Angel Biotechnology, which makes stem cells for medical research, posted wider half year losses as it looks to complete the joint venture agreement with MMH.
Pre-tax loss widened to £2.86m for the six month period ended September 30th 2012 most of which is attributable to a write back of accrued revenue and contract liabilities related to joint ventures. Angel posted a loss of £241,000 the year before. Revenue for the period slipped to £1.07m from £1.4m previously.
The group, which has also suffered from client funding constraints, delays and cancellations, reported a loss per share of 0.08p compared to a loss of 0.009p previously.
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Commercial Director and Acting CEO Dr Stewart White said: "The first half of 2012 has been a challenging period for Angel. The operational review of our business, measured against client requirements, has been thorough and has resulted in what we believe is the best outcome in the circumstances for our customers, staff and shareholders."
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"The main outcome has been to progress the formation of the joint venture company with MMH, using our Pentlands facility, in addition to the proposed transfer of existing MMH contracts from Angel to the joint venture company."
The completion of the JV with MMH will reduce the group's cost base and will result in a lower fixed cost profile for the group and allow it to gradually scale up resources to match revenue opportunities, it explained.
"It is the aim of the board to provide a cash neutral H2 outturn at year end 2013 and to move towards positive free cash flow in 2013-14. At the same time, Angel is actively seeking strategic partnership opportunities for elements of its businesses to provide necessary contingencies and to convert market potential into earnings at an early stage," it said in a statement.
Shares in Angel Biotechnology plunged 16.47% at 0.7p at 09:00 in London.
CJ
