CellCentric Limited is a private company limited by shares, registered in England and Wales. The registered office is Chesterford Research Park, Little Chesterford, Cambridge, Essex, CB10 1XL. The registered number is 04948632.
The financial statements are prepared in sterling, which is the functional currency of the company. Monetary amounts in these financial statements are rounded to the nearest £.
The company has incurred a loss for the year after tax of £11,492,956 and expects to incur further losses in the future as a result of its research activities.
The company will therefore remain dependent on further investment to fund its research activities. On the 11 July 2024 the Company secured additional investment of $35.7m which will provide adequate cashflows to continue in operational existence for at least 12 months from the balance sheet date and therefore the financial statements have been prepared on a going concern basis.
Basic financial assets, which include debtors and cash and bank balances, are initially measured at transaction price including transaction costs and are subsequently carried at amortised cost using the effective interest method unless the arrangement constitutes a financing transaction, where the transaction is measured at the present value of the future receipts discounted at a market rate of interest. Financial assets classified as receivable within one year are not amortised.
Financial liabilities and equity instruments are classified according to the substance of the contractual arrangements entered into. An equity instrument is any contract that evidences a residual interest in the assets of the company after deducting all of its liabilities.
Basic financial liabilities, including creditors that are classified as debt, are initially recognised at transaction price unless the arrangement constitutes a financing transaction, where the debt instrument is measured at the present value of the future payments discounted at a market rate of interest. Financial liabilities classified as payable within one year are not amortised.
Debt instruments are subsequently carried at amortised cost, using the effective interest rate method.
Trade creditors are obligations to pay for goods or services that have been acquired in the ordinary course of business from suppliers. Amounts payable are classified as current liabilities if payment is due within one year or less. If not, they are presented as non-current liabilities. Trade creditors are recognised initially at transaction price and subsequently measured at amortised cost using the effective interest method.
The component parts of compound instruments issued by the company are classified separately as financial liabilities and equity in accordance with the substance of the contractual arrangement. At the date of issue, the fair value of the liability component is estimated using the prevailing market interest rate for a similar non-convertible instrument. This amount is recorded as a liability on an amortised cost basis using the effective interest method until extinguished upon conversion or at the instrument's maturity date. The equity component is determined by deducting the amount of the liability component from the fair value of the compound instrument as a whole. This is recognised and included in equity net of income tax effects and is not subsequently remeasured.
Equity instruments issued by the company are recorded at the proceeds received, net of transaction costs. Dividends payable on equity instruments are recognised as liabilities once they are no longer at the discretion of the company.
Related party transactions
The company discloses transactions with related parties which are not wholly owned with the same group. It does not disclose transactions with its parent or with members of the same group that are wholly owned.
In the application of the company’s accounting policies, the directors are required to make judgements, estimates and assumptions about the carrying amount of assets and liabilities that are not readily apparent from other sources. The estimates and associated assumptions are based on historical experience and other factors that are considered to be relevant. Actual results may differ from these estimates.
The estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognised in the period in which the estimate is revised where the revision affects only that period, or in the period of the revision and future periods where the revision affects both current and future periods.
The Directors do not believe there to be any critical estimates or judgements that could reasonably move by a material amount in the next 12 months.
The average monthly number of persons (including directors) employed by the company during the year was:
The 18-month convertible loan notes were issued on 30 June 2023. Interest accrues on the principal amount of $25,000,000 at 10.0% per annum. The debt is converted into a variable number of shares upon maturity or redeemed with an applicable premium dependent on the terms of redemption. A reliable measure of the fair value is no longer available for the convertible loan notes that would otherwise be required to be measure at fair value through profit or loss. This has therefore been recorded at transaction price (less transaction costs) plus accrued interest and converted at the GBP:USD spot rate at the balance sheet date.
The interest charge on the convertible loan note is £1,010,993.
On 4 September 2023, 755,154 0.1p A Ordinary shares were issued. These shares were issued at a premium of £2,355,325.
Share conversion
Each A Ordinary shareholder may at any time convert all, or any part of, its holding of A Ordinary shares into Ordinary shares upon written notice to the company. Such number of Ordinary shares into which the A Ordinary shares will be converted is calculated as total nominal value of the A Ordinary shares to be converted multiplied by a conversion ratio (initially set at 1), divided by the nominal value of one Ordinary share.
All of the A Ordinary shares in issue will automatically be converted into Ordinary shares using the above calculation immediately prior to a listing of the company's shares.
Voting rights
Ordinary shares and A Ordinary shares carry one vote per share.
The Company has historically made equity awards to employees and other key contributors. These awards are conditional on a liquidity event, such as a trade sale or IPO taking place. Because such events are outside the Company’s control, the Company is not be able to determine that it is probable that such performance condition will be satisfied until the event occurs.
No expense was recorded in the year ended 31 December 2022 nor 31 December 2023 since a vesting exit event was not yet deemed probable of occurring.
As at 31 December 2023 there are shares that have been granted that remain unvested.
As the income statement has been omitted from the filing copy of the financial statements, the following information in relation to the audit report on the statutory financial statements is provided in accordance with s444(5B) of the Companies Act 2006:
The auditor's report was unqualified.
At 31 December 2023, the company had outstanding forward currency contracts for the purpose of paying its creditors. The total commitment is for $7,000,000 which will mature within 1 month commencing 1 January 2024. The effect of the contracts are to hedge the company's exposure to fluctuations in US Dollar to Sterling exchange rates.
At the reporting end date the company had outstanding commitments for future minimum lease payments under non-cancellable operating leases, as follows:
Investment of $35.7m was received on 11 July 2024 resulting in the issuance of 8,538,970 B-1 preferred shares.
The convertible loan notes of $25m plus accrued interest was converted into 8,279,207 B-2 preferred shares on 11 July 2024.
During the year the company entered into the following transactions with related parties:
Morningside Venture Investments Limited ("MVIL") is deemed to be a related party by virtue of its shareholding in CellCentric Limited. During the current and preceding year, all fees due to MVIL for the services of Dr J R Dinges as Director have been waived.
During the year, CellCentric Limited paid £Nil (2022 - £50,901) to Helpyou2 Limited in relation to consultancy Services provided by Prof A M Hughes prior to being appointed as a non-executive director of CellCentric Limited. Prof A M Hughes is the company secretary of Helpyou2 Limited.
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The parent undertaking is Morningside Venture Investments Limited, a company incorporated in the British Virgin Islands and registered address 18 Pasea Estate Road, Road Town, Tortola, VG1110, British Virgin Islands.