Title of each class | Trading Symbol | Name of each exchange on which registered |
American Depositary Shares (each representing 20 ‘A’ Ordinary Shares, par value US$0.0109) | TRIB | NASDAQ Global Market |
Large accelerated filer ☐ | Accelerated filer ☐ | Non-accelerated filer ☒ | Emerging growth company ☐ |
U.S. GAAP ☐ | International Financial Reporting Standards as issued by the International Accounting Standards Board ☒ | Other ☐ |
• | the development of our products; |
• | the potential attributes and benefit of our products and their competitive position; |
• | our ability to successfully commercialize, or enter into strategic relationships with third parties to commercialize, our products; |
• | our estimates regarding expenses, future revenues, capital requirements and our need for additional financing; |
• | our ability to acquire or in-licence new product candidates; |
• | potential strategic relationships; and |
• | the duration of our patent portfolio. |
Item 1. | Identity of Directors, Senior Management and Advisers |
Item 2. | Offer Statistics and Expected Timetable |
Item 3. | Key Information |
A. | Reserved |
B. | Capitalization and Indebtedness |
C. | Reasons for the Offer and Use of Proceeds |
D. | Risk Factors |
• | our ability to sell products could be adversely affected by competition from new and existing diagnostic products, changing conditions in the diagnostic market, including, inter alia, reductions in government funding and sector consolidation. |
• | our exclusion from one or more HIV testing algorithms, or a delay in the implementation of a HIV testing algorithm, could adversely affect our business and financial results. |
• | we have incurred substantial debt, which could impair our flexibility and access to capital and adversely affect our financial position. |
• | our ability to continue as a going concern depends on our ability to generate cash flows from operations and to conduct adequate financing activities. We expect we will require future additional capital. |
• | our long-term success depends upon the successful development and commercialization of new products, particularly in the biosensor area. |
• | significant interruptions in production at our principal manufacturing facilities and/or third-party manufacturing facilities would adversely affect our business and operating results. |
• | our products may in the future be subject to product recalls that could harm our reputation, business and financial results. |
• | the large amount of intangible assets and goodwill recorded on our balance sheet may lead to significant impairment charges in the future. |
• | failure to achieve our financial and strategic objectives could have a material adverse impact on our business prospects. |
• | changes in global economic conditions may have a material adverse impact on our results. |
• | we are highly dependent on our senior management team and other key employees, and the loss of one or more of these employees or the inability to attract and retain qualified personnel as necessary could adversely affect our operations. |
• | our revenues are highly dependent on a network of distributors worldwide. |
• | our ability to protect our information systems and electronic transmissions of sensitive data from data corruption, cyber-based attacks, security breaches or privacy violations is critical to the success of our business. |
• | our sales and operations are subject to the risks of fluctuations in currency exchange rates. |
• | tax matters, including disagreements with taxing authorities, the changes in corporate tax rates and imposition of new taxes could impact our results of operations and financial condition. |
• | the Covid-19 outbreak could significantly disrupt our operations and adversely affect our results of operations. |
• | clinical trials necessary to support future premarket submissions will be expensive and will require enrolment of suitable patients who may be difficult to identify and recruit. |
• | we may be subject to fines, penalties or injunctions if we are determined to be promoting the use of our products for unapproved or “off-label” uses. |
• | if we fail to maintain regulatory approvals and clearances our ability to commercially distribute and market these products could suffer. |
• | we face risks relating to our international sales and business operations, including regulatory risks, which could impact our current business operations and growth strategy. |
• | we are subject to various laws targeting fraud and abuse in the healthcare industry. |
• | we may be unable to protect or obtain proprietary rights that we utilize or intend to utilize. |
• | our patent protection may not be sufficiently broad to compete effectively, the existing patents could be challenged; and trade secrets and confidential know-how could be obtained by competitors. |
• | affiliates of Perceptive Credit Holdings III, LP (“Perceptive”) and MiCo IVD Holdings, LLC (“MiCo”) own approximately 19.0% and 23.6%, respectively, of the voting share capital of our Company (excluding ADS issuable with respect to warrants and a convertible note), which may give each of them significant influence over our management and affairs and may deter a change in control or other transaction that may be favorable to our shareholders. |
• | our failure to meet the continued listing requirements of Nasdaq could result in a de-listing of our ADSs and penny stock trading. |
• | as a foreign private issuer we are exempt from a number of reporting requirements under the Exchange Act and are permitted to file less information with the SEC than a domestic U.S. reporting company. |
• | we may be classified as a passive foreign investment company, |
• | the market price of our ADSs has been, and may continue to be, highly volatile. |
• | we expect we will need additional capital in the future. |
• | the conversion of our outstanding employee share options, any new employee share options and existing warrants would dilute the ownership interest of existing shareholders. |
• | it could be difficult for U.S. holders of our ADSs to enforce any securities laws claims against us, our officers or directors in Irish Courts. |
• | we have no plans to pay dividends on our ADSs, and you may not receive funds without selling the ADSs. |
• | the terms of the deposit agreement limit the voting rights of holders of ADSs. |
• | require us to use a substantial portion of our cash flow from operations to make debt service payments; |
• | limit our ability to use our cash flow or obtain additional financing for working capital, capital expenditures, acquisitions or other general business purposes; |
• | limit our flexibility to plan for, or react to, changes in our business and industry; |
• | result in dilution to our existing shareholders in the event we issue equity to fund our debt obligations; |
• | place us at a competitive disadvantage compared to our less leveraged competitors; and |
• | increase our vulnerability to the impact of adverse economic and industry conditions. |
• | incur, assume or guarantee additional indebtedness; or |
• | repurchase capital stock; |
• | make other restricted payments, including paying dividends and making investments; |
• | create liens; |
• | sell or otherwise dispose of assets, including capital stock of subsidiaries; |
• | enter into agreements that restrict dividends from subsidiaries; |
• | acquire another company or business or enter into mergers or consolidations; |
• | enter into certain inbound and outbound licenses of intellectual property, subject to certain exceptions; and |
• | enter into transactions with affiliates. |
• | The success of our research and product development efforts, in particular the significant development effort required to develop and commercialise the biosensor technology, including the glucose monitoring technology acquired in January 2024; |
• | The time, cost and degree of success of conducting clinical trials and obtaining regulatory approvals; |
• | The costs and timing of expansion of sales and marketing activities; |
• | The timing and size of any repayment requirements for existing debt obligations; |
• | The timing and success of the commercial launch of new products; |
• | The extent to which we gain or expand market acceptance for existing, new or enhanced products; |
• | The costs and timing of the expansion of our manufacturing capacity; |
• | The magnitude of capital expenditures; |
• | Changes in existing and potential relationships with distributors and other business partners; |
• | The costs involved in obtaining and enforcing patents, proprietary rights and necessary licences; |
• | The costs and liability associated with patent infringement or other types of litigation; |
• | The costs related to, and the success of, our operational efficiency focused activities; |
• | Competing technological and market developments; and |
• | The scope and timing of strategic acquisitions. |
• | The acquisition of the CGM assets and the related integration activities may require greater capital and other resources than originally anticipated at the time of acquisition; |
• | The benefits expected to be derived from the acquisition of the CGM assets may not materialize and could be affected by numerous factors, such as the failure to complete planned research and development objectives, regulatory developments, general economic conditions and increased competition; |
• | We may be unable to successfully integrate the CGM assets, products and technology into our business; |
• | Worse than expected performance of the acquired assets may result in the impairment of intangible assets; |
• | The acquisition will require substantial expense and management time and this could disrupt our business; |
• | The biosensor industry, including the CGM industry, is a highly innovative area with several industry participants developing intellectual property portfolios over many years. As such there can be no assurance that the technology acquired from Waveform or further developed by us, will not infringe on other parties’ existing IP portfolios. We could incur significant costs and management time in defending against IP infringement claims. |
• | We may not be able to accurately forecast the performance or ultimate impact of an acquired CGM business; and |
• | The acquisition may result in the incurrence of unexpected expenses, the dilution of our earnings or our existing stockholders’ percentage ownership, or potential losses from undiscovered liabilities not covered by an indemnification from the seller(s) of the acquired business; |
• | Suitable acquisitions or investments may not be found or consummated on terms or schedules that are satisfactory to us or consistent with our objectives; |
• | The benefits expected to be derived from an acquisition may not materialize and could be affected by numerous factors, such as regulatory developments, insurance reimbursement, general economic conditions and increased competition; |
• | We may be unable to successfully integrate an acquired company’s personnel, assets, management systems, products and/or technology into our business; |
• | Worse than expected performance of an acquired business may result in the impairment of intangible assets; |
• | Acquisitions may require substantial expense and management time and could disrupt our business; |
• | We may not be able to accurately forecast the performance or ultimate impact of an acquired business; |
• | An acquisition and subsequent integration activities may require greater capital and other resources than originally anticipated at the time of acquisition; |
• | An acquisition may result in the incurrence of unexpected expenses, the dilution of our earnings or our existing stockholders’ percentage ownership, or potential losses from undiscovered liabilities not covered by an indemnification from the seller(s) of the acquired business; |
• | An acquisition may result in the loss of our or the acquired company’s key personnel, customers, distributors or suppliers; |
• | An acquisition of a foreign business may involve additional risks, including, but not limited to, foreign currency exposure, liability or restrictions under foreign laws or regulations, and our inability to successfully assimilate differences in foreign business practices or overcome language or cultural barriers; and |
• | Our ability to integrate future acquisitions may be adversely affected by inexperience in dealing with new technologies. |
• | Decreased demand for our products; |
• | Lost revenues; |
• | Damage to our image or reputation; |
• | Costs related to litigation; and |
• | Diversion of management time and attention; |
• | contract manufacturers or suppliers may fail to comply with regulatory requirements or make errors in manufacturing that could negatively affect the efficacy or safety of our products or cause delays in shipments of our products; |
• | we or our contract manufacturers and suppliers may not be able to respond to unanticipated changes in customer orders, and if orders do not match forecasts, we or our suppliers may have excess or inadequate inventory of materials and components; |
• | we or our contract manufacturers and suppliers may be subject to price fluctuations due to a lack of long-term supply arrangements for key components; |
• | we or our contract manufacturers and suppliers may lose access to critical services and components, resulting in an interruption in the manufacture, assembly and shipment of our systems; |
• | we may experience delays in delivery by our contract manufacturers and suppliers due to changes in demand from us or their other customers; |
• | fluctuations in demand for products that our contract manufacturers and suppliers manufacture for others may affect their ability or willingness to deliver components to us in a timely manner; |
• | our suppliers or those of our contract manufacturer may wish to discontinue supplying components or services to us for risk management reasons; |
• | we may not be able to find new or alternative components or reconfigure our system and manufacturing processes in a timely manner if the necessary components become unavailable; and |
• | our contract manufacturers and suppliers may encounter financial hardships unrelated to our demand, which could inhibit their ability to fulfil our orders and meet our requirements. |
• | WMA Declaration of Helsinki – Ethical Principles for Medical Research Involving Human Subjects (2013); |
• | ICH Harmonised Guidelines - Integrated Addendum to ICH E6 (R2) Guideline for Good Clinical Practice (Nov 2016); |
• | ISO 20916:2019 In vitro diagnostic medical devices — Clinical performance studies using specimens from human subjects — Good study practice; and |
• | ISO 14155:2020: Clinical investigation of medical devices for human subjects – Good clinical practice. |
• | our inability to demonstrate to the FDA’s satisfaction that our products are safe and effective for their intended users; |
• | insufficient data from our pre-clinical studies and clinical trials to support clearance or approval, where required; and |
• | the failure of the manufacturing process or facilities we use to meet applicable requirements. |
• | untitled letters, warning letters, fines, injunctions, consent decrees and civil penalties; |
• | unanticipated expenditures to address or defend such actions; |
• | customer notifications for repair, replacement and refunds; |
• | recall, detention or seizure of our products; |
• | operating restrictions or partial suspension or total shutdown of production; |
• | refusing or delaying our requests for 510(k) clearance or premarket approval of new products or modified products; |
• | operating restrictions; |
• | withdrawing 510(k) clearances on PMA approvals that have already been granted; |
• | refusal to grant export approval for our products; or |
• | criminal prosecution. |
• | the federal Anti-Kickback Statute, which prohibits, among other things, persons from knowingly and wilfully soliciting, receiving, offering or paying remuneration, directly or indirectly, in exchange for or to induce either the referral of an individual for, or the purchase, order or recommendation of, any good or service for which payment may be made under federal healthcare programs, such as the Medicare and Medicaid programs. A person or entity does not need to have actual knowledge of the federal Anti-Kickback Statute or specific intent to violate it to have committed a violation; in addition, the government may assert that a claim including items or services resulting from a violation of the federal Anti-Kickback Statute constitutes a false or fraudulent claim for purposes of the False Claims Act; |
• | the Physician Self-Referral Law, also known as the “Stark Law”, which provides for strict liability for referrals by physicians to entities with which they or their immediate family members have a financial arrangement for certain designated health services, including clinical laboratory services provided by our CLIA-certified laboratory owned and operated by our subsidiary Immco Diagnostics Inc., that are reimbursable by federal healthcare programs, unless an exception applies. Penalties for violating the Stark Law include denial of payment, civil monetary penalties of up to fifteen thousand dollars per claim submitted, and exclusion from federal health care programs, as well as a penalty of up to one-hundred thousand dollars for attempts to circumvent the law; |
• | federal false claims laws which prohibit, among other things, individuals or entities from knowingly presenting, or causing to be presented, claims for payment from Medicare, Medicaid or other federal third-party payers that are false or fraudulent. Suits filed under the False Claims Act, known as “qui tam” actions, can be brought by any individual on behalf of the government and such individuals, commonly known as “whistleblowers”, may share in any amounts paid by the entity to the government in fines or settlement. When an entity is determined to have violated the False Claims Act, it may be required to pay up to three times the actual damages sustained by the government, plus civil penalties for each separate false claim. Often, to avoid the threat of treble damages and penalties under the False Claims Act, which in 2020 were $11,665 to $23,331 per false claim, companies will resolve allegations in a settlement without admitting liability to avoid the potential treble damages. Any such settlement could materially affect our business, financial operations, and reputation; |
• | the federal Civil Monetary Penalties Law, which prohibits, among other things, offering or transferring remuneration to a federal healthcare beneficiary that a person knows or should know is likely to influence the beneficiary’s decision to order or receive items or services reimbursable by the government from a particular provider or supplier; |
• | federal criminal laws that prohibit executing a scheme to defraud any federal healthcare benefit program or making false statements relating to healthcare matters. Similar to the federal Anti-Kickback Statute, a person or entity does not need to have actual knowledge of the statute or specific intent to violate it to have committed a violation; |
• | the federal Health Insurance Portability and Accountability Act of 1996, as amended by the Health Information Technology for Economic and Clinical Health Act, which governs the conduct of certain electronic healthcare transactions and protects the security and privacy of protected health information; |
• | the federal Physician Payment Sunshine Act, which requires manufacturers of drugs, devices, biologics and medical supplies for which payment is available under Medicare, Medicaid or the Children’s Health Insurance Program (with certain exceptions) to report annually to the CMS, information related to payments or other “transfers of value” made to physicians (defined to include doctors, dentists, optometrists, podiatrists and chiropractors) and teaching hospitals, and requires applicable manufacturers to report annually to the government ownership and investment interests held by the physicians described above and their immediate family members and payments or other “transfers of value” to such physician owners. Manufacturers are required to submit reports to CMS by the 90th day of each calendar year. We cannot assure you that we have and will successfully report all transfers of value by us, and any failure to comply could result in significant fines and penalties. Failure to submit the required information may result in civil monetary penalties up to an aggregate of $150,000 per year (and up to an aggregate of $1 million per year for “knowing failures”) for all payments, transfers of value or ownership or investment interests not reported in an annual submission, and may result in liability under other federal laws or regulations; |
• | federal and state laws governing the certification and licensing of clinical laboratories, including operational, personnel and quality requirements designed to ensure that testing services are accurate and timely, and federal and state laws governing the health and safety of clinical laboratory employees; |
• | the U.S. Foreign Corrupt Practices Act, or the FCPA, which prohibits corporations and individuals from paying, offering to pay or authorising the payment of anything of value to any foreign government official, government staff member, political party or political candidate in an attempt to obtain or retain business or to otherwise influence a person working in an official capacity; the UK Bribery Act, which prohibits both domestic and international bribery, as well as bribery across both public and private sectors; and bribery provisions contained in the German Criminal Code, which makes the corruption and corruptibility of physicians in private practice and other healthcare professionals a criminal offense; and |
• | analogous state and foreign law equivalents of each of the above federal laws, such as anti-kickback and false claims laws which may apply to items or services reimbursed by any payor, including commercial insurers; state laws that require device companies to comply with the industry’s voluntary compliance guidelines and the applicable compliance guidance promulgated by the federal government or otherwise restrict payments that may be made to healthcare providers and other potential referral sources; state laws that require device manufacturers to report information related to payments and other transfers of value to physicians and other healthcare providers or marketing expenditures; and state laws governing the privacy and security of health information in certain circumstances, many of which differ from each other in significant ways and may not have the same effect, thus complicating compliance efforts. |
• | announcements of new products by us or others; |
• | announcements by us of significant acquisitions, disposals, strategic partnerships, in-licensing, |
• | joint ventures or capital commitments; |
• | the developments of the businesses and projects of our various subsidiaries; |
• | expiration or terminations of licences, research contracts or other collaboration agreements; |
• | public concern as to the safety of the products we sell; |
• | the volatility of market prices for shares of companies with whom we compete; |
• | developments concerning intellectual property rights or regulatory approvals; |
• | variations in our and our competitors’ results of operations; |
• | changes in revenues, gross profits and earnings announced by us; |
• | changes in estimates or recommendations by securities analysts, if the ADSs are covered by analysts; |
• | fluctuations in the share price of our publicly traded subsidiaries; |
• | changes in government regulations or patent decisions; and |
• | general market conditions and other factors, including factors unrelated to our operating performance. |
• | the debt is for a liquidated or defined sum; |
• | the procedural rules of the U.S. Court must have been observed and the U.S. Court must have had jurisdiction in relation to the particular defendant according to Irish conflict of law rules (the submission to jurisdiction by the defendant would satisfy this rule); and |
• | the judgment must be final and conclusive and the decree must be final and unalterable in the U.S. Court which pronounces it. A judgment can be final and conclusive even if it is subject to appeal or even if an appeal is pending. If the effect of lodging an appeal under the applicable law is to stay execution of the judgment, it is possible that, in the meantime, the judgment should not be actionable in Ireland. It remains to be determined whether final judgment given in default of appearance is final and conclusive. |
• | if the judgment is not for a debt or a definite sum of money; |
• | if the judgment was obtained or alleged to have been obtained by fraud; |
• | if the process and decision of the U.S. Courts were contrary to natural or constitutional justice under the laws of Ireland and if the enforcement of the judgment in Ireland would be contrary to natural or constitutional justice; |
• | if the judgment is contrary to Irish public policy or involves certain United States laws which will not be enforced in Ireland or constitute the enforcement of a judgment of a penal or taxation nature; |
• | if jurisdiction cannot be obtained by the Irish Courts over the judgment debtors in the enforcement proceedings by personal service in Ireland or outside Ireland under Order 11 of the Irish Superior Courts Rules; |
• | there is no practical benefit to the party in whose favor the foreign judgment is made in seeking to have that judgment enforced in Ireland, or |
• | if the judgment is not consistent with a judgment of an Irish Court in respect of the same matter. |
Item 4. | Information on the Company |
A. | History and Development of the Company |
• | Trinity Biotech Manufacturing Limited, based in Bray, Ireland; |
• | Konamite Limited, based in Bray, Ireland; |
• | Clark Laboratories Inc, based in Jamestown, New York; |
• | Primus Corporation, based in Kansas City; |
• | Biopool US Inc (trading as Trinity Biotech USA), based in Jamestown, New York; |
• | Immco Diagnostics Inc, based in Buffalo, New York; |
• | Trib Biosensors Inc, based in Wilsonville, Oregon; |
• | Nova Century Scientific Inc, based in Burlington, Canada; and |
• | Trinity Biotech Brazil based in Sao Paulo, Brazil. |
Point-of-care | Clinical Laboratory | |||||||||
Infectious Diseases | Infectious Diseases | Haemoglobin | Autoimmune | Clinical Chemistry | Blood Bank Screening | |||||
UniGold | MarDx | Premier | ImmuBlot | EZ | Captia | |||||
Recombigen | FlexTrans | Ultra | ImmuGlo | |||||||
Trinscreen | ImmuLisa | |||||||||
OTOblot |
• | Infectious diseases; |
• | Glycated haemoglobin (for diabetes monitoring and diagnosis) and haemoglobin variants for the detection of haemoglobinopathies (haemoglobin abnormalities); and |
• | Autoimmune diseases. |
• | Sexually transmitted diseases, including Syphilis and Herpes; |
• | Markers for Epstein Barr, Measles, Mumps, Toxoplasmosis, Cytomegalovirus, Rubella, Varicella and other viral pathogens, and |
• | SARS-CoV-2. |
• | Immunofluorescence Assay (“IFA”); |
• | Enzyme-linked immunosorbent (“ELISA”); |
• | Western Blot (“WB”); and |
• | Line immunoassay (“LIA”). |
• | Its clinical chemistry product range directly to hospitals and laboratories in Germany and France; |
• | Infectious diseases and clinical chemistry product ranges directly to hospitals and laboratories in the UK; and |
• | All product lines through independent distributors and strategic partners in a further approximately 100 countries. |
2023 | 2022 | Total project costs to December 31, 20231 | ||||||||||
Product Name | US$’000 | US$’000 | US$’000 | |||||||||
Premier Instruments for A1c and haemoglobinopathies testing | 1,669 | 1,904 | 39,497 |
• | Immco entered into a licence agreement on January 19, 2012, and subsequently an amended licence agreement on June 14, 2018. The licence pertains to any product or service relating to identifying indicators of Sjogren’s disease. The agreement is effective through January 21, 2036 and is worldwide in scope. Royalties are payable based on agreement in place. |
• | In 2013, we entered into a licence agreement with a leading market participant, giving us a non-exclusive, worldwide licence to access a significant HIV-2 patent portfolio for the purpose of making, using and selling a HIV test kit, subject to certain limitations. |
• | On December 19, 1999, we obtained a non-exclusive commercial licence from the National Institutes of Health (“NIH”) in the United States for NIH patents relating to the general method of producing HIV-1 in cell culture and methods of serological detection of antibodies to HIV-1. |
• | untitled letters, warning letters, fines, injunctions, consent decrees and civil penalties; |
• | unanticipated expenditures to address or defend such actions; |
• | customer notifications for repair, replacement, refunds; |
• | recall, detention or seizure of our products; |
• | operating restrictions or partial suspension or total shutdown of production; |
• | refusing or delaying our requests for 510(k) clearance or premarket approval of new products or modified products; |
• | operating restrictions; |
• | withdrawing 510(k) clearances or PMA approvals that have already been granted; |
• | refusal to grant export approval for our products; or |
• | criminal prosecution. |
• | product design, development and manufacture; |
• | product safety, testing, labelling and storage; |
• | record keeping procedures; |
• | product marketing, sales and distribution; and |
• | post-marketing surveillance, complaint handling, medical device reporting, reporting of deaths, serious injuries or device malfunctions and repair or recall of products. |
• | Are non-invasive; |
• | Do not require an invasive sampling procedure that poses a significant risk; |
• | Do not introduce energy into a subject by design or intention; |
• | Are not to be used as a diagnostic procedure without confirmation of the diagnosis by another medically established diagnostic product or procedure; and |
• | Comply with the labelling requirements for IUO devices, as outlined in 21 C.F.R. § 812.2(c)(3). |
• | product listing and establishment registration, which helps facilitate FDA inspections and other regulatory action; |
• | Quality System Regulation, (“QSR”), which requires manufacturers, including third-party manufacturers, to follow stringent design, testing, control, documentation and other quality assurance procedures during all aspects of the manufacturing process; |
• | labelling regulations and FDA prohibitions against the promotion of products for uncleared, unapproved or off-label use or indication; |
• | clearance of product modifications that could significantly affect safety or efficacy or that would constitute a major change in intended use of one of our cleared devices; |
• | approval of product modifications that affect the safety or effectiveness of one of our approved devices; |
• | medical device reporting regulations, which require that manufacturers comply with FDA requirements to report if their device may have caused or contributed to a death or serious injury, or has malfunctioned in a way that would likely cause or contribute to a death or serious injury if the malfunction of the device or a similar device were to recur; |
• | post-approval restrictions or conditions, including post-approval study commitments; |
• | post-market surveillance regulations, which apply when necessary to protect the public health or to provide additional safety and effectiveness data for the device; |
• | the FDA's recall authority, whereby it can ask, or under certain conditions order, device manufacturers to recall from the market a product that is in violation of governing laws and regulations; |
• | regulations pertaining to voluntary recalls; and |
• | notices of corrections or removals. |
• | day-to-day operation of a clinical laboratory, including training and skill levels required of laboratory personnel; |
• | physical requirements of a facility; |
• | equipment; and |
• | validation and quality control. |
Item 4A. | Unresolved Staff Comments |
Item 5. | Operating and Financial Review and Prospects |
A. | Operating Results |
Year ended December 31, | ||||||||||||
2023 US$’000 | 2022 US$’000 | % Change | ||||||||||
Revenues – continuing operations | ||||||||||||
Clinical laboratory goods | 42,288 | 46,036 | (8.1 | )% | ||||||||
Clinical laboratory services | 5,453 | 7,272 | (25.0 | )% | ||||||||
Point-of-Care | 9,091 | 9,213 | (1.3 | )% | ||||||||
56,832 | 62,521 | (9.1 | )% |
Year ended December 31, | ||||||||||||
2023 US$‘000 | 2022 US$‘000 | % Change | ||||||||||
Revenues for continuing operations | ||||||||||||
Americas | 32,282 | 35,557 | (9.2 | )% | ||||||||
Asia/Africa | 18,909 | 20,401 | (7.3 | )% | ||||||||
Europe | 5,641 | 6,563 | (14.0 | )% | ||||||||
Total | 56,832 | 62,521 | (9.1 | )% |
i) | technical advisory, legal and professional fees were higher in 2023 compared to 2022 by US$1.6 million primarily due to costs associated with the acquisition of the biosensor assets of Waveform (which closed in January 2024) and other corporate development and corporate finance activities as we continue to assess strategic opportunities for inorganic growth and balance sheet optimization, |
ii) | an increase of US$1.5 million in foreign exchange losses largely relating to the accounting requirement to mark to market euro-denominated lease liabilities for right-of-use assets, and |
iii) | higher non-cash share-based payments expense of US$0.3 million mainly due to the full year effect of options granted in 2022. |
Year ended December 31, 2023 | Year ended December 31, 2022 | |||||||
US$m | US$m | |||||||
Interest on senior secured term loan | 8.4 | 9.8 | ||||||
Interest on convertible note | 1.1 | 0.7 | ||||||
Penalty for early partial settlement of term loan | 0.9 | 3.5 | ||||||
Lease interest | 0.6 | 0.7 | ||||||
Loss on disposal of exchangeable notes | 0.0 | 9.7 | ||||||
Interest on exchangeable notes | 0.0 | 0.4 | ||||||
Other non-cash financial expense | 0.0 | 0.1 | ||||||
Total | 11.1 | 24.7 |
Year ended December 31, | ||||||||||||
2022 US$’000 | 2021 US$’000 | % Change | ||||||||||
Revenues – continuing operations | ||||||||||||
Clinical laboratory goods | 46,036 | 62,884 | (26.8 | )% | ||||||||
Clinical laboratory services | 7,272 | 7,928 | (8.3 | )% | ||||||||
Point-of-Care | 9,213 | 10,337 | (10.9 | )% | ||||||||
62,521 | 81,149 | (23.0 | )% |
Year ended December 31, | ||||||||||||
2022 US$‘000 | 2021 US$‘000 | % Change | ||||||||||
Revenues – continuing operations | ||||||||||||
Americas | 35,557 | 52,779 | (32.6 | )% | ||||||||
Asia/Africa | 20,401 | 21,402 | (4.7 | )% | ||||||||
Europe | 6,563 | 6,968 | (5.8 | )% | ||||||||
Total | 62,521 | 81,149 | (23.0 | )% |
i. | VTM inventory write down (US$3.5 million) – as disclosed previously, we did not see any evidence during the winter season of 2022-23 of significant peaks in demand for VTM products. This led management to revisit our strategy of maintaining significant levels of raw materials inventory to meet demand peaks. Consequently, the value of inventory was written down in Q3, 2022 to our estimate of its net realisable value. |
ii. | Other inventory write down (US$0.9 million) - the value of certain excess raw materials and work in progress was written down in Q3, 2022 following a review and an update to our relevant quality assurance policy. |
iii. | Tri-stat inventory write down (US$0.3 million) - as disclosed previously, we undertook a strategic review of our Tri-stat instrument line as part of a broader review of our haemoglobins product portfolio. Management decided to limit sales of Tri-stat to certain targeted partnerships and as a consequence the value of this inventory was written down to reflect the revised outlook. |
o | The share-based payments expense was US$0.7m higher in 2022 compared to 2021, mainly due to share options granted during 2022. The majority of the options granted in 2022 are performance options and are structured such that they are exercisable only if the market price for Company’s ADSs exceeds certain levels ($15.00, $20.00 and $25.00 per ADS) during the life of the option. These performance share options align the goals of our team and our shareholders in the creation of shareholder value. |
o | With the lifting of COVID-related travel restrictions, we tasked our sales and marketing teams to increase travel to customers and trade shows as we continued to revitalise our sales activities. Similarly, some key functional leaders based in Ireland resumed visits to our overseas facilities as we sought to drive operational efficiencies. All of this led to an approximately US$1.1 million increase in travel and promotional costs in 2022. |
o | Due diligence and other legal and professional fees increased by approximately US$0.8 million in 2022 as we took an active, but disciplined, approach to pursuing a pipeline of attractive M&A opportunities. |
o | Non-recurring professional fees, primarily associated with the debt refinancing, of US$0.6 million were expensed in 2022. |
o | Increased expected credit loss on trade receivables, with the majority of the increase due to one distributor. |
o | Higher recruitment fees in 2022 due to the hiring of senior management personnel. |
o | Autoimmune smart reader (impairment charge US$1.3 million) - there is significant uncertainty whether the Company will complete the project to develop its own in-house autoimmune smart reader. While we may re-visit this decision in the future, in the interests of prudence we impaired the project’s carrying value. |
o | Tri-stat instrument (impairment charge US$1.0 million) - following a strategic review of the Tri-stat instrument, it was decided that Tri-stat sales would be restricted to certain targeted partnerships, and this led to an impairment in the carrying value of the Tri-stat intangible asset. |
o | COVID-19 antigen test on a rapid lateral flow format (impairment charge US$2.2 million) - this test was approved for professional use in the EU. However, the demand for our COVID-19 portfolio of products was highly uncertain and very difficult to predict and in our experience the market has moved to over the counter (“OTC”) rapid COVID-19 tests, for which this product was not approved. As such the Company’s efforts to commercialise this test were unsuccessful. In addition, pricing for rapid COVID-19 tests in the EU is relatively weak, with stronger pricing available in, for example, the U.S. market, for which this product is not yet approved. Given the market outlook for rapid COVID-19 testing products and continued uncertainty regarding regulatory approval pathways in key markets, including the U.S., management chose not to immediately pursue further regulatory approvals but does intend to monitor these markets and regulatory pathways with a view to potentially seeking additional regulatory approvals. As we have no imminent plans to pursue these regulatory approvals, under IFRS accounting rules these intangible assets were written down to zero. |
o | COVID-19 test on an ELISA format (impairment charge US$0.1 million) – this development project was written off because the market changed and there was no demand for a test based on this format. |
2022 US$’000 | 2021 US$’000 | |||||||
Loss on disposal of exchangeable notes | 9.7 | - | ||||||
Penalty for early settlement of term loan | 3.5 | - | ||||||
Term loan interest | 9.8 | - | ||||||
Convertible note interest | 0.7 | - | ||||||
Notional interest on lease liabilities for Right-of-use assets | 0.7 | 0.8 | ||||||
Exchangeable note interest | 0.4 | 4.6 | ||||||
Loan origination costs - term loan | - | 1.6 | ||||||
Fair value movement for derivative asset | 0.1 | - | ||||||
Total | 24.7 | 7.1 |
B. | Liquidity and Capital Resources |
• | The ability of the Group to generate revenue growth from its existing product lines and from new products following the successful completion of its development projects; |
• | The extent to which capital expenditure is incurred on additional property plant and equipment; |
• | The level of investment required to undertake both new and existing development projects; and |
• | Successful working capital management in the context of a growing business. |
Year ended December 31, | ||||||||
2023 US$‘000 | 2022 US$‘000 | |||||||
Net cash used in operating activities | (11,557 | ) | (921 | ) | ||||
Net cash inflow / (outflow) from investing activities | 24,756 | (5,977 | ) | |||||
Net cash outflow from financing activities | (16,042 | ) | (12,322 | ) | ||||
Net decrease in cash and cash equivalents and short-term investments | (2,843 | ) | (19,220 | ) |
• | Payments to acquire intangible assets of US$1.9 million (2022: US$4.9 million), which principally related to development expenditure capitalised as part of the Group’s on-going product development activities; |
• | Payments to acquire financial assets of US$0.7 million (2022: Nil), which relates to an investment in imaware Inc, which was subsequently fully impaired; |
• | Acquisition of property, plant and equipment of US$0.8 million (2022: US$1.1 million) incurred as part of the Group’s investment programme for its manufacturing and distributing activities; and, |
• | Proceeds from the sale of a business of US$28.2 million (2022: Nil), which solely relates to the proceeds (net of transactions costs) from the sale of Fitzgerald Industries. |
C. | Research and Development, Patents and Licences, etc. |
D. | Trend Information |
E. | Critical Accounting Policies and Estimates |
• | Significant underperformance relative to expected, historical or projected future operating results; |
• | Significant changes in the manner of our use of the acquired assets or the strategy for our overall business; |
• | Obsolescence of products; |
• | Significant decline in our stock price for a sustained period; and |
• | Our market capitalisation relative to net book value. |
• | In the event that there was a reduction of 10% in the assumed level of future growth in revenue growth rate, which would represent a reasonably likely range of outcomes, there would be no additional impairment loss recorded at December 31, 2023. |
• | In the event there was a 10% increase in the discount rate used to calculate the potential impairment of the carrying values, which would represent a reasonably likely range of outcomes, there would be no additional impairment loss recorded at December 31, 2023. |
Item 6. | Directors, Senior Management and Employees |
Name | Age | Title |
Directors | ||
John Gillard | 43 | Director, President and Chief Executive Officer |
Ronan O’Caoimh | 68 | Director, Founder & Executive Advisor |
Jim Walsh, PhD | 65 | Executive Director of Business Development |
Tom Lindsay | 66 | Independent Director |
Andrew Omidvar PhD,MBA | 68 | Independent Director |
Senior Management | ||
Ian Wells, PhD | 55 | Vice President of Quality and Regulatory Affairs |
Simon Dunne | 50 | Chief Accounting Officer |
Gary Keating, PhD | 51 | Chief Technology Officer |
Des Fitzgerald | 34 | Interim Chief Financial Officer, |
Eibhlín Kelly | 40 | Chief Information Officer |
Colm Molloy | 53 | Group Director of Human Resources and Culture |
John Mee | 60 | Global Supply Chain Director |
Jacqueline O’Neill | 51 | Director of Operations |
Mícheál Roche | 64 | Vice President of Global Health |
Director | Title | Salary/Other payments/ Benefits US$’000 | Performance related bonus US$’000 | Transaction related bonus US$’000 | Defined contribution pension US$’000 | Total 2023 US$’000 | Total 2022 US$’000 | |||||||||||||||||||
Aris Kekedjian1 | Former Chairman and Former Chief Executive Officer | 1,171 | — | — | — | 1,171 | 387 | |||||||||||||||||||
John Gillard 2 | President and Chief Executive Officer | 473 | — | 211 | 26 | 710 | 863 | |||||||||||||||||||
Ronan O’Caoimh | Director, Founder & Executive Advisor | 80 | — | — | — | 80 | 340 | |||||||||||||||||||
Jim Walsh | Director of Business Development | 50 | — | — | — | 50 | 20 | |||||||||||||||||||
Tom Lindsay | Independent Director | 63 | — | — | — | 63 | — | |||||||||||||||||||
Andrew Omidvar 3 | Independent Director | 10 | — | — | — | 10 | — | |||||||||||||||||||
1,847 | — | 211 | 26 | 2,084 | 1,610 |
D. | Employees |
Year Ended December 31, 2023 | ||||||||||||
2023 | 2022 | 2021 | ||||||||||
Numbers of employees by geographic location | ||||||||||||
United States | 203 | 203 | 224 | |||||||||
Ireland | 143 | 146 | 211 | |||||||||
United Kingdom | - | 1 | - | |||||||||
Brazil | 34 | 34 | 27 | |||||||||
Total workforce | 380 | 384 | 462 | |||||||||
Numbers of employees by category of activity | ||||||||||||
Research scientists & technicians | 23 | 26 | 25 | |||||||||
Manufacturing/Operations | 207 | 197 | 255 | |||||||||
Quality Assurance | 51 | 56 | 63 | |||||||||
Finance/Administration | 73 | 73 | 67 | |||||||||
Sales & Marketing | 26 | 32 | 52 | |||||||||
Total workforce | 380 | 384 | 462 |
E. | Share Ownership |
Name | Number of ‘A’ Ordinary Shares Beneficially Owned (1) | Percentage of Ownership (2) | |||||||
Ronan O’Caoimh (3) | 18,907,329 | 9.5 | % | ||||||
Jim Walsh (4) | 2,889,445 | 1.5 | % | ||||||
John Gillard (5) | 8,066,667 | 4.1 | % | ||||||
Tom Lindsay (6) | 145,833 | * | |||||||
Andrew Omidvar (7) | 145,833 | * | |||||||
Simon Dunne (8) | 240,000 | * | |||||||
Des Fitzgerald (9) | 541,667 | * | |||||||
Ian Wells | - | - | |||||||
Eibhlín Kelly | - | - | |||||||
Gary Keating | - | - | |||||||
Colm Molloy | - | - | |||||||
John Mee | - | - | |||||||
Jacqueline O’Neill | - | - | |||||||
Mícheál Roche | - | - | |||||||
Executive officers and directors as a group (14 persons) | 30,936,774 | 14.8 | % |
* | Less than 1% |
(1) | Beneficial ownership is determined in accordance with the rules of the SEC and generally includes voting or investment power with respect to securities. Ordinary Shares relating to options currently exercisable or exercisable within 60 days of the date of this table are deemed outstanding for computing the percentage of the person holding such securities but are not deemed outstanding for computing the percentage of any other person. Share options that have a performance condition related to the share price of the equity of the Company are deemed to be exercisable irrespective of whether the performance condition has been, or is expected to be, satisfied within 60 days of the date of this table. Except as indicated by footnote, and subject to community property laws where applicable, the persons named in the table above have sole voting and investment power with respect to all shares shown as beneficially owned by them. |
(2) | The percentages shown are based on 189,310,282 ‘A’ Ordinary Shares issued and outstanding as of March 31, 2024. |
(3) | Represents (a) 9,724,160 ‘A’ ordinary shares and (b) 9,183,169 ‘A’ ordinary shares underlying options that are currently vested and exercisable or that vest within sixty days of March 31, 2024. Includes options issued to Darnick Company which in the past provided Trinity Biotech with the services of Mr. O’Caoimh as Chief Executive Officer. |
(4) | Represents (a) 1,393,612 ‘A’ ordinary shares and (b) 1,495,833 ‘A’ ordinary shares underlying options that are currently vested and exercisable or that vest within sixty days of March 31, 2024. Note that 1,393,612 ‘A’ ordinary shares of Dr Walsh’s shares are held in trust for the benefit of Dr Walsh’s immediate family. |
(5) | Represents 8,066,667 ‘A’ ordinary shares underlying options that are currently vested and exercisable or that vest within sixty days of March 31, 2024. |
(6) | Represents 145,833 ‘A’ ordinary shares underlying options that are currently vested and exercisable or that vest within sixty days of March 31, 2024. |
(7) | Represents 145,833 ‘A’ ordinary shares underlying options that are currently vested and exercisable or that vest within sixty days of March 31, 2024. |
(8) | Represents 240,000 ‘A’ ordinary shares underlying options that are currently vested and exercisable or that vest within sixty days of March 31, 2024. |
(9) | Represents 541,667 ‘A’ ordinary shares underlying options that are currently vested and exercisable or that vest within sixty days of March 31, 2024. |
Director/Company Secretary | Number of Options ‘A’ Shares | Number of Options ADS Equivalent | Exercise Price (Per ‘A’ Share) | Exercise Price (Per ADS) | Hurdle Price 2 (Per ADS) | Expiration Date of Options | |||||||||||||||
John Gillard | 600,000 | 30,000 | 0.67 | 13.40 | None | 23/10/2027 | |||||||||||||||
1,400,000 | 70,000 | 0.27 | 5.40 | None | 25/03/2029 | ||||||||||||||||
2,000,000 | 100,000 | 0.29 | 5.80 | None | 19/12/2029 | ||||||||||||||||
666,667 | 33,333 | 0.29 | 5.80 | $ | 15.00 | 19/12/2029 | |||||||||||||||
666,667 | 33,333 | 0.29 | 5.80 | $ | 20.00 | 19/12/2029 | |||||||||||||||
666,667 | 33,333 | 0.29 | 5.80 | $ | 25.00 | 19/12/2029 | |||||||||||||||
7,000,000 | 350,000 | 0.12 | 2.40 | None | 18/12/2030 | ||||||||||||||||
2,333,333 | 116,667 | 0.12 | 2.40 | $ | 5.00 | 18/12/2030 | |||||||||||||||
2,333,333 | 116,667 | 0.12 | 2.40 | $ | 7.50 | 18/12/2030 | |||||||||||||||
2,333,334 | 116,667 | 0.12 | 2.40 | $ | 10.00 | 18/12/2030 | |||||||||||||||
Ronan O’Caoimh 1 | 2,244,000 | 112,200 | 1.34 | 26.80 | None | 07/09/2024 | |||||||||||||||
4,060,000 | 203,000 | 0.69 | 13.80 | None | 14/06/2026 | ||||||||||||||||
333,336 | 16,667 | 0.19 | 3.80 | None | 20/03/2027 | ||||||||||||||||
2,400,000 | 120,000 | 0.73 | 14.60 | None | 17/11/2027 | ||||||||||||||||
700,000 | 35,000 | 0.14 | 2.80 | None | 28/01/2031 | ||||||||||||||||
233,333 | 11,667 | 0.14 | 2.80 | $ | 5.00 | 28/01/2031 | |||||||||||||||
233,333 | 11,667 | 0.14 | 2.80 | $ | 7.50 | 28/01/2031 | |||||||||||||||
233,334 | 11,667 | 0.14 | 2.80 | $ | 10.00 | 28/01/2031 | |||||||||||||||
Jim Walsh | 750,000 | 37,500 | 1.34 | 26.80 | None | 07/09/2024 | |||||||||||||||
600,000 | 30,000 | 0.19 | 3.80 | None | 20/03/2027 | ||||||||||||||||
700,000 | 35,000 | 0.14 | 2.80 | None | 28/01/2031 | ||||||||||||||||
233,333 | 11,667 | 0.14 | 2.80 | $ | 5.00 | 28/01/2031 | |||||||||||||||
233,333 | 11,667 | 0.14 | 2.80 | $ | 7.50 | 28/01/2031 | |||||||||||||||
233,334 | 11,667 | 0.14 | 2.80 | $ | 10.00 | 28/01/2031 | |||||||||||||||
Thomas Lindsay | 700,000 | 35,000 | 0.14 | 2.80 | None | 28/01/2031 | |||||||||||||||
233,333 | 11,667 | 0.14 | 2.80 | $ | 5.00 | 28/01/2031 | |||||||||||||||
233,333 | 11,667 | 0.14 | 2.80 | $ | 7.50 | 28/01/2031 | |||||||||||||||
233,334 | 11,667 | 0.14 | 2.80 | $ | 10.00 | 28/01/2031 | |||||||||||||||
Andrew Omidvar | 700,000 | 35,000 | 0.14 | 2.80 | None | 28/01/2031 | |||||||||||||||
233,333 | 11,667 | 0.14 | 2.80 | $ | 5.00 | 28/01/2031 | |||||||||||||||
233,333 | 11,667 | 0.14 | 2.80 | $ | 7.50 | 28/01/2031 | |||||||||||||||
233,334 | 11,667 | 0.14 | 2.80 | $ | 10.00 | 28/01/2031 |
Number of ‘A’ Ordinary Shares Subject to Options | Range of Exercise Price per Ordinary Share | Range of Exercise Price per ADS | ||||||||||
Total options outstanding | 51,014,672 | $ | US0.12-US$1.34 | $ | US2.40-US$26.80 |
Item 7. | Major Shareholders and Related Party Transactions |
A. | Major Shareholders |
Name | Number of ‘A’ Ordinary Shares Beneficially Owned | Number of ADSs Beneficially Owned | Percentage ownership (2) | |||||||||
MiCo IVD Holdings, LLC | 44,759,388 | (3) | 2,237,969 | (3) | 29.9 | %(3) | ||||||
Perceptive Credit Holdings III, LP | 56,000,000 | (4) | 2,800,000 | (4) | 26.8 | % | ||||||
All directors and officers as a group | 30,936,774 | (1) | 1,546,839 | (1) | 14.8 | % |
(1) | Beneficial ownership is determined in accordance with the rules of the SEC and generally includes voting or investment power with respect to securities. Ordinary Shares relating to options currently exercisable or exercisable within 60 days of the date of this table are deemed outstanding for computing the percentage of the person holding such securities but are not deemed outstanding for computing the percentage of any other person. Share options that have a performance condition related to the share price of the equity of the Company are deemed to be exercisable irrespective of whether the performance condition has been, or is expected to be, satisfied within 60 days of the date of this table. Except as indicated by footnote, and subject to community property laws where applicable, the persons named in the table above have sole voting and investment power with respect to all shares shown as beneficially owned by them. |
(2) | The percentages shown are based on 189,310,282 ‘A’ Ordinary Shares outstanding (excluding treasury shares). |
(3) | Based upon a Schedule 13D filed on January 2, 2024, by MiCo IVD Holdings, LLC with the SEC. The percentage ownership in the table above includes the conversion of the maximum number of ‘A’ Ordinary Shares as permitted by the conversion terns of the Convertible Note. The principal business address of MiCo IVD Holdings, LLC is 85 Orchard Road. Skillman, New Jersey 08558 United States. |
(4) | Based upon Schedule 13D filed on February 9, 2024, by Perceptive Credit Holdings III, LP. The principal business address of Perceptive Credit Holdings III, LP is 51 Astor Place 10th Floor, New York, NY 10003. |
Number of ‘A’ Ordinary Shares Beneficially Owned | Number of ADSs Beneficially Owned (1) | Percentage ‘A’ Ordinary Shares | Percentage Total Voting Power | Date of Filing | |||||||||||||
Highbridge Capital Management, LLC | 675,064 | 33,753 | 0.4 | % | 0.4 | % | April 14, 2022 (1) | ||||||||||
Renaissance Technologies LLC | 5,573,752 | 278,688 | 2.9 | % | 2.9 | % | February 13, 2023 | ||||||||||
Stonehill Capital Management LLC | 6,690,592 | 334,530 | 3.5 | % | 3.5 | % | February 13, 2023 |
(1) | Based on information provided by Highbridge Capital Management, LLC to the Company in a letter dated April 14, 2022 |
Number of ‘A’ Ordinary Shares Beneficially Owned | Number of ADSs Beneficially Owned (1) | Percentage ‘A’ Ordinary Shares | Percentage Total Voting Power | Date of Filing | |||||||||||||
MiCo IVD Holdings, LLC | 44,759,388 | 2,237,969 | 29.9 | %(1) | 29.9 | %(1) | April 14, 2022 | ||||||||||
Perceptive Credit Holdings III, LP | 56,000,000 | 2,800,000 | 26.8 | % | 26.8 | % | February 09, 2024 |
(1) | The percentage ownership in the table above for MiCo IVD Holdings, LLC includes the conversion of the maximum number of ‘A’ Ordinary Shares as permitted by the conversion terns of the Convertible Note. |
Item 8. | Financial Information |
Item 9. | The Offer and Listing |
Item 10. | Additional Information |
• | an individual resident in the U.S. (or certain other countries with which Ireland has a double taxation treaty) and who is neither resident nor ordinarily resident in Ireland; or |
• | a U.S. tax resident corporation (or a corporation resident in certain other countries, with which Ireland has a double taxation treaty) not under the control of Irish residents; or |
• | a corporation that is not resident in Ireland and which is ultimately controlled by persons resident in the U.S. (or certain other countries with which Ireland has a double taxation treaty), with such person or persons not under the control of persons who are not so resident; or |
• | a corporation that is not resident in Ireland and the principal class of whose shares (or its 75% parent’s principal class of shares) is substantially or regularly traded on a recognised stock exchange in Ireland or a country with which Ireland has a double taxation treaty; or |
• | is otherwise entitled to an exemption from DWT. |
• | the recipient is the direct beneficial owner of the shares, and |
• | the recipient is the direct beneficial owner of the ADSs, and the depository bank’s ADS register shows that the direct beneficial owner of the dividends has a U.S. address on the register, and |
• | there is an intermediary between the depository bank and the shareholder beneficially entitled to the dividend and the depository bank receives confirmation from the intermediary that such shareholder’s address in the intermediary’s records is in the U.S. |
Item 11. | Quantitative and Qualitative Disclosures about Market Risk |
Item 12 | Description of Securities Other than Equity Securities |
Service | Rate | By whom paid | ||
(1) Issuance of ADSs upon deposit of ordinary shares. | Up to $10.00 per 100 ADSs (or portion thereof) issued. | Persons depositing ordinary shares or person receiving ADSs. | ||
(2) Delivery of deposited securities against surrender of ADSs. | Up to $10.00 per 100 ADSs (or portion thereof) issued. | Persons surrendering ADSs for the purpose of withdrawal of deposited securities or persons to whom deposited securities are delivered. | ||
(3) Issuance of ADSs in connection with a distribution of shares. | Up to $10.00 per 100 ADSs (or portion thereof) issued. | Person to whom distribution is made. | ||
(4) Distribution of cash dividends or other cash distributions, including distribution of cash proceeds following the sale of rights, shares or other property in accordance with the deposit agreement | Up to $0.02 per 1 ADS | Person to whom distribution is made. | ||
(5) Transfer of ADSs | Up to $1.50 per certificate for ADRs or ADRs transferred | Person to whom Receipt is transferred. |
• | transfer and registration fees of securities on Trinity Biotech’s securities register to or from the name of the depositary or its agent when ADS holders deposit or withdrawal securities; |
• | expenses for cable, telex and fax transmissions and for delivery of securities; |
• | expenses incurred for converting foreign currency into U.S. dollars; and |
• | taxes and duties upon the transfer of securities (i.e., when ordinary shares are deposited or withdrawn from deposit, other than taxes for which Trinity Biotech is liable). |
Item 13. | Defaults, Dividend Arrearages and Delinquencies |
Item 14. | Material Modifications to the Rights of Security Holders and Use of Proceeds |
Item 15. | Controls and Procedures |
Item 16. | Reserved |
16 A. | Audit Committee Financial Expert |
16 B. | Code of Ethics |
16 C. | Principal Accountant Fees and Services |
Year ended December 31, 2023 | Year ended December 31, 2022 | |||||||||||||||
US$’000 | % | US$’000 | % | |||||||||||||
Audit | 909 | 66 | % | 1,064 | 92 | % | ||||||||||
Tax | 463 | 34 | % | 89 | 8 | % | ||||||||||
Total | 1,372 | 1,153 |
16 D. | Exemptions from the Listing Standards for Audit Committees |
16 E. | Purchases of Equity Securities by the Issuer and Affiliated Purchasers |
16 F. | Change in Registrant’s Certifying Accountant |
16 G. | Corporate Governance |
• | Rule 5605(b)(1) - The Rule requiring maintaining a majority of independent directors. Instead, under Irish law and practice, we are not required to appoint a majority of independent directors. |
• | Rule 5605(b)(2) -The Rule requiring that our independent directors have regularly scheduled meetings at which only independent directors are present. Instead, we follow Irish law according to which independent directors are not required to hold executive sessions. |
• | Rule 5605(e) - The Rule regarding independent director oversight of director nominations process for directors. Instead, we follow Irish law and practice according to which our board of directors recommends directors for election/re-election by our shareholders. |
• | Rule 5635(c) - The requirement to obtain shareholder approval for the establishment or amendment of certain equity based compensation plans, an issuance that will result in a change of control of the company (Rule 5635(b)), certain transactions other than a public offering involving issuances of a 20% or more interest in the company (Rule 5635(d)) and certain acquisitions of the stock or assets of another company (Rule 5635(a)). Instead, we follow Irish law and practice in approving such procedures, according to which Board approval may suffice in certain circumstances, depending on the extent existing general authorities to issue shares are in place. |
• | Rule 5605(c)(2) - The Rule requiring maintaining an audit committee consisting of at least three independent directors. Instead, we follow Irish law that requires that an audit committee have at least one independent director. |
• | Rule 5605(d)(2) - The Rule requiring a compensation committee consisting of at least two independent directors. We have had a compensation committee, which we referred to as the remuneration committee. We have engaged an international consultancy to advise the Board on Board and executive compensation. |
• | Rule 5620(c) - The Rule requiring a quorum of 33 1/3% at any meeting of shareholders (Rule 5620(c)). Instead, we follow the provisions of our Articles which require a quorum of 40%. If a quorum is not present within 30 minutes (or such longer time not exceeding one hour as the chairperson of the meeting may decide to wait) after the time appointed for the holding of the meeting a quorum is not present, or if during the meeting a quorum ceases to be present, the meeting, if convened on the requisition of shareholders, shall be dissolved and in any other case, shall stand adjourned to the same day in the next week or to such other day and at such other time and place as the chairperson (or, in default, the board of directors) may, subject to the provisions of the Companies Act 2014, determine. If at such adjourned meeting a quorum is not present within 15 minutes after the time appointed for holding it, the members present in person or by proxy shall be a quorum, but so that not less than two individuals shall constitute a quorum. |
16 H. | Mine Safety Disclosure |
16 I. | Disclosure Regarding Foreign Jurisdictions That Prevent Inspections |
Item 16J. | Insider Trading Policies |
Item 16K. | Cybersecurity |
Item 17 | Financial Statements |
Item 18 | Financial Statements |
The audited consolidated financial statements as required under Item 18 are attached hereto starting on page 101 of this Annual Report. The audit report of Grant Thornton (PCAOB ID 1402), independent registered public accounting firm, is included herein preceding the audited consolidated financial statements.
• | We evaluated the design effectiveness of controls over management’s selection of the discount rates, short-term forecasts of future revenues and margins, and long-term growth rates used to determine the recoverable amount of each selected CGU. |
• | We identified relevant CGUs with significant non-current assets with impairment indicators such as CGUs with operating losses or those which did not meet their budgets in previous years. |
• | We agreed the underlying cash flow forecasts against budgets of the selected CGUs and we evaluated management’s ability to accurately forecast future revenues and margins by: |
• | performing a look-back analysis and comparing actual results to management’s historical forecasts; and |
• | assessing the reasonableness of the impact of new products and other macroeconomic activity on short-term cash flows. |
• | We assessed the reasonableness of the valuation model used by the Company compared to generally accepted valuation practices and accounting standards. |
• | We tested the source information underlying the determination of the discount rates through use of observable inputs from independent external sources and we developed independent estimates and compared those to the discount rates selected by management. |
• | We compared the long-term growth rates, used by management to grow cash flows in order to calculate a terminal value, to independent external sources to assess the reasonableness of these rates. |
• | We performed sensitivity analyses around significant management assumptions, such as discount rate and growth rate, to account for uncertainties around assumptions in the valuation model. |
Year ended December 31 | |||||||||||||||
Notes | 2023 Total US$‘000 | 2022 Total US$‘000 | 2021 Total US$‘000 | ||||||||||||
Revenues | 2 | 56,832 | 62,521 | 81,149 | |||||||||||
Cost of sales | (37,382 | ) | (45,253 | ) | (47,695 | ) | |||||||||
Gross profit | 19,450 | 17,268 | 33,454 | ||||||||||||
Other operating income | 4 | 141 | 343 | 4,428 | |||||||||||
Research and development expenses | (4,379 | ) | (4,138 | ) | (4,497 | ) | |||||||||
Selling, general and administrative expenses | (31,152 | ) | (26,983 | ) | (22,503 | ) | |||||||||
Impairment charges | 5 | (11,105 | ) | (5,839 | ) | (6,944 | ) | ||||||||
Operating (loss)/profit | (27,045 | ) | (19,349 | ) | 3,938 | ||||||||||
Financial income | 6 | 1,171 | 303 | 1,223 | |||||||||||
Financial expenses | 6 | (11,053 | ) | (24,734 | ) | (7,085 | ) | ||||||||
Net financing expense | (9,882 | ) | (24,431 | ) | (5,862 | ) | |||||||||
Loss before tax | 9 | (36,927 | ) | (43,780 | ) | (1,924 | ) | ||||||||
Total income tax credit | 2, 7 | 59 | 194 | 74 | |||||||||||
Loss for the year on continuing operations | 2 | (36,868 | ) | (43,586 | ) | (1,850 | ) | ||||||||
Profit for the year on discontinued operations | 8 | 12,850 | 2,577 | 2,725 | |||||||||||
(Loss)/profit for the year (all attributable to owners of the parent) | 2 | (24,018 | ) | (41,009 | ) | 875 | |||||||||
Basic (loss)/profit per ADS (US Dollars) – continuing operations | 10 | (4.81 | ) | (6.46 | ) | (0.44 | ) | ||||||||
Diluted (loss)/profit per ADS (US Dollars) – continuing operations | 10 | (4.81 | ) | (6.46 | ) | (0.44 | ) | ||||||||
Basic (loss)/profit per ‘A’ ordinary share (US Dollars) –continuing operations | 10 | (0.24 | ) | (0.32 | ) | (0.02 | ) | ||||||||
Diluted (loss)/profit) per ‘A’ ordinary share (US Dollars) – continuing operations | 10 | (0.24 | ) | (0.32 | ) | (0.02 | ) | ||||||||
Basic (loss)/profit per ADS (US Dollars) – group | 10 | (3.14 | ) | (6.08 | ) | 0.21 | |||||||||
Diluted (loss)/profit per ADS (US Dollars) – group | 10 | (3.14 | ) | (6.08 | ) | 0.16 | |||||||||
Basic (loss)/profit per ‘A’ ordinary share (US Dollars) – group | 10 | (0.16 | ) | (0.30 | ) | 0.01 | |||||||||
Diluted (loss)/profit) per ‘A’ ordinary share (US Dollars) – group | 10 | (0.16 | ) | (0.30 | ) | 0.01 |
Year ended December 31 | |||||||||||||||
Notes | 2023 US$‘000 | 2022 US$‘000 | 2021 US$‘000 | ||||||||||||
(Loss)/profit for the year | 2 | (24,018 | ) | (41,009 | ) | 875 | |||||||||
Other comprehensive profit/(loss) | |||||||||||||||
Items that will be reclassified subsequently to profit or loss | |||||||||||||||
Foreign exchange translation differences | 69 | (396 | ) | (86 | ) | ||||||||||
Other comprehensive profit/(loss) | 69 | (396 | ) | (86 | ) | ||||||||||
Total Comprehensive (Loss)/profit (all attributable to owners of the parent) | (23,949 | ) | (41,405 | ) | 789 |
At December 31 | |||||||||||
Notes | 2023 US$‘000 | 2022 US$‘000 | |||||||||
ASSETS | |||||||||||
Non-current assets | |||||||||||
Property, plant and equipment | 11 | 1,892 | 5,682 | ||||||||
Goodwill and intangible assets | 12 | 16,270 | 35,269 | ||||||||
Deferred tax assets | 14 | 1,975 | 4,218 | ||||||||
Derivative financial instruments | 23 | 178 | 128 | ||||||||
Other assets | 15 | 79 | 139 | ||||||||
Total non-current assets | 20,394 | 45,436 | |||||||||
Current assets | |||||||||||
Inventories | 16 | 19,933 | 22,503 | ||||||||
Trade and other receivables | 17 | 13,901 | 15,753 | ||||||||
Income tax receivable | 1,516 | 1,834 | |||||||||
Cash and cash equivalents | 18 | 3,691 | 6,578 | ||||||||
Total current assets | 39,041 | 46,668 | |||||||||
TOTAL ASSETS | 2 | 59,435 | 92,104 | ||||||||
EQUITY AND LIABILITIES | |||||||||||
Equity attributable to the equity holders of the parent | |||||||||||
Share capital | 19 | 1,972 | 1,963 | ||||||||
Share premium | 46,619 | 46,458 | |||||||||
Treasury shares | 19 | (24,922 | ) | (24,922 | ) | ||||||
Accumulated deficit | (48,644 | ) | (26,695 | ) | |||||||
Translation reserve | 19 | (5,706 | ) | (5,775 | ) | ||||||
Equity component of convertible note | 19, 23 | 6,709 | 6,709 | ||||||||
Other reserves | 19 | 23 | 86 | ||||||||
Total deficit | (23,949 | ) | (2,176 | ) | |||||||
Current liabilities | |||||||||||
Income tax payable | 279 | 28 | |||||||||
Trade and other payables | 21 | 12,802 | 15,375 | ||||||||
Provisions | 22 | 50 | 50 | ||||||||
Exchangeable notes and other borrowings | 23 | 210 | 210 | ||||||||
Lease liabilities | 24 | 1,694 | 1,676 | ||||||||
Total current liabilities | 15,035 | 17,339 | |||||||||
Non-current liabilities | |||||||||||
Senior secured term loan | 23 | 40,109 | 44,301 | ||||||||
Derivative financial liability | 23 | 526 | 1,569 | ||||||||
Convertible Note | 23 | 14,542 | 13,746 | ||||||||
Lease liabilities | 24 | 10,872 | 12,267 | ||||||||
Deferred tax liabilities | 14 | 2,300 | 5,058 | ||||||||
Total non-current liabilities | 68,349 | 76,941 | |||||||||
TOTAL LIABILITIES | 2 | 83,384 | 94,280 | ||||||||
TOTAL EQUITY AND LIABILITIES | 59,435 | 92,104 |
Share capital ‘A’ ordinary shares US$’000 | Share premium US$’000 | Treasury Shares US$’000 | Translation reserve US$’000 | Equity Component of Convertible Note US$’000 | Other reserves US$’000 | Accumulated (deficit)/surplus US$’000 | Total US$’000 | |||||||||||||||||||||||||
Balance at January 1, 2021 | 1,213 | 16,187 | (24,922 | ) | (5,293 | ) | - | 23 | 10,573 | (2,219 | ) | |||||||||||||||||||||
Profit for the period | - | - | - | - | - | - | 875 | 875 | ||||||||||||||||||||||||
Other comprehensive income | - | - | - | (86 | ) | - | - | - | (86 | ) | ||||||||||||||||||||||
- | - | - | - | |||||||||||||||||||||||||||||
Total comprehensive loss | - | - | - | (86 | ) | - | - | 875 | 789 | |||||||||||||||||||||||
Share-based payments (Note 20) | - | - | - | - | - | - | 1,111 | 1,111 | ||||||||||||||||||||||||
- | - | |||||||||||||||||||||||||||||||
Balance at December 31, 2021 | 1,213 | 16,187 | (24,922 | ) | (5,379 | ) | - | 23 | 12,559 | (319 | ) | |||||||||||||||||||||
Balance at January 1, 2022 | 1,213 | 16,187 | (24,922 | ) | (5,379 | ) | - | 23 | 12,559 | (319 | ) | |||||||||||||||||||||
Loss for the period | - | - | - | - | - | - | (41,009 | ) | (41,009 | ) | ||||||||||||||||||||||
Other comprehensive loss | - | - | - | (396 | ) | - | - | - | (396 | ) | ||||||||||||||||||||||
- | - | |||||||||||||||||||||||||||||||
Total comprehensive loss | - | - | - | (396 | ) | - | - | (41,009 | ) | (41,405 | ) | |||||||||||||||||||||
Shares issued in the year (Note 19) | 750 | 30,271 | - | - | - | - | - | 31,021 | ||||||||||||||||||||||||
Shares to be issued | - | - | - | - | - | 63 | - | 63 | ||||||||||||||||||||||||
Equity component of convertible note (Note 19) | - | - | - | - | 6,709 | - | - | 6,709 | ||||||||||||||||||||||||
Share-based payments (Note 20) | - | - | - | - | - | - | 1,755 | 1,755 | ||||||||||||||||||||||||
- | - | |||||||||||||||||||||||||||||||
Balance at December 31, 2022 | 1,963 | 46,458 | (24,922 | ) | (5,775 | ) | 6,709 | 86 | (26,695 | ) | (2,176 | ) | ||||||||||||||||||||
Balance at January 1, 2023 | 1,963 | 46,458 | (24,922 | ) | (5,775 | ) | 6,709 | 86 | (26,695 | ) | (2,176 | ) | ||||||||||||||||||||
Loss for the period | - | - | - | - | - | - | (24,018 | ) | (24,018 | ) | ||||||||||||||||||||||
Other comprehensive income | - | - | - | 69 | - | - | - | 69 | ||||||||||||||||||||||||
Total comprehensive loss | - | - | - | 69 | - | - | (24,018 | ) | (23,949 | ) | ||||||||||||||||||||||
Shares issued in the year (Note 19) | 9 | 161 | - | - | - | (63 | ) | - | 107 | |||||||||||||||||||||||
Share-based payments (Note 20) | - | - | - | - | - | - | 2,069 | 2,069 | ||||||||||||||||||||||||
Balance at December 31, 2023 | 1,972 | 46,619 | (24,922 | ) | (5,706 | ) | 6,709 | 23 | (48,644 | ) | (23,949 | ) |
Year ended December 31, | |||||||||||||||
Notes | 2023 US$‘000 | 2022 US$‘000 | 2021 US$‘000 | ||||||||||||
Cash flows from operating activities | |||||||||||||||
(Loss)/profit for the year | (24,018 | ) | (41,009 | ) | 875 | ||||||||||
Adjustments to reconcile net profit/(loss) to cash provided by operating activities: | |||||||||||||||
Depreciation | 9,11 | 831 | 1,410 | 1,827 | |||||||||||
Amortisation | 9,12 | 946 | 923 | 917 | |||||||||||
Income tax credit | 7 | (59 | ) | (192 | ) | (167 | ) | ||||||||
Financial income | 6 | (1,171 | ) | (303 | ) | (1,223 | ) | ||||||||
Financial expense | 6 | 11,053 | 24,745 | 7,097 | |||||||||||
Share-based payments (net of capitalized amounts) | 20 | 2,069 | 1,755 | 1,100 | |||||||||||
Foreign exchange gains on operating cash flows | 238 | (76 | ) | (251 | ) | ||||||||||
Loss/(gain) on disposal or retirement of property, plant and equipment | 9 | - | 2 | (1 | ) | ||||||||||
Movement in inventory provision | 16 | 2,291 | 7,391 | 5,589 | |||||||||||
Impairment of prepayments | 5, 17 | - | 482 | 583 | |||||||||||
Impairment of property, plant and equipment | 5, 11 | 3,772 | 733 | 2,508 | |||||||||||
Impairment of intangible assets | 5, 12 | 5,833 | 4,624 | 3,853 | |||||||||||
Impairment of financial assets | 5,13 | 1,500 | - | - | |||||||||||
Gain on sale of business | 8 | (12,718 | ) | - | - | ||||||||||
Other non-cash items | 257 | 269 | (5,317 | ) | |||||||||||
Operating cash flows before changes in working capital | (9,176 | ) | 754 | 17,390 | |||||||||||
Decrease/(increase) in trade and other receivables | 1,047 | (966 | ) | 6,236 | |||||||||||
Increase in inventories | (971 | ) | (877 | ) | (4,406 | ) | |||||||||
(Decrease)/increase in trade and other payables | (2,769 | ) | 181 | (7,591 | ) | ||||||||||
Cash (used in)/generated from operations | (11,869 | ) | (908 | ) | 11,629 | ||||||||||
Interest paid | - | - | (11 | ) | |||||||||||
Interest received | - | 2 | 1 | ||||||||||||
Income taxes received/(paid) | 312 | (15 | ) | 1,619 | |||||||||||
Net cash (used in)/generated by operating activities | (11,557 | ) | (921 | ) | 13,238 | ||||||||||
Cash flows from investing activities | |||||||||||||||
Payments to acquire intangible assets | (1,901 | ) | (4,876 | ) | (6,879 | ) | |||||||||
Acquisition of property, plant and equipment | (803 | ) | (1,101 | ) | (1,812 | ) | |||||||||
Payments to acquire financial asset | 13 | (700 | ) | - | - | ||||||||||
Proceeds from sale of business (net of transaction costs) | 8 | 28,160 | - | - | |||||||||||
Net cash generated by/(used in) investing activities | 24,756 | (5,977 | ) | (8,691 | ) | ||||||||||
Cash flows from financing activities | |||||||||||||||
Issue of ordinary share capital including share premium (net of issuance costs) | 19 | - | 25,336 | - | |||||||||||
Proceeds from shares to be issued | - | 63 | - | ||||||||||||
Net proceeds from senior secured term loan | 23 | 5,000 | 80,015 | - | |||||||||||
Proceeds from convertible note issued | 23 | - | 20,000 | - | |||||||||||
Expenses paid in connection with debt financing | 23 | (147 | ) | (2,356 | ) | (848 | ) | ||||||||
Purchase of exchangeable notes | 23 | - | (86,730 | ) | - | ||||||||||
Repayment of senior secured term loan | 23 | (10,050 | ) | (34,500 | ) | - | |||||||||
Penalty for early settlement of term loan | 23 | (905 | ) | (3,450 | ) | - | |||||||||
Repayment of other loan | - | (23 | ) | - | |||||||||||
Interest paid on senior secured term loan | (7,314 | ) | (6,424 | ) | - | ||||||||||
Interest paid on convertible note | (300 | ) | (199 | ) | - | ||||||||||
Proceeds from Paycheck Protection loans | - | - | 1,764 | ||||||||||||
Interest paid on exchangeable notes | 28 | (8 | ) | (1,293 | ) | (3,996 | ) | ||||||||
Payment of lease liabilities | 28 | (2,318 | ) | (2,761 | ) | (2,939 | ) | ||||||||
Net cash used in financing activities | (16,042 | ) | (12,322 | ) | (6,019 | ) | |||||||||
Decrease in cash and cash equivalents and short-term investments | (2,843 | ) | (19,220 | ) | (1,472 | ) | |||||||||
Effects of exchange rate movements on cash held | (44 | ) | (112 | ) | 55 | ||||||||||
Cash and cash equivalents and short-term investments at beginning of year | 6,578 | 25,910 | 27,327 | ||||||||||||
Cash and cash equivalents and short-term investments at end of year | 18 | 3,691 | 6,578 | 25,910 |
1. | BASIS OF PREPARATION AND SIGNIFICANT ACCOUNTING POLICIES |
The principal accounting policies adopted by Trinity Biotech plc (“the Company”) and its subsidiaries (together the “the Group”) are set out below.
i) | General information |
ii) | Statement of compliance |
iii) | Basis of preparation |
101
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
1. | BASIS OF PREPARATION AND SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) |
iv) | Basis of consolidation |
v) | Property, plant and equipment |
• Leasehold improvements | 5-15 years | |
• Buildings | 50 years | |
• Office equipment and fittings | 10 years | |
• Computer equipment | 3-5 years | |
• Plant and equipment | 5-15 years |
102
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
1. | BASIS OF PREPARATION AND SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) |
The Group considers whether a contract is or contains a lease. A lease is defined as ‘a contract, or part of a contract, that conveys the right to use an asset (the underlying asset) for a period of time in exchange for consideration’. To apply this definition the Group assesses whether the contract meets three key evaluations which are whether: |
• | the contract contains an identified asset, which is either explicitly identified in the contract or implicitly specified by being identified at the time the asset is made available to the Group | |
• | the Group has the right to obtain substantially all of the economic benefits from use of the identified asset throughout the period of use, considering its rights within the defined scope of the contract | |
• | the Group has the right to direct the use of the identified asset throughout the period of use. The Group assess whether it has the right to direct ‘how and for what purpose’ the asset is used throughout the period of use. |
vi) | Goodwill |
103
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
1. | BASIS OF PREPARATION AND SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) |
At the acquisition date, any goodwill is allocated to each of the cash-generating units expected to benefit from the combination’s synergies. Following initial recognition, goodwill is stated at cost less any accumulated impairment losses.
vii) | Intangibles, including research and development (other than goodwill) |
104
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
1. | BASIS OF PREPARATION AND SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) |
• Capitalised development costs | 15 years | |
• Patents and licences | 6-15 years | |
• Other (including acquired customer and supplier lists) | 6-15 years |
(a) | once a diagnostic test becomes established, customers are reluctant to change to new technology until it is fully proven, thus resulting in relatively long product life cycles. There is also reluctance in customers to change to a new product as it can be costly both in terms of the initial changeover cost and as new technology is typically more expensive. |
(b) | demand for the diagnostic tests is enduring and robust within a wide geographic base. The diseases that the products diagnose are widely prevalent (HIV, Diabetes and Chlamydia being just three examples) in many countries. There is a general consensus that these diseases will continue to be widely prevalent in the future. Demand for biosensors is showing high growth in recent years due to the ease of use and the appeal of real time information. |
(c) | there are significant barriers to new entrants in this industry. Patents and/or licences are in place for several of our products, though this is not the only barrier to entry. There is a significant cost and time to develop new products, it is necessary to obtain regulatory approval and tests are protected by proprietary know-how, manufacturing techniques and trade secrets. |
Where amortisation is charged on assets with finite lives, this expense is taken to the statement of operations through the ‘selling, general and administrative expenses’ line.
viii) | Impairment |
105
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
1. | BASIS OF PREPARATION AND SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) |
viii) | Impairment (continued) |
In-process research and development (IPR&D) is tested for impairment on a bi-annual basis, and always at year end, or more frequently if impairment indicators are present, using projected discounted cash flow models. If IPR&D becomes impaired or is abandoned, the carrying value of the IPR&D is written down to its revised fair value with the related impairment charge recognised in the period in which the impairment occurs. If the fair value of the asset becomes impaired as the result of unfavorable data from any ongoing or future clinical trial, changes in assumptions that negatively impact projected cash flows, or because of any other information regarding the prospects of successfully developing or commercializing our programs, we could incur significant charges in the period in which the impairment occurs. The valuation techniques utilized in performing impairment tests incorporate significant assumptions and judgments to estimate the fair value, as described above. The use of different valuation techniques or different assumptions could result in materially different fair value estimates.
ix) | Financial Assets |
On initial recognition, a financial asset is classified as measured at amortised cost and subsequently measured using the effective interest rate (EIR) method and subject to impairment. Financial assets may also be initially measured at fair value with any movement being reflected through other comprehensive income or the Consolidated Income Statement.
x) | Inventories |
Inventories are stated at the lower of cost and net realisable value. Cost is based on the first-in, first-out principle and includes all expenditure which has been incurred in bringing the products to their present location and condition and includes an appropriate allocation of manufacturing overhead based on the normal level of operating capacity. Net realisable value is the estimated selling price of inventory on hand in the ordinary course of business less all further costs to completion and costs expected to be incurred in selling these products.
106
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
1. | BASIS OF PREPARATION AND SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) |
xi) | Trade and other receivables |
xii) | Trade and other payables |
xiii) | Cash and cash equivalents Cash and cash equivalents comprise cash balances and short-term deposits which are readily available at year-end. Deposits with maturities less than six months as at the year-end date are recognised as cash and cash equivalents and are carried at fair value when there is no expected loss in value on early termination. The Group has no short-term bank overdraft facilities. Where restrictions are imposed by third parties, such as lending institutions, on cash balances held by the Group these are treated as financial assets in the financial statements. |
xiv) | Share-based payments |
107
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
1. | BASIS OF PREPARATION AND SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) |
xv) | Government grants and financial support |
xvi) | Revenue recognition |
Goods sold and services rendered
108
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
1. | BASIS OF PREPARATION AND SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) |
xvii) | Employee benefits |
xviii) | Foreign currency |
109
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
1. | BASIS OF PREPARATION AND SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) |
xix) | Hedging |
The activities of the Group expose it primarily to changes in foreign exchange rates and interest rates. The Group uses derivative financial instruments, from time to time, such as forward foreign exchange contracts to hedge these exposures.
xx) | Exchangeable notes and derivative financial instruments |
110
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
1. | BASIS OF PREPARATION AND SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) |
xxi) | Senior secured term loan |
xxii) | Warrants and loan prepayment option |
xxiii) | Convertible Note |
111
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
1. | BASIS OF PREPARATION AND SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) |
xxiv) | Segment reporting |
Operating segments are reported in a manner consistent with the internal reporting provided to the chief operating decision-maker. The chief operating decision-maker, who is responsible for allocating resources and assessing performance of the operating segments, has been identified as the Board of Directors.
xxv) | Tax (current and deferred) |
i. | Where the deferred tax liability arises from goodwill not deductible for tax purposes or the initial recognition of an asset or a liability in a transaction that is not a business combination and affects neither the accounting profit nor the taxable profit or loss at the time of the transaction; and |
ii. | Where, in respect of temporary differences associated with investments in subsidiary undertakings, the timing of the reversal of the temporary difference is subject to control and it is probable that the temporary difference will not reverse in the foreseeable future. |
xxvi) | Provisions and contingent liabilities |
112
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
1. | BASIS OF PREPARATION AND SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) |
xxvii) | Cost of sales |
xxviii) | Finance income and costs |
xxix) | Treasury shares |
xxx) | Equity |
xxxi) | Profit or loss from discontinued operations |
xxxii) | Fair values |
113
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
1. | BASIS OF PREPARATION AND SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) |
xxxiii) | New IFRS Standards |
• | Classification of Liabilities as Current or Non-current (Amendments to IAS 1), effective from 1 January 2024 |
• | Lease Liability in a Sale and Leaseback (Amendments to IFRS 16), effective from 1 January 2024 |
• | Supplier Finance Arrangements (Amendments to IAS 7 and IFRS 7), effective from 1 January 2024 |
• | Non-current Liabilities with Covenants (Amendments to IAS 1), effective from 1 January 2024 |
• | General Requirements for Disclosure of Sustainability-related Financial Information (IFRS S1), effective from 1 January 2024 |
• | Climate-related Disclosures (IFRS S2), effective from 1 January 2024 |
• | Lack of Exchangeability (Amendments to IAS 21), effective from 1 January 2025 |
xxxiv) | Standards, amendments and interpretations to existing IFRS Standards that are not yet effective |
114
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
2. | SEGMENT INFORMATION |
i) | The distribution of revenue by geographical area based on location of assets was as follows: |
Revenue | Americas | Rest of World Ireland | Eliminations | Total | ||||||||||||
Year ended December 31, 2023 | US$‘000 | US$‘000 | US$’000 | US$‘000 | ||||||||||||
Revenue from external customers | 44,984 | 11,848 | - | 56,832 | ||||||||||||
Inter-segment revenue | 21,867 | 872 | (22,739 | ) | - | |||||||||||
Total revenue | 66,851 | 12,720 | (22,739 | ) | 56,832 |
Revenue | Americas | Rest of World Ireland | Eliminations | Total | ||||||||||||
Year ended December 31, 2022 | US$‘000 | US$‘000 | US$’000 | US$‘000 | ||||||||||||
Revenue from external customers | 50,508 | 12,013 | - | 62,521 | ||||||||||||
Inter-segment revenue | 26,110 | 828 | (26,938 | ) | - | |||||||||||
Total revenue | 76,618 | 12,841 | (26,938 | ) | 62,521 |
115
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
2. | SEGMENT INFORMATION (CONTINUED) |
Revenue | Americas | Rest of World Ireland | Eliminations | Total | ||||||||||||
Year ended December 31, 2021 | US$‘000 | US$‘000 | US$’000 | US$‘000 | ||||||||||||
Revenue from external customers | 67,249 | 13,900 | - | 81,149 | ||||||||||||
Inter-segment revenue | 49,059 | 2,517 | (51,576 | ) | - | |||||||||||
Total revenue | 116,308 | 16,417 | (51,576 | ) | 81,149 |
ii) | The distribution of revenue by customers’ geographical area was as follows: |
Revenue | December 31, 2023 US$‘000 | December 31, 2022 US$‘000 | December 31, 2021 US$‘000 | |||||||||
Americas | 32,282 | 35,557 | 52,779 | |||||||||
Asia / Africa | 18,909 | 20,401 | 21,402 | |||||||||
Europe (including Ireland) * | 5,641 | 6,563 | 6,968 | |||||||||
56,832 | 62,521 | 81,149 |
* | Revenue from customers in Ireland is not disclosed separately due to the immateriality of these revenues. |
iii) | The distribution of revenue by major product group was as follows: |
Revenue | December 31, 2023 US$‘000 | December 31, 2022 US$‘000 | December 31, 2021 US$‘000 | |||||||||
Clinical laboratory goods | 42,288 | 46,036 | 62,884 | |||||||||
Clinical laboratory services | 5,453 | 7,272 | 7,928 | |||||||||
Point-of-care | 9,091 | 9,213 | 10,337 | |||||||||
56,832 | 62,521 | 81,149 |
iv) | The group has recognised the following amounts relating to revenue in the consolidated statement of operations: |
Revenue | December 31, 2023 US$‘000 | December 31, 2022 US$‘000 | December 31, 2021 US$‘000 | |||||||||
Revenue from contracts with customers | 56,832 | 62,521 | 81,149 | |||||||||
56,832 | 62,521 | 81,149 |
116
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
2. | SEGMENT INFORMATION (CONTINUED) |
(v) | Disaggregation of revenue from contracts with customers: The Group derives revenue from the transfer of goods and services over time and at a point in time in the following geographical areas: |
Timing of revenue recognition | Americas | Rest of World Ireland | Total | |||||||||
Year ended December 31, 2023 | US$‘000 | US$‘000 | US$‘000 | |||||||||
At a point in time | 44,692 | 11,848 | 56,540 | |||||||||
Over time | 292 | - | 292 | |||||||||
Total | 44,984 | 11,848 | 56,832 |
Timing of revenue recognition | Americas | Rest of World Ireland | Total | |||||||||
Year ended December 31, 2022 | US$‘000 | US$‘000 | US$‘000 | |||||||||
At a point in time | 50,174 | 12,013 | 62,187 | |||||||||
Over time | 334 | - | 334 | |||||||||
Total | 50,508 | 12,013 | 62,521 |
Timing of revenue recognition | Americas | Rest of World Ireland | Total | |||||||||
Year ended December 31, 2021 | US$‘000 | US$‘000 | US$‘000 | |||||||||
At a point in time | 66,806 | 13,900 | 80,706 | |||||||||
Over time | 443 | - | 443 | |||||||||
Total | 67,249 | 13,900 | 81,149 |
(vi) | The Group derives revenue from the transfer of goods and services over time and at a point in time based on customers’ geographical area as follows: |
Timing of revenue recognition | Americas | Asia / Africa | Europe | Total | ||||||||||||
Year ended December 31, 2023 | US$‘000 | US$‘000 | US$‘000 | US$‘000 | ||||||||||||
At a point in time | 31,990 | 18,909 | 5,641 | 56,540 | ||||||||||||
Over time | 292 | - | - | 292 | ||||||||||||
Total | 32,282 | 18,909 | 5,641 | 56,832 |
Timing of revenue recognition | Americas | Asia / Africa | Europe | Total | ||||||||||||
Year ended December 31, 2022 | US$‘000 | US$‘000 | US$‘000 | US$‘000 | ||||||||||||
At a point in time | 35,223 | 20,401 | 6,563 | 62,187 | ||||||||||||
Over time | 334 | - | - | 334 | ||||||||||||
Total | 35,557 | 20,401 | 6,563 | 62,521 |
117
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
2. | SEGMENT INFORMATION (CONTINUED) |
Timing of revenue recognition | Americas | Asia / Africa | Europe | Total | ||||||||||||
Year ended December 31, 2021 | US$‘000 | US$‘000 | US$‘000 | US$‘000 | ||||||||||||
At a point in time | 52,336 | 21,402 | 6,968 | 80,706 | ||||||||||||
Over time | 443 | - | - | 443 | ||||||||||||
Total | 52,779 | 21,402 | 6,968 | 81,149 |
vii) | The distribution of segment results by geographical area was as follows: |
Rest of World | ||||||||||||||||
Americas | Ireland | Other | Total | |||||||||||||
Year ended December 31, 2023 | US$‘000 | US$‘000 | US$‘000 | US$‘000 | ||||||||||||
Result before impairment and unallocated expenses | (4,365 | ) | (7,886 | ) | (104 | ) | (12,355 | ) | ||||||||
Impairment charges | (11,105 | ) | - | - | (11,105 | ) | ||||||||||
Result after impairment | (15,470 | ) | (7,886 | ) | (104 | ) | (23,460 | ) | ||||||||
Unallocated expenses * | (3,585 | ) | ||||||||||||||
Operating loss | (27,045 | ) | ||||||||||||||
Net financing expense (Note 6) | (9,882 | ) | ||||||||||||||
Loss before tax | (36,927 | ) | ||||||||||||||
Income tax credit (Note 7) | 59 | |||||||||||||||
Loss for the year on continuing operations | (36,868 | ) | ||||||||||||||
Profit for the year on discontinued operations (Note 8) | 12,850 | |||||||||||||||
Loss for the year | (24,018 | ) |
Rest of World | ||||||||||||||||
Americas | Ireland | Other | Total | |||||||||||||
Year ended December 31, 2022 | US$‘000 | US$‘000 | US$‘000 | US$‘000 | ||||||||||||
Result before impairment and unallocated expenses | (5,892 | ) | (5,112 | ) | (33 | ) | (11,037 | ) | ||||||||
Impairment charges | (2,331 | ) | (3,508 | ) | - | (5,839 | ) | |||||||||
Result after impairment | (8,223 | ) | (8,620 | ) | (33 | ) | (16,876 | ) | ||||||||
Unallocated expenses * | (2,473 | ) | ||||||||||||||
Operating loss | (19,349 | ) | ||||||||||||||
Net financing expense (Note 6) | (24,431 | ) | ||||||||||||||
Loss before tax | (43,780 | ) | ||||||||||||||
Income tax charge (Note 7) | 194 | |||||||||||||||
Loss for the year on continuing operations | (43,586 | ) | ||||||||||||||
Profit for the year on discontinued operations (Note 8) | 2,577 | |||||||||||||||
Loss for the year | (41,009 | ) |
118
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
2. | SEGMENT INFORMATION (CONTINUED) |
Rest of World | ||||||||||||||||
Americas | Ireland | Other | Total | |||||||||||||
Year ended December 31, 2021 | US$‘000 | US$‘000 | US$‘000 | US$‘000 | ||||||||||||
Result before impairment and unallocated expenses | 9,276 | 2,397 | (12 | ) | 11,661 | |||||||||||
Impairment | (6,088 | ) | (856 | ) | - | (6,944 | ) | |||||||||
Result after impairment | 3,188 | 1,541 | (12 | ) | 4,717 | |||||||||||
Unallocated expenses * | (779 | ) | ||||||||||||||
Operating profit | 3,938 | |||||||||||||||
Net financing expense (Note 6) | (5,862 | ) | ||||||||||||||
Loss before tax | (1,924 | ) | ||||||||||||||
Income tax credit (Note 7) | 74 | |||||||||||||||
Loss for the year on continuing operations | (1,850 | ) | ||||||||||||||
Profit for the year on discontinued operations (Note 8) | 2,725 | |||||||||||||||
Profit for the year | 875 |
* | Unallocated expenses represent head office general and administration costs of the Group, which cannot be allocated to the results of any specific geographical area. |
viii) | The distribution of segment assets and segment liabilities by geographical area was as follows: |
Rest of World | ||||||||||||||||
Americas | Ireland | Other | Total | |||||||||||||
As at December 31, 2023 | US$‘000 | US$‘000 | US$‘000 | US$‘000 | ||||||||||||
Assets and liabilities | ||||||||||||||||
Segment assets | 26,230 | 26,023 | - | 52,253 | ||||||||||||
Unallocated assets: | ||||||||||||||||
Income tax assets (current and deferred) | 3,491 | |||||||||||||||
Cash and cash equivalents and short-term investments | 3,691 | |||||||||||||||
Total assets as reported in the Group balance sheet | 59,435 | |||||||||||||||
Segment liabilities | 49,398 | 31,387 | 20 | 80,805 | ||||||||||||
Unallocated liabilities: | ||||||||||||||||
Income tax liabilities (current and deferred) | 2,579 | |||||||||||||||
Total liabilities as reported in the Group balance sheet | 83,384 |
119
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
2. | SEGMENT INFORMATION (CONTINUED) |
Rest of World | ||||||||||||||||
Americas | Ireland | Other | Total | |||||||||||||
As at December 31, 2022 | US$‘000 | US$‘000 | US$‘000 | US$‘000 | ||||||||||||
Assets and liabilities | ||||||||||||||||
Segment assets | 41,779 | 37,695 | - | 79,474 | ||||||||||||
Unallocated assets: | ||||||||||||||||
Income tax assets (current and deferred) | 6,052 | |||||||||||||||
Cash and cash equivalents and short-term investments | 6,578 | |||||||||||||||
Total assets as reported in the Group balance sheet | 92,104 | |||||||||||||||
Segment liabilities | 58,307 | 30,845 | 42 | 89,194 | ||||||||||||
Unallocated liabilities: | ||||||||||||||||
Income tax liabilities (current and deferred) | 5,086 | |||||||||||||||
Total liabilities as reported in the Group balance sheet | 94,280 |
ix) | The distribution of long-lived assets, which are property, plant and equipment, goodwill and intangible assets and other non-current assets (excluding deferred tax assets and derivative financial instruments), by geographical area was as follows: |
December 31, 2023 US$‘000 | December 31, 2022 US$‘000 | |||||||
Rest of World – Ireland | 12,448 | 21,180 | ||||||
Americas | 5,793 | 19,910 | ||||||
18,241 | 41,090 |
x) | The distribution of depreciation and amortisation by geographical area was as follows: |
December 31, 2023 US$‘000 | December 31, 2022 US$‘000 | December 31, 2021 US$‘000 | ||||||||||
Depreciation: | ||||||||||||
Rest of World – Ireland | 162 | 123 | 159 | |||||||||
Americas | 668 | 1,282 | 1,662 | |||||||||
830 | 1,405 | 1,821 | ||||||||||
Amortisation: | ||||||||||||
Rest of World – Ireland | 458 | 89 | 51 | |||||||||
Americas | 487 | 800 | 848 | |||||||||
945 | 889 | 899 |
xi) | The distribution of share-based payment expense by geographical area was as follows: |
December 31, 2023 US$‘000 | December 31, 2022 US$‘000 | December 31, 2021 US$‘000 | ||||||||||
Rest of World – Ireland | 1,650 | 632 | 1,072 | |||||||||
Americas | 419 | 1,123 | 28 | |||||||||
2,069 | 1,755 | 1,100 |
120
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
2. | SEGMENT INFORMATION (CONTINUED) |
xii) | The distribution of taxation credit/(expense) by geographical area was as follows: |
December 31, 2023 US$‘000 | December 31, 2022 US$‘000 | December 31, 2021 US$‘000 | ||||||||||
Rest of World – Ireland | (385 | ) | 286 | 436 | ||||||||
Rest of World – Other | (235 | ) | (4 | ) | (2 | ) | ||||||
Americas | 679 | (88 | ) | (360 | ) | |||||||
59 | 194 | 74 |
xiii) | During 2023 and 2022 there were no customers generating 10% or more of total revenues. In 2021, one customer accounted for more than 10% of total revenues. |
xiv) | The distribution of capital expenditure by geographical area was as follows: |
December 31 2023 US$‘000 | December 31, 2022 US$‘000 | |||||||
Rest of World – Ireland | 251 | 2,443 | ||||||
Rest of World – Other | - | - | ||||||
Americas | 2,547 | 4,370 | ||||||
2,798 | 6,813 |
3. | EMPLOYMENT |
December 31, 2023 | December 31, 2022 | December 31, 2021 | ||||||||||
Research and development | 23 | 26 | 25 | |||||||||
Administration and sales | 99 | 105 | 119 | |||||||||
Manufacturing and quality | 258 | 253 | 318 | |||||||||
380 | 384 | 462 |
Employment costs charged in the consolidated statement of operations for continuing operations are analysed as follows:
December 31, 2023 US$‘000 | December 31, 2022 US$‘000 | December 31, 2021 US$‘000 | ||||||||||
Wages and salaries | 23,718 | 22,364 | 25,320 | |||||||||
Social welfare costs | 2,061 | 1,965 | 2,346 | |||||||||
Pension costs | 508 | 347 | 351 | |||||||||
Share-based payments | 2,069 | 1,755 | 1,100 | |||||||||
Restructuring cost | 485 | 274 | 270 | |||||||||
28,841 | 26,705 | 29,387 |
121
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
3. | EMPLOYMENT (CONTINUED) |
Employment costs including discontinued operations, are analysed as follows:
December 31, 2023 US$‘000 | December 31, 2022 US$‘000 | December 31, 2021 US$‘000 | ||||||||||
Wages and salaries | 24,343 | 23,608 | 26,561 | |||||||||
Social welfare costs | 2,097 | 2,036 | 2,403 | |||||||||
Pension costs | 510 | 352 | 352 | |||||||||
Share-based payments | 2,069 | 1,755 | 1,100 | |||||||||
Restructuring cost | 485 | 274 | 270 | |||||||||
29,504 | 28,025 | 30,686 |
4. | OTHER OPERATING INCOME |
December 31, 2023 US$‘000 | December 31, 2022 US$‘000 | December 31, 2021 US$‘000 | ||||||||||
Other income | 138 | - | - | |||||||||
Rental income from premises | 3 | 3 | 4 | |||||||||
Government supports - COVID-19 | - | 7 | 4,424 | |||||||||
Government grants | - | 333 | - | |||||||||
141 | 343 | 4,428 |
122
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
5. | IMPAIRMENT CHARGES |
December 31, | December 31, | December 31, | ||||||||||
2023 | 2022 | 2021 | ||||||||||
US$’000 | US$’000 | US$’000 | ||||||||||
Selling, general & administration expenses | ||||||||||||
Impairment of PP&E (Note 11) | 3,772 | 733 | 2,508 | |||||||||
Impairment of goodwill and other intangible assets (Note 12) | 5,833 | 4,624 | 3,853 | |||||||||
Impairment of prepayments (Note 17) | - | 482 | 583 | |||||||||
Impairment of financial assets (Note 13) | 1,500 | - | - | |||||||||
Total impairment loss | 11,105 | 5,839 | 6,944 |
December 31, 2023 US$‘000 | December 31, 2022 US$‘000 | December 31, 2021 US$‘000 | ||||||||||
Financial income: | ||||||||||||
Non-cash financial income | 1,171 | 303 | 1,220 | |||||||||
Interest income | - | - | 3 | |||||||||
1,171 | 303 | 1,223 | ||||||||||
Financial expense: | ||||||||||||
Interest on leases (Note 28) | (624 | ) | (647 | ) | (803 | ) | ||||||
Loss on disposal of exchangeable notes (Note 23, 28) | - | (9,678 | ) | - | ||||||||
Penalty for early partial settlement of senior secured term loan (Note 23) | (905 | ) | (3,450 | ) | - | |||||||
Cash interest payable on senior secured term loan | (7,289 | ) | (7,039 | ) | - | |||||||
Cash interest payable on convertible note | (300 | ) | (199 | ) | - | |||||||
Cash interest on exchangeable notes | (8 | ) | (296 | ) | (3,996 | ) | ||||||
Loan origination costs | - | - | (1,638 | ) | ||||||||
Non-cash interest on exchangeable notes | - | (84 | ) | (648 | ) | |||||||
Non-cash interest on senior secured term loan | (1,131 | ) | (2,772 | ) | - | |||||||
Non-cash interest on convertible note | (796 | ) | (495 | ) | - | |||||||
Non-cash financial expense | - | (74 | ) | - | ||||||||
(11,053 | ) | (24,734 | ) | (7,085 | ) | |||||||
Net financing expense | (9,882 | ) | (24,431 | ) | (5,862 | ) |
123
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
December 31, 2023 US$‘000 | December 31, 2022 US$‘000 | December 31, 2021 US$‘000 | ||||||||||
Current tax expense/(credit) | ||||||||||||
Irish Corporation tax | - | (336 | ) | (520 | ) | |||||||
Foreign taxes (a) | 462 | (5 | ) | 296 | ||||||||
Adjustment in respect of prior years | (198 | ) | 61 | 113 | ||||||||
Total current tax expense/(credit) | 264 | (280 | ) | (111 | ) | |||||||
Deferred tax credit (b) | ||||||||||||
Origination and reversal of temporary differences (see Note 14) | (547 | ) | 324 | 620 | ||||||||
Origination and reversal of net operating losses (see Note 14) | 224 | (238 | ) | (583 | ) | |||||||
Total deferred tax (credit)/charge | (323 | ) | 86 | 37 | ||||||||
Total income tax credit on continuing operations in statement of operations | (59 | ) | (194 | ) | (74 | ) | ||||||
Tax charge/(credit) on discontinued operations (see Note 8) | - | 2 | (92 | ) | ||||||||
Total tax credit | (59 | ) | (192 | ) | (166 | ) |
(a) | In 2023, the foreign taxes relate primarily to Luxembourg and Canada. |
(b) | In 2023, there was a deferred tax charge of US$174,000 (2022: charge of US$109,000) (2021: charge of US$18,000) recognised in respect of Ireland and a deferred tax credit of US$497,000 (2022: credit of US$26,000) (2021: credit of US$81,000) recognised in respect of overseas tax jurisdictions. |
Effective tax rate | December 31, 2023 | December 31, 2022 | December 31, 2021 | |||||||||
Loss before taxation – continuing operations (US$‘000) | (36,927 | ) | (43,780 | ) | (1,924 | ) | ||||||
As a percentage of loss before tax: | ||||||||||||
Current tax % | (0.72) | % | (0.64) | % | (5.77) | % | ||||||
Total (current and deferred) % | (0.16) | % | (0.44) | % | (3.85) | % |
124
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
7. | INCOME TAX CREDIT (CONTINUED) |
The following table reconciles the applicable Republic of Ireland statutory tax rate to the effective total tax rate for the Group:
December 31, 2023 | December 31, 2022 | December 31, 2021 | ||||||||||
Irish corporation tax | (12.5) | % | (12.5) | % | (12.5) | % | ||||||
Effect of current year net operating losses and temporary differences for which no deferred tax asset was recognised (a) | 17.19 | % | 10.97 | % | 19.41 | % | ||||||
Effect of tax rates on overseas earnings | (7.82) | % | (7.30) | % | (0.09) | % | ||||||
Effect of Irish income taxable at higher tax rate | 2.62 | % | 3.93 | % | 38.60 | % | ||||||
Adjustments in respect of prior years | (0.53) | % | 0.14 | % | 5.93 | % | ||||||
R&D tax credits | - | (0.75) | % | (30.99) | % | |||||||
Other items (b) | 0.88 | % | 5.07 | % | (16.51) | % | ||||||
Effective tax rate | (0.16) | % | (0.44) | % | (3.85) | % |
(a) | No deferred tax asset was recognised because there was no reversing deferred tax liability in the same jurisdiction reversing in the same period and insufficient future projected taxable income in the same jurisdiction. |
(b) | Other items comprise items not chargeable to tax and expenses not deductible for tax purposes. In 2022, other items mainly related to the loss on disposal of the exchangeable notes which was non-recurring. In 2021 other items mainly related to the US$4.4 million income from the Paycheck Protection Program loans which was not chargeable for tax purposes. There was no Paycheck Protection Program income in 2023 or 2022. |
December 31, 2023 US$‘000 | December 31, 2022 US$‘000 | December 31, 2021 US$‘000 | ||||||||||
Rest of World – Ireland | (12,922 | ) | (22,354 | ) | (813 | ) | ||||||
Rest of World – Other | (104 | ) | (33 | ) | 3,939 | |||||||
Americas | (23,901 | ) | (21,393 | ) | (5,050 | ) | ||||||
(36,927 | ) | (43,780 | ) | (1,924 | ) |
December 31, 2023 US$‘000 | December 31, 2022 US$‘000 | December 31, 2021 US$‘000 | ||||||||||
Rest of World – Ireland | 69,851 | 62,731 | 68,132 | |||||||||
Rest of World – Other | 52,511 | 448 | 1,000 | |||||||||
Americas | 13,840 | 12,778 | 4,761 | |||||||||
136,202 | 75,957 | 73,893 |
125
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
7. | INCOME TAX CREDIT (CONTINUED) |
December 31, 2023 US$‘000 | December 31, 2022 US$‘000 | December 31, 2021 US$‘000 | ||||||||||
Rest of World – Ireland – unused tax losses | 8,464 | 7,489 | 9,272 | |||||||||
Rest of World – Other – unused tax losses | 14,701 | 124 | 279 | |||||||||
Americas – unused tax losses | 3,395 | 3,163 | 5,891 | |||||||||
Americas – unused tax credits | 5,806 | 4,658 | 3,368 | |||||||||
Unrecognised deferred tax asset | 32,366 | 15,434 | 18,810 |
8. | PROFIT FOR THE YEAR ON DISCONTINUED OPERATIONS |
December 31, 2023 US$‘000 | December 31, 2022 US$‘000 | December 31, 2021 US$‘000 | ||||||||||
Revenue | 2,784 | 12,258 | 11,817 | |||||||||
Operating expenses | (2,652 | ) | (9,679 | ) | (9,142 | ) | ||||||
Closure provision | - | - | (42 | ) | ||||||||
Tax (expense)/credit | - | (2 | ) | 92 | ||||||||
Profit from operating activities | 132 | 2,577 | 2,725 | |||||||||
Gain on sale of discontinued operations | 12,718 | - | - | |||||||||
Profit for the year from discontinued operations | 12,850 | 2,577 | 2,725 |
126
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
8. | PROFIT FOR THE YEAR ON DISCONTINUED OPERATIONS (CONTINUED) |
US$’000 | ||||
Cash received from sale of the discontinued operations net of transaction costs | 28,935 | |||
Cash sold as a part of discontinued operations | (775 | ) | ||
Net cash inflow on date of disposal | 28,160 |
US$’000 | ||||
Property plant & equipment | 103 | |||
Goodwill and intangible assets | 14,123 | |||
Inventory | 1,160 | |||
Cash | 775 | |||
Trade and other receivables | 1,309 | |||
Trade and other payables | (864 | ) | ||
Lease liabilities | (106 | ) | ||
Current Corporation tax | (2 | ) | ||
Deferred tax liability | (195 | ) | ||
Total net assets disposed | 16,303 |
127
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
8. | PROFIT FOR THE YEAR ON DISCONTINUED OPERATION (CONTINUED) |
December 31, 2023 | December 31, 2022 | December 31, 2021 | ||||||||||
Basic earnings per ‘A’ share (US Dollars) – discontinued operations | 0.08 | 0.02 | 0.03 | |||||||||
Diluted earnings per ‘A’ share (US Dollars) – discontinued operations | 0.07 | 0.02 | 0.03 |
December 31, 2023 | December 31, 2022 | December 31, 2021 | ||||||||||
Basic earnings per ADS (US Dollars) – discontinued operations | 1.68 | 0.38 | 0.65 | |||||||||
Diluted earnings per ADS (US Dollars) – discontinued operations | 1.44 | 0.33 | 0.51 |
December 31, 2023 | December 31, 2022 | December 31, 2021 | ||||||||||
US$000 | US$000 | US$000 | ||||||||||
Cash (outflow)/inflow from operating activities | (177 | ) | 3,798 | 5,140 | ||||||||
Cash inflow from investing activities | 28,160 | - | - | |||||||||
Cash (outflow)/inflow from financing activities | - | (10,800 | ) | 104 |
128
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
December 31, 2023 US$‘000 | December 31, 2022 US$‘000 | December 31, 2021 US$‘000 | ||||||||||
Directors’ emoluments (including non- executive directors): | ||||||||||||
Remuneration | 2,058 | 1,639 | 1,391 | |||||||||
Pension | 26 | 24 | 24 | |||||||||
Share based payments | 1,601 | 1,707 | 986 | |||||||||
Auditor’s remuneration | ||||||||||||
Audit fees | 861 | 888 | 580 | |||||||||
Tax fees | 407 | 89 | 77 | |||||||||
Depreciation (Note 11) 1 | 830 | 1,405 | 1,821 | |||||||||
Amortisation (Note 12) | 945 | 889 | 899 | |||||||||
Loss/(profit) on the disposal of property, plant and equipment | - | 2 | (1 | ) | ||||||||
Net foreign exchange differences | 336 | (1,210 | ) | (789 | ) |
10. | (LOSS)/EARNINGS PER SHARE |
129
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
10. | (LOSS)/EARNINGS PER SHARE (CONTINUED) |
December 31, 2023 | December 31, 2022 | December 31, 2021 | ||||||||||
‘A’ ordinary shares | 153,099,405 | 134,939,327 | 83,606,810 | |||||||||
Basic (loss)/earnings per share denominator | 153,099,405 | 134,939,327 | 83,606,810 | |||||||||
Reconciliation to weighted average (loss)/earnings per share denominator: | ||||||||||||
Number of ‘A’ ordinary shares at January 1 (Note 19) | 164,985,882 | 96,162,410 | 96,162,410 | |||||||||
Weighted average number of ‘A’ ordinary shares issued during the year* | 669,123 | 51,332,517 | - | |||||||||
Weighted average number of treasury shares | (12,555,600 | ) | (12,555,600 | ) | (12,555,600 | ) | ||||||
Basic (loss)/earnings per share denominator | 153,099,405 | 134,939,327 | 83,606,810 |
* The weighted average number of shares issued during the year is calculated by taking the number of shares issued multiplied by the number of days in the year each share is in issue, divided by 365 days.
December 31, 2023 | December 31, 2022 | December 31, 2021 | ||||||||||
Potentially Dilutive Instruments: | ||||||||||||
Issuable on exercise of options (Note 20) | 186,908 | 2,752,153 | 4,648,586 | |||||||||
Issuable on exercise of warrants to Perceptive (Note 23) | - | - | - | |||||||||
Issuable on conversion of Exchangeable notes (Note 23) | 38,391 | 1,436,463 | 18,263,254 | |||||||||
Issuable on conversion of Convertible notes (Note 23) | 24,691,358 | 16,370,709 | - | |||||||||
Total number of potentially dilutive instruments excluded from the weighted average number of ‘A’ ordinary shares in calculating dilutive (loss)/earnings per ‘A’ ordinary share | 24,916,657 | 20,559,325 | 22,911,840 |
130
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
10. | (LOSS)/EARNINGS PER SHARE (CONTINUED) |
○ | Options over 12,100,000 ‘A’ ordinary shares were granted, of which 6,250,000 are contingently issuable as their issue is contingent upon satisfaction of specified performance conditions in addition to the passage of time. |
○ | In connection with the acquisition of the Waveform Assets and the Amendment of the Term Loan in January 2024, Perceptive received new warrants to purchase an additional 10,000,000 'A' shares and the Company has agreed to price these additional warrants and reprice the existing warrants to purchase the 10,00,000 shares that were issued to Perceptive under the original term loan, with an exercise price of US$0.11. |
○ | Warrants to purchase 1,200,000 'A' shares have been issued to a consultant assisting with our CGM business. The exercise price is US$0.11 per share. The warrants are exercisable, in whole or part, until the fifth anniversary of the issue date in January 2024. |
(Loss)/earnings per ADS
December 31, 2023 | December 31, 2022 | December 31, 2021 | ||||||||||
ADS | 7,654,970 | 6,746,966 | 4,180,340 | |||||||||
Basic (loss)/earnings per ADS denominator | 7,654,970 | 6,746,966 | 4,180,340 | |||||||||
Reconciliation to weighted average (loss)/earnings per ADS denominator: | ||||||||||||
Number of ADS at January 1 (Note 19) | 8,249,294 | 4,808,120 | 4,808,120 | |||||||||
Weighted average number of shares issued during the year* | 33,456 | 2,566,626 | - | |||||||||
Weighted average number of treasury shares | (627,780 | ) | (627,780 | ) | (627,780 | ) | ||||||
Basic (loss)/earnings per ADS denominator | 7,654,970 | 6,746,966 | 4,180,340 |
* The weighted average number of ADSs issued during the year is calculated by taking the number of ADSs issued multiplied by the number of days in the year each share is in issue, divided by 365 days.
131
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
10. | (LOSS)/EARNINGS PER SHARE (CONTINUED) |
December 31, 2023 | December 31, 2022 | December 31, 2021 | ||||||||||
Potentially Dilutive Instruments: | ||||||||||||
Issuable on exercise of options (Note 20) | 9,345 | 137,608 | 232,429 | |||||||||
Issuable on exercise of warrants to Perceptive (Note 23) | - | - | - | |||||||||
Issuable on conversion of Exchangeable notes (Note 23) | 1,920 | 71,823 | 913,163 | |||||||||
Issuable on conversion of Convertible notes (Note 23) | 1,234,568 | 818,535 | - | |||||||||
Total number of potentially dilutive instruments excluded from the weighted average number of ADS in calculating dilutive (loss)/earnings per ADS | 1,245,833 | 1,027,966 | 1,145,592 |
○ | Options over 605,000 ADS were granted, of which 312,500 are contingently issuable as their issue is contingent upon satisfaction of specified performance conditions in addition to the passage of time. |
○ | Perceptive received new warrants to purchase an additional 500,000 ADSs and the Company has agreed to price these additional warrants and reprice the existing warrants to purchase the 500,000 ADSs that were issued to Perceptive under the original term loan, with an exercise price of US$2.20 per ADS. |
○ | Warrants to purchase 60,000 ADS shares have been issued to a consultant assisting with our CGM business. The exercise price is US$2.20 per ADS. The warrants are exercisable, in whole or part, until the fifth anniversary of the issue date in January 2024. |
132
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
11. | PROPERTY, PLANT AND EQUIPMENT |
Land & Buildings US$‘000 | Leasehold Improvements US$‘000 | Computer & Office Equipment US$‘000 | Plant & Equipment US$‘000 | Total US$‘000 | ||||||||||||||||
Cost | ||||||||||||||||||||
At January 1, 2022 | 24,334 | 2,592 | 4,200 | 32,337 | 63,463 | |||||||||||||||
Additions | 379 | 93 | 362 | 1,100 | 1,934 | |||||||||||||||
Disposals or retirements | - | - | (25 | ) | (42 | ) | (67 | ) | ||||||||||||
Reallocations/ reclassifications | - | - | (2 | ) | 2 | - | ||||||||||||||
Exchange adjustments | (31 | ) | 16 | 5 | 286 | 276 | ||||||||||||||
At December 31, 2022 | 24,682 | 2,701 | 4,540 | 33,683 | 65,606 | |||||||||||||||
At January 1, 2023 | 24,682 | 2,701 | 4,540 | 33,683 | 65,606 | |||||||||||||||
Additions | 55 | 87 | 173 | 596 | 911 | |||||||||||||||
Disposals or retirements | (480 | ) | (40 | ) | (115 | ) | (220 | ) | (855 | ) | ||||||||||
Reallocations/ reclassifications | - | (8 | ) | 8 | - | - | ||||||||||||||
Exchange adjustments | 11 | 20 | 6 | 370 | 407 | |||||||||||||||
At December 31, 2023 | 24,268 | 2,760 | 4,612 | 34,429 | 66,069 | |||||||||||||||
Accumulated depreciation and Impairment losses | ||||||||||||||||||||
At January 1, 2022 | (21,432 | ) | (2,131 | ) | (3,950 | ) | (30,032 | ) | (57,545 | ) | ||||||||||
Charge for the year | (414 | ) | (133 | ) | (214 | ) | (649 | ) | (1,410 | ) | ||||||||||
Disposals or retirements | - | - | 22 | 43 | 65 | |||||||||||||||
Impairment losses | (48 | ) | (4 | ) | (31 | ) | (650 | ) | (733 | ) | ||||||||||
Exchange adjustments | 9 | (16 | ) | (5 | ) | (289 | ) | (301 | ) | |||||||||||
At December 31, 2022 | (21,885 | ) | (2,284 | ) | (4,178 | ) | (31,577 | ) | (59,924 | ) | ||||||||||
At January 1, 2023 | (21,885 | ) | (2,284 | ) | (4,178 | ) | (31,577 | ) | (59,924 | ) | ||||||||||
Charge for the year | (272 | ) | (64 | ) | (178 | ) | (317 | ) | (831 | ) | ||||||||||
Disposals or retirements | 385 | 38 | 115 | 213 | 751 | |||||||||||||||
Impairment losses | (2,246 | ) | (339 | ) | (101 | ) | (1,086 | ) | (3,772 | ) | ||||||||||
Exchange adjustments | (4 | ) | (20 | ) | (7 | ) | (370 | ) | (401 | ) | ||||||||||
At December 31, 2023 | (24,022 | ) | (2,669 | ) | (4,349 | ) | (33,137 | ) | (64,177 | ) | ||||||||||
Carrying amounts | ||||||||||||||||||||
At December 31, 2023 | 246 | 91 | 263 | 1,292 | 1,892 | |||||||||||||||
At December 31, 2022 | 2,797 | 417 | 362 | 2,106 | 5,682 |
133
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
11. | PROPERTY, PLANT AND EQUIPMENT (CONTINUED) |
Carrying amount | Depreciation Charge | Impairment Charge | ||||||||||
At December 31, 2023 | Year ended December 31, 2023 | Year ended December 31, 2023 | ||||||||||
US$000 | US$000 | US$000 | ||||||||||
Buildings | 229 | (196 | ) | (1,930 | ) | |||||||
Computer equipment | 166 | (51 | ) | - | ||||||||
Plant and Equipment, vehicles | - | (26 | ) | (86 | ) | |||||||
395 | (273 | ) | (2,016 | ) |
Carrying amount | Depreciation Charge | Impairment Charge | ||||||||||
At December 31, 2022 | Year ended December 31, 2022 | Year ended December 31, 2022 | ||||||||||
US$000 | US$000 | US$000 | ||||||||||
Buildings | 2,482 | (398 | ) | (48 | ) | |||||||
Computer equipment | 217 | (40 | ) | - | ||||||||
Plant and Equipment, vehicles | - | (17 | ) | (200 | ) | |||||||
2,699 | (455 | ) | (248 | ) |
Right-of-Use assets at 31 December 2023 | No. of Right-of-Use leased assets | Range of remaining term in years | Average remaining lease term (years) | No. of Leases with extension options | No. of Leases with options to purchase | No. of leases with variable payments linked to index | No. of leases with termination options | ||||||||||||||
Building | 7 | 1 to 10 | 5 | 1 | - | - | - | ||||||||||||||
Vehicle | 22 | 1 to 3 | 2 | - | 22 | - | 22 | ||||||||||||||
I.T. and office equipment | 5 | 3 | 3 | - | - | - | - |
Right-of-Use assets at 31 December 2022 | No. of Right-of-Use leased assets | Range of remaining term in years | Average remaining lease term (years) | No. of Leases with extension options | No. of Leases with options to purchase | No. of leases with variable payments linked to index | No. of leases with termination options | ||||||||||||||
Building | 9 | 1 to 11 | 5 | 2 | - | - | - | ||||||||||||||
Vehicle | 20 | 0.4 to 3 | 2 | - | 20 | - | 20 | ||||||||||||||
I.T. and office equipment | 5 | 4 | 4 | - | - | - | - |
134
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
11. | PROPERTY, PLANT AND EQUIPMENT (CONTINUED) |
135
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
12. | GOODWILL AND INTANGIBLE ASSETS |
Goodwill US$‘000 | Development costs US$‘000 | Patents and licenses US$‘000 | Other US$‘000 | Total US$‘000 | ||||||||||||||||
Cost | ||||||||||||||||||||
At January 1, 2022 | 79,182 | 121,173 | 8,707 | 33,198 | 242,260 | |||||||||||||||
Additions | 4,475 | 22 | 382 | 4,879 | ||||||||||||||||
Exchange adjustments | - | (64 | ) | - | - | (64 | ) | |||||||||||||
At December 31, 2022 | 79,182 | 125,584 | 8,729 | 33,580 | 247,075 | |||||||||||||||
At January 1, 2023 | 79,182 | 125,584 | 8,729 | 33,580 | 247,075 | |||||||||||||||
Additions | - | 1,758 | 19 | 110 | 1,887 | |||||||||||||||
Disposals or retirements | (12,591 | ) | - | - | (14,488 | ) | (27,079 | ) | ||||||||||||
Reclassifications | 54 | - | (54 | ) | - | - | ||||||||||||||
Exchange adjustments | - | 23 | - | - | 23 | |||||||||||||||
At December 31, 2023 | 66,645 | 127,365 | 8,694 | 19,202 | 221,906 | |||||||||||||||
Accumulated amortisation and Impairment losses | ||||||||||||||||||||
At January 1, 2022 | (66,645 | ) | (103,494 | ) | (8,561 | ) | (27,579 | ) | (206,279 | ) | ||||||||||
Charge for the year | (479 | ) | (9 | ) | (435 | ) | (923 | ) | ||||||||||||
Impairment losses | - | (4,623 | ) | - | (1 | ) | (4,624 | ) | ||||||||||||
Exchange adjustments | - | 20 | - | - | 20 | |||||||||||||||
At December 31, 2022 | (66,645 | ) | (108,576 | ) | (8,570 | ) | (28,015 | ) | (211,806 | ) | ||||||||||
At January 1, 2023 | (66,645 | ) | (108,576 | ) | (8,570 | ) | (28,015 | ) | (211,806 | ) | ||||||||||
Charge for the year | - | (753 | ) | 30 | (223 | ) | (946 | ) | ||||||||||||
Disposals or retirements | - | - | - | 12,956 | 12,956 | |||||||||||||||
Impairment losses | - | (2,926 | ) | (9 | ) | (2,898 | ) | (5,833 | ) | |||||||||||
Exchange adjustments | - | (7 | ) | - | - | (7 | ) | |||||||||||||
At December 31, 2023 | (66,645 | ) | (112,262 | ) | (8,549 | ) | (18,180 | ) | (205,636 | ) | ||||||||||
Carrying amounts | ||||||||||||||||||||
At December 31, 2023 | - | 15,103 | 145 | 1,022 | 16,270 | |||||||||||||||
At December 31, 2022 | 12,537 | 17,008 | 159 | 5,565 | 35,269 |
Product Name | 2023 US$’000 | 2022 US$’000 | ||||||
Premier Instruments for A1c and haemoglobinopathies testing | 1,669 | 1,904 | ||||||
COVID-19 tests | - | 1,378 | ||||||
Mid-tier haemoglobins instrument | 51 | 484 | ||||||
HIV screening rapid test | 6 | 379 | ||||||
Tri-stat point-of-care instrument | - | 163 | ||||||
Other projects | 32 | 167 | ||||||
Total capitalised development costs | 1,758 | 4,475 |
136
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
12. | GOODWILL AND INTANGIBLE ASSETS (CONTINUED) |
Other intangible assets
December 31, 2023 | December 31, 2022 | |||||||
US$’000 | US$’000 | |||||||
Immco Diagnostics inc. | 9,331 | - | ||||||
Trinity Biotech Manufacturing Limited (Note 13) | 1,500 | 3,599 | ||||||
Trinity Biotech Do Brasil | 274 | 454 | ||||||
Primus Corp | - | 1,024 | ||||||
Clark Laboratories Inc. | - | 407 | ||||||
Biopool US Inc. | - | 355 | ||||||
Total impairment loss | 11,105 | 5,839 |
137
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
12. | GOODWILL AND INTANGIBLE ASSETS (CONTINUED) |
December 31, 2023 | December 31, 2022 | |||||||
US$’000 | US$’000 | |||||||
Goodwill and other intangible assets | 5,833 | 4,624 | ||||||
Property, plant and equipment (see Note 11) | 3,772 | 733 | ||||||
Financial assets (see Note 13) | 1,500 | - | ||||||
Prepayments (see Note 17) | - | 482 | ||||||
Total impairment loss | 11,105 | 5,839 |
Asset name | Entity | 2022 US$’000 | ||||
Rapid COVID-19 antigen test | Trinity Biotech Manufacturing Ltd | 2,214 | ||||
Autoimmune smart reader | Trinity Biotech Manufacturing Ltd | 1,266 | ||||
Tri-stat instrument | Primus Corp. | 1,024 | ||||
COVID-19 ELISA test | Trinity Biotech Manufacturing Ltd | 120 | ||||
Total | 4,624 |
138
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
12. | GOODWILL AND INTANGIBLE ASSETS (CONTINUED) |
• | In the event that there was a reduction of 10% in the assumed level of future growth in revenue growth rate, which would represent a reasonably likely range of outcomes, there would be no additional impairment loss recorded at December 31, 2023. |
• | In the event there was a 10% increase in the discount rate used to calculate the potential impairment of the carrying values, which would represent a reasonably likely range of outcomes, there would be no additional impairment loss recorded at December 31, 2023. |
Fitzgerald Industries | December 31, 2022 | |||
Carrying amount of goodwill (US$’000) | 12,591 | |||
Discount rate applied (real pre-tax) | 15.77 | % | ||
Excess value-in-use over carrying amount (US$’000) | 7,432 | |||
% EBITDA would need to decrease for an impairment to arise | 31.28 | % | ||
Long-term growth rate | 2.0 | % |
139
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
12. | GOODWILL AND INTANGIBLE ASSETS (CONTINUED) |
Intangible Assets with Indefinite Useful lives (included in other intangibles) | December 31, 2023 US$‘000 | December 31, 2022 US$‘000 | ||||||
Immco Diagnostic CGU | ||||||||
Immco Diagnostic trade name | - | 2,069 | ||||||
Fitzgerald Industries CGU | ||||||||
Fitzgerald trade name | - | 970 | ||||||
RDI trade name | - | 560 | ||||||
Primus Corporation CGU | ||||||||
Primus trade name | 365 | 365 | ||||||
Total | 365 | 3,964 |
In 2023, an impairment loss of US$2,069,000 was allocated against the Immco Diagnostic trade name as the carrying value of the CGU’s net assets exceeded its discounted future cashflows. In 2023, the Group sold the Fitzgerald Industries business and the Fitzgerald trade name and RDI trade name were disposed of as part of that divestment. The trade name assets purchased as part of the acquisition of Fitzgerald in 2004, Primus and RDI in 2005 and Immco Diagnostics in 2013 were valued using the relief from royalty method and based on factors such as (1) the market and competitive trends and (2) the expected usage of the name. It was considered that these trade names will generate net cash inflows for the Group for an indefinite period. |
140
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
13. | FINANCIAL ASSETS |
December 31, 2023 US$‘000 | ||||
Cost | ||||
At January 1 | - | |||
Additions in year | 1,500 | |||
At December 31 | 1,500 | |||
Provision for impairment | ||||
At January 1 | - | |||
Impairment in the current year | (1,500 | ) | ||
At December 31 | (1,500 | ) | ||
Carrying amount | ||||
At December 31 | - |
In January 2023, the Company announced a strategic partnership with imaware Inc (“imaware”) that combined their built-to-partner digital health platform with Trinity Biotech’s advanced reference laboratory facilities to power the Digital Health Industry with at-home and remote testing programs. Trinity Biotech agreed to make a US$1.5 million convertible note investment in imaware. Trinity Biotech also entered into a 5-year agreement to become the lab testing partner for imaware. To date the Group has paid US$0.7 million of the US$1.5 million investment to imaware. The Group has not to date paid the additional US$0.8 million to imaware which remains as an accrued liability as at December 31, 2023. The strategic partnership yielded no income for the Company in 2023. Given the uncertainty over the future of imaware’s performance and the value of this investment, the Company has recognised an impairment loss for the investment of US$1.5 million in the year ended December 31, 2023. |
141
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
14. | DEFERRED TAX ASSETS AND LIABILITIES |
Recognised deferred tax assets and liabilities
Assets | Liabilities | Net | ||||||||||||||||||||||
2023 US$’000 | 2022 US$’000 | 2023 US$’000 | 2022 US$’000 | 2023 US$’000 | 2022 US$’000 | |||||||||||||||||||
Property, plant and equipment | 168 | 229 | - | (5 | ) | 168 | 224 | |||||||||||||||||
Intangible assets | - | - | (931 | ) | (3,950 | ) | (931 | ) | (3,950 | ) | ||||||||||||||
Inventories | 105 | 423 | - | - | 105 | 423 | ||||||||||||||||||
Provisions | 558 | 2,194 | - | - | 558 | 2,194 | ||||||||||||||||||
Tax value of loss carry-forwards | 1,030 | 1,254 | - | - | 1,030 | 1,254 | ||||||||||||||||||
Other items | 114 | 118 | (1,369 | ) | (1,103 | ) | (1,255 | ) | (985 | ) | ||||||||||||||
Deferred tax assets/(liabilities) | 1,975 | 4,218 | (2,300 | ) | (5,058 | ) | (325 | ) | (840 | ) |
Balance January 1, 2023 | Recognised in income | Recognised in discontinued operations | Balance December 31, 2023 | |||||||||||||
US$’000 | US$’000 | US$’000 | US$’000 | |||||||||||||
Property, plant and equipment | 224 | (56 | ) | - | 168 | |||||||||||
Intangible assets | (3,950 | ) | 2,827 | 192 | (931 | ) | ||||||||||
Inventories | 423 | (318 | ) | - | 105 | |||||||||||
Provisions | 2,194 | (1,636 | ) | - | 558 | |||||||||||
Tax value of loss carry-forwards | 1,254 | (224 | ) | - | 1,030 | |||||||||||
Other items | (985 | ) | (270 | ) | - | (1,255 | ) | |||||||||
(840 | ) | 323 | 192 | (325 | ) |
142
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
14. | DEFERRED TAX ASSETS AND LIABILITIES (CONTINUED) |
Balance January 1, 2022 | Recognised in income | Recognised in discontinued operations | Balance December 31, 2022 | |||||||||||||
US$’000 | US$’000 | US$’000 | US$’000 | |||||||||||||
Property, plant and equipment | 466 | (242 | ) | - | 224 | |||||||||||
Intangible assets | (3,969 | ) | 16 | 3 | (3,950 | ) | ||||||||||
Inventories | 620 | (197 | ) | - | 423 | |||||||||||
Provisions | 1,871 | 323 | - | 2,194 | ||||||||||||
Tax value of loss carry-forwards | 1,016 | 238 | - | 1,254 | ||||||||||||
Other items | (761 | ) | (224 | ) | - | (985 | ) | |||||||||
(757 | ) | (86 | ) | 3 | (840 | ) |
December 31, 2023 | December 31, 2022 | |||||||
US$’000 | US$’000 | |||||||
Capital losses | 8,293 | 8,293 | ||||||
Net operating losses | 136,202 | 75,957 | ||||||
US alternative minimum tax credits | 1,790 | 1,906 | ||||||
Other temporary timing differences | 57,986 | 38,960 | ||||||
US state credit carryforwards | 4,015 | 2,753 | ||||||
208,286 | 127,869 |
15. | OTHER NON-CURRENT ASSETS |
December 31, 2023 US$‘000 | December 31, 2022 US$‘000 | |||||||
Finance lease receivables (see Note 17) | 36 | 84 | ||||||
Other assets | 43 | 55 | ||||||
79 | 139 |
143
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
16. | INVENTORIES |
December 31, 2023 US$‘000 | December 31, 2022 US$‘000 | |||||||
Raw materials and consumables | 10,053 | 12,094 | ||||||
Work-in-progress | 4,498 | 3,948 | ||||||
Finished goods | 5,382 | 6,461 | ||||||
19,933 | 22,503 |
December 31, 2023 US$‘000 | December 31, 2022 US$‘000 | December 31, 2021 US$‘000 | ||||||||||
Opening provision at January 1 | 16,274 | 12,063 | 9,781 | |||||||||
Charged during the year | 2,291 | 7,391 | 5,589 | |||||||||
Utilised during the year | (5,456 | ) | (3,180 | ) | (3,307 | ) | ||||||
Eliminated on disposal of business | (1,765 | ) | - | - | ||||||||
Closing provision at December 31 | 11,344 | 16,274 | 12,063 |
17. | TRADE AND OTHER RECEIVABLES |
December 31, 2023 US$‘000 | December 31, 2022 US$‘000 | |||||||
Trade receivables, net of impairment losses | 10,698 | 12,620 | ||||||
Prepayments | 2,036 | 1,932 | ||||||
Contract assets | 525 | 739 | ||||||
Value added tax | 43 | 43 | ||||||
Finance lease receivables | 119 | 86 | ||||||
Consideration due from sale of business (Note 8) | 373 | - | ||||||
Other receivables | 107 | - | ||||||
Grant receivable | - | 333 | ||||||
13,901 | 15,753 |
144
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
17. | TRADE AND OTHER RECEIVABLES (CONTINUED) |
December 31, 2023 US$‘000 | ||||||||||||
Gross investment | Unearned income | Minimum payments receivable | ||||||||||
Less than one year | 170 | 4 | 119 | |||||||||
Between one and five years (Note 15) | 54 | 3 | 36 | |||||||||
224 | 7 | 155 |
December 31, 2022 US$‘000 | ||||||||||||
Gross investment | Unearned income | Minimum payments receivable | ||||||||||
Less than one year | 180 | 6 | 86 | |||||||||
Between one and five years (Note 15) | 173 | 6 | 84 | |||||||||
353 | 12 | 170 |
December 31, 2023 US$‘000 | ||||||||
Instruments | Total | |||||||
Less than one year | 1,995 | 1,995 | ||||||
1,995 | 1,995 |
145
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
17. | TRADE AND OTHER RECEIVABLES (CONTINUED) |
December 31, 2022 US$‘000 | ||||||||
Instruments | Total | |||||||
Less than one year | 1,589 | 1,589 | ||||||
1,589 | 1,589 |
18. | CASH AND CASH EQUIVALENTS |
December 31, 2023 US$’000 | December 31, 2022 US$’000 | |||||||
Cash at bank and in hand | 3,691 | 6,578 | ||||||
Cash and cash equivalents | 3,691 | 6,578 |
19. | CAPITAL AND RESERVES |
December 31, 2023 | December 31, 2022 | |||||||
Class ‘A’ Ordinary shares ‘000s | Class ‘A’ Ordinary shares ‘000s | |||||||
In thousands of shares | ||||||||
In issue at January 1 | 164,986 | 96,162 | ||||||
Issued for cash (a) | 880 | 47,492 | ||||||
Issued as consideration for exchangeable notes purchase | - | 21,332 | ||||||
At period end | 165,866 | 164,986 |
December 31, 2023 | December 31, 2022 | |||||||
ADS | ADS | |||||||
In thousands of ADSs | ||||||||
Balance at January 1 | 8,249 | 4,808 | ||||||
Issued for cash | 44 | 2,374 | ||||||
Issued as consideration for Exchangeable Notes purchase | - | 1,067 | ||||||
At period end | 8,293 | 8,249 |
|
146
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
19. | CAPITAL AND RESERVES (CONTINUED) |
The amounts in the tables above are inclusive of Treasury Shares. The number of Treasury Shares is as follows: |
December 31, 2023 | December 31, 2022 | |||||||
Class ‘A’ Treasury shares ‘000s | Class ‘A’ Treasury shares ‘000s | |||||||
In thousands of shares | ||||||||
Balance at January 1 | 12,556 | 12,556 | ||||||
Purchased during period | - | - | ||||||
At period end | 12,556 | 12,556 |
December 31, 2023 | December 31, 2022 | |||||||
Class ‘A’ Treasury shares ‘000s | Class ‘A’ Treasury shares ‘000s | |||||||
In thousands of ADSs | ||||||||
Balance at January 1 | 628 | 628 | ||||||
Purchased during period | - | - | ||||||
At period end | 628 | 628 |
(a) | During the year ended December 31, 2023, the Company issued 880,000 ‘A’ Ordinary shares for a consideration of US$170,800 settled in cash. The Company incurred expenses of US$11,000 in connection with the issuances. The total shares issued for cash comprises 880,000‘A’ Ordinary from the exercise of employee share options. |
147
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
20. | SHARE OPTIONS |
148
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
20. | SHARE OPTIONS (CONTINUED) |
Contractual life
Share Options ‘A’ Ordinary Shares | Weighted- average exercise price US$ Per ‘A’ Ordinary Share | Range US$ Per ‘A’ Ordinary Share | ||||||||||
Outstanding January 1, 2021 | 19,485,990 | 0.79 | 0.19-4.36 | |||||||||
Granted | - | - | - | |||||||||
Exercised | - | - | - | |||||||||
Expired / Forfeited | (758,000 | ) | 1.07 | 0.19-4.21 | ||||||||
Outstanding December 31, 2021 | 18,727,990 | 0.78 | 0.19-4.36 | |||||||||
- | - | - | ||||||||||
Exercisable December 31, 2021 | 13,401,322 | 0.93 | 0.19-4.36 | |||||||||
Outstanding January 1, 2022 | 18,727,990 | 0.78 | 0.19-4.36 | |||||||||
Granted | 29,400,000 | 0.27 | 0.27-0.29 | |||||||||
Exercised | (2,733,328 | ) | 0.19 | 0.19-0.19 | ||||||||
Expired / Forfeited | (579,990 | ) | 1.87 | 0.69-4.36 | ||||||||
Outstanding December 31, 2022 | 44,814,672 | 0.47 | 0.19-2.43 | |||||||||
Exercisable December 31, 2022 | 14,138,004 | 0.89 | 0.19-2.43 | |||||||||
Outstanding January 1, 2023 | 44,814,672 | 0.47 | 0.19-2.43 | |||||||||
Granted | 19,600,000 | 0.14 | 0.12-0.25 | |||||||||
Exercised | (880,000 | ) | 0.19 | 0.19-0.19 | ||||||||
Expired / Forfeited | (16,620,000 | ) | 0.33 | 0.27-2.43 | ||||||||
Outstanding December 31,2023 | 46,914,672 | 0.39 | 0.12-1.34 | |||||||||
Exercisable December 31,2023 | 19,764,672 | 0.67 | 0.19-1.34 |
149
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
20. | SHARE OPTIONS (CONTINUED) |
In February 2024, the Company adjusted its ADS ratio from 1 ADS: 4 ordinary share to 1 ADS: 20 ordinary shares. The 2023 and 2022 ADS amounts in the below tables reflect this change.
Share Options ‘ADS’ Equivalent | Weighted- average exercise price US$ Per ‘ADS’ | Range US$ Per ‘ADS’ | ||||||||||
Outstanding January 1, 2021 | 974,300 | 15.80 | 3.80-87.20 | |||||||||
Granted | ||||||||||||
Exercised | ||||||||||||
Expired / Forfeited | (37,900 | ) | 21.40 | 3.80-84.20 | ||||||||
Outstanding December 31, 2021 | 936,400 | 15.60 | 3.80-87.20 | |||||||||
Exercisable December 31, 2021 | 670,066 | 18.60 | 3.80-87.20 | |||||||||
Outstanding January 1, 2022 | 936,400 | 15.60 | 3.80-87.20 | |||||||||
Granted | 1,470,000 | 5.40 | 5.40-5.80 | |||||||||
Exercised | (136,666 | ) | 3.80 | 3.80-3.80 | ||||||||
Expired / Forfeited | (29,000 | ) | 37.40 | 13.80-87.20 | ||||||||
Outstanding December 31, 2022 | 2,240,734 | 9.40 | 3.80-48.60 | |||||||||
Exercisable December 31, 2022 | 706,900 | 17.80 | 3.80-48.60 | |||||||||
Outstanding January 1, 2023 | 2,240,734 | 9.40 | 3.80-48.60 | |||||||||
Granted | 980,000 | 2.80 | 2.40-5.00 | |||||||||
Exercised | (44,000 | ) | 3.80 | 3.80-3.80 | ||||||||
Expired / Forfeited | (831,000 | ) | 6.60 | 5.40-48.60 | ||||||||
Outstanding December 31, 2023 | 2,345,734 | 7.80 | 2.40-26.80 | |||||||||
Exercisable December 31, 2023 | 988,234 | 13.40 | 3.80-26.80 |
In 2023, 880,000 options to purchase ‘A’ ordinary shares (44,000 options to purchase ADS’s) were exercised at an average share price of US$0.19 per ‘A’ ordinary share or US$3.80 per ADS at the date of exercise.
150
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
20. | SHARE OPTIONS (CONTINUED) |
Outstanding | Exercisable | ||||||||||||||||||||||||
Exercise price range | No. of options ‘A’ ordinary shares | Weighted– average exercise price | Weighted- average contractual life remaining (years) | No. of options ‘A’ ordinary shares | Weighted– average exercise price | Weighted- average contractual life remaining (years) | |||||||||||||||||||
US$0.12-US$0.99 | 42,266,672 | 0.28 | 5.50 | 15,116,672 | 0.47 | 4.16 | |||||||||||||||||||
US$1.00-US$1.74 | 4,648,000 | 1.33 | 0.79 | 4,648,000 | 1.33 | 0.79 | |||||||||||||||||||
46,914,672 | 19,764,672 |
Outstanding | Exercisable | ||||||||||||||||||||||||
Exercise price range | No. of options ‘ADS equivalent’ | Weighted– average exercise price | Weighted- average contractual life remaining (years) | No. of options ‘ADS equivalent’ | Weighted– average exercise price | Weighted- average contractual life remaining (years) | |||||||||||||||||||
US$2.40-US$19.80 | 2,113,334 | 5.64 | 5.50 | 755,834 | 9.32 | 4.16 | |||||||||||||||||||
US$20.00-US$34.80 | 232,400 | 26.54 | 0.79 | 232,400 | 26.54 | 0.79 | |||||||||||||||||||
2,345,734 | 988,234 |
Outstanding | Exercisable | ||||||||||||||||||||||||
Exercise price range | No. of options ‘A’ ordinary shares | Weighted– average exercise price | Weighted- average contractual life remaining (years) | No. of options ‘A’ ordinary shares | Weighted– average exercise price | Weighted- average contractual life remaining (years) | |||||||||||||||||||
US$0.12-US$0.99 | 39,546,672 | 0.35 | 6.10 | 8,930,004 | 0.59 | 4.05 | |||||||||||||||||||
US$1.00-US$1.74 | 4,988,000 | 1.34 | 1.78 | 4,928,000 | 1.34 | 1.74 | |||||||||||||||||||
US$1.75- US$2.43 | 280,000 | 2.43 | 0.15 | 280,000 | 2.43 | 0.15 | |||||||||||||||||||
44,814,672 | 14,138,004 |
151
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
20. | SHARE OPTIONS (CONTINUED) |
Outstanding | Exercisable | ||||||||||||||||||||||||
Exercise price range | No. of options ‘ADS equivalent’ | Weighted– average exercise price | Weighted- average contractual life remaining (years) | No. of options ‘ADS equivalent’ | Weighted– average exercise price | Weighted- average contractual life remaining (years) | |||||||||||||||||||
US$2.40-US$19.99 | 1,977,334 | 7.00 | 6.10 | 446,500 | 11.80 | 4.05 | |||||||||||||||||||
US$20.00-US$34.80 | 249,400 | 26.80 | 1.78 | 246,400 | 26.80 | 1.74 | |||||||||||||||||||
US$35.00- US$48.60 | 14,000 | 48.60 | 0.15 | 14,000 | 48.60 | 0.15 | |||||||||||||||||||
2,240,734 | 706,900 |
Charge for the year under IFRS 2
December 31, 2023 US$‘000 | December 31, 2022 US$‘000 | December 31, 2021 US$‘000 | ||||||||||
Share-based payments – cost of sales | - | - | 5 | |||||||||
Share-based payments – selling, general and administrative | 2,069 | 1,755 | 1,095 | |||||||||
Total – continuing operations | 2,069 | 1,755 | 1,100 | |||||||||
Share-based payments – discontinued operations | - | - | - | |||||||||
Total | 2,069 | 1,755 | 1,100 |
152
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
20. | SHARE OPTIONS (CONTINUED) |
Key management personnel | Key management personnel | Key management personnel | ||||||||||
2023 | 2022 | 2021 | ||||||||||
Weighted average fair value at measurement date per ‘A’ share / (per ADS) | $ | US0.50 / (US$10.04 | $ | US0.19 / (US$3.80 | -/ - | |||||||
Total ‘A’ share options granted / (ADS’s equivalent) | 19,600,000/ (980,000 | ) | 29,400,000 / (1,470,000 | ) | -/ - | |||||||
Weighted average share price per ‘A’ share / (per ADS) | $ | US0.14/ (US$2.80 | ) | $ | US0.27 / (US$5.40 | ) | -/ - | |||||
Weighted average exercise price per ‘A’ share / (per ADS) | $ | US0.14 / (US$2.80 | ) | $ | US0.27 / (US$5.40 | ) | -/ - | |||||
Weighted average expected volatility | 40.21 | % | 76.79 | % | - | |||||||
Weighted average expected life | 7 | 6.82 | - | |||||||||
Weighted average risk-free interest rate | 4.13 | % | 3.59 | % | - |
153
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
20. | SHARE OPTIONS (CONTINUED) |
The expected life of the options is based on historical data and is not necessarily indicative of exercise patterns that may occur. The expected volatility is based on the historic volatility (calculated based on the expected life of the options). The Group has considered how future experience may affect historical volatility. The profile and activities of the Group are not expected to change in the immediate future and therefore Trinity Biotech would expect estimated volatility to be consistent with historical volatility.
21. | TRADE AND OTHER PAYABLES |
December 31, 2023 US$’000 | December 31, 2022 US$’000 | |||||||
Trade payables | 3,885 | 6,205 | ||||||
Accruals and other liabilities | 7,552 | 8,585 | ||||||
Amounts payable for financial assets (Note 13) | 800 | - | ||||||
Payroll taxes | 405 | 368 | ||||||
Employee related social insurance | 110 | 103 | ||||||
Deferred income | 50 | 114 | ||||||
12,802 | 15,375 |
22. | PROVISIONS |
December 31, 2023 US$’000 | December 31, 2022 US$’000 | |||||||
Product warranty provision | 50 | 50 | ||||||
50 | 50 |
154
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
23. | INTEREST-BEARING LOANS AND BORROWINGS |
December 31, 2023 US$’000 | December 31, 2022 US$’000 | |||||||
Current liabilities | ||||||||
Exchangeable senior notes | 210 | 210 | ||||||
Total | 210 | 210 |
December 31, 2023 US$’000 | December 31, 2022 US$’000 | |||||||
Non-Current liabilities | ||||||||
Senior secured term loan | 40,109 | 44,301 | ||||||
Derivative financial liability | 526 | 1,569 | ||||||
Convertible note | 14,542 | 13,746 | ||||||
Total non-current liabilities | 55,177 | 59,616 |
December 31, 2023 US$’000 | December 31, 2022 US$’000 | |||||||
Non-Current assets | ||||||||
Derivative financial asset | 178 | 128 | ||||||
Total non-current assets | 178 | 128 |
In January 2022, the Company retired approximately US$99.7 million of the Exchangeable Notes as part of a debt re-financing. This represented approximately 99.7% of the total Exchangeable Notes. Consideration was in cash and an issue of ‘A’ Ordinary shares. The cash paid was US$86.73 million with each holder that was party to the agreement receiving US$0.87 of cash per US$1 nominal value of the Exchangeable Notes. The shares consideration was 1,066,600 ADSs (21,332,000 ‘A’ Ordinary shares) representing the equivalent of US$0.40 of the Company’s ADS (based upon the 5-day trailing VWAP of the ADSs on NASDAQ on December 10, 2021, discounted by 13%) per US$1 nominal value of the Exchangeable Notes, as partial consideration for the exchange of the Exchangeable Notes. The shares consideration is valued at US$6.1 million based on market price on the date of issue.
The Exchangeable Notes were treated as a host debt instrument under IFRS with embedded derivatives attached. The embedded derivatives related to a number of put and call options which were measured at fair value in the consolidated statement of operations. On initial recognition in 2015, the host debt instrument was recognised at the residual value of the total net proceeds of the note issue less fair value of the embedded derivatives. Subsequently, the host debt instrument was measured at amortised cost using the effective interest rate method.
155
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
23. | INTEREST-BEARING LOANS AND BORROWINGS (CONTINUED) |
December 31, 2023 US$000 | December 31, 2022 US$000 | |||||||
Balance at January 1 | (210 | ) | (83,312 | ) | ||||
Accretion interest | - | (83 | ) | |||||
Repaid to Note holders | - | 86,730 | ||||||
Shares issued to Note holders as consideration | - | 6,133 | ||||||
Loss on disposal | - | (9,678 | ) | |||||
Liability | (210 | ) | (210 | ) |
156
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
23. | INTEREST-BEARING LOANS AND BORROWINGS (CONTINUED) |
December 31, 2023 US$000 | December 31, 2022 US$000 | |||||||
Balance at January 1 | (44,301 | ) | - | |||||
Principal amount loaned | (5,000 | ) | (81,250 | ) | ||||
Loan drawdown costs | 194 | 3,551 | ||||||
Derivative financial liability at date of drawdown | 90 | 1,872 | ||||||
Derivative financial asset at date of drawdown | (11 | ) | (202 | ) | ||||
Accretion interest | (1,131 | ) | (2,772 | ) | ||||
Cash repayment of principal | 10,050 | 34,500 | ||||||
Balance at December 31 | (40,109 | ) | (44,301 | ) |
December 31, 2023 US$000 | December 31, 2022 US$000 | |||||||
Balance at January 1 | 128 | - | ||||||
Derivative financial asset at date of drawdown | 11 | 202 | ||||||
Fair value adjustments in the period | 39 | (74 | ) | |||||
Non-current asset at December 31 | 178 | 128 |
157
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
23. | INTEREST-BEARING LOANS AND BORROWINGS (CONTINUED) |
December 31, 2023 US$000 | December 31, 2022 US$000 | |||||||
Balance at January 1 | (1,569 | ) | - | |||||
Derivative financial liability at date of drawdown | (90 | ) | (1,872 | ) | ||||
Fair value adjustments in the period | 1,133 | 303 | ||||||
Non-current liability at December 31 | (526 | ) | (1,569 | ) |
In May 2022, the Company announced a US$45.2 million investment from MiCo IVD Holdings, LLC. The investment consists of an equity investment of US$25.2 million and a seven -year, unsecured junior convertible note of US$20.0 million. The convertible note has an interest rate of 1.5%. The convertible note mandatorily converts into ADSs if the volume weighted average price of the Company’s ADSs is at or above US$16.20 for any five consecutive NASDAQ trading days. For further details on the convertible note, refer to the Company’s Form 6-K filings with the SEC on April 11, 2022.
December 31, 2023 US$000 | December 31, 2022 US$000 | |||||||
Balance at January 1 | (13,746 | ) | - | |||||
Principal amount loaned | - | (20,000 | ) | |||||
Loan origination costs | - | 40 | ||||||
Equity component at date of issue | - | 6,709 | ||||||
Accretion interest | (796 | ) | (495 | ) | ||||
Non-current liability at December 31 | (14,542 | ) | (13,746 | ) |
158
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
24. | LEASE LIABILITIES |
December 31, 2023 US$’000 | December 31, 2022 US$’000 | |||||||
Current liabilities | ||||||||
Lease liabilities related to Right of Use assets | 1,694 | 1,631 | ||||||
Sale and leaseback liabilities | - | 45 | ||||||
1,694 | 1,676 | |||||||
Non-Current liabilities | ||||||||
Lease liabilities related to Right of Use assets | 10,872 | 12,267 |
December 31, 2023 US$’000 | ||||||||||||
Lease liabilities related to Right of Use assets | ||||||||||||
Minimum lease payments | Interest | Principal | ||||||||||
Less than one year | 2,221 | 577 | 1,644 | |||||||||
In more than one year, but not more than two | 2,243 | 498 | 1,745 | |||||||||
In more than two years but not more than five | 5,442 | 1,017 | 4,425 | |||||||||
More than five years | 5,400 | 648 | 4,752 | |||||||||
15,306 | 2,740 | 12,566 |
159
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
24. | LEASE LIABILITIES (CONTINUED) |
December 31, 2022 US$’000 | December 31, 2022 US$’000 | |||||||||||||||||||||||
Lease liabilities related to Right of Use assets | Sale and leaseback Liabilities | |||||||||||||||||||||||
Minimum lease payments | Interest | Principal | Minimum lease payments | Interest | Principal | |||||||||||||||||||
Less than one year | 2,249 | 618 | 1,631 | 46 | 1 | 45 | ||||||||||||||||||
In more than one year, but not more than two | 2,240 | 561 | 1,679 | - | - | - | ||||||||||||||||||
In more than two years but not more than five | 5,739 | 1,217 | 4,522 | - | - | - | ||||||||||||||||||
more than five years | 6,968 | 902 | 6,066 | - | - | - | ||||||||||||||||||
17,196 | 3,298 | 13,898 | 46 | 1 | 45 |
25. | COMMITMENTS AND CONTINGENCIES |
(a) | Capital Commitments |
(b) | Leasing Commitments |
160
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
25. | COMMITMENTS AND CONTINGENCIES (CONTINUED) |
(c) | Bank Security |
(d) | Group Company Guarantees |
Pursuant to the provisions of Section 357, Companies Act, 2014, the Company has guaranteed the liabilities of Trinity Biotech Manufacturing Limited, Trinity Research Limited and Trinity Biotech Financial Services Limited subsidiary undertakings in the Republic of Ireland, for the financial year to December 31, 2023 and, as a result, these subsidiary undertakings have been exempted from the filing provisions of Section 357, Companies Act, 2014. Where the company enters into these guarantees of the indebtedness of other companies within its Group, the Company considers these to be insurance arrangements and accounts for them as such. The Company treats the guarantee contract as a contingent liability until such time as it becomes probable that the company will be required to make a payment under the guarantee. The Company does not enter into financial guarantees with third parties.
(e) | Government Grant Contingencies |
(f) | Contingency relating to the sale of Fitzgerald Industries |
On April 27, 2023 the Company announced it had closed the sale of Fitzgerald Industries (“Fitzgerald”) to Biosynth for cash proceeds of approximately US$30 million subject to customary adjustments. In a telephone call conducted in March 2024, a representative of Biosynth alleged a breach of certain of the warranties set out in the Share Purchase Agreement for the sale of Fitzgerald. To date, Biosynth has not formally served notice of a breach of warranty claim on the Company as required by the Share Purchase Agreement and no supporting evidence has been presented to show that a breach of warranty has occurred. At the date of approval of these financial statements, as we have yet to receive a formal breach of warranty claim, and as no evidence has been presented to us of a loss or cause of loss, it is disputed whether certain events have occurred or whether those events result in a present obligation. No liability has therefore been recorded for this possible obligation in the Statement of Financial Position as at December 31, 2023.
(g) | Other Contingencies |
161
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
26. | RELATED PARTY TRANSACTIONS |
The Group has related party relationships with its subsidiaries, and with its directors and executive officers. Leasing arrangements with related parties The Group has entered into various arrangements with JRJ Investments (“JRJ”), a partnership owned by Mr O’Caoimh and Dr Walsh, directors of Trinity Biotech, and directly with Mr O’Caoimh, to provide premises at IDA Business Park, Bray, County Wicklow, Ireland. The Group entered into an agreement with JRJ for a 25-year lease commencing in December 2003 for offices that were adjacent to its then premises at IDA Business Park, Bray, County Wicklow, Ireland with an annual rent of €381,000 (US$421,000). Upward-only rent reviews are carried out every five years and there have been no increases arising from these rent reviews. In 2007, the Group entered into a 25-year lease agreement with Mr O’Caoimh and Dr Walsh for a 43,860 square foot manufacturing facility in Bray, Ireland with an annual rent of €787,000 (US$869,000). Subsequent to the signing of this lease, the ownership of the building transferred from JRJ to Mr O’Caoimh solely. In 2016, the Group also entered into a 10-year lease agreement with Mr O’Caoimh for a warehouse of 16,000 square feet adjacent to the leased manufacturing facility in Bray, Ireland. The annual rent for the warehouse is €144,000 (US$159,000). At the time, independent valuers advised the Group that the rent in respect of each of the leases represented a fair market rent. Upward-only rent reviews are carried out every five years and there have been no increases to date arising from these rent reviews. A rent review of the 43,860 square foot facility and the warehouse is currently ongoing. The review of the 43,860 square foot facility has been referred to an independent arbitrator for determination. In late 2020, the Group occupied some additional space adjoining the warehouse owned by Mr O’Caoimh. This was a short-term arrangement, and no payments were made for the additional space during 2020 and 2021. The Company vacated this space in 2021. In 2022, the rent payable to Mr O’Caoimh of US$90,000 was settled. At the time that the arrangements were entered into, Trinity Biotech and its directors (excepting Mr O’Caoimh and Dr Walsh who expressed no opinion on this point) believed they represented a fair and reasonable basis on which the Group could meet its ongoing requirements for premises. Dr Walsh has no ownership interest in the additional space adjoining the warehouse owned by Mr O’Caoimh and was therefore entitled to express an opinion on this arrangement. |
Compensation of key management personnel of the Group During the years ended December 31, 2023 and 2022, the key management personnel of the Group were made up of the following directors; Mr. Ronan O’Caoimh, Dr Jim Walsh, Mr. John Gillard and Mr. Aris Kekedjian (who resigned as CEO and member of the Trinity Board of Directors effective December 17, 2023). Compensation for the year for these personnel is detailed below: |
December 31, 2023 | December 31, 2022 | |||||||
US$’000 | US$’000 | |||||||
Short-term employee benefits | 1,774 | 1,074 | ||||||
Performance related bonus | 211 | 512 | ||||||
Post-employment benefits | 26 | 24 | ||||||
Share-based compensation benefits as calculated under IFRS 2 | 1,601 | 1,690 | ||||||
3,612 | 3,300 |
162
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
26. | RELATED PARTY TRANSACTIONS (CONTINUED) |
‘A’ Ordinary Shares | Share options | |||||||
At January 1, 2023 | 11,117,777 | 40,547,336 | ||||||
Shares of retired / resigned directors | - | - | ||||||
Options of retired / resigned directors | - | (20,000,000 | ) | |||||
Shares purchased during the year | - | - | ||||||
Shares sold during the year | - | - | ||||||
Granted | - | 14,000,000 | ||||||
Expired / forfeited | - | (4,160,000 | ) | |||||
At December 31, 2023 | 11,117,777 | 30,387,336 |
‘A’ Ordinary Shares | Share options | |||||||
At January 1, 2022 | 9,077,713 | 16,738,000 | ||||||
Shares of retired director | (626,600 | ) | - | |||||
Options of retired director | - | (2,924,000 | ) | |||||
Shares purchased during the year | 2,666,664 | (2,666,664 | ) | |||||
Shares sold during the year | - | - | ||||||
Granted | - | 29,400,000 | ||||||
Expired / forfeited | - | - | ||||||
At December 31, 2022 | 11,117,777 | 40,547,336 |
163
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
27. | CAPITAL AND FINANCIAL RISK MANAGEMENT |
Level 1 | Level 2 | Total carrying amount | Fair Value | ||||||||||||||||
Note | US$’000 | US$’000 | US$’000 | US$’000 | |||||||||||||||
December 31, 2023 | |||||||||||||||||||
Loans and receivables at amortised cost | |||||||||||||||||||
Trade receivables | 17 | 10,698 | - | 10,698 | 10,698 | ||||||||||||||
Cash and cash equivalents | 18 | 3,691 | - | 3,691 | 3,691 | ||||||||||||||
Finance lease receivable | 15, 17 | 155 | - | 155 | 155 | ||||||||||||||
14,544 | - | 14,544 | 14,544 | ||||||||||||||||
Liabilities at amortised cost | |||||||||||||||||||
Senior secured term loan | 23 | - | (40,109 | ) | (40,109 | ) | (40,109 | ) | |||||||||||
Convertible note | 23 | - | (14,542 | ) | (14,542 | ) | (14,542 | ) | |||||||||||
Exchangeable note | 23 | - | (210 | ) | (210 | ) | (210 | ) | |||||||||||
Lease liabilities | 24 | (12,566 | ) | - | (12,566 | ) | (12,566 | ) | |||||||||||
Trade and other payables (excluding deferred income) | 21 | (12,752 | ) | - | (12,752 | ) | (12,752 | ) | |||||||||||
Provisions | 22 | (50 | ) | - | (50 | ) | (50 | ) | |||||||||||
(25,368 | ) | (54,861 | ) | (80,229 | ) | (80,229 | ) | ||||||||||||
Fair value through profit and loss (FVPL) | |||||||||||||||||||
Derivative liability - warrants | 23 | - | (526 | ) | (526 | ) | (526 | ) | |||||||||||
Derivative asset – prepayment option | 23 | - | 178 | 178 | 178 | ||||||||||||||
- | (348 | ) | (348 | ) | (348 | ) | |||||||||||||
(10,824 | ) | (55,209 | ) | (66,033 | ) | (66,033 | ) |
For financial reporting purposes, fair value measurements are categorized into Level 1, 2 or 3 based on the degree to which inputs to the fair value measurements are observable and the significance of the inputs to the fair value measurement in its entirety, which are described as follows: Level 1: quoted prices (unadjusted) in active markets for identical assets or liabilities Level 2: valuation techniques for which the lowest level of inputs which have a significant effect on the recorded fair value are observable, either directly or indirectly Level 3: valuation techniques for which the lowest level of inputs that have a significant effect on the recorded fair value are not based on observable market data. |
164
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
27. | CAPITAL AND FINANCIAL RISK MANAGEMENT (CONTINUED) |
Level 1 | Level 2 | Total carrying amount | Fair Value | ||||||||||||||||
Note | US$’000 | US$’000 | US$’000 | US$’000 | |||||||||||||||
December 31, 2022 | |||||||||||||||||||
Loans and receivables at amortised cost | |||||||||||||||||||
Trade receivables | 17 | 12,620 | - | 12,620 | 12,620 | ||||||||||||||
Cash and cash equivalents | 18 | 6,578 | - | 6,578 | 6,578 | ||||||||||||||
Finance lease receivable | 15, 17 | 170 | - | 170 | 170 | ||||||||||||||
19,368 | - | 19,368 | 19,368 | ||||||||||||||||
Liabilities at amortised cost | |||||||||||||||||||
Senior secured term loan | 23 | - | (44,301 | ) | (44,301 | ) | (44,301 | ) | |||||||||||
Convertible note | 23 | - | (13,746 | ) | (13,746 | ) | (13,746 | ) | |||||||||||
Exchangeable note¹ | 23 | - | (210 | ) | (210 | ) | (210 | ) | |||||||||||
Lease liabilities | 24 | (13,943 | ) | - | (13,943 | ) | (13,943 | ) | |||||||||||
Trade and other payables (excluding deferred income) | 21 | (15,261 | ) | - | (15,261 | ) | (15,261 | ) | |||||||||||
Provisions | 22 | (50 | ) | - | (50 | ) | (50 | ) | |||||||||||
(29,254 | ) | (58,257 | ) | (87,511 | ) | (87,511 | ) | ||||||||||||
Fair value through profit and loss (FVPL) | |||||||||||||||||||
Derivative liability - warrants | 23 | - | (1,569 | ) | (1,569 | ) | (1,569 | ) | |||||||||||
Derivative asset – prepayment option | 23 | - | 128 | 128 | 128 | ||||||||||||||
- | (1,441 | ) | (1,441 | ) | (1,441 | ) | |||||||||||||
(9,886 | ) | (59,698 | ) | (69,584 | ) | (69,584 | ) |
165
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
27. | CAPITAL AND FINANCIAL RISK MANAGEMENT (CONTINUED) |
As at December 31, 2023 | Note | Effective interest rate | Total US$’000 | 6 mths or less US$’000 | 6 –12 mths US$’000 | 1-2 years US$’000 | 2-5 years US$’000 | > 5 years US$’000 | |||||||||||||||||||||||
Cash and cash equivalents | 18 | 0.00 | % | 3,691 | 3,691 | - | - | - | - | ||||||||||||||||||||||
Lease receivable | 15,17 | 4.0 | % | 155 | 62 | 39 | 49 | 5 | - | ||||||||||||||||||||||
Exchangeable note1 | 23 | 4.8 | % | (210 | ) | - | - | - | - | (210 | ) | ||||||||||||||||||||
Senior secured term loan2 | 23 | 16.3 | % | (40,109 | ) | - | - | - | (40,109 | ) | - | ||||||||||||||||||||
Convertible note3 | 23 | 1.5 | % | (14,542 | ) | - | - | - | - | (14,542 | ) | ||||||||||||||||||||
Lease payable on Right of Use assets | 24 | 5.0 | % | (12,566 | ) | (812 | ) | (832 | ) | (1,745 | ) | (4,425 | ) | (4,752 | ) | ||||||||||||||||
Total | (63,581 | ) | 2,941 | (793 | ) | (1,696 | ) | (44,529 | ) | (19,504 | ) |
As at December 31, 2022 | Note | Effective interest rate | Total US$’000 | 6 mths or less US$’000 | 6 –12 mths US$’000 | 1-2 years US$’000 | 2-5 years US$’000 | > 5 years US$’000 | |||||||||||||||||||||||
Cash and cash equivalents | 18 | 0.00 | % | 6,578 | 6,578 | - | - | - | - | ||||||||||||||||||||||
Lease receivable | 15,17 | 4.0 | % | 170 | 46 | 41 | 49 | 34 | - | ||||||||||||||||||||||
Exchangeable note1 | 23 | 4.8 | % | (210 | ) | - | - | - | - | (210 | ) | ||||||||||||||||||||
Senior secured term loan2 | 23 | 15.4 | % | (44,301 | ) | - | - | - | (44,301 | ) | |||||||||||||||||||||
Convertible note3 | 23 | 1.5 | % | (13,746 | ) | - | - | - | - | (13,746 | ) | ||||||||||||||||||||
Lease payable on Right of Use assets | 5.0 | % | (13,898 | ) | (812 | ) | (819 | ) | (1,679 | ) | (4,522 | ) | (6,066 | ) | |||||||||||||||||
Lease payable on sale & leaseback transactions | 24 | 5.0 | % | (45 | ) | (35 | ) | (10 | ) | - | - | - | |||||||||||||||||||
Total | (65,452 | ) | 5,777 | (788 | ) | (1,630 | ) | (48,789 | ) | (20,022 | ) |
166
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
27. | CAPITAL AND FINANCIAL RISK MANAGEMENT (CONTINUED) |
December 31, 2023 US$‘000 | December 31, 2022 US$‘000 | |||||||
Variable rate instruments | ||||||||
Cash at bank and in hand | 3,691 | 6,578 | ||||||
Variable rate financial liabilities (senior secured term loan) | (40,109 | ) | (44,301 | ) | ||||
(36,418 | ) | (37,723 | ) | |||||
Fixed rate instruments | ||||||||
Fixed rate financial liabilities (exchangeable note) | (210 | ) | (210 | ) | ||||
Fixed rate financial liabilities (convertible note) | (14,542 | ) | (13,746 | ) | ||||
Fixed rate financial liabilities (lease payables) | (12,566 | ) | (13,943 | ) | ||||
Financial assets (lease receivables) | 155 | 170 | ||||||
(27,163 | ) | (27,729 | ) |
Fair value sensitivity analysis for fixed rate instruments The Group does not account for any fixed rate financial liabilities at fair value through profit and loss. Therefore, a change in interest rates at December 31, 2023 or December 31, 2022 would not affect profit or loss. There was no significant difference between the fair value and carrying value of the Group’s trade receivables and trade and other payables at December 31, 2023 and December 31, 2022 as all fell due within 6 months. Liquidity risk The following are the contractual maturities of financial liabilities, including estimated interest payments: |
As at December 31, 2023 US$’000 | Carrying amount US$’000 | Contractual cash flows US$’000 | 6 mths or less US$’000 | 6 mths – 12 mths US$’000 | 1-2 years US$’000 | 2-5 years US$’000 | >5 years US$’000 | |||||||||||||||||||||
Financial liabilities | ||||||||||||||||||||||||||||
Trade and other payables (excluding deferred income) | 12,752 | 12,752 | 12,752 | - | - | - | - | |||||||||||||||||||||
Lease payable on Right of Use assets | 12,566 | 15,306 | 1,107 | 1,114 | 2,243 | 5,442 | 5,400 | |||||||||||||||||||||
Senior secured term loan¹ | 40,109 | 56,121 | 3,461 | 3,461 | 6,922 | 42,277 | - | |||||||||||||||||||||
Convertible note | 14,542 | 21,650 | 150 | 150 | 300 | 900 | 20,150 | |||||||||||||||||||||
Exchangeable notes | 210 | 389 | 4 | 4 | 8 | 24 | 349 | |||||||||||||||||||||
80,179 | 106,218 | 17,474 | 4,729 | 9,473 | 48,643 | 25,899 |
167
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
27. | CAPITAL AND FINANCIAL RISK MANAGEMENT (CONTINUED) |
As at December 31, 2022 US$’000 | Carrying amount US$’000 | Contractual cash flows US$’000 | 6 mths or less US$’000 | 6 mths – 12 mths US$’000 | 1-2 years US$’000 | 2-5 years US$’000 | >5 years US$’000 | |||||||||||||||||||||
Financial liabilities | ||||||||||||||||||||||||||||
Trade and other payables (excluding deferred income) | 15,261 | 15,261 | 15,261 | - | - | - | - | |||||||||||||||||||||
Lease payable on Right of Use assets | 13,898 | 17,196 | 1,120 | 1,130 | 2,240 | 5,739 | 6,967 | |||||||||||||||||||||
Lease payable on sale & leaseback transactions | 45 | 46 | 36 | 10 | - | - | - | |||||||||||||||||||||
Senior secured term loan¹ | 44,301 | 69,519 | 4,194 | 3,595 | 7,190 | 54,540 | - | |||||||||||||||||||||
Convertible note | 13,746 | 21,900 | 150 | 150 | 300 | 900 | 20,400 | |||||||||||||||||||||
Exchangeable notes | 210 | 397 | 4 | 4 | 8 | 24 | 357 | |||||||||||||||||||||
87,461 | 124,319 | 20,765 | 4,889 | 9,738 | 61,203 | 27,724 |
EUR | GBP | SEK | CAD | BRL | Other | |||||||||||||||||||
As at December 31, 2023 | US$‘000 | US$‘000 | US$‘000 | US$‘000 | US$‘000 | US$‘000 | ||||||||||||||||||
Cash | 219 | 15 | 5 | 191 | 854 | - | ||||||||||||||||||
Trade and other receivable | 856 | 100 | - | 533 | 1,533 | - | ||||||||||||||||||
Trade and other payables | (3,766 | ) | (100 | ) | (12 | ) | (220 | ) | (704 | ) | (1 | ) | ||||||||||||
Lease liabilities | (8,349 | ) | - | - | - | (241 | ) | - | ||||||||||||||||
Total exposure | (11,040 | ) | 15 | (7 | ) | 504 | 1,442 | (1 | ) |
EUR | GBP | SEK | CAD | BRL | Other | |||||||||||||||||||
As at December 31, 2022 | US$‘000 | US$‘000 | US$‘000 | US$‘000 | US$‘000 | US$‘000 | ||||||||||||||||||
Cash | 700 | 199 | 5 | 2,061 | 756 | - | ||||||||||||||||||
Trade and other receivable | 1,001 | 27 | - | 950 | 1,443 | - | ||||||||||||||||||
Trade and other payables | (3,481 | ) | (5 | ) | (6 | ) | (473 | ) | (662 | ) | - | |||||||||||||
Lease liabilities | (9,024 | ) | - | - | - | (277 | ) | - | ||||||||||||||||
Total exposure | (10,804 | ) | 221 | (1 | ) | 2,538 | 1,260 | - |
168
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
27. | CAPITAL AND FINANCIAL RISK MANAGEMENT (CONTINUED) |
Profit or Loss US$’000 | ||||
December 31, 2023 | ||||
Euro | 1,004 | |||
December 31, 2022 | ||||
Euro | 982 |
Profit or Loss US$000 | ||||
December 31, 2023 | ||||
Euro | (1,227 | ) | ||
December 31, 2022 | ||||
Euro | (1,200 | ) |
169
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
27. | CAPITAL AND FINANCIAL RISK MANAGEMENT (CONTINUED) |
Carrying Value December 31, 2023 US$’000 | Carrying Value December 31, 2022 US$’000 | |||||||
Third party trade receivables (Note 17) | 10,698 | 12,620 | ||||||
Finance lease income receivable (Note 17) | 155 | 170 | ||||||
Cash and cash equivalents (Note 18) | 3,691 | 6,578 | ||||||
14,544 | 19,368 |
Carrying Value December 31, 2023 US$’000 | Carrying Value December 31, 2022 US$’000 | |||||||
United States | 4,041 | 6,061 | ||||||
Euro-zone countries | 851 | 1,183 | ||||||
United Kingdom | 126 | 67 | ||||||
Other regions | 5,835 | 5,479 | ||||||
10,853 | 12,790 |
Carrying Value December 31, 2023 US$’000 | Carrying Value December 31, 2022 US$’000 | |||||||
End-user customers | 5,029 | 7,365 | ||||||
Distributors | 5,399 | 4,630 | ||||||
Non-governmental organisations | 425 | 795 | ||||||
10,853 | 12,790 |
170
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
27. | CAPITAL AND FINANCIAL RISK MANAGEMENT (CONTINUED) |
Gross | Impairment | Expected Credit Loss Rate | Gross | Impairment | Expected Credit Loss Rate | |||||||||||||||||||
2023 | 2023 | 2023 | 2022 | 2022 | 2022 | |||||||||||||||||||
US$’000 | US$’000 | % | US$’000 | US$’000 | % | |||||||||||||||||||
Not past due | 8,031 | - | - | 8,341 | - | - | ||||||||||||||||||
Past due 0-30 days | 1,534 | - | - | 1,622 | - | - | ||||||||||||||||||
Past due 31-120 days | 856 | 22 | 2.6 | % | 1,564 | 23 | 1.5 | % | ||||||||||||||||
Greater than 120 days | 2,601 | 2,302 | 88.5 | % | 3,783 | 2,668 | 70.5 | % | ||||||||||||||||
13,022 | 2,324 | - | 15,310 | 2,691 | - |
2023 | 2022 | |||||||
US$’000 | US$’000 | |||||||
Balance at January 1 | 2,691 | 2,986 | ||||||
Charged to costs and expenses | 715 | 1,240 | ||||||
Amounts written off during the year | (977 | ) | (1,535 | ) | ||||
Eliminated on disposal of business | (105 | ) | - | |||||
Balance at December 31 | 2,324 | 2,691 |
171
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
28. | RECONCILIATION OF LIABILITIES ARISING FROM FINANCING ACTIVITIES |
The changes in the Group’s liabilities arising from financing activities can be classified as follows:
Note | Borrowings & derivative financial instruments US$’000 | Lease liabilities US$’000 | |||||||||
Balance at January 1, 2023 | 23,24 | 59,826 | 13,943 | ||||||||
Cash-flows: | |||||||||||
Principal amount loaned – term loan | 5,000 | - | |||||||||
Loan origination costs paid | (194 | ) | - | ||||||||
Interest paid for senior secured term loan | (7,314 | ) | - | ||||||||
Interest paid for convertible note | (300 | ) | - | ||||||||
Interest paid for exchangeable notes | (8 | ) | - | ||||||||
Repayment of term loan | (10,050 | ) | |||||||||
Repayment of leases | - | (2,318 | ) | ||||||||
Penalty paid for early settlement of term loan | (905 | ) | - | ||||||||
Non-cash: | - | ||||||||||
Interest charged | 7,622 | - | |||||||||
Penalty for early settlement charged | 905 | - | |||||||||
Derivative financial asset at date of issue | 23 | 11 | - | ||||||||
Disposals (related to Right of Use assets) | - | (106 | ) | ||||||||
Additions (related to Right of Use assets) | - | 112 | |||||||||
Exchange adjustment | - | 311 | |||||||||
Accretion interest | 1,927 | 624 | |||||||||
Fair value of derivative liability - warrants | (1,133 | ) | - | ||||||||
Balance at December 31, 2023 | 23,24 | 55,387 | 12,566 |
172
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
28. | RECONCILIATION OF LIABILITIES ARISING FROM FINANCING ACTIVITIES (CONTINUED) |
Note | Borrowings & derivative financial instruments US$’000 | Lease liabilities US$’000 | |||||||||
Balance at January 1, 2022 | 23,24 | 83,343 | 15,845 | ||||||||
Cash-flows: | |||||||||||
Principal amount loaned – term loan | 81,250 | - | |||||||||
Principal amount loaned – convertible note | 20,000 | - | |||||||||
Loan origination costs paid | (3,591 | ) | - | ||||||||
Interest paid for term loan | (6,424 | ) | - | ||||||||
Interest paid for convertible note | (199 | ) | - | ||||||||
Interest paid for exchangeable notes | (1,293 | ) | - | ||||||||
Repayment of exchangeable notes | (86,730 | ) | - | ||||||||
Repayment of term loan | (34,500 | ) | - | ||||||||
Repayment of CEBA loan | (23 | ) | (2,761 | ) | |||||||
Penalty paid for early settlement of term loan | (3,450 | ) | - | ||||||||
Non-cash: | |||||||||||
Interest charged | 7,914 | - | |||||||||
Penalty for early settlement charged | 3,450 | - | |||||||||
Shares issued as consideration for purchase of Exchangeable Notes | (6,133 | ) | - | ||||||||
Equity component of convertible note at date of issue | (6,709 | ) | - | ||||||||
Derivative financial asset at date of issue | 202 | - | |||||||||
Loss on disposal of Exchangeable Notes | 9,678 | - | |||||||||
Additions (related to Right of Use assets) | - | 830 | |||||||||
Exchange adjustment | - | (628 | ) | ||||||||
Loan forgiven | (7 | ) | - | ||||||||
Accretion interest | 3,351 | 657 | |||||||||
Fair value of derivative liability - warrants | (303 | ) | - | ||||||||
Balance at December 31, 2022 | 23,24 | 59,826 | 13,943 |
173
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
29. | POST BALANCE SHEET EVENTS |
174
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
29. | POST BALANCE SHEET EVENTS (CONTINUED) |
The fair value of the total net assets acquired is US$23.2 million and comprises the following:
US$’000 | ||||
ASSETS ACQUIRED | ||||
Non-current assets | ||||
Property, plant and equipment | 1,569 | |||
Goodwill | 12,071 | |||
Other intangible assets | 9,360 | |||
Financial assets | 9 | |||
Total non-current assets | 23,009 | |||
Current assets | ||||
Inventory | 1,296 | |||
Other receivables | 135 | |||
Total current assets | 1,431 | |||
Total assets acquired | 24,440 | |||
LIABILITIES ASSUMED | ||||
Current liabilities | ||||
Trade and other payables | 50 | |||
Total current liabilities | 50 | |||
Non-current liabilities | ||||
Deferred tax liability | 1,170 | |||
Total non-current liabilities | 1,170 | |||
Total liabilities assumed | 1,220 | |||
NET ASSETS ACQUIRED | 23,220 |
○ | Trading Trigger: a US$5.0 million payment if, within the next 12 months, the (i) the closing price of the Company’s ADSs does not exceed US$7.50 per ADS for at a least 20 consecutive trading days and (ii) the average daily trading volume of the Company’s ADSs does not equal or exceed 20,000 ADSs for 20 consecutive trading days, and |
○ | Partnership trigger: 50% of the proceeds received by the Company (up to a maximum payment of additional consideration of US$15.0 million) on our entering into certain commercial partnering agreements with certain glucose pump manufacturers in the next 24 months. |
175
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
29. | POST BALANCE SHEET EVENTS |
Amendment and Restatement of Term Loan
176
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
30. | ACCOUNTING ESTIMATES AND JUDGEMENTS |
177
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
30. | ACCOUNTING ESTIMATES AND JUDGEMENTS (CONTINUED) |
• | Significant underperformance relative to expected historical or projected future operating results; |
• | Significant changes in the manner of our use of the acquired assets or the strategy for our overall business; |
• | Obsolescence of products; |
• | Significant decline in our stock price for a sustained period; and |
• | Our market capitalisation relative to net book value. |
178
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
30. | ACCOUNTING ESTIMATES AND JUDGEMENTS (CONTINUED) |
179
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
31. | GROUP UNDERTAKINGS |
Name and registered office | Principal activity | Principal Country of incorporation and operation | Group % holding | |||
Trinity Biotech Manufacturing Limited IDA Business Park, Bray County Wicklow, Ireland | Manufacture and sale of diagnostic test kits | Ireland | 100% | |||
Trinity Research Limited IDA Business Park, Bray County Wicklow, Ireland | Research and development | Ireland | 100% | |||
Trinity Biotech Manufacturing Services Limited IDA Business Park, Bray County Wicklow, Ireland | Dormant | Ireland | 100% | |||
Trinity Biotech Luxembourg Sarl 1, rue Bender, L-1229 Luxembourg | Investment and provision of financial services | Luxembourg | 100% | |||
Trinity Biotech Inc Girts Road, Jamestown, NY 14702, USA | Holding Company | U.S.A. | 100% | |||
Clark Laboratories Inc Trading as Trinity Biotech (USA) Girts Road, Jamestown NY14702, USA | Manufacture and sale of diagnostic test kits | U.S.A. | 100% | |||
Mardx Diagnostics Inc 5919 Farnsworth Court Carlsbad CA 92008, USA | Dormant | U.S.A. | 100% | |||
Biopool US Inc (trading as Trinity Biotech Distribution) Girts Road, Jamestown NY14702, USA | Sale of diagnostic test kits | U.S.A. | 100% | |||
Primus Corporation 4231 E 75th Terrace Kansas City, MO 64132, USA | Manufacture and sale of diagnostic test kits and instrumentation | U.S.A. | 100% |
180
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
31. | GROUP UNDERTAKINGS (CONTINUED) |
Name and registered office | Principal activity | Principal Country of | Group % holding | |||
Phoenix Bio-tech Corp. 1166 South Service Road West Oakville, ON L6L 5T7 Canada. | Dormant | Canada | 100% | |||
Fiomi Diagnostics Holding AB Dag Hammarskjöldsv 52A SE-752 37 Uppsala Sweden | Holding Company | Sweden | 100% | |||
Fiomi Diagnostics AB Dag Hammarskjöldsv 52A SE-752 37 Uppsala Sweden | Discontinued operation | Sweden | 100% | |||
Trinity Biotech Do Brasil Comercio e Importacao Ltda Rua Silva Bueno 1.660 – Cj. 101/102 Ipiranga Sao Paulo Brazil | Sale of diagnostic test kits | Brazil | 100% | |||
Trinity Biotech (UK) Ltd Mills and Reeve LLP Botanic House 100 Hills Road Cambridge, CB2 1PH United Kingdom | Sales & marketing activities | UK | 100% | |||
Immco Diagnostics Inc 60 Pineview Drive Buffalo NY 14228, USA | Manufacture and sale of autoimmune products and laboratory services | U.S.A. | 100% | |||
Nova Century Scientific Inc 5022 South Service Road Burlington Ontario Canada | Manufacture and sale of autoimmune products and infectious diseases | Canada | 100% | |||
Trinity Biotech Investment Ltd PO Box 309 Ugland House Grand Cayman KY1-1104 Cayman Islands | Investment and provision of financial services | Cayman Islands | 100% |
181
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
31. | GROUP UNDERTAKINGS (CONTINUED) |
Name and registered office | Principal activity | Principal Country of incorporation and operation | Group % holding | |||
Trib Biosensors Inc. 27700 S.W. 95th Avenue, Wilsonville, Oregon 97070, USA | Manufacturing, development, and sale of biosensors | USA | 100% | |||
Konamite Limited IDA Business Park, Bray County Wicklow, Ireland | Sales & marketing activities | Ireland | 100% | |||
Trinity Biotech Joint Venture Limited IDA Business Park, Bray County Wicklow, Ireland | Holding Company | Ireland | 100% |
32. | AUTHORISATION FOR ISSUE |
These Group consolidated financial statements were authorised for issue by the Board of Directors on April 30, 2024.
182
TRINITY BIOTECH PLC | ||
By | /s/ Mr John Gillard | |
Mr John Gillard | ||
Director/ | ||
Chief Executive Officer | ||
Date: April 30, 2024 | ||
By: | /s/ Mr Des Fitzgerald | |
Mr Des Fitzgerald | ||
Interim Chief Financial Officer | ||
Date: April 30, 2024 |
4.21 | |
4.22 | |
99.7 | |
101.INS | XBRL Instance Document (The instance document does not appear in the interactive data file because its XBRL tags are embedded within the Inline XBRL document). |
101.SCH | Inline XBRL Taxonomy Extension Schema Document. |
101.PRE | Inline XBRL Taxonomy Presentation Linkbase Document. |
101.CAL | Inline XBRL Taxonomy Calculation Linkbase Document. |
101.LAB | Inline XBRL Taxonomy Label Linkbase Document. |
101.DEF | Inline XBRL Taxonomy Extension Definition Linkbase Document. |
104 | Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101). |
185