First North announcement no. 17, 2008
Copenhagen, October 31, 2008
Quarterly announcement for the 3rd quarter of 2008
• Landmine plants sown in Serbia did not show the expected colour change
• Investment in mine-affected land is continuing - investment has been made in
two areas, four hectares in total
• Staff has been reduced as a result of the change in strategy
• The company has been granted a patent for the reporting technology
(BioSensor) in Australia
• As planned, the board of directors is working to raise additional capital
• The accounting figures for the first three quarters are in accordance with
the expectations
Sowing tobacco plants
The result of the sowing of transgenic tobacco plants at the test site in
Serbia is that no plants changed colour to red. As mentioned in previous
announcements, the result reflects the fact that the number of available
transgenic plant lines was limited.
In First North announcement no. 13-2008, the company announced that we had
estimated that it would take a minimum of a further two to three years to
produce an adequate number of plant lines to properly document the technology's
applicability and develop landmine plants commercially.
This, together with the declining market potential, was the basis for the
decision taken at the extraordinary general meeting to investigate the business
opportunities offered by the possibility of changing strategy and investing in
and developing mine-affected land in the Balkans.
Investment in mine-affected land in the Balkans
During the quarter, the company's subsidiary in Croatia has invested in
mine-affected land as part of ongoing pilot studies, and at the present time,
investment has been made in four hectares of land distributed on two
geographical areas. Further investments are anticipated during the final
quarter, involving partly the purchase of land, and partly mine clearing in the
areas purchased.
Adjustment of costs
The board of directors has decided to take the appropriate measures to adjust
company costs and create a secure financial base for future operations in the
form of a successfully implemented capital increase. This has meant that
employees who worked directly with the development of transgenic tobacco plants
were given notice at the end of the quarter.
Patent granted in Australia
The company has been granted a patent for the reporting technology (BioSensor)
in Australia, which the management regards as an important step in securing the
company's intellectual property. The company's ability to apply the technology
in areas other than simply landmine detection is protected by the patent, and
this protection therefore has a value in work going forward.
Plans for raising additional capital
At the extraordinary general meeting in September, the board of directors was
authorised to raise additional capital to secure the company's continuing
activities, as the liquidity in the company secures operations for a few months
into 2009, as previously announced in First North announcement no 13-2008.
Preparations for the raising of additional capital are being undertaken in
cooperation with the certified advisors, Dahl-Sørensen & Partners A/S.
Financial information - financial statements
The company's unaudited accounting figures for the period 1 January to 30
September 2008 appear in the attached document.
Results
The loss for the period of DKK 10.743m is in accordance with expectations.
The expectations for the full year remain a loss of DKK 16-18m. A possible
complete or partial write-down of consolidated goodwill at the end of the year
as a result of the reduction in biotechnological activities must be deducted
from this. As at 30 September 2008, consolidated goodwill is valued at DKK
13.35m.
The extent of the write-down depends on the content of the plans the board of
directors is working on in relation to raising additional capital, and the
financial basis that can be created for the continuation of activities.
Liquidity
Cash and cash equivalents amounted to DKK 14.1m at the end of the third quarter
of 2008 compared with DKK 23.2m on 31 December 2007.
Capital structure
In the near future, the company expects to submit plans for a capital increase
in order to strengthen its capital base.
Miscellaneous information
Share information
Aresa's share capital is listed on Nasdaq/OMX-First North. At the end of the
first half, the share price was 4.56 compared with 13.10 at the end of 2007.
During the first three quarters of 2008, 254,238 Aresa shares were traded at
Nasdaq/OMX-First North, of which the turnover in the third quarter was 153,357.
In accordance with s 29 of the Danish Securities Trading Act, the following
shareholders have informed Aresa that they own more than 5% of the company's
share capital:
• S-A invest A/S
• Carsten Meier
• Vækstfonden
• Forsknings- og innovationsstyrelsen
• Aps Falkenhøj
• Olav W. Hansen A/S
Own shares
The company owns 2,723 of its own shares, corresponding to 0.1% of the share
capital.
Warrant programme
In consequence of a resolution passed at the general meeting in March, the
board of directors has issued warrants to the employees and the executive
management corresponding to a total nominal amount of DKK 126,000. Part of the
issue is conditional on previously issued warrants not being exercised. At the
end of the first quarter of 2008, warrants were therefore issued for a total
nominal amount of DKK 193,000.
No further warrants were issued in the second or third quarter of 2008.
The current authority granted by the general meeting in March authorises the
board of directors to issue warrants for a further nominal amount of DKK
24,000.
Shareholdings of insiders
As at 30 June 2008 the members of the board of directors and the executive
management of Aresa hold, directly or indirectly, a total of 402,985 shares in
Aresa A/S, which is unchanged from the situation as at 30 June 2008.
The certified advisor and its relevant employees have no shareholdings in the
company.
Financial calendar
The announcement for the whole year (2008) is expected to be made on 27
February 2009.
For more information, please contact
Steen Thaarup
CEO
Phone: +45 7022 7747
Mobile: +45 4077 8695
E-mail: st@aresa.dk
The company's certified advisor is Dahl-Sørensen & Partners A/S, Allan Reimann,
tel: +45 3364 9205.
About Aresa
Aresa is a plant biotech company established in 2001 by the company's current
SSO, Carsten Meier. It originates from the Institute of Molecular Biology at
Copenhagen University.
Aresa focuses on the plant-based technology platform: BioSensor for the
detection of substances in soil, including leakage of explosives from
landmines.
Aresa was listed on the Nasdaq/OMX-First North in 2006. Aresa is based at
Symbion Science Park in Copenhagen and has greenhouse facilities on the
outskirts of Copenhagen and test sites in Denmark, Croatia and Serbia. Aresa
has 11 employees, 7 in research & development and 2 in landmine operations.
