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Company registration number: 06422158
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ANNUAL REPORT AND FINANCIAL STATEMENTS
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FOR THE YEAR ENDED
31 DECEMBER 2024
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TOUCHLIGHT GENETICS LIMITED
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TOUCHLIGHT GENETICS LIMITED
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COMPANY INFORMATION
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Morelands & Riverdale Buildings
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TOUCHLIGHT GENETICS LIMITED
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CONTENTS
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Independent auditors' report
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Statement of comprehensive income
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Statement of financial position
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Statement of changes in equity
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Notes to the financial statements
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TOUCHLIGHT GENETICS LIMITED
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STRATEGIC REPORT
FOR THE YEAR ENDED 31 DECEMBER 2024
The directors present their Strategic Report together with the audited financial statements for the year ended 31 December 2024.
Touchlight Genetics Limited (‘TGL’) supports Touchlight Holdings Limited and its subsidiaries to enable the Group objectives to be met. TGL engages in grant-funded research projects, employs staff and bears support costs which are recharged across the Group as appropriate.
Significant progress and key milestones at the Group level were achieved as demonstrated by (i) Touchlight and GSK signing a non-exclusive license agreement for use of enzymatic dbDNA for mRNA manufacturing (ii) significant growth in CDMO sales and revenue (iii) further grant awards received in the year.
Post period end the Group (i) receives GMP certification for the facility in Hampton UK, as a result Touchlight becomes the first synthetic DNA manufacturer globally to gain regulatory approval to produce Active Pharmaceutical Ingredient (API), (ii) disposed of Touchlight Aquaculture subsidiary to Ceva Animal Health, with Ceva in parallel entering into a Licence to be granted rights to develop and manufacture future products using Touchlight’s dbDNA technology across the animal health field.
Business developments
∙Licence agreement signed with GSK for the non-exclusive rights to use dbDNA in the development and manufacture of mRNA.
∙Agreement with University of Liverpool for the use of dbDNA in the development of a fully-personalised therapeutic neoantigen DNA vaccine for patients with non-small cell lung cancer.
∙Wins two grants from Innovate UK to support R&D, one for the use of dbDNA in AAV production and the other to further develop and characterise Touchlight’s new genome editing product, mbDNA.
∙Awarded further grant form the Office of Naval Research (ONR) and the Defence Science and Technology Laboratory (Dstl) following successful proof of concept studies, in order to develop DNA-enabled biobattery prototype with real- world applicability.
∙CPI, a leading technology innovation centre in the UK, has selected Touchlight to supply research and GMP-grade enzymatic DNA for the development and manufacture of RNA therapeutics and vaccines.
∙Awarded the Business Innovator Award in the SAP UKI Customer Success Awards 2024.
Principal risks and uncertainties
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Risks are monitored at the Group level, which either individually or collectively could affect the future operating and financial performance of the Touchlight Group. Touchlight seeks to manage the risks to minimise the potential impact, however several of these risks are outside the control of the business. Risks specific to TGL include the following:
∙Partnership risk. TGL is engaged in grant funded projects. Such arrangements will invariably expose the business to some counterparty risk. TGL seeks to mitigate this risk by ensuring adequate liquidity at the Group level.
∙Dependence on key personnel. Touchlight is dependent on its scientific and management team. The loss (whether temporary or permanent) of these people could materially impact research and development activities. TGL seeks to mitigate this risk through competitive remuneration and succession planning.
∙Economic environment and market conditions. The operating costs of Touchlight may be affected by currency fluctuations, inflation, legislative and other future political decisions including the increasing use of global trade tariffs. TGL seeks to mitigate this through close monitoring of the cost base and the economic environment.
The above list of risks is not exhaustive and other unforeseen risks may in the future impact on the performance of Touchlight's business.
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TOUCHLIGHT GENETICS LIMITED
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STRATEGIC REPORT (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2024
Financial key performance indicators
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The key performance indicators ("KPI") maintained at the Group level which are:
∙The closing cash balance, which was £11.8 million at 31 December 2024 (FY2023: £17.8 million).
∙Revenue in the year, which was £16.6 million (FY2023: £4.4 million).
∙Net loss/ profit in the year, which was £17.1 million (FY2023: £48.7 million).
This report was approved by the board and signed on its behalf.
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TOUCHLIGHT GENETICS LIMITED
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DIRECTORS' REPORT
FOR THE YEAR ENDED 31 DECEMBER 2024
The directors present their report and the financial statements for the year ended 31 December 2024.
Principal activity
The Company's principal activity is that of managing central Group support operations and conducting grant funded research projects.
Directors
The directors who served during the year and up to the date of signing were:
D Lewis
J Ohlson
B Theobald
Directors' responsibilities statement
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The directors are responsible for preparing the Strategic report, the Directors' report and the financial statements in accordance with applicable law and regulations.
Company law requires the directors to prepare financial statements for each financial year. Under that law the directors have elected to prepare the financial statements in accordance with applicable law and United Kingdom Accounting Standards (United Kingdom Generally Accepted Accounting Practice), including Financial Reporting Standard 102 ‘The Financial Reporting Standard applicable in the UK and Republic of Ireland'. Under company law the directors must not approve the financial statements unless they are satisfied that they give a true and fair view of the state of affairs of the Company and of the profit or loss of the Company for that period.
In preparing these financial statements, the directors are required to:
∙select suitable accounting policies for the Company's financial statements and then apply them consistently;
∙make judgements and accounting estimates that are reasonable and prudent;
∙prepare the financial statements on the going concern basis unless it is inappropriate to presume that the Company will continue in business.
The directors are responsible for keeping adequate accounting records that are sufficient to show and explain the Company's transactions and disclose with reasonable accuracy at any time the financial position of the Company and to enable them to ensure that the financial statements comply with the Companies Act 2006. They are also responsible for safeguarding the assets of the Company and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.
The loss for the year, after taxation, amounted to £1,587,439 (2023 - loss £1,359,497).
There were no dividends paid in the year (2023 - £Nil).
The directors are satisfied with the progress and expect positive developments in the future, please see the group strategic report for an indication of the future business developments.
Qualifying third party indemnity provisions
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The company held third party indemnity insurance cover for the directors and officers of the company during the current and prior year. This cover also extended to directors and officers of the parent company.
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TOUCHLIGHT GENETICS LIMITED
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DIRECTORS' REPORT (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2024
Matters covered in the Strategic report
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The Company has chosen, in accordance with Section 414C(11) of the Companies Act 2006 (Strategic Report and Directors' Report) Regulations 2013, to set out within the Group's Strategic Report the Company's Strategic Report Information Required by Schedule 7 of the Large and Medium Sized Companies and Groups (Accounts and Reports) Regulation 2008. This includes information that would have been included in the business review and details of the principal risks and uncertainties.
Disclosure of information to auditors
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Each of the persons who are directors at the time when this Directors' report is approved has confirmed that:
∙so far as the director is aware, there is no relevant audit information of which the Company's auditors are unaware, and
∙the director has taken all the steps that ought to have been taken as a director in order to be aware of any relevant audit information and to establish that the Company's auditors are aware of that information.
Post balance sheet events
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There have been no significant events affecting the Company since the year end.
Under section 487(2) of the Companies Act 2006, Deloitte LLP will be deemed to have been reappointed as auditors 28 days after these financial statements were sent to members or 28 days after the latest date prescribed for filing the accounts with the registrar, whichever is earlier.
This report was approved by the board and signed on its behalf.
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Morelands & Riverdale Buildings
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TOUCHLIGHT GENETICS LIMITED
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INDEPENDENT AUDITOR'S REPORT TO THE MEMBERS OF TOUCHLIGHT GENETICS LIMITED
Report on the audit of the financial statements
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Opinion
In our opinion the financial statements of Touchlight Genetics Limited (the ‘company’):
∙give a true and fair view of the state of the company’s affairs as at 31 December 2024 and of its loss for the year then ended;
∙have been properly prepared in accordance with United Kingdom Generally Accepted Accounting Practice, including Financial Reporting Standard 102 “The Financial Reporting Standard applicable in the UK and Republic of Ireland”; and
∙have been prepared in accordance with the requirements of the Companies Act 2006.
We have audited the financial statements which comprise:
∙the statement of comprehensive income;
∙the statement of financial position;
∙the statement of changes in equity; and
∙the related notes 1 to 25.
The financial reporting framework that has been applied in their preparation is applicable law and United Kingdom Accounting Standards, including Financial Reporting Standard 102 “The Financial Reporting Standard applicable in the UK and Republic of Ireland” (United Kingdom Generally Accepted Accounting Practice).
We conducted our audit in accordance with International Standards on Auditing (UK) (ISAs (UK)) and applicable law. Our responsibilities under those standards are further described in the auditor's responsibilities for the audit of the financial statements section of our report.
We are independent of the company in accordance with the ethical requirements that are relevant to our audit of the financial statements in the UK, including the Financial Reporting Council’s (the ‘FRC’s’) Ethical Standard, and we have fulfilled our other ethical responsibilities in accordance with these requirements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.
Conclusions relating to going concern
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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.
Based on the work we have performed, we have not identified any material uncertainties relating to events or conditions that, individually or collectively, may cast significant doubt on the company’s ability to continue as a going concern for a period of at least twelve months from when the financial statements are authorised for issue.
Our responsibilities and the responsibilities of the directors with respect to going concern are described in the relevant sections of this report.
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TOUCHLIGHT GENETICS LIMITED
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INDEPENDENT AUDITOR'S REPORT TO THE MEMBERS OF TOUCHLIGHT GENETICS LIMITED (CONTINUED)
The other information comprises the information included in the Annual Report other than the financial statements and our Auditors' report thereon. The directors are responsible for the other information contained within the Annual Report. Our opinion on the financial statements does not cover the other information and, except to the extent otherwise explicitly stated in our report, we do not express any form of assurance conclusion thereon.
Our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the financial statements or our knowledge obtained in the course of the audit, or otherwise appears to be materially misstated. If we identify such material inconsistencies or apparent material misstatements, we are required to determine whether this gives rise to a material misstatement in the financial statements themselves. If, based on the work we have performed, we conclude that there is a material misstatement of this other information, we are required to report that fact.
We have nothing to report in this regard.
Responsibilities of directors
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As explained more fully in the directors’ responsibilities statement set out on page 3, the directors are responsible for the preparation of the financial statements and for being satisfied that they give a true and fair view, and for such internal control as the directors determine is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error.
In preparing the financial statements, the directors are responsible for assessing the company’s ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless the directors either intend to liquidate the company or to cease operations, or have no realistic alternative but to do so.
Auditor’s responsibilities for the audit of the financial statements
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Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor's report that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with ISAs (UK) will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these financial statements.
A further description of our responsibilities for the audit of the financial statements is located on the FRC’s website at: www.frc.org.uk/auditorsresponsibilities. This description forms part of our auditor's report.
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TOUCHLIGHT GENETICS LIMITED
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INDEPENDENT AUDITOR'S REPORT TO THE MEMBERS OF TOUCHLIGHT GENETICS LIMITED (CONTINUED)
Extent to which the audit was considered capable of detecting irregularities, including fraud
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Irregularities, including fraud, are instances of non-compliance with laws and regulations. We design procedures in line with our responsibilities, outlined above, to detect material misstatements in respect of irregularities, including fraud. The extent to which our procedures are capable of detecting irregularities, including fraud is detailed below.
We considered the nature of the company’s industry and its control environment, and reviewed the company’s documentation of their policies and procedures relating to fraud and compliance with laws and regulations. We also enquired of management and the directors about their own identification and assessment of the risks of irregularities, including those that are specific to the company’s business sector.
We obtained an understanding of the legal and regulatory frameworks that the company operates in, and identified the key laws and regulations that:
∙had a direct effect on the determination of material amounts and disclosures in the financial statements. This included UK Companies Act and tax legislation; and
∙do not have a direct effect on the financial statements but compliance with which may be fundamental to the company’s ability to operate or to avoid a material penalty.
We discussed among the audit engagement team regarding the opportunities and incentives that may exist within the organisation for fraud and how and where fraud might occur in the financial statements.
Management Override
In common with all audits under ISAs (UK), we are also required to perform specific procedures to respond to the risk of management override. In addressing the risk of fraud through management override of controls, we tested the appropriateness of journal entries and other adjustments; assessed whether the judgements made in making accounting estimates are indicative of a potential bias; and evaluated the business rationale of any significant transactions that are unusual or outside the normal course of business.
In addition to the above, our procedures to respond to the risks identified included the following:
∙reviewing financial statement disclosures by testing to supporting documentation to assess compliance with provisions of relevant laws and regulations described as having a direct effect on the financial statements;
∙performing analytical procedures to identify any unusual or unexpected relationships that may indicate risks of material misstatement due to fraud;
∙enquiring of management and external legal counsel concerning actual and potential litigation and claims, and instances of non-compliance with laws and regulations; and
∙reading minutes of meetings of those charged with governance.
Report on other legal and regulatory requirements
Opinions on other matters prescribed by the Companies Act 2006
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In our opinion, based on the work undertaken in the course of the audit:
∙the information given in the strategic report and the directors’ report for the financial year for which the financial statements are prepared is consistent with the financial statements; and
∙the strategic report and the directors’ report have been prepared in accordance with applicable legal requirements.
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TOUCHLIGHT GENETICS LIMITED
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INDEPENDENT AUDITOR'S REPORT TO THE MEMBERS OF TOUCHLIGHT GENETICS LIMITED (CONTINUED)
Matters on which we are required to report by exception
Under the Companies Act 2006 we are required to report in respect of the following matters if, in our opinion:
∙adequate accounting records have not been kept, or returns adequate for our audit have not been received from branches not visited by us; or
∙the financial statements are not in agreement with the accounting records and returns; or
∙certain disclosures of directors’ remuneration specified by law are not made; or
∙we have not received all the information and explanations we require for our audit.
We have nothing to report in respect of these matters.
This report is made solely to the Company's members, as a body, in accordance with Chapter 3 of Part 16 of the Companies Act 2006. Our audit work has been undertaken so that we might state to the Company's members those matters we are required to state to them in an Auditors' report and for no other purpose. To the fullest extent permitted by law, we do not accept or assume responsibility to anyone other than the Company and the Company's members, as a body, for o audit work, for this report, or for the opinions we have formed.
Julian Rae (Senior Statutory Auditor)
for and on behalf of
Deloitte LLP
Statutory Auditor
Cambridge, United Kingdom
29 September 2025
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TOUCHLIGHT GENETICS LIMITED
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STATEMENT OF COMPREHENSIVE INCOME
FOR THE YEAR ENDED 31 DECEMBER 2024
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Interest receivable and similar income
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Interest payable and similar expenses
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Loss for the financial year
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There was no other comprehensive income for 2024 (2023: £Nil).
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The notes on pages 12 to 27 form part of these financial statements.
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TOUCHLIGHT GENETICS LIMITED
REGISTERED NUMBER:06422158
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STATEMENT OF FINANCIAL POSITION
AS AT 31 DECEMBER 2024
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Debtors: amounts falling due within one year
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Creditors: amounts falling due within one year
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Total assets less current liabilities
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The financial statements were approved and authorised for issue by the board and were signed on its behalf by:
The notes on pages 12 to 27 form part of these financial statements.
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TOUCHLIGHT GENETICS LIMITED
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STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 31 DECEMBER 2024
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At 1 January 2023 (as previously stated)
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Prior year adjustment - correction of error
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At 1 January 2023 (as restated)
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Comprehensive income for the year
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Loss for the year (as restated)
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Total comprehensive income for the year
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Contributions by and distributions to owners
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Share based payment expense
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Comprehensive income for the year
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Total comprehensive income for the year
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Contributions by and distributions to owners
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Share based payment expense
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The notes on pages 12 to 27 form part of these financial statements.
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TOUCHLIGHT GENETICS LIMITED
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NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2024
Touchlight Genetics Limited is a private company limited by shares incorporated in England. Details of the Company's registered office can be found on the company information page.
2.Accounting policies
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Basis of preparation of financial statements
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The financial statements have been prepared under the historical cost convention unless otherwise specified within these accounting policies and in accordance with Financial Reporting Standard 102, the Financial Reporting Standard applicable in the UK and the Republic of Ireland and the Companies Act 2006.
The preparation of financial statements in compliance with FRS 102 requires the use of certain critical accounting estimates. It also requires management to exercise judgement in applying the Company's accounting policies (see note 3).
The following principal accounting policies have been applied:
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Financial Reporting Standard 102 - reduced disclosure exemptions
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The Company has taken advantage of the following disclosure exemptions in preparing these financial statements, as permitted by the FRS 102 "The Financial Reporting Standard applicable in the UK and Republic of Ireland":
∙the requirements of Section 7 Statement of Cash Flows;
∙the requirements of Section 3 Financial Statement Presentation paragraph 3.17(d);
∙the requirements of Section 26 Share-based Payment paragraphs 26.18(b), 26.19 to 26.21 and 26.23;
∙the requirements of Section 33 Related Party Disclosures paragraph 33.7.
This information is included in the consolidated financial statements of Touchlight Holdings Limited as at 31 December 2024 and these financial statements may be obtained from Morelands and Riverdale Buildings, Lower Sunbury Road, Hampton, TW12 2ER.
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Exemption from preparing consolidated financial statements
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The Company is a parent company that is also a subsidiary included in the consolidated financial statements of a larger group by a parent undertaking established under the law of any part of the United Kingdom and is therefore exempt from the requirement to prepare consolidated financial statements under section 400 of the Companies Act 2006.
The Company is consolidated within the group accounts of Touchlight Holdings Limited. The address and principal place of business is Morelands & Riverdale Buildings, Lower Sunbury Road, Hampton, TW12 2ER.
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TOUCHLIGHT GENETICS LIMITED
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NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2024
2.Accounting policies (continued)
At 31 December 2024, the company had a deficit on shareholders' funds amounting to £8,022,710 (2023: £7,902,454), following a loss for the year of £1,587,439 (2023: £1,359,497). The company has received confirmation that its parent company, Touchlight Holdings Limited, will not demand repayment of the balance due to it until such time as the company is in a position to do so without jeopardising the continued operational existence of the company. The parent company has also confirmed that it will provide sufficient funds to enable the company to meet its liabilities as they fall due for a period of at least twelve months from the date of approval of the financial statements. Accordingly, the directors believe that the financial statements should be prepared on a going concern basis.
The Company relies upon the continuing support of the Group who has expressed willingness to provide such support for the foreseeable future to enable the Company to continue operations. Accordingly, the directors believe that the financial statements should be prepared on a going concern basis. The directors have assessed the ability of the Group to provide support and are satisfied that they are able to.
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Foreign currency translation
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Functional and presentation currency
The Company's functional and presentational currency is GBP and the accounts are rounded to the nearest £ reflecting the principal geography where the company operates in.
Transactions and balances
Foreign currency transactions are translated into the functional currency using the spot exchange rates at the dates of the transactions.
At each period end foreign currency monetary items are translated using the closing rate. Non-monetary items measured at historical cost are translated using the exchange rate at the date of the transaction and non-monetary items measured at fair value are measured using the exchange rate when fair value was determined.
Foreign exchange gains and losses resulting from the settlement of transactions and from the translation at period-end exchange rates of monetary assets and liabilities denominated in foreign currencies are recognised in profit or loss except when deferred in other comprehensive income as qualifying cash flow hedges.
Turnover is recognised to the extent that it is probable that the economic benefits will flow to the Company and the turnover can be reliably measured. Turnover is measured as the fair value of the consideration received or receivable, excluding discounts, rebates, value added tax and other sales taxes. The following criteria must also be met before turnover is recognised:
Sale of goods
Turnover from the sale of goods is recognised when all of the following conditions are satisfied:
∙the Company has transferred the significant risks and rewards of ownership to the buyer;
∙the Company retains neither continuing managerial involvement to the degree usually associated with
ownership nor effective control over the goods sold;
∙the amount of turnover can be measured reliably;
∙it is probable that the Company will receive the consideration due under the transaction; and
∙the costs incurred or to be incurred in respect of the transaction can be measured reliably.
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TOUCHLIGHT GENETICS LIMITED
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NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2024
2.Accounting policies (continued)
Rendering of services
Turnover from a contract to provide services is recognised in the period in which the services are provided in accordance with the stage of completion of the contract when all of the following conditions are satisfied:
∙the amount of turnover can be measured reliably;
∙it is probable that the Company will receive the consideration due under the contract;
∙the stage of completion of the contract at the end of the reporting period can be measured reliably; and
∙the costs incurred and the costs to complete the contract can be measured reliably.
Rentals paid under operating leases are charged to profit or loss on a straight-line basis over the lease term.
Research and development expenditure is written off as incurred and recognised in the Statement of Comprehensive Income.
Development costs have been capitalised in accordance with FRS 102 Section 18 Intangible Assets other than Goodwill and are therefore not treated, for dividend purposes, as a realised loss.
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Research and development tax credits
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Tax credits relating to research and development are recognised in the Statement of Comprehensive Income on a receivable basis.
Grants are accounted for under the accruals model as permitted by FRS 102. Grants of a revenue nature are recognised in the Statement of Comprehensive Income in the same period as the related expenditure.
The deferred element of grants is included in creditors as deferred income.
Interest income is recognised in the Statement of Comprehensive Income on a receivable basis.
All borrowing costs are recognised in profit or loss in the year in which they are incurred.
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Allocation of staff costs
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Staff costs relating to time spent on specific projects are allocated to cost of sales and research and development costs, as appropriate. All other staff costs, including sickness, holidays and time spent training are allocated to administrative expenses.
Finance costs are charged to profit or loss over the term of the debt using the effective interest method so that the amount charged is at a constant rate on the carrying amount. Issue costs are initially recognised as a reduction in the proceeds of the associated capital instrument.
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TOUCHLIGHT GENETICS LIMITED
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NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2024
2.Accounting policies (continued)
Defined contribution pension plan
The Company operates a defined contribution plan for its employees. A defined contribution plan is a pension plan under which the Company pays fixed contributions into a separate entity. Once the contributions have been paid the Company has no further payment obligations.
The contributions are recognised as an expense in profit or loss when they fall due. Amounts not paid are shown in accruals as a liability in the Statement of financial position. The assets of the plan are held separately from the Company in independently administered funds.
Touchlight Holdings Limited ( 'the parent company') operates an Enterprise Management Investment Scheme, in which employees of the group hold options to subscribe for ordinary shares as granted by the parent company. The parent company also has other option schemes in which share options to subscribe for ordinary shares are awarded to selected employees, consultants and associates of the parent company and other companies in the group. The contractual life of all outstanding share options is until the day before the tenth anniversary of the original grant date.
Where share options are awarded to employees, the fair value of the options at the date of grant is charged to the Statement of Comprehensive Income. Where share options previously awarded to employees lapse, the fair value of these options at the date of grant are credited to the Statement of Comprehensive Income.
The fair value of the award also takes into account non- vesting conditions. These are either factors beyond the control of either party (such as a target based on an index) or factors which are within the control of one or other of the parties (such as the group keeping the scheme open or the employee maintaining any contributions required by the scheme).
Where equity instruments are granted to persons other than employees, the Statement of Comprehensive Income is charged with the fair value of goods and services received, allocated based on the group's use of the services.
The fair value of the share options granted was determined using an equity-allocation model based on the Black-Scholes-Merton option-pricing methodology, taking into account factors such as management's assessment of equity value at each valuation date, expected term to exit, expected equity volatility, exercise price, risk-free interest rate and assumed dividend yield.
These assumptions were based on (i) information and an exit timetable determined by management and (ii) market data, including UK government bond yields for the risk-free rate and volatility benchmarks derived from comparable biotechnology companies.
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National Insurance on share options
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To the extent that the share price at the reporting date is greater than the exercise price on certain options granted under unapproved schemes, provision for any National Insurance contributions has been made based on the prevailing rate of National Insurance. The provision is accrued over the performance period attaching to the award.
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TOUCHLIGHT GENETICS LIMITED
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NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2024
2.Accounting policies (continued)
Tax is recognised in profit or loss except that a charge attributable to an item of income and expense recognised as other comprehensive income or to an item recognised directly in equity is also recognised in other comprehensive income or directly in equity respectively.
The current income tax charge is calculated on the basis of tax rates and laws that have been enacted or substantively enacted by the reporting date in the countries where the Company operates and generates income.
Deferred tax balances are recognised in respect of all timing differences that have originated but not reversed by the reporting date, except that:
∙The recognition of deferred tax assets is limited to the extent that it is probable that they will be recovered against the reversal of deferred tax liabilities or other future taxable profits; and
∙Any deferred tax balances are reversed if and when all conditions for retaining associated tax allowances have been met.
Deferred tax balances are not recognised in respect of permanent differences except in respect of business combinations, when deferred tax is recognised on the differences between the fair values of assets acquired and the future tax deductions available for them and the differences between the fair values of liabilities acquired and the amount that will be assessed for tax. Deferred tax is determined using tax rates and laws that have been enacted or substantively enacted by the reporting date.
Intangible assets are initially recognised at cost. After recognition, under the cost model, intangible assets are measured at cost less any accumulated amortisation and any accumulated impairment losses. Amortisation is shown in the profit or loss.
All intangible assets are considered to have a finite useful life. If a reliable estimate of the useful life cannot be made, the useful life shall not exceed ten years.
The estimated useful lives range as follows:
Assets in the course of construction are not amortised until they are brought into use. At each reporting date the company assesses whether there is any indication of impairment. If such indication exists, the recoverable amount of the asset is determined, which is the higher of its fair value less costs to sell and its value in use. An impairment loss is recognised where the carrying amount exceeds the recoverable amount.
Tangible fixed assets under the cost model are stated at historical cost less accumulated depreciation and any accumulated impairment losses. Historical cost includes expenditure that is directly attributable to bringing the asset to the location and condition necessary for it to be capable of operating in the manner intended by management.
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TOUCHLIGHT GENETICS LIMITED
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NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2024
2.Accounting policies (continued)
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Tangible fixed assets (continued)
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Depreciation is charged so as to allocate the cost of assets less their residual value over their estimated useful lives, using the straight-line method.
Depreciation is provided on the following basis:
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Short-term leasehold property
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The assets' residual values, useful lives and depreciation methods are reviewed, and adjusted prospectively if appropriate, or if there is an indication of a significant change since the last reporting date.
Gains and losses on disposals are determined by comparing the proceeds with the carrying amount and are recognised in profit or loss.
Investments in subsidiaries are measured at cost less accumulated impairment.
Short-term debtors are measured at transaction price, less any impairment. Loans receivable are measured initially at fair value, net of transaction costs, and are measured subsequently at amortised cost using the effective interest method, less any impairment.
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Cash and cash equivalents
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Cash is represented by cash in hand and deposits with financial institutions repayable without penalty on notice of not more than 24 hours. Cash equivalents are highly liquid investments that mature in no more than three months from the date of acquisition and that are readily convertible to known amounts of cash with insignificant risk of change in value.
Short-term creditors are measured at the transaction price. Other financial liabilities, including bank loans, are measured initially at fair value, net of transaction costs, and are measured subsequently at amortised cost using the effective interest method.
The Company only enters into basic financial instrument transactions that result in the recognition of financial
assets and liabilities like trade and other debtors and creditors, loans from banks and other third parties, loans
to related parties and investments in ordinary shares.
Financial assets that are measured at cost and amortised cost are assessed at the end of each reporting period for objective evidence of impairment. If objective evidence of impairment is found, an impairment loss is recognised in the Statement of Comprehensive Income.
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TOUCHLIGHT GENETICS LIMITED
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NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2024
2.Accounting policies (continued)
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Financial instruments (continued)
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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.
Financial liabilities
Financial liabilities and equity instruments are classified according to the substance of the financial instrument's contractual obligations, rather than the financial instrument's legal form.
The Company determines the classification of its financial liabilities at initial recognition. All financial liabilities are recognised initially at fair value and in the case of loans and borrowings, plus directly attributable transaction costs.
After initial recognition, interest bearing loans and borrowings are subsequently measured at amortised cost using the effective interest method.
Convertible preference shares are separated into liability and equity components based on the terms of the contract. Convertible preference shares with a cumulative dividend stream that do not result in a fixed number of equity shares on conversion are accounted for as a financial liability at fair value through profit and loss with no equity component.
Dividends on shares recognised as liabilities are recognised as expenses and classified within interest payable.
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Judgements in applying accounting policies and key sources of estimation uncertainty
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Estimates and judgments are continually evaluated and are based on historical experience and other facts, including expectations of future events that are believed to be reasonable under the circumstances. The company makes estimates and assumptions concerning the future. The resulting accounting estimates will, by definition, seldom equal the related actual results. The estimates and assumptions that have significant risk of causing a material adjustment to the carrying amounts of assets and liabilities within the next financial year are addressed below.
Key sources of estimation uncertainty:
(i) Valuation of the share options
As the shares in the parent Company are not publicly traded, the directors estimate the fair value of the share options on the date on which they are granted. In estimating the fair value of the share options, the directors have regard to the share price of the most recent issue of shares prior to issuing the shares, the results of recent fundraising, projected business performance, the net assets of the Group and the prevailing economic and market
conditions at the date the option is granted.
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TOUCHLIGHT GENETICS LIMITED
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NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2024
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An analysis of turnover by class of business is as follows:
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Sale of services to other Group entities
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All turnover arose within the United Kingdom.
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All of the grant income is in respect of specific projects carried out by the Company.
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The operating loss is stated after charging:
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Research & development charged as an expense
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Other operating lease rentals
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TOUCHLIGHT GENETICS LIMITED
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NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2024
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During the year, the Company obtained the following services from the Company's auditors:
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Audit of the Company's financial statements
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Cost of defined contribution scheme
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The Company employs staff, on behalf of the other Touchlight group companies, and recharges staff costs to the other group entities. This note displays the gross employment costs to Touchlight Genetics Limited.
The share based payment expense in the period, in connection with employees of the Group amounted to £1,467,183 (2023: £1,757,356).
The average number of employees, including directors, during the year was as follows:
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TOUCHLIGHT GENETICS LIMITED
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NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2024
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Company contributions to defined contribution pension schemes
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During the year retirement benefits were accruing to 2 directors (2023 - 2) in respect of defined contribution pension schemes.
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The highest paid director received remuneration of £259,000 (2023: £204,000).
The value of the companies contributions paid to a defined contribution pension scheme in respect of the highest paid director amounts to £5,610 (2023: £9,860).
The share based payment expense in the period, in connection with directors of the Group amounted to £1,059,541 (2023: £609,584)
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Other interest receivable
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Interest payable and similar expenses
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TOUCHLIGHT GENETICS LIMITED
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NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2024
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Current tax on profits for the year
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Adjustments in respect of previous periods
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Deferred tax asset write off
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Factors affecting tax charge for the year
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The tax assessed for the year is higher than (2023 - higher than) the standard rate of corporation tax in the UK of 25% (2023 - 23.5%). The differences are explained below:
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Loss on ordinary activities before tax
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Loss on ordinary activities multiplied by standard rate of corporation tax in the UK of 25% (2023 - 23.5%)
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Expenses not deductible for tax purposes
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Capital allowances for year in excess of depreciation
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Research and development expenditure credits
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Surrender of tax losses for R&D tax credit refund
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Adjustments to tax charge in respect of prior periods
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Adjustments to tax charge in respect of prior periods - deferred tax
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Movement in deferred tax not recognised
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Income not deductible for tax purposes
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Additional deduction for R&D expenditure
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Research and development tax credits
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Total tax charge for the year
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TOUCHLIGHT GENETICS LIMITED
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NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2024
12.Taxation (continued)
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Factors that may affect future tax charges
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The Company has tax losses amounting to approximately £7,363,033 (2023: £7,893,107) available to carry forward against future profits. The headline rate of corporation tax increased to 25% from 1 April 2023. Therefore, the deferred tax asset relating to the losses carried forward has been calculated at the rate of 25% (2023: 25%). At 31 December 2024, the deferred tax asset amounted to approximately £1,840,758 (2023: £1,973,277) for the Company. No deferred tax asset has been recognised in these financial statements due to uncertainty over the timing of recoverability of the asset.
The movement in deferred tax not recognised consists of tax losses and capital allowances.
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TOUCHLIGHT GENETICS LIMITED
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NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2024
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Short-term leasehold property
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Investments in subsidiary companies
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TOUCHLIGHT GENETICS LIMITED
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NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2024
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The following were subsidiary undertakings of the Company:
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Ceva Hampton Limited (formerly Touchlight Aquaculture Limited)
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Explorer House Mercury Park Wycombe Lane, Wooburn Green, High Wycombe, HP10 0HH
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Developing vaccines for the aquaculture market
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Morelands and Riverdale Buildings, Lower Sunbury Road, Hampton, TW12 2ER
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Morelands and Riverdale Buildings, Lower Sunbury Road, Hampton, TW12 2ER
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The shareholding in Ceva Hampton Limited (previously Touchlight Aquaculture Limited) has been reduced due to shares issued in the year.On 1 December 2024 17 £0.001 shares were issued to the non controlling interest on conversion of £150,000 of convertible unsecured loan notes into shares of the subsidiary. The Company still holds the majority voting rights and control was still held at the year end.
On 14 January 2025, Ceva Hampton Limited (previously Touchlight Aquaculture Limited), was disposed of for total consideration of £8,100,301.
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Amounts owed by group undertakings
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Prepayments and accrued income
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TOUCHLIGHT GENETICS LIMITED
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NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2024
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Creditors: Amounts falling due within one year
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Amounts owed to group undertakings
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Other taxation and social security
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Accruals and deferred income
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In the opinion of the directors, the amounts owed to other group companies are unsecured, interest free, have no fixed date of repayment and are repayable on demand.
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Allotted, called up and fully paid
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656,567 (2023 - 656,567) Ordinary shares of £0.01 each
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Each ordinary share carries voting rights and there are no restrictions on the distribution of dividends.
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Share premium account
This reserve records the amount above the nominal value received for shares issued, less transaction costs.
Share option reserve
This reserve reflects movements on the share options granted by the parent Company.
Profit and loss account
This reserve records retained earnings and accumulated losses.
The Company operates a defined contributions pension scheme. The assets of the scheme are held separately from those of the Company in an independently administered fund. Contributions totalling £86,527 (2023: £88,688) were payable to the fund at the reporting date and are included in creditors.
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TOUCHLIGHT GENETICS LIMITED
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NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2024
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Commitments under operating leases
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At 31 December 2024 the Company had future minimum lease payments due under non-cancellable operating leases for each of the following periods:
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Later than 1 year and not later than 5 years
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22.Other financial commitments
As at 31 December 2024 the company had contracted for capital expenditure and to purchase raw materials and services to the value of £544,551 (2023: £473,399).
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Related party transactions
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The company has taken advantage of the exemptions provided in FRS 102 from disclosing transactions with members of the same group that are wholly owned.
During the year, the company paid £601,200 (2023: £430,187) to a shareholder of the parent company in respect of rent for the premises occupied by the company. The balance is unsecured, interest free and repayable on demand.
At 31 December 2024, remuneration payable to key management personnel from the group amounted to £2,534,487 (2023: £2,193,901).
At 31 December 2024, £139,400 (2023: £96,000) was due to the Company from the subsidiary undertaking. The balance due to the group was unsecured, interest free and repayable on demand. In addition, the Company advanced a further £43,400 (2023: £18,000) to the indirect subsidiary during the year, which has been fully provided for in these financial statements.
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Post balance sheet events
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On 14 January 2025, one of the Company’s subsidiaries, Ceva Hampton Limited (previously Touchlight Aquaculture Limited), was disposed of for consideration of £8,100,301.
The ultimate and immediate parent company is considered to be Touchlight Holdings Limited, a Company registered in the UK.
The smallest and the largest group in which the results of Touchlight Genetics Limited are consolidated is Touchlight Holdings Limited. The consolidated financial statements of this group may be obtained from the registered office of Touchlight Holdings Limited at Morelands and Riverdale Buildings, Lower Sunbury Road, Hampton TW12 2ER.
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