Aptamer Group PLC (P0J.SG) Earnings Call Transcript & Summary

Good afternoon, and welcome to the Aptamer Group Plc investor presentation. [Operator Instructions]. The company may not be in a position to answer every question received during the meeting itself. However, the company can review all the questions submitted today and publish responses where it's appropriate to do so. Before we begin, I'd like to submit the following poll. I'd now like to hand you over to CEO, Arron Tolley. Good afternoon, sir.

Hello. Good afternoon, and welcome to Aptamer Group's full year results to June 30, 2025. And the presentation will be structured as an introduction to the presenting team, a recap on the technology for any new investors, finances, operational update and then a look towards the future. We'll then go on to some questions and answers. So please submit the questions as we go along. So I'll introduce myself first. So I'm the Co-Founder and CEO of Aptamer Group. I have PhD and a background in structural biology and biophysics, and I founded Aptamer Group in 2008 and built the infrastructure to start essentially trading the company in 2012. I've run the business for the past 12 years and guided it through a period of revenue growth subsequent IPO. I'm now focused on building the team to take the company through transition, developing licensable assets and focusing the company's technologies in areas where it is suited to solve niche high-value opportunities.

Good afternoon, everyone. I'm Andrew Rapson. I'm the CFO of Aptamer Group. I've got over 20 years of experience now as a chartered accountant. I joined Aptamer in August '22 and then took over the role of CFO in August '23, and I've now got just over 10 years of experience working in the AIM environment.

So thought we'd start with an overview of Aptamer Group. So we address a very large mature market with our proprietary platform, solving high-value problems for pharmaceutical companies and large biotech companies. We have a proprietary platform for the discovery of molecules called Optimer, and they're used essentially as alternatives to antibodies, which I'll come on to explain a bit later. We have relationships with all of the top 10 pharma companies and now 85% of the top 20 pharmaceutical companies. We have a very talented team of 30 people. 70% of the people within the team have Masters or PhD level qualifications, which is obviously a helpful requirement when operating in the biotechnology space. So over the last 10 years, we've built a reputation as a key global player in the Optimer space, if not the best custom solution developer globally for this technology. We are focused really on monetizing the platform in 3 areas. So fee-for-service for early-stage revenue, licensing technology for passive income through commercial exploitation of the assets that we develop. And we are also developing high-value therapeutic opportunities. And just some key metrics for this year. The first one is that we've increased revenue by 40% from last year. We've increased the number of licensable assets going from 4 to 11, and we've refined our data packs to make the proof of concept for the technologies to be used in therapeutic applications and initiated discussions with multiple big pharma companies to look at collaborations in that area. So we'll move on to just refresh and remind everybody what is an Optimer. So an Optimer is essentially a short strand of DNA or RNA. And these are isolated using our proprietary high-throughput automated process that are designed to develop molecules that can specifically recognize targets of interest. So Optimers have a flexible backbone. This allows them to bind to a large variety of different targets, and it solves a lot of problems that are inherent with antibody technology, such as we have better quality control, easier chemical modification, manufacturing to the kilogram scale is possible with these molecules, if needed for therapeutic uses that have lower immunogenicity profiles, meaning they're great for therapeutic use. Company-wise, we've got a strong patent portfolio, protecting our position all the way through from modified nucleotides all the way through to patents, protecting the manufacturing of certain variations of our product. And someone that I read at some point came up with a really good analogy that I will shamelessly steal here. But if you think of antibodies like handcrafted keys, our platform is equivalent to a digital key cutting machine. It's faster, cheaper and more capable of producing new and more complicated keys. Now the reason that this is important is because as more is understood about diseases, the "blocks" are getting more complicated. So demand for these next-generation keys will only grow as time goes forward. And this is why I think we have 85% of the top 20 pharma companies using our services. So let's just have a look at the market and where we fit in the market. So we operate in this really large, what's referred to as an affinity ligand market, $210 billion globally, in fact. And the affinity ligand is a term used to describe the type of molecule that can stick to another molecule. So antibodies are not the only players in this market. The market currently is and it was dominated by antibodies. But as I touched on earlier, about 50% of our antibodies fail to perform as expected. They're expensive and slow to develop. So there's a need for alternative solutions. So since the, I would say, the late '80s and early '90s, various different alternative platforms have emerged. So if you look on the slide, if you look at Abcam on the left-hand side, who focus mainly on traditional antibodies, all the way through to Argenx, Molecular Partners, PeptiDream, Bicycle Therapeutics, all having different variations on antibody or binder type technologies all the way through from recombinant antibodies through to various different types of protein scaffolds through to what's referred to as macrocyclic peptides and then on to Optimer and Aptamer technology, which are essentially nucleic acid-based binders. So we're a platform tech company. We followed a traditional platform tech approach solving problems, proving the market and then focusing on niche areas where the technology excels, which is what we're hyper focusing on now. And as you can see, some of the platform companies on the slide here, hitting the right therapeutic indication and reaching the $1 billion valuation level. So to put this into context, there's around 500-plus antibody-related companies in the market. So there's a lot of noise. Over 100 of those are involved in therapeutic development with around 500 antibodies in trials. Conversely, there are a few dozen aptamer companies. There's an increasing amount of activity in clinical trial -- clinical trials with aptamers as people are exploring aptamer-based therapeutics. In fact, if people are ever questioning if there's an interest to buy big players in aptamers like 2023, Astellas Pharma acquired Iveric Bio for $6 billion, and that was actually an aptamer-based technology. As a company and where we fit into this, we are globally recognized as a key player in the space. It's a less crowded space than with antibodies. And as we work to develop data packs and evidence that the binders that we're generating and the molecules we're generating can be used for gene therapy delivery. And with the recent RNS now, we're looking at developing radiopharmaceutical delivery, we're taking advantage of the unique properties of these molecules to leverage therapeutic partnerships. So we feel that we're at pretty much a good value inflection point as a company and as a business. So moving on to look a bit more in detail at our company. So as we know, these Optimers affinity ligands or these keys, we're developing as alternatives to antibodies. We're paid on a fee-for-service basis for solving these problems, often unsolved problems for our clients. And we generate revenues solving these problems in 3 broad areas. So first, on the bottom left-hand side is critical reagents. So these are molecules that are used as quality control tools in developing assays for drug discovery and basically ancillary and support reagents, very important reagents and batch-to-batch variability here is really key because if you're developing a drug and you require a critical reagent, you need to make sure that through the lifetime of drug development that, that reagent performs the same every single time. And that's why we're picking up a lot of work and interest in our molecules. We're also looking at the application of aptamers in diagnostics. This is where you would use an aptamer to develop, say, a lateral flow device for the detection of things like COVID or other various things that you would like to detect through standard diagnostic applications. And we've got loads of data that demonstrates aptamers can be used and replace antibodies in a variety of different platforms. And then finally, we're looking at using aptamers in the therapeutic space as delivery vehicles. And quite interestingly, the fourth application area, which I've mentioned several times before, came a bit left the field is using the technology in the deodorant space or the cosmetic application area. So the business model has 3 strands, generating revenue through fee-for-service, generating IP from those provision of services and eventually hoping that, that will lead to passive revenue streams from licensing royalties and then we're planning to partner in key therapeutic areas. So I'll quickly go through a couple of examples of where this model has worked and it's turned into imminent licensing opportunities for the company. So the first one here is an example of some optimist that we generated to folic acid. So you can see on the right-hand side of the slide that you have multiple different variations of folic acid. And the one at the top is the one that's usually fortified and added to food products. So this data generally shows that the aptamers that we've developed can recognize folic acid when compared to other versions of folic acid or its derivatives, which is down to the fact that aptamers can be highly selective. No antibodies have been able to do this as far as we are aware. And that puts us in a position to negotiate to license these molecules, which we are currently doing with the global foundation. Now the reason we're doing this is because across the world, there are multiple food fortification programs. That essentially aim to add folate to various different food stuffs in order to make sure that folic acid levels are high, particularly in pregnant women due to the fact that the lack of folate can lead to what's referred to as neural tube defects that can cause babies to have spina bifida. So this is a really important project for us and getting this technology out there into the market to solve real-world problems is very important. The second area is an area that's referred to as enzyme modulation. So this is quite complicated area. But broadly speaking, if you think about what's referred to as PCR enzymes, these enzymes are multi -- key to multibillion-dollar PCR market. So if you remember during COVID times, the original tests were PCR-based tests. And these are essentially molecular diagnostics that have these enzymes at the core of that. So being able to modulate enzyme activity in this area can improve the diagnostic applications and improve the performance of these molecules. So we're currently negotiating multiple licenses for molecules that we've developed that can perturb and modulate these PPR-related enzymes. The second area is the project with Unilever, which we've had applications in cosmetics. So what happened here is we were asked to generate binders that could recognize and penetrate odor causing bacteria that lived in sweaty areas on the human body. And the project was to generate binders that recognize the bacteria, penetrate the bacteria and then bind to these enzymes and modulate the enzymatic activity that could turn off that pathway in bacteria to effectively shut off the ability for your body to produce body odor or more accurately the bacteria to produce body odor. So obviously, if this is commercialized, it will be a significant value inflection point for the company, generating passive income and be a real good validation for the platform. So thirdly, I'll move on to an example in targeted therapeutics, which is where the real high value is -- so currently, we decided to focus on liver. And the reason for this is liver is a hot area with multiple big pharmaceutical companies interested in solutions for delivery to the liver. There's around 2 million deaths per year from liver disease, and it's the only major disease where death rates are currently rising. And interestingly, there's only one licensed treatment for liver fibrosis. So there's very high unmet needs. So traditionally, there's a molecule used called GalNAc, which is basically owned by a company called Alnylam in the U.S. Now this company is a big company. It's valued around $61 billion. And the basis of the technology is to deliver gene therapies to the liver. I mean Alnylam recently signed a deal with Roche in '23, $310 million upfront in payments with a total deal value of $2 billion. So transformative and enormous deals can be done in this particular space. The GalNAc targets what's referred to as the ASGPR receptor, which is a receptor that's highly expressed on liver cells, but it's not expressed on hepatic stellate cells, which are the primary drivers of liver fibrosis, meaning that the delivery technology that's primarily aimed at liver therapeutics does not target these types of cells. So there was a need for a delivery system to be developed to target drugs to fibrotic liver cells. And effectively, that's what we've done. We developed a technology that solves the problem and addresses a clear unmet need. We're currently in the preclinical stage of development. And the images on the slide that you can see there, effectively the top left-hand image that's titled fibrotic liver cells. That's essentially aptamers with a fluorescent marker attached to them binding selectively to fibrotic liver cells or cells that are representative of that. And you can see there's no binding to other cells or related cells in that kind of panel of different tissues. So we're currently in multiple discussions with pharmaceutical companies for potential licensing opportunities and opportunities to move that through preclinical development. So at this point, I'll pause and talk about the recent radiopharmaceutical announcement that we did. This is really important as a layer of differentiation for the company. It's another interest in the use of aptamers as delivery vehicles. In this situation, instead of delivering an siRNA or an antisense oligo, which is commonly associated with what we would do with liver technology. Here, we'll be looking to deliver radioactive particles essentially to cancer cells. And deals in this space can be similarly transformative. In 2023, Bicycle Therapeutics signed 2 deals, both with around GBP 50 million upfront and both with around 1.7 billion in downstream payments. And these were -- one was with Novartis. And Bicycle were focused on developing what's referred to as radio -- bicycle radio conjugates, and we are focused at the moment on developing our alternative to that, which is what we refer to as an Optimer radio conjugate. And we're aiming, obviously, for deals like the ones with Bicycle to create massive investor upside. So obviously, that's quite a lofty aspiration and one that we're confident that we can achieve. But while we're developing these relationships and the technology, the day-to-day running of the business, fee-for-service generation and generated licensable technology and generating passive income from that has to go on. So over the past 12 months, we've completed projects giving us an increase of 4 to 11 opportunities, many of which are in active discussions. And we're essentially focused on evolving these -- solving these practical problems, intractable problems and evolving all of the opportunities that we have for fee-for-service into licensable income. And there are several new success-based additions that have the potential to be added to this wheel, things like the project with Invizius that we've just signed, which is in the area of kidney disease, the radioligand project that we've just signed with a top 3 pharma company and there's a few other opportunities in critical reagents that we've just signed. So we may be pushing 11 to 15 different opportunities fairly quickly here based on success. So now that we've covered the background areas of focus for the company with some examples. I'll pass to Andrew now to go through the finances for the past year.

Thanks, Arron. So firstly, we'll take a look through the income statement and the cash flow. The revenue for the year was GBP 1.2 million. That's up 40% on the GBP 0.86 million reported in the prior period. We took forward much improved sales and production pipelines into this latest financial year, resulting in the increased revenue. We've continued to convert deals steadily throughout the year, continuing to focus on retaining IP to make the business more financially secure in the future. We've seen a strong mix of repeat business and new contracts, and we closed a series of new contracts in the final quarter, an element of which will roll over into the new financial year. This includes a couple of notable contracts. We're very pleased to agree a second fee-for-service contract with Unilever. For us, that demonstrates the value they've seen in the technology from the first project. We also have repeat business with a top 20 pharma partner, where we successfully retained the IP in a contract worth GBP 126,000 in fee-for-service revenue. In that case, target material was delivered quickly to us, which meant we recognized some revenue in FY '25 and the remainder will roll over into FY '26. And it's also worth noting we had a project with a top 5 pharma company that was signed in November '24, and that's progressed very successfully, resulting in a contract extension that we announced in August '25. The customers evaluated the Optimer in a parallel application, showing that the Optimer significantly outperforms all previously tested antibodies. As a result, the customers placed repeat orders of the Optimer to expand internal testing and evaluation of the technology. This developed Optimer will be used to support the current clinical drug development program. The increase in revenue resulted in an increase in margin. This is due to an element of cost of sales relating to staff costs. And for these costs, the increased revenue has been accommodated with staffing capacity rather than needing more staff. If we look on to administrative expenses, they reduced from GBP 3.2 million to GBP 2.9 million, which is a result of the continued focus on the lean cost base despite the wage and supply chain inflation. The current headcount reduced from 38 to 31 at the end of the year. We look at the cash flow and the net cash used in operations was GBP 1.9 million, and that's largely reflective of the adjusted EBITDA loss of GBP 2.2 million after adjusting for GBP 0.2 million of nonexecutive director fees paid in shares rather than cash. This outflow was funded by the fundraise completed in August '24 with net proceeds of GBP 2.6 million. And we closed the year with a cash balance of GBP 1.1 million. And shortly after year-end, we raised GBP 1.8 million net of expenses. I thought now we just have a quick look through the licensing progression. And FY '25 has been a significant year in terms of asset progression. As Arron has mentioned, we have significantly advanced the asset portfolio, starting the year with 4 assets in the licensing pipeline and concluding the year with 11. This is a significant step forward and demonstrates that technology has long-term value to customers. This is an area we've worked hard on over the last 2 years. Increasingly, we try and protect our position regarding IP generated from the fee-for-service projects. This means that securing fee-for-service contracts is slightly more difficult, and it gives us the ability to benefit from downstream commercialization through passive licensing revenue. We're particularly pleased that 2 of these assets have reached signed licensing terms during the period, one to NeuroBio in the development of an early Alzheimer's diagnosis test and the second to Glasgow University as a vaccine adjuvant. We now look forward to seeing how these customers progress the development of these assets into end-use applications. You can see on the table there, we've recently signed a development contract with a major multinational conglomerate to deliver Optimer FC for inclusion in immunohistochemistry kits. And this deal includes a 2% royalty on net sales from assay kits. At the bottom of the table, we show 3 late-stage legal review licensing deals for enzyme modulating Optimers. We had 2 customers that approached us separately early in the financial year with a view to carrying out fee-for-service work with their enzymes and both projects progressed very successfully. One of those customers then initiated a second enzyme project with us, and that has also progressed very well. So technology seems to perform very well in this setting, and we've now got 2 customers with whom we've agreed heads of terms and we're progressing through legal contracting with a view to licensing the technology. An exciting element for us as an early-stage company is the enzyme modulating Optimers are capable of being moved into a commercial setting very quickly, which means we could see Optimers incorporated into products very soon and consequently start generating royalty revenues from them. This has underscored our belief in the business strategy we've adopted to target retention of IP in the work we do, so that ultimately, we can benefit from the commercialization of any arising products. It's worth pointing out that this is not always possible to execute, but the majority of our fee-for-service projects now are executed in this manner and allow us to benefit from downstream commercialization. I'll just turn on to the balance sheet. The net assets at the end of the period were GBP 1.4 million compared to GBP 0.9 million for June '24. The cash position at the end of the year was GBP 1.1 million, and we raised a further GBP 1.8 million net of expenses shortly after the year-end. So at the end of July, we had a cash balance of GBP 2.7 million. And we expect the overhead to be just over GBP 3 million for FY '26. So we expect the current cash to last us into 2027. We had strong support for the fund raise this time around, which is oversubscribed and puts us in a much stronger position to execute our plans over the near term. Other items on the balance sheet, we saw a slight rise in trade receivables, and that reflects the 3 significant contract wins in the final quarter as we got those projects underway and started recognizing revenue. The tax receivable is GBP 43,000 lower than last year. That's due to updated R&D credit scheme -- tax credit scheme, which is now slightly reduced from where it was in the prior period. There was no CGU impairment in this period or the prior, but there's a slight increase in the intangibles, and that's due to the patent costs relating to some of the assets that we've already touched on. So a quick look at the post-period review. So we -- as we mentioned, we successfully raised GBP 1.8 million, and there's 5 key areas that we're looking to deploy funds from that fundraise. One is asset licensing negotiations. So as we touched on, we've got a number of assets that are going through legal contracting. And these processes include supply due diligence and testing, and they can be quite lengthy. And so ensuring we have financial stability to complete these negotiations and onboarding processes is key to us getting a good outcome. Aligned with that is manufacturing investment. So as a company to date, we've only provided Optimers to customers for research and development. If we get to a point of signing commercial agreements for licensing, we'll be able -- we'll need to be able to upscale our production to produce commercial scale. And so we're reviewing that at the moment, and we're looking to invest if needed in it. So third area is advancing the liver fibrosis program and that requires investment in animal models as a next step. And if that was successful, this will open doors to other partner programs to assess the value of this technology as a delivery system. Along with the liver fibrosis work, we identified the biomarker and being able to identify biomarkers has gained strong interest at industry conferences and has the potential to become a revenue-generating service for us in its own rate. And indeed, we did launch this as a service post year-end. And then lastly, we would like to look at AI and machine learning. We have a huge amount of data here in the company, and we feel that we can leverage that to more efficiently select and predict Optimers. The speed of development in this particular area is significant and being able to leverage a database like ours could differentiate our service offering. We've seen strong commercial momentum post period. We've made a number of positive announcements on fee-for-service contract wins over the last couple of months. We now have GBP 1.14 million in contracts signed, which are at various stages of progression through the lab and that we'll look to recognize throughout FY '26. This is a good place to be with over 2/3 of the year remaining, with which to add further contracts from the GBP 3.3 million pipeline and be able to start recognizing revenue in this financial year. Indeed, we have a number of contracts in negotiation, which are at late stage, and we look forward to updating you on those in due course. We've won a particularly significant contract with a top 3 pharma to develop Optimers for targeted radiopharmaceuticals worth GBP 360,000. Again, this is another contract that has the benefit of downstream value should we be able to deliver a working binder and the partner look to commercialize it. Both the top 10 and top 5 pharma company partnerships are repeat business, which encouragingly is starting to show the value that these large companies are starting to place in this technology. Both projects have followed successful projects earlier in FY '25. As part of the liver fibrosis program, we've successfully identified the biomarkers I mentioned, and we're now pleased that we've managed to launch that as a service offering. And we've seen expansion of licensing opportunities, one with a global health organization looking to license our folate binder and the 2 companies that I've already mentioned looking to license the enzyme modulating Optimers. Each of these potential licenses have the ability to generate revenue in the near term, particularly the enzyme modulated Optimers. So we could see passive royalty revenue from those products if they can be commercialized quickly. So that gives you a quick overview of the post-period highlights. I'll now hand back to Arron to talk more about the investment case.

Okay. Thank you, Andrew. So one of the key things to take from this is that we're delivering cash flow at the moment. We're creating value for short and medium and long term. And we're doing this in these 3 broad areas. So I'm just going to cover an overview of these areas and what we're planning to do. So the first area is the fee-for-service helps to contribute towards costs, builds assets to license. We've increased 40% from last year. So far, we have around GBP 800,000 in new contracts layering on top of GBP 350,000 in deferred income from last year. So we have visibility of total contract value of around GBP 1.15 million just out of quarter 1. We've built a GBP 3.3 million pipeline over the last 18 months that's now beginning to convert with around GBP 1 million in late-stage discussions. We've also launched, as Andrew touched on, this new biomarker ID service, and we have existing interest in the pipeline already within the first couple of days of launching, we've had inquiries into the pipeline. This year, we're going to continue to build and expand the pipeline, close opportunities and convert them through to licensing. So then we're going to focus on the existing pipeline of assets. So the general concept here as we've already touched on is to generate passive income to support medium and long-term revenue over the life cycle of these assets with revenue layering on as licenses come in and start to pay. We've increased the portfolio up to 11 assets, and we have multiple opportunities in late-stage negotiation. Andrew mentioned the word soon in his section. But on Signature, we would expect to generate some licensing revenue. And we would hope that we will be able to generate some modest licensing revenue in this financial year should those contracts come to fruition. This year, we'll focus on completing these transactions and getting more of those 11 opportunities signed and starting to build these licensing revenue streams. The third area effectively is underpinned by areas 1 and 2. This is the therapeutic development area. And here, we will focus over the next 12 months to develop more data packs that will give us much more capability to position ourselves for these higher-value opportunities. Now if you look at the work we've done in liver delivery technology, we've already got good what's referred to as in vitro data, and we look to get in vivo data by putting the molecules that we've developed into animals. So we will also this year diversify into looking at radiopharmaceuticals. We already have one partnered asset with a top 3 pharmaceutical company, which means there is a potential outlay for that technology or an outlet for the technology should it be successful. And we also have on our Scientific Advisory Board, people experienced in radiopharmaceuticals. That's not by any accident because we know that the technology is well suited to this application area, and we've been working on this over the past 12 months. So we're going to be looking at also generating some internal data sets. Underpinning all of this really is the application areas in AI and machine learning. So as we go through all of these different technology developments, we will obviously generate data, and we will be curating and preparing the data ready for application in these machine learning tools. So we're currently in the process of recruiting and building that expertise within the company. So I'd like to leave really the presentation with 4 key take-home messages. So the first one is our platform is targeting this big $210 billion market. We have established relationships with 85% of the top 20 companies, and we're getting repeat business as we prove the technology platform has high value. Secondly, we are diversifying our asset portfolio with a mixture of licensing opportunities representing short, medium and long-term revenue and also value. Last year, we said we would move licensing opportunities forward, and that's what we've done. We've taken that from 4 to 11 in the past 12 months. Thirdly, we will continue to focus on securing intellectual property-based positions where we can have licensing and royalty revenues from the successfully developed solutions. This is particularly important in the potential application for therapeutics where the upside can be pretty tremendous if we deliver successful molecules. And fourthly, just to point out that we are funded and we have underpinning revenue streams and potentially in the short-ish term, licensing that can start to layer on. So we've got the foundations. We've got the relationships with the big pharma companies, and we've got a platform for growth. I think we've successfully reshaped and improved the business over the last 12 months, and we continue to work very hard to deliver opportunities, news flow and progress for the shareholders. So we're looking forward essentially to keeping you updated with exciting news and updates. So that concludes the presentation, and thank you very much for your time, and we'll now move on to questions.

Arron, Andrew, thank you very much for your presentation this afternoon. [Operator Instructions]. And if I may just start off with the first question here, which reads as follows. With the amount of new contract opportunities rising, do you plan to increase staff headcount? Or is it containable within your present staffing levels?

Take that one, Arron?

Yes. I mean, as I mentioned in the, it's a, one-line throwaway comment that we essentially, our technology is based on high throughput liquid handling robots. So with a, staff base of around 30 people, we have more than enough capacity to generate binders and increase revenue within the company.

The next question here reads, in July your RNS states enough cash to last till 2027. Is this still the case?

Yes. Yes, so we've made no changes from that announcement that we made in July. Yes, we had GBP 2.7 million of cash at the end of July. We're running with a cost base of around GBP 3 million, just over GBP 3 million. So even with no revenue that sees us through another year, but revenue projections are quite good given the contract closing that we've seen over the last few weeks. So yes, we've still got a focus going through to 2027. It's worth bearing in mind as well that these financial statements have just gone out. The auditors have been in. They've effectively agreed with the going concern assumption, which requires stress testing downside scenarios and being able to agree that we've got at least 12 months of visibility on cash runway. Yes, so there's nothing that's changed from what we said in July there.

That's great. Just moving on here. What are the key drivers behind the 40% revenue growth this year?

So we started the year strongly. We took forward a much stronger pipeline, both in sales and production. The prior year had seen us rebuild those pipelines, and so that contributed to most of the revenue growth this year. We've maintained the good momentum in deal closure. As we've been updating on over recent weeks, we still have a pipeline of GBP 3.3 million, and that includes circa GBP 1 million of late-stage deals. And we've got GBP 1.14 million of contracts that are now signed, and we're looking to recognize those throughout FY '26.

Perfect. With adjusted EBITDA losses narrowing to GBP 2.2 million, when do you believe you will reach breakeven or generate positive cash flow?

So that's hard to say. We are continuing to focus on building the fee-for-service side of the business. And really, one of our main focuses over the current period is to start getting some licensing agreements in place. You could see from the update we've just given that they're progressing well. We've increased the number of assets and some of those are progressing quite well. We signed 2 deals in the period. But the ones that we talked about recently post period, one with the Global Health Organization, a couple for enzyme modulating optimers have the potential for near-term revenues. Licensing deals by their nature are much higher margin than the fee-for-service work. So that just brings closer to that breakeven point, makes it more achievable. So that's our focus for the current period.

Just turning to the next question here. How much of the GBP 3.3 million sales pipeline is near-term contracts versus longer-term opportunities?

Do you want to take that, Arron?

Yes, it's no problem. So typically, it can take anywhere between a couple of months through to maybe 6 to 9 months to fully go through the contracting process. Now we've been rebuilding the pipeline for 18 months. So we have projects and opportunities that are in various stages of close. The ones that are in the late stage, which is what we would define as likely to close within the next 1 to 3 months is around GBP 1 million out of that GBP 3.3 million. But obviously, as we go forward in time, more of that pipeline will be replenished at the top end and more of it will move through. So hopefully, we're in a position now where we can start more regularly closing opportunities out of the pipeline.

Thank you. Of the 11 licensable Optimer assets, which are expected to generate near-term royalty or licensing income?

Well, yes, I think I just touched on this in one of my answers. But the enzyme-modulating optimers, we've got 3 of those that we've developed for the 2 companies that I talked about. They've both performed well. We've got heads of terms in place there and both companies have indicated a want to license those assets. So they look nearer term as does the folate binder that we're discussing with the Global Health Organization. I think they are our best opportunities for near-term licensing revenue.

Just turning to the next question. The recent top 3 pharma contracts on radiopharmaceuticals suggest diversification into therapeutics and oncology. Is this now a key strategic focus area?

Yes, I would say it absolutely is, given the kind of references I made to the potential deal values and unmet needs within these particular market areas, I think our platform is well positioned to take advantage of its unique properties to enable us to move into that space. So that will be almost certainly a key area of focus for us, both in gene therapy delivery and also radionuclide delivery over the next 12 months and going forward.

Perfect. The fibroptic liver delivery vehicle showed the reversal of scarring in lab tests. What are the next preclinical milestones? And what is the commercial potential?

So the next preclinical milestone. So we've done everything that we can do broadly in an in vitro setting, which means in a test tube. So we've done all of the cell-based assays pro proven, phenotype reversal, which is what that's referred to, to show that we can take cells that have become activated such that they show fibrotic phenotypes, and then we can reverse that by the "delivery" of these SiRNA constructs. So the next phase of development would be to demonstrate this functionality in an animal-based model. So we're currently in discussions with providers of services that can do that and also looking at partnerships with pharma companies who would like to evaluate that technology within their own animal models. In terms of value inflection points and value for the companies, I think value for the opportunity. If you look at any of these kind of opportunities, they come with potential for multiple tens of millions in downstream -- in kind of research fees and potentially hundreds of millions of downstream payments if you can demonstrate the correct functionality and efficacy of the molecules. So I think we stand as good a chance as any pivoting into this particular space.

The next question we have here reads, can you provide updates on the advanced licensing negotiations for the enzyme-modulating Optimer assets and expected timing of deal completions?

So yes, I think, again, I have probably covered this a little bit. So those deals, obviously, we're working through the licensing and working through the structure of those deals. This is a, this will be a new type of deal for us. It will require us to supply and as I mentioned, with the use of proceeds, it requires us to be able to manufacture. So there'll be an element of supply agreement as well as having some sort of royalty basis to these agreements as well. In terms of the timing of the deals, it's hard to say. These have progressed really well. Like I say, we've progressed through heads of terms. We're now in contracting. We've had -- with one of the customers, we've had several terms of licensing terms that we've been through. So yes, they're reasonably advanced, but I'm not sure exactly when they will complete. Hopefully, it's within weeks to months rather than years.

The next question we have here reads, what early traction have you seen for the new biomarker discovery service? And how material could this be to the future revenue?

That's a good question. When we launched the service a while back, within the first 2 days, we had 2 or 3 opportunities that come into the pipeline just on the kind of announcement of the -- of it. That -- those are now working their way through the pipeline. For me, it's additional revenue that wouldn't necessarily have been planned. In terms of value for the projects, you can do a quick Google search yourself. So I'm not providing any guidance on the kind of size of deals for biomarker discovery. I think the big value is in the identification of novel biomarkers for novel application areas. Those can have significant values attached to them. So potentially, it could generate reasonably good additional revenue for the company for the fee-for-service side of things. But again, the big upside for it is the ownership and the licensing of the intellectual property on those biomarkers, particularly if they turn out to be novel or, for example, functional as a gateway for a drug delivery application.

If the on-person testing with Unilever is successful, what kind of commercial milestones or royalties are linked to the Optimer deodorants?

That's a good question, and it's one we would love to know the answer to. At the moment, we are in the process of going through the on-skin safety studies with Unilever. Assuming success, we will be going through a process of manufacturability, which is kind of how you would prepare the Optimers for application in deodorant products or other products. And at that point, we would start to discuss the BD terms. So I would hope that they would be pretty transformative to the company.

With headcount reduced to 30, how are you maintaining the capacity to deliver multiple commercial and R&D programs?

Again, that goes back to the question previously with our high-throughput liquid handling robots. And I think at the moment, we've got a potential with the current contracting. There's quite a lot of work coming in and that will be done over the next several months. So we're looking at how we can maximize the use of automation internally to get more throughput out of the existing people. So automating things that are currently done manually outside of the existing automation processes. So what we would hope to be able to do there is increase bandwidth to handle more projects at once with the existing staff. It's just not been necessary to do that up until this point.

Just turning to the next question. Will you retain IP ownership of all future Optimer licensing deals?

Yes, that's again, a very good question. We -- it's important to clarify ownership and the ability to generate revenue. So from downstream commercialization. So not every single opportunity, we will own the intellectual property. So in some cases, we may sign an agreement where the intellectual property is transferred to the customer, but it's not able to be commercialized unless market fair commercial terms have arrived at. But in general, the position that we start out at is that we retain intellectual property and everything that we do, and we offer fee-for-service kind of research services and the molecules that are developed are our IP.

How is AI and machine learning being incorporated into the discovery process? And is this expected to materially shorten development time lines? So...

This is quite a complicated question to answer. A lot of existing molecules that are considered to be undruggable or what's referred to as RNA binding proteins or nucleic acid binding proteins. So if you look at things like KRAS or I believe TDP43, these are a couple of examples of target proteins that current technologies will be trying to drug those molecules with antibodies or small molecules. Now if they're a natural nucleic acid binding molecule, it makes sense to me that a protein or a small molecule wouldn't be a natural bedfellow for that if you're looking at modulating activity. Our platform is based on nucleic acids. So they're obviously a better molecule for modulating or interfering with RNA binding proteins. We've got 15 years of data associated with interactions between nucleic acids and proteins. So collating and curating all of that data into a data set that can then be uploaded and analyzed through machine learning tools is pretty key essentially to adding value. Once we've done that, though, we'll be able to understand much more deeply how nucleic acids and proteins interact and how better to design aptamers. So what we would hope is not only would it shorten the development process, but it would also lead to much better quality molecules for drugging particular targets. So that would obviously come with a requisite increase in value and therefore, revenue into the company. So I hope that explains it.

That's great. Who are your main competitors? And what is your competitive advantage against them?

That's a good question. There are a number of companies all over the world. As I mentioned earlier, there's a handful of aptamer companies around 20. I won't mention particular names for obvious reasons. But our USP as a company, I suppose, is that we have automated the selection process. We've got 15 years experience in developing binders to various types of targets and whereas a lot of our competitors will only have one process for generating binders. We have 3 very, very different processes for isolating binders to different molecule classes, all of which are automated with high quality. And I think it will be fair to say that where our customers have gone to competitors in the past, we have very often picked up projects that have failed with other companies have been successful or our competitors have failed, which is what leads me to believe that we're the best out there for customer development and why we have 85% of the top 20 pharma companies as our partners.

When do you expect license income to pick up substantially?

I can take this one, Arron. So I think we've touched on we're at near stages with some of the licensing of assets that we think have near-term revenue potential. So I guess, this current financial year will be -- will give us a good indication of when that sort of licensing revenue will materialize. Clearly, we will be keen to make everyone aware when we start getting revenues from licensing of assets. But yes, we hope that's going to be in the near term.

Just moving on here. Can you say what percentage of turnover is attributed to licensing fees and royalties?

So at the moment, we haven't got any revenues from royalties from license fees. We have a small amount for production, if you like, for synthesis of binders but most of our revenue comes from fee-for-service contracts at this stage. This is our strategy now to start monetizing some of those assets that we've managed to retain IP on, and that's been our focus really for the last sort of 18 months to 2 years to get us in this position where we can start generating licensing fees because it's more passive income, and that will just help to get us to a point where we can get to breakeven and beyond and really shows the value of the technology.

And just turning on to the final question here. The licensing deal with Glasgow University was announced some time ago. When do you expect to receive first income from this deal?

Do you want that, Arron?

Yes. So that's an interesting question. So for us, as far as we are aware, we would be expecting commercialization of that over the next 12 months and that's pretty much what I understand to be the situation. I believe the University of Glasgow during the development of that already had a commercial partner, and they're working through the processes of commercialization as we speak.

That's great. Arron, Andrew, thank you for answering all those questions you have from investors. And of course, the company can review all questions submitted today, and we'll publish those responses on the Investor Meet Company platform. Just before redirecting investors to provide you with their feedback, which is particularly important to the company, Arron, could I please just ask you for a few closing comments?

Yes. I would just like to say thank you for taking the time to listen to the presentation, and thank you for your support and staying with the company and effectively being a good solid shareholder base.

Arron, Andrew, thank you for updating investors today. Can I please ask investors not to close this session as you'll now be automatically redirected to provide your feedback in order that the management team can better understand your views and expectations. This will only take a few moments to complete, and I'm sure will be greatly valued by the company. On behalf of the management team of Aptamer Group Plc, we'd like to thank you for attending today's presentation, and good afternoon to you all.