net | ||||||||||||||||||||||
2021 US$’000 | 2020 US$’000 | 2021 US$’000 | 2020 US$’000 | 2021 US$’000 | 2020 US$’000 | |||||||||||||||||||
Property, plant and equipment | 477 | 733 | (11 | ) | (9 | ) | 466 | 724 | ||||||||||||||||
Intangible assets | 0 | 0 | (3,969 | ) | (4,072 | ) | (3,969 | ) | (4,072 | ) | ||||||||||||||
Inventories | 620 | 750 | 0 | 0 | 620 | 750 | ||||||||||||||||||
Provisions | 1,871 | 2,159 | 0 | 0 | 1,871 | 2,159 | ||||||||||||||||||
Tax value of loss carry-forwards | 1,016 | 433 | 0 | 0 | 1,016 | 433 | ||||||||||||||||||
Other items | 117 | 110 | (878 | ) | (824 | ) | (761 | ) | (714 | ) | ||||||||||||||
Deferred tax assets/(liabilities) | 4,101 | 4,185 | (4,858 | ) | (4,905 | ) | (757 | ) | (720 | ) |
Balance January, 1 2021 | Recognised in income | Balance December 31, 2021 | ||||||||||
US$’000 | US$’000 | US$’000 | ||||||||||
Property, plant and equipment | 724 | (258 | ) | 466 | ||||||||
Intangible assets | (4,072 | ) | 103 | (3,969 | ) | |||||||
Inventories | 750 | (130 | ) | 620 | ||||||||
Provisions | 2,159 | (288 | ) | 1,871 | ||||||||
Tax value of loss carry-forwards | 433 | 583 | 1,016 | |||||||||
Other items | (714 | ) | (47 | ) | (761 | ) | ||||||
(720 | ) | (37 | ) | (757 | ) |
135
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
Balance January, 1 2020 | Recognised in income | Balance December 31, 2020 | ||||||||||
US$’000 | US$’000 | US$’000 | ||||||||||
Property, plant and equipment | 1,018 | (294 | ) | 724 | ||||||||
Intangible assets | (6,099 | ) | 2,027 | (4,072 | ) | |||||||
Inventories | 642 | 108 | 750 | |||||||||
Provisions | 3,622 | (1,463 | ) | 2,159 | ||||||||
Tax value of loss carry-forwards | 216 | 217 | 433 | |||||||||
Other items | (286 | ) | (428 | ) | (714 | ) | ||||||
(887 | ) | 167 | (720 | ) |
December 31, 2021 | December 31, 2020 | |||||||
US$’000 | US$’000 | |||||||
Capital losses | 8,293 | 8,293 | ||||||
Net operating losses | 73,893 | 85,198 | ||||||
US alternative minimum tax credits | 1,704 | 1,848 | ||||||
Other temporary timing differences | 21,301 | 21,878 | ||||||
US state credit carry-forwards | 1,664 | 802 | ||||||
106,855 | 118,019 |
16. | OTHER NON-CURRENT ASSETS |
December 31, 2021 US$‘000 | December 31, 2020 US$‘000 | |||||||
Finance lease receivables (see Note 18) | 151 | 291 | ||||||
Other assets | 56 | 64 | ||||||
207 | 355 |
136
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
17. | INVENTORIES |
December 31, 2021 US$‘000 | December 31, 2020 US$‘000 | |||||||
Raw materials and consumables | 13,650 | 12,168 | ||||||
Work-in-progress | 5,546 | 5,169 | ||||||
Finished goods | 9,927 | 12,882 | ||||||
29,123 | 30,219 |
December 31, 2021 US$‘000 | December 31, 2020 US$‘000 | December 31, 2019 US$‘000 | ||||||||||
Opening provision at January 1 | 9,781 | 6,716 | 6,299 | |||||||||
Charged during the year | 5,589 | 5,179 | 1,567 | |||||||||
Utilised during the year | (3,307 | ) | (1,994 | ) | (1,150 | ) | ||||||
Released during the year | 0 | (120 | ) | 0 | ||||||||
Closing provision at December 31 | 12,063 | 9,781 | 6,716 |
After January 27, 2022, the assets of the Group are pledged as security for the term loan from Perceptive Advisors. Refer to Note 30, Post Balance Sheet events.
18. | TRADE AND OTHER RECEIVABLES |
December 31, 2021 US$‘000 | December 31, 2020 US$‘000 | |||||||
Trade receivables, net of impairment losses | 13,290 | 20,025 | ||||||
Prepayments | 1,945 | 1,159 | ||||||
Contract assets | 739 | 1,177 | ||||||
Value added tax | 0 | 92 | ||||||
Finance lease receivables | 142 | 215 | ||||||
16,116 | 22,668 |
137
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
18. | TRADE AND OTHER RECEIVABLES (CONTINUED) |
December 31, 2021 US$‘000 | ||||||||||||
Gross investment | Unearned income | Minimum payments receivable | ||||||||||
Less than one year | 292 | 150 | 142 | |||||||||
Between one and five years (Note 16) | 310 | 159 | 151 | |||||||||
602 | 309 | 293 |
December 31, 2020 US$‘000 | ||||||||||||
Gross investment | Unearned income | Minimum payments receivable | ||||||||||
Less than one year | 415 | 200 | 215 | |||||||||
Between one and five years (Note 16) | 591 | 300 | 291 | |||||||||
1,006 | 500 | 506 |
December 31, 2021 | ||||||||
US$‘000 | ||||||||
Instruments | Total | |||||||
Less than one year | 3,953 | 3,953 | ||||||
Between one and five years | 171 | 171 | ||||||
4,124 | 4,124 |
December 31, 2020 | ||||||||
US$‘000 | ||||||||
Instruments | Total | |||||||
Less than one year | 2,767 | 2,767 | ||||||
Between one and five years | 171 | 171 | ||||||
2,938 | 2,938 |
138
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
19. | CASH AND CASH EQUIVALENTS |
December 31, 2021 US$’000 | December 31, 2020 US$’000 | |||||||
Cash at bank and in hand | 22,790 | 24,209 | ||||||
Short-term deposits | 3,120 | 3,118 | ||||||
Cash and cash equivalents | 25,910 | 27,327 |
20. | CAPITAL AND RESERVES |
Share capital |
Class ‘A’ Ordinary shares | Class ‘A’ Ordinary shares | |||||||
In thousands of shares | 2021 | 2020 | ||||||
In issue at January 1 | 96,162 | 96,162 | ||||||
Issued for cash | 0 | 0 | ||||||
In issue at December 31 | 96,162 | 96,162 |
ADS | ADS | |||||||
In thousands of ADSs | 2021 | 2020 | ||||||
Balance at January 1 | 24,041 | 24,041 | ||||||
Issued for cash | 0 | 0 | ||||||
Balance at December 31 | 24,041 | 24,041 |
Class ‘A’ Treasury shares | Class ‘A’ Treasury shares | |||||||
In thousands of shares | 2021 | 2020 | ||||||
Balance at January 1 | 12,556 | 12,556 | ||||||
Purchased during the year | 0 | 0 | ||||||
Balance at December 31 | 12,556 | 12,556 |
ADS Treasury shares | ADS Treasury shares | |||||||
In thousands of ADSs | 2021 | 2020 | ||||||
Balance at January 1 | 3,139 | 3,139 | ||||||
Purchased during the year | 0 | 0 | ||||||
Balance at December 31 | 3,139 | 3,139 |
The Group had authorised share capital of 200,700,000 ‘A’ ordinary shares of US$0.0109 each (2020: 200,700,000 ‘A’ ordinary shares of US$0.0109 each) as at December 31, 2021. The Group did not issue any shares from the exercise of employee options and did not repurchase any ‘A’ ordinary shares under its share buyback program in either 2020 or 2021. No dividends have been paid in the last five years. The last dividend paid was in respect of the 2014 financial year.
Translation reserve
139
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
20. | CAPITAL AND RESERVES (CONTINUED) |
Hedging reserve
21. | SHARE OPTIONS |
140
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
21. | SHARE OPTIONS (CONTINUED) |
Options and warrants | Weighted- average exercise price US$ | Range US$ | ||||||||||
‘A’ Ordinary Shares | Per ‘A’ Ordinary Share | Per ‘A’ Ordinary Share | ||||||||||
Outstanding January 1, 2019 | 10,908,200 | 1.83 | 0.67 –4.36 | |||||||||
Granted | 4,370,000 | 0.68 | 0.46 –0.78 | |||||||||
Exercised | 0 | 0 | 0 | |||||||||
Expired / Forfeited | (2,974,210 | ) | 2.25 | 0.66 –4.23 | ||||||||
Outstanding at end of year | 12,303,990 | 1.31 | 0.46 –4.36 | |||||||||
Exercisable at end of year | 6,622,667 | 1.73 | 1.24 –4.36 | |||||||||
Outstanding January 1, 2020 | 12,303,990 | 1.31 | 0.46 –4.36 | |||||||||
Granted | 9,100,000 | 0.38 | 0.19 –1.10 | |||||||||
Exercised | 0 | 0 | 0 | |||||||||
Expired / Forfeited | (1,918,000 | ) | 2.14 | 0.19-4.21 | ||||||||
Outstanding at end of year | 19,485,990 | 0.79 | 0.19-4.36 | |||||||||
Exercisable at end of year | 7,959,323 | 1.27 | 0.66-4.36 | |||||||||
Outstanding January 1, 2021 | 19,485,990 | 0.79 | 0.19-4.36 | |||||||||
Granted | 0 | 0 | 0 | |||||||||
Exercised | 0 | 0 | 0 | |||||||||
Expired / Forfeited | (758,000 | ) | 1.07 | 0.19-4.21 | ||||||||
Outstanding at end of year | 18,727,990 | 0.78 | 0.19-4.36 | |||||||||
Exercisable at end of year | 13,401,322 | 0.93 | 0.19-4.36 |
141
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
21. | SHARE OPTIONS (CONTINUED) |
Options and warrants | Weighted- average exercise price US$ | Range US$ | ||||||||||
‘ADS’ Equivalent | Per ‘ADS’ | Per ‘ADS’ | ||||||||||
Outstanding January 1, 2019 | 2,727,050 | 7.32 | 2.68 - 17.44 | |||||||||
Granted | 1,092,500 | 2.72 | 1.83 – 3.10 | |||||||||
Exercised | 0 | 0 | 0 | |||||||||
Expired / Forfeited | (743,552 | ) | 8.99 | 2.64 – 16.92 | ||||||||
Outstanding at end of year | 3,075,998 | 5.24 | 1.83–17.45 | |||||||||
Exercisable at end of year | 1,655,667 | 6.92 | 4.95 –17.45 | |||||||||
Outstanding January 1, 2020 | 3,075,998 | 5.24 | 1.83–17.45 | |||||||||
Granted | 2,275,000 | 1.52 | 0.77 - 4.41 | |||||||||
Exercised | 0 | 0 | 0 | |||||||||
Expired / Forfeited | (479,500 | ) | 8.56 | 0.77 - 16.84 | ||||||||
Outstanding at end of year | 4,871,498 | 3.15 | 0.77 - 17.45 | |||||||||
Exercisable at end of year | 1,989,831 | 5.08 | 2.64 –17.45 | |||||||||
Outstanding January 1, 2021 | 4,871,498 | 3.15 | 0.77 - 17.45 | |||||||||
Granted | 0 | 0 | 0 | |||||||||
Exercised | 0 | 0 | 0 | |||||||||
Expired / Forfeited | (189,500 | ) | 4.28 | 0.76 - 16.84 | ||||||||
Outstanding at end of year | 4,681,998 | 3.12 | 0.76-17.44 | |||||||||
Exercisable at end of year | 3,350,331 | 3.72 | 0.76-17.44 |
Outstanding | Exercisable | |||||||||||||||||||||||
Exercise price range | No. of options ‘A’ ordinary shares | Weighted– average exercise price | Weighted- average contractual life remaining (years) | No. of options ‘A’ ordinary shares | Weighted– average exercise price | Weighted- average contractual life remaining (years) | ||||||||||||||||||
US$0.19-US$0.99 | 13,000,006 | 0.48 | 3.54 | 7,960,004 | 0.55 | 2.92 | ||||||||||||||||||
US$1.00-US$2.05 | 5,228,000 | 1.34 | 0.79 | 4,941,334 | 1.35 | 0.99 | ||||||||||||||||||
US$2.06- US$2.99 | 439,984 | 2.53 | 0.03 | 439,984 | 2.53 | 0.04 | ||||||||||||||||||
US$3.00 -US$4.36 | 60,000 | 4.17 | 0.00 | 60,000 | 4.17 | 0.00 | ||||||||||||||||||
18,727,990 | 13,401,322 |
142
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
21. | SHARE OPTIONS (CONTINUED) |
Outstanding | Exercisable | |||||||||||||||||||||||
Exercise price range | No. of options ‘ADS equivalent’ | Weighted– average exercise price | Weighted- average contractual life remaining (years) | No. of options ‘ADS equivalent’ | Weighted– average exercise price | Weighted- average contractual life remaining (years) | ||||||||||||||||||
US$0.77-US$3.96 | 3,250,002 | 1.94 | 3.54 | 1,990,001 | 2.19 | 2.92 | ||||||||||||||||||
US$4.00-US$8.20 | 1,307,000 | 5.36 | 0.79 | 1,235,334 | 5.40 | 0.99 | ||||||||||||||||||
US$8.24- US$11.96 | 109,996 | 10.13 | 0.03 | 109,996 | 10.13 | 0.04 | ||||||||||||||||||
US$12.00 -US$17.45 | 15,000 | 16.67 | 0.00 | 15,000 | 16.67 | 0.00 | ||||||||||||||||||
4,681,998 | 3,350,331 |
Outstanding | Exercisable | ||||||||||||||||||||||||
Exercise price range | No. of options ‘A’ ordinary shares | Weighted– average exercise price | Weighted- average contractual life remaining (years) | No. of options ‘A’ ordinary shares | Weighted– average exercise price | Weighted- average contractual life remaining (years) | |||||||||||||||||||
US$0.19-US$0.99 | 13,260,006 | 0.48 | 4.14 | 2,106,673 | 0.69 | 1.44 | |||||||||||||||||||
US$1.00-US$2.05 | 5,664,000 | 1.34 | 1.11 | 5,290,667 | 1.35 | 2.44 | |||||||||||||||||||
US$2.06- US$2.99 | 499,984 | 2.52 | 0.05 | 499,984 | 2.52 | 0.13 | |||||||||||||||||||
US$3.00 -US$4.36 | 62,000 | 4.17 | 0.00 | 62,000 | 4.17 | 0.01 | |||||||||||||||||||
19,485,990 | 7,959,324 |
Outstanding | Exercisable | ||||||||||||||||||||||||
Exercise price range | No. of options ‘ADS equivalent’ | Weighted– average exercise price | Weighted- average contractual life remaining (years) | No. of options ‘ADS equivalent’ | Weighted– average exercise price | Weighted- average contractual life remaining (years) | |||||||||||||||||||
US$0.77-US$3.96 | 3,315,002 | 1.92 | 4.17 | 526,668 | 2.76 | 1.44 | |||||||||||||||||||
US$4.00-US$8.20 | 1,416,000 | 5.36 | 1.10 | 1,322,667 | 5.40 | 2.44 | |||||||||||||||||||
US$8.24- US$11.96 | 124,996 | 10.08 | 0.05 | 124,996 | 10.08 | 0.13 | |||||||||||||||||||
US$12.00 -US$17.45 | 15,500 | 16.68 | 0.00 | 15,500 | 16.68 | 0.01 | |||||||||||||||||||
4,871,498 | 1,989,831 |
143
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
21. | SHARE OPTIONS (CONTINUED) |
December 31, 2021 US$‘000 | December 31, 2020 US$‘000 | December 31, 2019 US$‘000 | ||||||||||
Share-based payments – cost of sales | 5 | 12 | 26 | |||||||||
Share-based payments – selling, general and administrative | 1,095 | 780 | 732 | |||||||||
Total – continuing operations | 1,100 | 792 | 758 | |||||||||
Share-based payments – discontinued operations | 0 | 0 | 0 | |||||||||
Total | 1,100 | 792 | 758 |
Key management personnel | Other employees | Key management personnel | Other employees | Key management personnel | Other employees | ||||||||
2021 | 2021 | 2020 | 2020 | 2019 | 2019 | ||||||||
Weighted average fair value at measurement date per ‘A’ share / (per ADS) | 0 / 0 | 0 / 0 | US$0.20 / (US$0.80) | US$0.27 / (US$1.08) | US$0.14 / (US$0.56) | US$0.25 / (US$1.02) | |||||||
Total ‘A’ share options granted / (ADS’s equivalent) | 0 / 0 | 0 / 0 | 8,480,000 / (2,120,000) | 620,000 / (155,000) | 4,060,000 / (1,015,000) | 310,000 / (77,500) | |||||||
Weighted average share price per ‘A’ share / (per ADS) | 0 / 0 | 0 / 0 | US$0.38 / (US$1.52) | US$0.48 / (US$1.96) | US$0.46 / (US$1.84) | US$0.64 / (US$2.53) | |||||||
Weighted average exercise price per ‘A’ share / (per ADS) | 0 / 0 | 0 / 0 | US$0.38 / (US$1.52) | US$0.48 / (US$1.96) | US$0.69 / (US$2.74) | US$0.64 / (US$2.53) | |||||||
Weighted average expected volatility | 0% | 0% | 66.98% | 65.89% | 51.18% | 47.31% | |||||||
Weighted average expected life | 0 | 0 | 4.34 | 4.35 | 4.15 | 4.42 | |||||||
Weighted average risk free interest rate | 0% | 0% | 0.44% | 0.42% | 1.84% | 2.23% |
144
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
21. | SHARE OPTIONS (CONTINUED) |
22. | TRADE AND OTHER PAYABLES |
December 31, 2021 US$’000 | December 31, 2020 US$’000 | |||||||
Trade payables | 6,763 | 7,103 | ||||||
Payroll taxes | 398 | 688 | ||||||
Employee related social insurance | 130 | 344 | ||||||
Accruals and other liabilities | 7,595 | 8,850 | ||||||
Deferred income | 141 | 4,445 | ||||||
Deferred government grants | 69 | 0 | ||||||
Other payables | 31 | 0 | ||||||
Government COVID-19 loans (Note 4) | 0 | 2,905 | ||||||
15,127 | 24,335 |
145
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
23. | PROVISIONS |
December 31, 2021 US$’000 | December 31, 2020 US$’000 | |||||||
Product warranty provision | 50 | 50 | ||||||
Other provisions | 0 | 366 | ||||||
50 | 416 |
24. | EXCHANGEABLE NOTES AND OTHER BORROWINGS |
December 31, 2021 US$’000 | December 31, 2020 US$’000 | |||||||
Current liabilities | ||||||||
Exchangeable senior notes | 83,312 | 0 | ||||||
Total current liabilities | 83,312 | 0 |
December 31, 2021 US$’000 | December 31, 2020 US$’000 | |||||||
Non-Current liabilities | ||||||||
Exchangeable senior notes | 0 | 82,664 | ||||||
Other borrowings | 0 | 31 | ||||||
Total value of embedded derivatives – liability | 0 | 1,370 | ||||||
Total non-current liabilities | 0 | 84,065 |
146
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
24. | EXCHANGEABLE NOTES AND OTHER BORROWINGS (CONTINUED) |
December 31, 2021 US$’000 | December 31, 2020 US$’000 | |||||||
Balance at 1 January | 82,664 | 82,021 | ||||||
Accretion interest (Note 8) | 648 | 643 | ||||||
83,312 | 82,664 |
December 31, 2021 US$’000 | December 31, 2020 US$’000 | |||||||
Non-current assets | ||||||||
Exchangeable note bond call option | 0 | 150 | ||||||
Non-current liabilities | ||||||||
Exchangeable note equity conversion option | 0 | 1,370 | ||||||
Exchangeable note bond put option | 0 | 0 | ||||||
0 | 1,370 | |||||||
Total value of embedded derivatives – net liability | 0 | 1,220 |
147
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
24. | EXCHANGEABLE NOTES AND OTHER BORROWINGS (CONTINUED) |
25. | LEASE LIABILITIES |
December 31, 2021 US$’000 | December 31, 2020 US$’000 | |||||||
Current liabilities | ||||||||
Lease liabilities related to Right of Use assets | 1,878 | 2,054 | ||||||
Sale and leaseback liabilities | 102 | 99 | ||||||
1,980 | 2,153 | |||||||
Non-Current liabilities | ||||||||
Lease liabilities related to Right of Use assets | 13,790 | 16,407 | ||||||
Sale and leaseback liabilities | 75 | 181 | ||||||
13,865 | 16,588 |
148
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
25. | LEASE LIABILITIES (CONTINUED) |
December 31, 2021 US$’000 | December 31, 2021 US$’000 | |||||||||||||||||||||||
Lease liabilities related to Right of Use assets | Sale and leaseback Liabilities | |||||||||||||||||||||||
Minimum lease payments | Interest | Principal | Minimum lease payments | Interest | Principal | |||||||||||||||||||
Less than one year | 2,575 | 697 | 1,878 | 109 | 7 | 102 | ||||||||||||||||||
In more than one year, but not more than two | 2,175 | 621 | 1,554 | 77 | 2 | 75 | ||||||||||||||||||
In more than two years but not more than five | 5,985 | 1,469 | 4,516 | 0 | 0 | 0 | ||||||||||||||||||
more than five years | 8,992 | 1,272 | 7,720 | 0 | 0 | 0 | ||||||||||||||||||
19,727 | 4,059 | 15,668 | 186 | 9 | 177 |
December 31, 2020 US$’000 | December 31, 2020 US$’000 | |||||||||||||||||||||||
Lease liabilities related to Right of Use assets | Sale and leaseback liabilities | |||||||||||||||||||||||
Minimum lease payments | Interest | Principal | Minimum lease payments | Interest | Principal | |||||||||||||||||||
Less than one year | 2,877 | 823 | 2,054 | 111 | 12 | 99 | ||||||||||||||||||
In more than one year, but not more than two | 2,644 | 730 | 1,914 | 111 | 7 | 104 | ||||||||||||||||||
In more than two years but not more than five | 6,621 | 1,765 | 4,856 | 79 | 2 | 77 | ||||||||||||||||||
more than five years | 11,389 | 1,752 | 9,637 | 0 | 0 | 0 | ||||||||||||||||||
23,531 | 5,070 | 18,461 | 301 | 21 | 280 |
Lease payments not recognised as a liability
No short term lease expenses were incurred for the year ended December 31, 2021. In 2020 the Group elected not to recognise a lease liability for short term leases (leases with an expected term of 12 months or less) or for leases of low value assets. Payments made under such leases are expensed on a straight-line basis. In addition, certain variable lease payments are not permitted to be recognised as lease liabilities and are expensed as incurred.
149
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
25. | LEASE LIABILITIES (CONTINUED) |
Facility | Currency | Nominal interest rate | Year of maturity | Fair Value | Carrying Value | |||||||||||||
Sale and leaseback liabilities | Euro | 4.53 | % | 2023 | 65 | 65 | ||||||||||||
Sale and leaseback liabilities | USD | 5.51 | % | 2023 | 111 | 111 | ||||||||||||
Total interest-bearing loans and borrowings | 176 | 176 |
Facility | Currency | Nominal interest rate | Year of maturity | Fair Value | Carrying Value | |||||||||||||
Sale and leaseback liabilities | Euro | 4.53 | % | 2023 | 106 | 106 | ||||||||||||
Sale and leaseback liabilities | USD | 5.51 | % | 2023 | 174 | 174 | ||||||||||||
Total interest-bearing loans and borrowings | 280 | 280 |
26. | COMMITMENTS AND CONTINGENCIES |
(a) | Capital Commitments |
(b) | Leasing Commitments |
(d) | Group Company Guarantees |
150
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
26. | COMMITMENTS AND CONTINGENCIES (CONTINUED) |
(e) | Contingent Asset |
(f) | Government Grant Contingencies |
To mitigate the financial impact of the Covid-19 outbreak, the Company has availed of governmental supports. In 2020, the Company received US$4.5 million of Paycheck Protection Program (“PPP”) loans and in 2021, a further US$1.8 million of PPP loans were received. All of the loans received to date under the program have been forgiven by the US government before December 31, 2021 and therefore no liability for these loans exists at December 31, 2021.
(g) | Other Contingencies |
27. | RELATED PARTY TRANSACTIONS |
151
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
27. | RELATED PARTY TRANSACTIONS (CONTINUED) |
The Group has entered into an agreement for a 25-year lease with JRJ for offices that adjacent to its then premises at IDA Business Park, Bray, Co. Wicklow, Ireland. The annual rent of €381,000 (US$432,000) is payable from January 1, 2004. Upward-only rent reviews are carried out every five years and there have been no increases arising from these rent reviews. The Group has also entered into lease agreements with Ronan O’Caoimh for a 43,860 square foot manufacturing facility in Bray, Ireland and an adjacent warehouse of 16,000 square feet. The annual rent for the manufacturing facility is €787,000 (US$891,000) and the annual rent for the warehouse is €144,000 (US$163,000). These two leases expire in 2028 and 2026 respectively. At the time, independent valuers advised the Group that the rent in respect of each of the leases represents a fair market rent. Upward-only rent reviews are carried out every five years and there have been no increases arising from these rent reviews. |
December 31, 2021 | December 31, 2020 | |||||||
US$’000 | US$’000 | |||||||
Short-term employee benefits | 1,065 | 1,274 | ||||||
Performance related bonus | 227 | 584 | ||||||
Post-employment benefits | 24 | 41 | ||||||
Share-based compensation benefits | 965 | 626 | ||||||
2,281 | 2,525 |
152
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
27. | RELATED PARTY TRANSACTIONS (CONTINUED) |
‘A’ Ordinary Shares | Share options | |||||||
At January 1, 2021 | 9,077,706 | 17,394,004 | ||||||
Shares of retired director | 0 | 0 | ||||||
Options of retired director | 0 | (656,000 | ) | |||||
Shares purchased during the year | 0 | 0 | ||||||
Shares sold during the year | 0 | 0 | ||||||
Granted | 0 | 0 | ||||||
Expired / forfeited | 0 | 0 | ||||||
At December 31, 2021 | 9,077,706 | 16,738,004 |
‘A’ Ordinary Shares | Share options | |||||||
At January 1, 2020 | 9,077,709 | 10,414,004 | ||||||
Shares of retired director | 0 | 0 | ||||||
Options of retired director | 0 | 0 | ||||||
Shares purchased during the year | 0 | 0 | ||||||
Shares sold during the year | 0 | 0 | ||||||
Granted | 0 | 8,480,000 | ||||||
Expired / forfeited | 0 | (1,500,000 | ) | |||||
At December 31, 2020 | 9,077,706 | 17,394,004 |
153
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
28. | CAPITAL AND FINANCIAL RISK MANAGEMENT |
Level 1 | Level 2 | Total carrying amount | Fair Value | |||||||||||||||||
Note | US$’000 | US$’000 | �� | US$’000 | US$’000 | |||||||||||||||
December 31, 2021 | ||||||||||||||||||||
Loans and receivables at amortised cost | ||||||||||||||||||||
Trade receivables | 18 | 13,290 | 0 | 13,290 | 13,290 | |||||||||||||||
Cash and cash equivalents | 19 | 25,910 | 0 | 25,910 | 25,910 | |||||||||||||||
Finance lease receivable | 16, 18 | 293 | 0 | 293 | 293 | |||||||||||||||
39,493 | 0 | 39,493 | 39,493 | |||||||||||||||||
Liabilities at amortised cost | ||||||||||||||||||||
Exchangeable note¹ | 24 | 0 | (83,312 | ) | (83,312 | ) | (83,312 | ) | ||||||||||||
Lease liabilities | 25 | (15,845 | ) | 0 | (15,845 | ) | (15,845 | ) | ||||||||||||
Trade and other payables (excluding deferred income) | 22 | (14,986 | ) | 0 | (14,986 | ) | (14,986 | ) | ||||||||||||
Provisions | 23 | (50 | ) | 0 | (50 | ) | (50 | ) | ||||||||||||
(30,881 | ) | (83,312 | ) | (114,193 | ) | (114,193 | ) | |||||||||||||
Fair value through profit and loss (FVPL) | ||||||||||||||||||||
Exchangeable note bond call option | 24 | 0 | 0 | 0 | 0 | |||||||||||||||
Exchangeable note equity conversion option | 24 | 0 | 0 | 0 | 0 | |||||||||||||||
0 | 0 | 0 | 0 | |||||||||||||||||
8,612 | (83,312 | ) | (74,700 | ) | (74,700 | ) |
¹ The maturity of the Exchangeable Notes is based on the contractual maturity date of April 1, 2045 and does not take into account the potential exercise of put and call options in the next five years or the exchange agreements entered into with five exchangeable note holders in December 2021.
154
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
28. | CAPITAL AND FINANCIAL RISK MANAGEMENT (CONTINUED) |
For financial reporting purposes, fair value measurements are categorized into Level 1, 2 or 3 based on the degree to which inputs to the fair value measurements are observable and the significance of the inputs to the fair value measurement in its entirety, which are described as follows:
Level 1 | Level 2 | Total carrying amount | Fair Value | ||||||||||||||||
Note | US$’000 | US$’000 | US$’000 | US$’000 | |||||||||||||||
December 31, 2020 | |||||||||||||||||||
Loans and receivables at amortised cost | |||||||||||||||||||
Trade receivables | 18 | 20,025 | 0 | 20,025 | 20,025 | ||||||||||||||
Cash and cash equivalents | 19 | 27,327 | 0 | 27,327 | 27,327 | ||||||||||||||
Finance lease receivable | 16, 18 | 506 | 0 | 506 | 506 | ||||||||||||||
47,858 | 0 | 47,858 | 47,858 | ||||||||||||||||
Liabilities at amortised cost | |||||||||||||||||||
Exchangeable note | 24 | 0 | (82,664 | ) | (82,664 | ) | (82,664 | ) | |||||||||||
Lease liabilities | 25 | (18,741 | ) | 0 | (18,741 | ) | (18,741 | ) | |||||||||||
Trade and other payables (excluding deferred income) | 22 | (19,890 | ) | 0 | (19,890 | ) | (19,890 | ) | |||||||||||
Provisions | 23 | (416 | ) | 0 | (416 | ) | (416 | ) | |||||||||||
(39,047 | ) | (82,664 | ) | (121,711 | ) | (121,711 | ) | ||||||||||||
Fair value through profit and loss (FVPL) | |||||||||||||||||||
Exchangeable note bond call option | 24 | 0 | 150 | 150 | 150 | ||||||||||||||
Exchangeable note equity conversion option | 24 | 0 | (1,370 | ) | (1,370 | ) | (1,370 | ) | |||||||||||
0 | (1,220 | ) | (1,220 | ) | (1,220 | ) | |||||||||||||
8,811 | (83,884 | ) | (75,073 | ) | (75,073 | ) |
¹ The maturity of the Exchangeable Notes is based on the contractual maturity date of April 1, 2045 and does not take into account the potential exercise of put and call options in the next five years or the exchange agreements entered into with five exchangeable note holders in December 2021.
The valuation techniques used for instruments categorised as level 2 are described below:
155
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
28. | CAPITAL AND FINANCIAL RISK MANAGEMENT (CONTINUED) |
As at December 31, 2021 | Note | Effective interest rate | Total US$’000 | 6 mths or less US$’000 | 6 –12 mths US$’000 | 1-2 years US$’000 | 2-5 years US$’000 | > 5 years US$’000 | |||||||||||||||||||||||
Cash and cash equivalents | 19 | 0.01 | % | 25,910 | 25,910 | 0 | 0 | 0 | 0 | ||||||||||||||||||||||
Lease receivable | 16,18 | 4.0 | % | 293 | 81 | 61 | 89 | 62 | 0 | ||||||||||||||||||||||
Exchangeable note¹ | 24 | 4.8 | % | (83,312 | ) | 0 | 0 | 0 | 0 | (83,312 | ) | ||||||||||||||||||||
Other borrowings | 22 | 0 | % | (31 | ) | 0 | (31 | ) | 0 | 0 | 0 | ||||||||||||||||||||
Lease payable on Right of Use assets | 25 | 5.0 | % | (15,668 | ) | (973 | ) | (905 | ) | (1,554 | ) | (4,516 | ) | (7,720 | ) | ||||||||||||||||
Lease payable on sale & leaseback transactions | 25 | 5.0 | % | (177 | ) | (51 | ) | (51 | ) | (75 | ) | 0 | 0 | ||||||||||||||||||
Total | (72,985 | ) | 24,967 | (926 | ) | (1,540 | ) | (4,454 | ) | (91,032 | ) |
¹ The maturity of the Exchangeable Notes is based on the contractual maturity date of April 1, 2045 and does not take into account the potential exercise of put and call options in the next five years or the exchange agreements entered into with five exchangeable note holders in December 2021.
As at December 31, 2020 | Note | Effective interest rate | Total US$’000 | 6 mths or less US$’000 | 6 –12 mths US$’000 | 1-2 years US$’000 | 2-5 years US$’000 | > 5 years US$’000 | |||||||||||||||||||||||
Cash and cash equivalents | 19 | 0.1 | % | 27,327 | 27,327 | 0 | 0 | 0 | 0 | ||||||||||||||||||||||
Lease receivable | 16,18 | 4.0 | % | 506 | 120 | 95 | 142 | 149 | 0 | ||||||||||||||||||||||
Licence payments | 23 | 8.1 | % | (194 | ) | (194 | ) | 0 | 0 | 0 | 0 | ||||||||||||||||||||
Exchangeable note | 24 | 4.8 | % | (82,664 | ) | 0 | 0 | 0 | 0 | (82,664 | ) | ||||||||||||||||||||
Other borrowings | 22 | 0 | % | (31 | ) | 0 | 0 | (31 | ) | 0 | 0 | ||||||||||||||||||||
Lease payable on Right of Use assets | 25 | 5.0 | % | (18,461 | ) | (1,022 | ) | (1,032 | ) | (1,914 | ) | (4,856 | ) | (9,637 | ) | ||||||||||||||||
Lease payable on sale & leaseback transactions | 25 | 5.0 | % | (280 | ) | (49 | ) | (50 | ) | (104 | ) | (77 | ) | 0 | |||||||||||||||||
Total | (73,797 | ) | 26,182 | (987 | ) | (1,907 | ) | (4,784 | ) | (92,301 | ) |
¹ The maturity of the Exchangeable Notes is based on the contractual maturity date of April 1, 2045 and does not take into account the potential exercise of put and call options in the next five years or the exchange agreements entered into with five exchangeable note holders in December 2021.
156
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
28. | CAPITAL AND FINANCIAL RISK MANAGEMENT (CONTINUED) |
December 31, 2021 US$‘000 | December 31, 2020 US$‘000 | |||||||
Fixed rate instruments | ||||||||
Fixed rate financial liabilities (licence fees) | 0 | (194 | ) | |||||
Fixed rate financial liabilities (exchangeable note) | (83,312 | ) | (82,664 | ) | ||||
Fixed rate financial liabilities (borrowings) | (31 | ) | (31 | ) | ||||
Fixed rate financial liabilities (lease payables) | (15,844 | ) | (18,741 | ) | ||||
Financial assets (short-term deposits and short-term investments) | 3,121 | 3,118 | ||||||
Financial assets (lease receivables) | 293 | 506 | ||||||
(95,773 | ) | (98,006 | ) |
As at December 31, 2021 US$’000 | Carrying amount US$’000 | Contractual cash flows US$’000 | 6 mths or less US$’000 | 6 mths – 12 mths US$’000 | 1-2 years US$’000 | 2-5 years US$’000 | >5 years US$’000 | |||||||||||||||||||||
Financial liabilities | ||||||||||||||||||||||||||||
Trade & other payables | 15,127 | 15,127 | 15,127 | 0 | 0 | 0 | 0 | |||||||||||||||||||||
Lease payable on Right of Use assets | 15,668 | 15,668 | 973 | 905 | 1,554 | 4,516 | 7,720 | |||||||||||||||||||||
Lease payable on sale & leaseback transactions | 177 | 177 | 51 | 51 | 75 | 0 | 0 | |||||||||||||||||||||
Other borrowings | 31 | 31 | 0 | 31 | 0 | 0 | 0 | |||||||||||||||||||||
Exchangeable notes ¹ | 83,312 | 99,900 | 0 | 0 | 0 | 0 | 99,900 | |||||||||||||||||||||
Exchangeable note interest | 999 | 93,906 | 1,998 | 1,998 | 3,996 | 11,988 | 73,926 | |||||||||||||||||||||
115,314 | 224,809 | 18,149 | 2,985 | 5,625 | 16,504 | 181,546 |
157
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
28. | CAPITAL AND FINANCIAL RISK MANAGEMENT (CONTINUED) |
As at December 31, 2020 US$’000 | Carrying amount US$’000 | Contractual cash flows US$’000 | 6 mths or less US$’000 | 6 mths – 12 mths US$’000 | 1-2 years US$’000 | 2-5 years US$’000 | >5 years US$’000 | |||||||||||||||||||||
Financial liabilities | ||||||||||||||||||||||||||||
Trade & other payables | 24,335 | 24,335 | 24,335 | 0 | 0 | 0 | 0 | |||||||||||||||||||||
Lease payable on Right of Use assets | 18,461 | 18,461 | 1,022 | 1,032 | 1,914 | 4,856 | 9,637 | |||||||||||||||||||||
Lease payable on sale & leaseback transactions | 280 | 280 | 49 | 50 | 104 | 77 | 0 | |||||||||||||||||||||
Other borrowings | 31 | 31 | 0 | 0 | 31 | 0 | 0 | |||||||||||||||||||||
Exchangeable notes ¹ | 82,664 | 99,900 | 0 | 0 | 0 | 0 | 99,900 | |||||||||||||||||||||
Exchangeable note interest | 999 | 97,902 | 1,998 | 1,998 | 3,996 | 11,988 | 77,922 | |||||||||||||||||||||
126,770 | 240,909 | 27,404 | 3,080 | 6,045 | 16,921 | 187,459 |
EUR | GBP | SEK | CAD | BRL | Other | |||||||||||||||||||
As at December 31, 2021 | US$‘000 | US$‘000 | US$‘000 | US$‘000 | US$‘000 | US$‘000 | ||||||||||||||||||
Cash | 327 | 115 | 5 | 4,617 | 1,370 | 0 | ||||||||||||||||||
Trade and other receivable | 464 | 58 | 0 | 488 | 1,538 | 0 | ||||||||||||||||||
Trade and other payables | (2,456 | ) | (28 | ) | (11 | ) | (166 | ) | (629 | ) | 0 | |||||||||||||
Total exposure | (1,665 | ) | 145 | (6 | ) | 4,939 | 2,279 | 0 |
EUR | GBP | SEK | CAD | BRL | Other | |||||||||||||||||||
As at December 31, 2020 | US$‘000 | US$‘000 | US$‘000 | US$‘000 | US$‘000 | US$‘000 | ||||||||||||||||||
Cash | 1,229 | 152 | 9 | 2,859 | 776 | 0 | ||||||||||||||||||
Trade and other receivable | 1,105 | 63 | 0 | 3,191 | 1,357 | 0 | ||||||||||||||||||
Trade and other payables | (2,821 | ) | (57 | ) | (1 | ) | (449 | ) | (529 | ) | 0 | |||||||||||||
Total exposure | (487 | ) | 158 | 8 | 5,601 | 1,604 | 0 |
158
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
28. | CAPITAL AND FINANCIAL RISK MANAGEMENT (CONTINUED) |
Profit or loss US$’000 | ||||
December 31, 2021 | ||||
Euro | 780 | |||
December 31, 2020 | ||||
Euro | 541 |
Profit or Loss US$000 | ||||
December 31, 2021 | ||||
Euro | (953 | ) | ||
December 31, 2020 | ||||
Euro | (661 | ) |
159
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
28. | CAPITAL AND FINANCIAL RISK MANAGEMENT (CONTINUED) |
Carrying Value December 31, 2021 US$’000 | Carrying Value December 31, 2020 US$’000 | |||||||
Third party trade receivables (Note 18) | 13,290 | 20,025 | ||||||
Finance lease income receivable (Note 18) | 293 | 506 | ||||||
Cash and cash equivalents (Note 19) | 25,910 | 27,327 | ||||||
39,493 | 47,858 |
Carrying Value December 31, 2021 US$’000 | Carrying Value December 31, 2020 US$’000 | |||||||
United States | 5,822 | 10,730 | ||||||
Euro-zone countries | 1,072 | 1,360 | ||||||
United Kingdom | 118 | 98 | ||||||
Other European countries | 0 | 13 | ||||||
Other regions | 6,571 | 8,330 | ||||||
13,583 | 20,531 |
Carrying Value December 31, 2021 US$’000 | Carrying Value December 31, 2020 US$’000 | |||||||
End-user customers | 6,923 | 11,812 | ||||||
Distributors | 6,220 | 8,186 | ||||||
Non-governmental organisations | 440 | 533 | ||||||
13,583 | 20,531 |
160
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
28. | CAPITAL AND FINANCIAL RISK MANAGEMENT (CONTINUED) |
Gross | Impairment | Expected Credit Loss Rate | Gross | Impairment | Expected Credit Loss Rate | |||||||||||||||||||
2021 | 2021 | 2021 | 2020 | 2020 | 2020 | |||||||||||||||||||
US$’000 | US$’000 | % | US$’000 | US$’000 | % | |||||||||||||||||||
Not past due | 8,461 | 0 | 0 | % | 16,754 | 112 | 0.7 | % | ||||||||||||||||
Past due 0-30 days | 2,423 | 1 | 0.1 | % | 1,829 | 222 | 12.1 | % | ||||||||||||||||
Past due 31-120 days | 1,981 | 97 | 4.9 | % | 1,755 | 60 | 3.4 | % | ||||||||||||||||
Greater than 120 days | 3,011 | 2,888 | 73.0 | % | 3,609 | 3,528 | 97.8 | % | ||||||||||||||||
15,876 | 2,986 | 0 | 23,947 | 3,922 | 0 |
2021 | 2020 | 2019 | ||||||||||
US$’000 | US$’000 | US$’000 | ||||||||||
Balance at January 1 | 3,922 | 5,443 | 4,202 | |||||||||
Charged to costs and expenses | 76 | 166 | 1,276 | |||||||||
Amounts written off during the year | (1,012 | ) | (1,687 | ) | (35 | ) | ||||||
Balance at December 31 | 2,986 | 3,922 | 5,443 |
161
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
29. | RECONCILIATION OF LIABILITIES ARISING FROM FINANCING ACTIVITIES |
Note | Borrowings & derivative financial instruments US$’000 | Lease liabilities US$’000 | |||||||||
Balance at January 1, 2021 | 22,24,25 | 84,065 | 18,741 | ||||||||
Cash-flows: | |||||||||||
Interest paid | (3,996 | ) | (11 | ) | |||||||
Repayment | 0 | (2,939 | ) | ||||||||
Non-cash: | |||||||||||
Interest charged | 3,996 | 0 | |||||||||
Additions (related to Right of Use assets) | 0 | 71 | |||||||||
Exchange adjustment | 0 | (820 | ) | ||||||||
Accretion interest | 648 | 803 | |||||||||
Fair value | 8 | (1,370 | ) | 0 | |||||||
Balance at December 31, 2021 | 22, 24,25 | 83,343 | 15,845 |
162
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
29. | RECONCILIATION OF LIABILITIES ARISING FROM FINANCING ACTIVITIES (CONTINUED) |
Note | Borrowings & derivative financial instruments US$’000 | Lease liabilities US$’000 | |||||||||
Balance at 1 January 2020 | 22,24,25 | 82,025 | 20,149 | ||||||||
Cash-flows: | |||||||||||
Interest paid | (3,996 | ) | 0 | ||||||||
Proceeds from government Covid-19 loan (Note 24) | 31 | 0 | |||||||||
Repayment | 0 | (3,240 | ) | ||||||||
Non-cash: | |||||||||||
Interest charged | 3,996 | 0 | |||||||||
Additions (related to Right of Use assets) | 0 | 224 | |||||||||
Disposals¹ | 0 | (216 | ) | ||||||||
Exchange adjustment | 0 | 928 | |||||||||
Accretion interest | 8 | 643 | 896 | ||||||||
Fair value | 1,366 | 0 | |||||||||
Balance at 31 December 2020 | 22, 24,25 | 84,065 | 18,741 |
¹ Disposal of Lease liabilities relates to the early termination of a lease for a right-of-use building asset in Carlsbad, California. This facility was closed in June 2020.
30. | POST BALANCE SHEET EVENTS |
• | the Group paid a total amount of US$86,730,000 to retire Exchangeable Notes with a carrying value of US$83,312,000 at December 31, 2021. Each holder that was party to the agreement received US$0.87 of cash per $1 nominal value of the Notes, and |
• | the Company also issued 5,333,000 ADSs (21,332,000 ‘A’ Ordinary shares) representing the equivalent of $0.08 of the Company’s ADS (based upon the 5-day trailing VWAP of the ADSs on NASDAQ on December 9, 2021, discounted by 13%) per $1 nominal value of the Notes, as partial consideration for the exchange of the notes. |
163
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
30. | POST BALANCE SHEET EVENTS (CONTINUED) |
164
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
31. | ACCOUNTING ESTIMATES AND JUDGEMENTS (CONTINUED) |
At December 31, 2021 the carrying value of capitalised development costs was US$17,679,000 (2020: US$13,444,000) (see Item 18, Note 14 to the consolidated financial statements). The increase in 2021 was mainly as a result of additions of US$6,771,000. In 2021, an impairment charge of US$2,053,000 was incurred. This charge was partially offset by additions of US$6,771,000 and amortisation of US$482,000.
• | Significant underperformance relative to expected historical or projected future operating results; |
• | Significant changes in the manner of our use of the acquired assets or the strategy for our overall business; |
• | Obsolescence of products; |
• | Significant decline in our stock price for a sustained period; and |
• | Our market capitalisation relative to net book value. |
165
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
31. | ACCOUNTING ESTIMATES AND JUDGEMENTS (CONTINUED) |
The impairment testing performed during year ended December 31, 2021 identified an impairment loss in four CGUs, namely Trinity Biotech Manufacturing Limited, Biopool US Inc, Immco Diagnostics, and Trinity Biotech Do Brazil. For further information, refer to Note 14.
166
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
31. | ACCOUNTING ESTIMATES AND JUDGEMENTS (CONTINUED) |
• | Determining whether or not a contract contains a lease. Company assessed if the contract conveys the right to control the use of an identified asset for a period of time in exchange for consideration. |
• | Significant judgement is also required in establishing whether or not it is reasonably certain that an extension option will be exercised, considering whether or not it is reasonably certain that a termination option will not be exercised. In making this decision, management considered the facts and circumstances that create a significant economic incentive. Factors specific to the asset, the entity and the wider market were also considered. |
• | Further, critical judgement is involved in determining whether or not variable lease payments are truly variable, or in-substance fixed. In-substance variable lease payments are treated as fixed lease payments. |
167
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
32. | GROUP UNDERTAKINGS |
Name and registered office | Principal activity | Principal Country of incorporation and operation | Group % holding | |||
Trinity Biotech Manufacturing Limited IDA Business Park, Bray Co. Wicklow, Ireland | Manufacture and sale of diagnostic test kits | Ireland | 100% | |||
Trinity Research Limited IDA Business Park, Bray Co. Wicklow, Ireland | Research and development | Ireland | 100% | |||
Benen Trading Limited IDA Business Park, Bray Co. Wicklow, Ireland | Trading | Ireland | 100% | |||
Trinity Biotech Manufacturing Services Limited IDA Business Park, Bray Co. Wicklow, Ireland | Dormant | Ireland | 100% | |||
Trinity Biotech Luxembourg Sarl 1, rue Bender, L-1229 Luxembourg | Investment and provision of financial services | Luxembourg | 100% | |||
Trinity Biotech Inc Girts Road, Jamestown, NY 14702, USA | Holding Company | U.S.A. | 100% | |||
Clark Laboratories Inc Trading as Trinity Biotech (USA) Girts Road, Jamestown NY14702, USA | Manufacture and sale of diagnostic test kits | U.S.A. | 100% | |||
Mardx Diagnostics Inc 5919 Farnsworth Court Carlsbad CA 92008, USA | Manufacture and sale of diagnostic test kits | U.S.A. | 100% | |||
Fitzgerald Industries International, Inc 2711 Centerville Road, Suite 400 Wilmington, New Castle Delaware, 19808, USA | Management services company | U.S.A. | 100% | |||
Biopool US Inc (trading as Trinity Biotech Distribution) Girts Road, Jamestown NY14702, USA | Sale of diagnostic test kits | U.S.A. | 100% | |||
Primus Corporation 4231 E 75th Terrace Kansas City, MO 64132, USA | Manufacture and sale of diagnostic test kits and instrumentation | U.S.A | 100% |
168
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
32. | GROUP UNDERTAKINGS (CONTINUED) |
Name and registered office | Principal activity | Principal Country of incorporation and operation | Group % holding | |||
Phoenix Bio-tech Corp. 1166 South Service Road West Oakville, ON L6L 5T7 Canada. | Dormant | Canada | 100% | |||
Fiomi Diagnostics Holding AB Dag Hammarskjöldsv 52A SE-752 37 Uppsala Sweden | Holding Company | Sweden | 100% | |||
Fiomi Diagnostics AB Dag Hammarskjöldsv 52A SE-752 37 Uppsala Sweden | Discontinued operation | Sweden | 100% | |||
Trinity Biotech Do Brasil Comercio e Importacao Ltda Rua Silva Bueno 1.660 – Cj. 101/102 Ipiranga Sao Paulo Brazil | Sale of diagnostic test kits | Brazil | 100% | |||
Trinity Biotech (UK) Ltd Mills and Reeve LLP Botanic House 100 Hills Road Cambridge, CB2 1PH United Kingdom | Sales & marketing activties | UK | 100% | |||
Immco Diagnostics Inc 60 Pineview Drive Buffalo NY 14228, USA | Manufacture and sale of autoimmune products and laboratory services | U.S.A. | 100% | |||
Nova Century Scientific Inc 5022 South Service Road Burlington Ontario Canada | Manufacture and sale of autoimmune products and infectious diseases | Canada | 100% | |||
Trinity Biotech Investment Ltd PO Box 309 Ugland House Grand Cayman KY1-1104 Cayman Islands | Investment and provision of financial services | Cayman Islands | 100% |
33. | AUTHORISATION FOR ISSUE |
TRINITY BIOTECH PLC | ||
By | /s/ Ronan O’Caoimh | |
Mr Ronan O’Caoimh | ||
Director/ | ||
Chief Executive Officer | ||
Date: May 2, 2022 | ||
By: | /s/ John Gillard | |
Mr John Gillard | ||
Company secretary/ | ||
Chief Financial Officer | ||
Date: May 2, 2022 |
Item 19 | Exhibits |
Exhibit No. | Description of Exhibit |
101.INS | XBRL Instance Document (The instance document does not appear in the interactive data file because its XBRL tags are embedded within the Inline XBRL document). |
101.SCH | Inline XBRL Taxonomy Extension Schema Document. |
101.PRE | Inline XBRL Taxonomy Presentation Linkbase Document. |
101.CAL | Inline XBRL Taxonomy Calculation Linkbase Document. |
101.LAB | Inline XBRL Taxonomy Label Linkbase Document. |
101.DEF | Inline XBRL Taxonomy Extension Definition Linkbase Document. |
104 | Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101). |