Company registration number 09700231 (England and Wales)
AFON TECHNOLOGY LTD
FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2024
AFON TECHNOLOGY LTD
CONTENTS
Page
Balance sheet
1
Notes to the financial statements
2 - 11
AFON TECHNOLOGY LTD
BALANCE SHEET
AS AT
31 DECEMBER 2024
31 December 2024
- 1 -
2024
2023
Notes
£
£
FIXED ASSETS
Intangible assets
3
194,327
170,816
Tangible assets
4
3,116
5,822
197,443
176,638
CURRENT ASSETS
Stocks
2
2
Debtors
5
479,464
249,920
Cash at bank and in hand
42,889
359,705
522,355
609,627
CREDITORS: AMOUNTS FALLING DUE WITHIN ONE YEAR
6
(569,370)
(301,843)
NET CURRENT (LIABILITIES)/ASSETS
(47,015)
307,784
NET ASSETS
150,428
484,422
CAPITAL AND RESERVES
Called up share capital
8
5,998
5,840
Share premium account
6,514,565
5,935,415
Other reserves
50,000
233,640
Profit and loss reserves
(6,420,135)
(5,690,473)
TOTAL EQUITY
150,428
484,422
The directors of the company have elected not to include a copy of the profit and loss account within the financial statements.true
These financial statements have been prepared and delivered in accordance with the provisions applicable to companies subject to the small companies regime.
The financial statements were approved by the board of directors and authorised for issue on
10 July 2025
10 July 2025
10 July 2025
and are signed on its behalf by:
Dr M. S. Chaudhry
Director
Company registration number 09700231 (England and Wales)
AFON TECHNOLOGY LTD
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2024
- 2 -
1
ACCOUNTING POLICIES
Company information
Afon Technology Ltd is a private company limited by shares incorporated in England and Wales. The registered office is Unit 670 Castlegate Business Park, Caldicot, Monmouthshire, NP26 5AD.
1.1
Accounting convention
These financial statements have been prepared in accordance with FRS 102 “The Financial Reporting Standard applicable in the UK and Republic of Ireland” (“FRS 102”) and the requirements of the Companies Act 2006 as applicable to companies subject to the small companies regime. The disclosure requirements of section 1A of FRS 102 have been applied other than where additional disclosure is required to show a true and fair view.
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 financial statements have been prepared under the historical cost convention. The principal accounting policies adopted are set out below.
AFON TECHNOLOGY LTD
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2024
1
ACCOUNTING POLICIES
(Continued)
- 3 -
1.2
Going concern
Afon has made continued progress with its non-invasive blood glucose monitoring technology. During the financial year, Afon has focused on the development and realisation of its wearable non-invasive blood glucose monitoring technology in preparation for clinical trial and commercialisation. The designs have been tested and evaluated through user group participations.
Presentations at technical conferences and publications, has attracted interest from an international pharmaceutical company which is engaged in discussions regarding pre-orders. The company has also attracted considerable direct interest from the global diabetic community which will potentially translate to pre-orders when the technology is ready for release.
During 2024, the company was successful in raising £629,308 from private investors in addition to £1,222,231 received as grant income. Post year end the company has raised a further £681,552 from the issue of share capital. For the company to continue, it has forecast that a further £2.4m is required in the next 12 months. Overall, £6.4m will be required for manufacturing working capital. This is to fund the company to take it through clinical trials, manufacturing and onto the CE/CA mark. International clinical trials in Germany and Poland began in 2024.
The company is currently working with a lender to secure a £4.5 million convertible loan, which will provide the necessary funding to achieve CE marking and support initial manufacturing requirements ahead of product launch. In parallel, Afon has entered into a strategic manufacturing partnership with a global technology leader, ensuring the device will be produced to medical-grade standards in the UK.
Looking ahead, the company has engaged a specialist firm with a strong track record of securing multi-million-dollar investments, with the goal of raising an additional £15 million to support its global growth ambitions and establish itself as a market leader in non-invasive blood glucose monitoring.
AFON TECHNOLOGY LTD
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2024
1
ACCOUNTING POLICIES
(Continued)
- 4 -
The company continues to grow its highly talented resource pool to mitigate against any technical challenges.
The project remains of considerable interest to investors, especially as the technology is being advanced and near commercialisation. This has resulted in interest from technology companies across the globe and from international government institutions.
The future cash needs of the business have been identified by the Director's based on their previous experiences of medical product development. The Company has been operating and continues to operate on a frugal basis to preserve and manage its finances.
These events or conditions indicate that a material uncertainty exists that may cast significant doubt on the company's ability to continue as a going concern and therefore its ability to realise its assets and discharge its liabilities in the normal course of business.
The directors have concluded that they have a high degree of confidence that the company has the ability to manage operations and to attract further investment to continue in operational existence for the foreseeable future. The directors are satisfied that as a result of the strength of the company's technology and management, there continues to be substantial long-term strength in interest from future investors.
For these reasons, including the company's history of raising significant amounts of capital, the directors continue to adopt the going concern basis of accounting in preparing the annual financial statements. The financial statements do not reflect the adjustments that would be required if the company ceased to operate as a going concern.
1.3
Intangible fixed assets other than goodwill
Intangible assets acquired separately from a business are recognised at cost and are subsequently measured at cost less accumulated amortisation and accumulated impairment losses.
Intangible assets acquired on business combinations are recognised separately from goodwill at the acquisition date where it is probable that the expected future economic benefits that are attributable to the asset will flow to the entity and the fair value of the asset can be measured reliably; the intangible asset arises from contractual or other legal rights; and the intangible asset is separable from the entity.
Amortisation is recognised so as to write off the cost or valuation of assets less their residual values over their useful lives on the following bases:
Patents & licences
4% - 10% straight line
1.4
Tangible fixed assets
Tangible fixed assets are initially measured at cost and subsequently measured at cost or valuation, net of depreciation and any impairment losses.
AFON TECHNOLOGY LTD
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2024
1
ACCOUNTING POLICIES
(Continued)
- 5 -
Depreciation is recognised so as to write off the cost or valuation of assets less their residual values over their useful lives on the following bases:
Leasehold land and buildings
Over the term of the lease
Fixtures and fittings
15% - 33% straight line
The gain or loss arising on the disposal of an asset is determined as the difference between the sale proceeds and the carrying value of the asset, and is credited or charged to profit or loss.
1.5
Impairment of fixed assets
At each reporting period end date, the company reviews the carrying amounts of its tangible and intangible assets to determine whether there is any indication that those assets have suffered an impairment loss. If any such indication exists, the recoverable amount of the asset is estimated in order to determine the extent of the impairment loss (if any). Where it is not possible to estimate the recoverable amount of an individual asset, the company estimates the recoverable amount of the cash-generating unit to which the asset belongs.
Recoverable amount is the higher of fair value less costs to sell and value in use. In assessing value in use, the estimated future cash flows are discounted to their present value using a pre-tax discount rate that reflects current market assessments of the time value of money and the risks specific to the asset for which the estimates of future cash flows have not been adjusted.
If the recoverable amount of an asset (or cash-generating unit) is estimated to be less than its carrying amount, the carrying amount of the asset (or cash-generating unit) is reduced to its recoverable amount. An impairment loss is recognised immediately in profit or loss, unless the relevant asset is carried at a revalued amount, in which case the impairment loss is treated as a revaluation decrease.
Recognised impairment losses are reversed if, and only if, the reasons for the impairment loss have ceased to apply. Where an impairment loss subsequently reverses, the carrying amount of the asset (or cash-generating unit) is increased to the revised estimate of its recoverable amount, but so that the increased carrying amount does not exceed the carrying amount that would have been determined had no impairment loss been recognised for the asset (or cash-generating unit) in prior years. A reversal of an impairment loss is recognised immediately in profit or loss, unless the relevant asset is carried at a revalued amount, in which case the reversal of the impairment loss is treated as a revaluation increase.
1.6
Stocks
Stocks are stated at the lower of cost and estimated selling price less costs to complete and sell. Cost comprises direct materials and, where applicable, direct labour costs and those overheads that have been incurred in bringing the stocks to their present location and condition.
Stocks held for distribution at no or nominal consideration are measured at the lower of cost and replacement cost, adjusted where applicable for any loss of service potential.
At each reporting date, an assessment is made for impairment. Any excess of the carrying amount of stocks over its estimated selling price less costs to complete and sell is recognised as an impairment loss in profit or loss. Reversals of impairment losses are also recognised in profit or loss.
AFON TECHNOLOGY LTD
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2024
1
ACCOUNTING POLICIES
(Continued)
- 6 -
1.7
Cash and cash equivalents
Cash and cash equivalents are basic financial assets and include cash in hand, deposits held at call with banks, other short-term liquid investments with original maturities of three months or less, and bank overdrafts. Bank overdrafts are shown within borrowings in current liabilities.
1.8
Financial instruments
The company has elected to apply the provisions of Section 11 ‘Basic Financial Instruments’ and Section 12 ‘Other Financial Instruments Issues’ of FRS 102 to all of its financial instruments.
Financial instruments are recognised in the company's balance sheet when the company becomes party to the contractual provisions of the instrument.
Financial assets and liabilities are offset, with the net amounts presented in the financial statements, when there is a legally enforceable right to set off the recognised amounts and there is an intention to settle on a net basis or to realise the asset and settle the liability simultaneously.
Basic financial assets
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.
Classification of financial liabilities
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
Basic financial liabilities, including creditors, bank loans, loans from fellow group companies and preference shares 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.
AFON TECHNOLOGY LTD
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2024
1
ACCOUNTING POLICIES
(Continued)
- 7 -
1.9
Equity instruments
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.
1.10
Taxation
The taxation expense represents the aggregate amount of current and deferred tax recognised in the reporting period. Tax is recognised in profit or loss, except to the extent that it relates to items recognised in other comprehensive income or directly in equity. In this case, tax is recognised in other comprehensive income or directly in equity, respectively.
Current tax
Current tax is recognised on taxable profit for the current and past periods. Current tax is measured at the amounts of tax expected to pay or recover using the tax rates and laws that have been enacted or substantively enacted at the reporting date.
Deferred tax
Deferred tax liabilities are generally recognised for all timing differences and deferred tax assets are recognised to the extent that it is probable that they will be recovered against the reversal of deferred tax liabilities or other future taxable profits. Such assets and liabilities are not recognised if the timing difference arises from goodwill or from the initial recognition of other assets and liabilities in a transaction that affects neither the tax profit nor the accounting profit.
The carrying amount of deferred tax assets is reviewed at each reporting end date and reduced to the extent that it is no longer probable that sufficient taxable profits will be available to allow all or part of the asset to be recovered. Deferred tax is calculated at the tax rates that are expected to apply in the period when the liability is settled or the asset is realised. Deferred tax is charged or credited in the profit and loss account, except when it relates to items charged or credited directly to equity, in which case the deferred tax is also dealt with in equity. Deferred tax assets and liabilities are offset when the company has a legally enforceable right to offset current tax assets and liabilities and the deferred tax assets and liabilities relate to taxes levied by the same tax authority.
1.11
Employee benefits
The costs of short-term employee benefits are recognised as a liability and an expense, unless those costs are required to be recognised as part of the cost of stock or fixed assets.
The cost of any unused holiday entitlement is recognised in the period in which the employee’s services are received.
Termination benefits are recognised immediately as an expense when the company is demonstrably committed to terminate the employment of an employee or to provide termination benefits.
1.12
Retirement benefits
Payments to defined contribution retirement benefit schemes are charged as an expense as they fall due.
AFON TECHNOLOGY LTD
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2024
1
ACCOUNTING POLICIES
(Continued)
- 8 -
1.13
Government grants
Government grants are recognised at the fair value of the asset received or receivable when there is reasonable assurance that the grant conditions will be met and the grants will be received.
A grant that specifies performance conditions is recognised in income when the performance conditions are met. Where a grant does not specify performance conditions it is recognised in income when the proceeds are received or receivable. A grant received before the recognition criteria are satisfied is recognised as a liability.
2
EMPLOYEES
The average monthly number of persons (including directors) employed by the company during the year was:
2024
2023
Number
Number
Total
13
11
3
INTANGIBLE FIXED ASSETS
Patents & licences
£
Cost
At 1 January 2024
226,191
Additions
40,137
At 31 December 2024
266,328
Amortisation and impairment
At 1 January 2024
55,375
Amortisation charged for the year
16,626
At 31 December 2024
72,001
Carrying amount
At 31 December 2024
194,327
At 31 December 2023
170,816
AFON TECHNOLOGY LTD
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2024
- 9 -
4
TANGIBLE FIXED ASSETS
Leasehold land and buildings
Fixtures and fittings
Total
£
£
£
Cost
At 1 January 2024 and 31 December 2024
10,056
81,929
91,985
Depreciation and impairment
At 1 January 2024
5,363
80,800
86,163
Depreciation charged in the year
2,011
695
2,706
At 31 December 2024
7,374
81,495
88,869
Carrying amount
At 31 December 2024
2,682
434
3,116
At 31 December 2023
4,693
1,129
5,822
5
DEBTORS
2024
2023
Amounts falling due within one year:
£
£
Corporation tax recoverable
252,619
95,307
Other debtors
226,845
154,613
479,464
249,920
6
CREDITORS: AMOUNTS FALLING DUE WITHIN ONE YEAR
2024
2023
£
£
Trade creditors
324,728
145,588
Taxation and social security
32,467
16,565
Other creditors
212,175
139,690
569,370
301,843
AFON TECHNOLOGY LTD
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2024
- 10 -
7
RESERVES
Ordinary Share Capital
This represents the nominal value of the ordinary shares issued by the company.
Share Premium
This reserve records the amount received by the company over and above the nominal value of the shares issued.
Other Reserve
This reserve reflects amounts received from shareholders prior to the year-end in respect of shares issued after the year-end.
Retained Earnings
This reserve comprises the company’s accumulated profits and losses, net of dividends paid and other appropriations.
8
CALLED UP SHARE CAPITAL
2024
2023
2024
2023
Ordinary share capital
Number
Number
£
£
Issued and fully paid
Ordinary shares of £1 each
5,998
5,840
5,998
5,840
During the year, the company issued 158 ordinary shares of £1 each for a total consideration including a share premium of £579,308.
9
AUDIT REPORT INFORMATION
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 is unqualified and includes the following:
We draw attention to note 1.2 in the financial statements, which highlights that the directors have disclosed the need to raise an additional £2.4m in funding over the next 12 months, the success of which is not guaranteed. These events or conditions indicate that a material uncertainty exists that may cast significant doubt on the Company's ability to continue as a going concern. Our opinion is not modified in respect of this matter.
In auditing the financial statements, we have concluded that the directors’ use of the going concern basis of accounting in the preparation of the financial statements is appropriate. Our evaluation of the directors’ assessment of the entity’s ability to continue to adopt the going concern basis of accounting included evaluating financial forecasts, reviewing progress on the £4.5m fundraising initiative and reviewing the entity's historical success in securing funding.
AFON TECHNOLOGY LTD
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2024
9
AUDIT REPORT INFORMATION
(Continued)
- 11 -
Senior Statutory Auditor:
Jonathan Harrhy
Statutory Auditor:
Kilsby & Williams LLP
Date of audit report:
10 July 2025
10
OPERATING LEASE COMMITMENTS
At the reporting end date the company had outstanding commitments for future minimum lease payments under non-cancellable operating leases, as follows:
2024
2023
£
£
71,950
23,176
11
CONTINGENCIES
The company has agreements in place to remunerate directors and ex-directors, if the company is sold at a future date. Any potential remuneration is contingent on an uncertain future event. On this basis the directors are unable to accurately quantify any potential liability.
12
EVENTS AFTER THE REPORTING DATE
After the year-end, the company issued additional Ordinary A shares to raise capital. The shares were issued at £3.00 and £6.00 each, with a nominal value of £0.001 per share. The total gross proceeds from the issue amounted to £731,550. Although the shares were issued after the year-end, £50,000 was received before the year-end and has been recognised within the capital contribution reserve as at the balance sheet date.
13
RELATED PARTY TRANSACTIONS
The company purchased services worth £61,105 (2023 - £130,000) from, and have a year-end creditor balance of £nil (2023 - £10,000) with Citalytics. Citalytics is considered a related party as a director of Afon Technology Limited was also a director of Citalytics, until his resignation during the year.
The company purchased services worth £31,691 (2023 - £7,379) from, and have a year-end creditor balance of £9,924 (2023 - £nil) with BSI. BSI is considered a related party as a director of Afon Technology Limited is also a Chairman of BSI.
The company purchased services worth £nil (2023 - £8,348) from John Shillingford, who is a director of Afon Technology Limited.