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Unaudited Preliminary Results for the Year Ended December 31, 2025
LONDON and PHILADELPHIA, May 19, 2026 (GLOBE NEWSWIRE) -- Avacta Therapeutics (AIM: AVCT, “the Company”, “Avacta”), a clinical stage biopharmaceutical company developing pre|CISION, a tumor-activated oncology delivery platform today published its unaudited preliminary results for the 12 months ended December 31, 2025 ("FY25").
FY25 Highlights
Research & Development (R&D) Highlights
- Increased momentum and strengthened position as a pure-play oncology biopharmaceutical company by focusing on the Company’s unique proprietary pre|CISION® peptide drug conjugate platform, with significant progress in R&D programs
- Gen Two (AVA6103):
- First patient received treatment in FOCUS-01, a multicenter, open-label Phase 1 clinical trial of AVA6103 (FAP-Exd, pre|CISION®-enabled exatecan) - March 2026.
- The FOCUS-01 trial is enrolling patients with six advanced cancers that were selected by leveraging our strategic collaboration with Tempus AI
- Presented highly favorable data from multiple preclinical studies compared to successful antibody drug conjugate, Enhertu®. Also presented further data comparing with another successful antibody drug conjugate, Datroway®.
- Updated preclinical and translational data presented at the American Association of Cancer Research (AACR) Annual Congress in San Diego in April 2026
- Gen One (AVA6000):
- Reported highly encouraging efficacy and safety data from patients with salivary gland cancer.
- Program continued to enroll patients in the Phase 1b trial to assess the efficacy of AVA6000 (Faridoxorubicin, pre|CISION®-enabled doxorubicin) in more homogenous, defined patient populations.
- Positive Health Authority interactions resulted in the lifting of lifetime maximum dose due to highly favorable cardiac safety and agreement on dose selection for subsequent trials.
- Gen Three (AVA6207):
- Demonstrated the dual payload technology incorporating the sustained release mechanism with multiple combinations of payloads with updated in vivo data presented at the AACR Annual Congress in San Diego in April 2026.
- Intellectual property (IP) portfolio continued to grow and gain momentum measured by increased IP filings. These include two important advances in the pre|CISION® IP estate:
- The sustained release mechanism of payload delivery and
- The dual payload mechanism of delivery allowing the precise delivery of two payloads.
Management and Board strengthening
- Appointment of Brian Hahn as Chief Financial Officer (non-Board) in January 2025.
- Appointment of Francis Wilson as Chief Scientific Officer in February 2026.
- Appointment of David Bryant and Richard Hughes as Non-Executive Directors of the Company in May 2025.
- Appointment of David Liebowitz as Chief Medical Officer in July 2025.
Financial
- Strengthened financial position to support our R&D programs.
- Raised £22.5 million in new equity from a broad range of existing and new investors and renegotiated the terms of the convertible bond
- March 2026 - completed oversubscribed placing and subscription raising £10 million - extending cash runway into Q1 2027
Cash and short-term deposit balances at December 31, 2025, of £16.9 million (31 December 2024: £12.9 million). As of April 30, 2026 cash held was £16.4 million
Outlook for 2026
- Initial clinical data in the AVA6103 program anticipated in late H2 2026.
- AVA6000 clinical data from the Phase 1a and 1b cohorts are expected in H1 2026 - including updated efficacy data in expansion cohorts, the lead indication of salivary gland cancer, and cardiac safety data which resulted in removal of lifetime maximum dose limit.
- Payload selection and clinical candidate selection in the Gen Three pre|CISION® Dual Payload program (AVA6207) are expected in H2 2026.
- Continuing discussions with multiple parties on potential partnering of first, second and third generation assets.
Christina Coughlin, MD, PhD, CEO of Avacta, commented,
“We have made great strides to strengthen our position as a pure-play oncology therapeutics company by focusing on our industry-leading technology pre|CISION®. Ahead of industry norm, we already have two programs in clinical development.
“Our pre|CISION® provides unique advantages, as we believe it is the only technology that is capable of delivering cancer treatment drugs directly to the tumor at the precise concentrations our payloads can achieve – and without triggering severe toxic side effects.
“Our portfolio is supported by strong and increasingly valuable intellectual property to protect our innovation. It continues to generate strong interest from multiple parties for potential commercial agreements. These could both generate revenue to support our development and broaden the application of our technology.
“Our strong financial position, having raised £32.5 million over the last 18 months, provides us with a cash runway into early Q1 2027 and through key value inflection points. This promises to be a transformative period for Avacta and our patients.”
For further information from Avacta, please contact:
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Avacta Group plc Christina Coughlin, Chief Executive Officer |
https://avacta.com/ via Cohesion Bureau |
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Strand Hanson Limited (Nominated Adviser) James Harris / Chris Raggett / James Dance |
www.strandhanson.co.uk |
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Zeus (Broker) James Hornigold / George Duxberry / Dominic King |
www.zeuscapital.co.uk |
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Cohesion Bureau Communications / Media / Investors Richard Jarvis |
avacta@cohesionbureau.com |
About Avacta - https://avacta.com/
Avacta Therapeutics is a clinical-stage life sciences company expanding the reach of highly potent cancer therapies through its proprietary pre|CISION® platform. pre|CISION® is a payload delivery system based on a tumor-specific protease (Fibroblast Activation Protein or FAP) that is designed to concentrate highly potent payloads in the tumor microenvironment while sparing normal tissues. Avacta’s innovative pre|CISION® peptide drug conjugates (PDC) are a novel entry to the XDC drug class, leveraging the success of antibody drug conjugates with alternative methods of delivery beyond antibodies.
Our pre|CISION® PDCs leverage this tumor-specific release mechanism to provide unique benefits over traditional antibody drug conjugates, releasing active payload in the tumor and reducing systemic exposure and toxicity which enables dosing to be optimized to deliver the best outcomes for patients. The lead clinical program is faridoxorubicin (AVA6000), a Gen One FAP-enabled pre|CISION® version of doxorubicin that delivers the payload directly in the tumor with limited peripheral blood exposure and has demonstrated preliminary activity in tumor types sensitive to doxorubicin including salivary gland cancer and soft tissue sarcoma.
About AVA6103 (FAP-Exd)
AVA6103 is the second clinical candidate and is based on the innovative pre|CISION® sustained release mechanism that provides for prolonged release of payload directly in the tumor, minimizing systemic exposure. AVA6103 is being evaluated in the FOCUS-01 Phase 1 trial (FAP-Exd in Oncologic Cancers with Unmet needS). Preclinical data suggest this approach has optimized payload delivery with a high intratumoral concentration and prolonged exposure of released payload in the tumor, coupled with limited systemic exposure to the released payload.
Chairman’s statement
Avacta has made great strides forward in 2025 and into 2026. The Company has developed into a pure-play therapeutics biotechnology force with two clinical stage programs, a developing pipeline of pre|CISION® medicines and a broadening IP portfolio that will drive value for patients and shareholders, boosted by raising £32.5 million over the last 18 months to support our R&D programs.
The Company has moved the numerous development initiatives forward faster than industry norms and has increasing confidence in the growing class of drugs in the peptide drug conjugate field – the combination of an oncology drug and our pre|CISION® peptide. The Board believes the pre|CISION®-enabled technology makes the drug conjugate model considerably more advantageous.
Avacta’s profile across the sector is now also gaining real momentum and it is in discussions with numerous parties over commercial partnering agreements which, if secured, will support the Company’s development as well as widen the scope to exploit its technologies.
Board and employees
In January 2025 Brian Hahn was appointed Chief Financial Officer (non-Board), in July of 2025 David Liebowitz was appointed Chief Medical Officer. In April 2025, Dr Trevor Nicholls retired and Mark Goldberg took over as Chair of the Remuneration Committee. In May 2025, David Bryant and Richard Hughes were appointed Non-Executive Directors.
On behalf of the Board, I would like to thank all our employees in the UK and the US. We have some of the leading international scientists in biotech, their expertise, creativity and commitment have enabled the business to move faster than expected and also drive numerous innovative developments.
The delivery from concept to IND application (Investigational New Drug – the submission to the US Food and Drug Administration) for the AVA6103 program in less than 12 months from candidate selection is a strong illustration of the team’s capabilities. A second example is the innovative use of AI to recreate a synthetic comparator arm which allows a direct comparison of the AVA6103 data with the published data of other oncology drugs, Enhertu® and Datroway®, rather than repeating their experiments in-house.
Outlook
As I stated last year, Avacta has a clear value proposition and world-class scientific capabilities. It is supported by robust data and an innovative platform.
The coming 9-12 months are crucial for the Company as we anticipate seeing the first evidence of the real potential for our innovative Gen Two pre|CISION® platform from our exatecan program, AVA6103.
Clinical testing has now started in the AVA6103 program based on the sustained release delivery mechanism and we expect initial evidence in late H2 2026. This innovation opens up the full potential for the platform by enabling multiple payloads to be delivered as either single or dual platforms, driving value for both patients and shareholders alike
We expect multiple data updates in the AVA6000 program in all groups from the Phase 1b expansion cohorts, in H1 2026.
Our team continues to explore multiple commercial opportunities with potential strategic partners. Our new data in both clinical programs are anticipated to be significant advances in moving these ongoing conversations forward.
Shaun Chilton,
Chairman
Chief Executive Officer’s statement
Overview
Avacta is making excellent progress and gaining real momentum as we invest in and develop our unique proprietary industry-leading protein-drug conjugate technology platform, pre|CISION®.
We are building a substantial portfolio of related intellectual property (IP) and currently have two programs in clinical development, our lead candidate AVA6000 (faridoxorubicin) and our Gen Two sustained release program, AVA6103 (FAP-Exd).
The Company raised £22.5 million in equity during 2025 to support our investment programs which was supplemented by the recent raise of a further £10 million in March 2026, meaning that Avacta now has cash resources to support its development until early Q1 2027.
pre|CISION® is a highly innovative, versatile and unique platform, through which we are seeking to deliver clinical results across our two lead programs.
Vision and strategy
Our vision Is to conquer cancer with existing therapies while preserving patient vitality and healing. In a world where effective cancer therapy often means a difficult trade-off between efficacy and safety, pre|CISION® has the potential to offer something different: Hope without compromise.
Our strategy is to develop and ultimately commercialize a broad portfolio of drugs, based on the ability of pre|CISION® technology to repurpose a range of oncology drugs to significantly reduce toxicity and side effects by concentrating the payload in the tumor, and so improving efficacy and patient tolerability.
We are challenging the current drug delivery methods with the goal of expanding the reach of high potent anticancer therapies. In principle, if applied to all patients whose tumors overexpress fibroblast activation protein (FAP), a common tumor-associated protein, our approach could ultimately lead to treatments for nearly all patients across a wide range of cancers.
A unique approach to treating cancer - our proprietary technology pre|CISION®
A key challenge in oncology is that it is the most effective therapies which cause the most toxicity in normal tissues. Our approach leverages existing cancer drugs that are delivered precisely to the tumor using our proprietary pre|CISION® platform.
The key aspect of our pre|CISION® peptide drug conjugate (PDC) technology is that the conjugated drug (the combination of the oncology drug and our peptide) is inert. Our innovative technology links a dipeptide to an existing cancer drug to inactivate it. It is incapable of entering cells and killing, until the peptide is specifically released when it comes into contact with FAP, in or near the tumor.
Our platform is based on a highly successful drug class in oncology, known as the antibody drug conjugate or ADC. The ADC delivery mechanism was founded on the premise that an antibody directed at a tumor antigen can deposit or release a highly potent payload in the tumor. Our platform seeks to move this premise further by creating a highly selective release mechanism that leverages a key tumor-specific enzyme, FAP. Antibodies are comprised of 1300-1400 amino acids, whereas the pre|CISION® peptide contains only 2 amino acids, resulting in better tumor penetration, higher maximal concentrations of released payload and simpler, less expensive manufacturing for use in patients.
When a pre|CISION® PDC encounters FAP in the tumor microenvironment (TME), the peptide is cleaved and active payload is released. The release of the payload from the pre|CISION® product in the TME results in higher concentration of the drug at the tumor and lower blood and healthy tissue levels than would be achievable with standard systemic administration. Our pre|CISION® technology is designed to concentrate the active drug in the tumor while maintaining the inactive pre|CISION®-enabled drug in the bloodstream.
Our clinical data with the first pre|CISION® medicine AVA6000 demonstrates that pre|CISION® is capable of delivering higher drug levels within tumors which will lead to improved antitumor activity while reducing systemic toxicities. This will dramatically widen the all-important therapeutic index and efficacy of a given anticancer drug.
Therapeutic index (TI) is a quantitative measurement of a drug’s relative safety, comparing the dose that produces a toxic effect to the dose that produces a desired, effective response. A higher TI indicates a wider, safer margin between effectiveness and toxicity.
In addition to the impact on the TI with our newly developed sustained release mechanism, we have demonstrated that pre|CISION® is also capable of delivering improved release kineticsthe rate and mechanism of active pharmaceutical ingredients exiting a formulation, which is crucial for optimizing therapeutic efficacy. This addresses issues associated with the pharmacokinetics (how the body interacts with a drug throughout its exposure) of an agent in the clinic in addition to the impact on the TI.
Additionally, our pre|CISION® platform has been demonstrated to have four key advantages over the ADC drug class:
- tumor-specific release leading to very low peripheral exposure to the payload;
- rapid tumor penetration and release of payload with demonstrated higher maximal tumor concentration;
- an optimized bystander effect, allowing effective killing of antigen (FAP)-negative tumor cells; and
- a large market opportunity based on FAP expression noted in 90% of solid tumors and the ability to link multiple payloads to the pre|CISION® peptide
We believe there are no other technologies that can deliver cancer treatment drugs directly into the tumor at the concentrations that our payloads enable without causing highly toxic side effects.
Our strategic collaboration with Tempus, a technology company leading the adoption of artificial intelligence to advance precision medicine and patient care, has also enabled us to better understand the large addressable patient population for the full suite of pre|CISION® medicines.
Opportunities and business development
The recent advances in our R&D are allowing us to “pre|CISION®-enable" a number of different therapies. We now believe that some 90% of solid tumors are potentially treatable by our pre|CISION® platform, as demonstrated by multiple indications across a wide range of solid tumors.
Our IP portfolio continued to grow and gain momentum measured by increased IP filings, including two important advances in the pre|CISION® IP estate:
- the sustained release mechanism of payload delivery piloted in our AVA6103 program, and
- our dual payload mechanism of delivery allowing the precise delivery of two payloads to the tumor from a single FAP cleavage event with our pre|CISION® technology.
These advances have led to new and increasingly valuable IP being developed around our foundational pre|CISION® technology, the Company’s most valuable asset. The advances we have made in the last year and a half are remarkable and open up a wealth of opportunities for the platform, both with single-agent delivery mechanisms as well as our new dual payload system. The latter allows our scientists to design drugs that attack cancer at the same time as treating the resistance mechanism.
Avacta has an active business development program as it looks to enhance its position and develop the numerous opportunities by working with other companies in the sector. The unique nature of the dual payload program is also generating interest with potential partners.
Programs
AVA6000 (Faridoxorubicin) – FAP-Dox
AVA6000, our lead product candidate, is a peptide drug conjugate form of doxorubicin, an approved cancer drug with known severe toxicities.
Doxorubicin was selected as the first candidate because:
- it is an approved drug with known activity in a set of solid tumors
- the chemistry and half-life of the drug was highly amenable to peptide conjugation and
- there is a distinct serious toxicity (cardiac failure) that would represent proof of concept, if pre|CISION® enabling could eliminate this toxic effect.
The program continues to demonstrate excellent progress in the clinic with the lead indication selected, salivary gland cancer (SGC). We have seen a significant gain in progression free survival over existing therapy.
We have also cleared significant regulatory hurdles with the cardiac lifetime maximum limit of doxorubicin exposure removed during Phase 1 testing and we have agreed with the regulators on the dose selection for further study.
In December 2025, we reported highly encouraging efficacy and safety data from the cohort of patients enrolled with SGC where a disease control rate of 90% is maintained in the full cohort.
The program continued to enroll patients in the Phase 1b expansion cohorts, to assess the efficacy of AVA6000 in more homogenous, defined patient populations to better predict the magnitude of efficacy anticipated in larger Phase 2/3 trials.
Further data will be presented by the end of the 1H 2026, in particular an update on the Phase 1b cohorts, including the lead indication, salivary gland cancer. In addition, we will present the full cardiac safety data and clinical pharmacology data that led to the lifting of the cardiac dosing limitation.
AVA6103 (FAP-Exd)
AVA6103 is our second program. Exatecan (Exd) is a potent topoisomerase I inhibitor (a chemotherapy drug that interrupts DNA replication and transcription leading to DNA damage and cancer cell death).
Conventional exatecan has demonstrated clinical activity in the original Phase 1-3 trials enrolling patients with cancers such as breast, gastric, lung and pancreatic cancers. However, dose-limiting toxicities and challenging dosing regimens required based on the short drug half-life led to discontinuation of its development.
We believe that exatecan represents a good candidate for our pre|CISION® technology because:
- This drug has demonstrated single agent activity in a set of Phase 1 and 2 trials
- A closely related payload, deruxtecan has demonstrated significant activity in two approved top-selling antibody drug conjugate medicines (Enhertu® and Datroway®) including potent bystander effects
- The pharmacokinetic challenges and systemic toxicities of exatecan can be potentially solved by the sustained release mechanism in the pre|CISION® technology.
The first patients have been treated in Phase 1a of the program with the FOCUS-01 trial initiating in Q1 2026 as planned. This pre|CISION® drug moved from concept to clinical trial enrollment in only 24 months, and our final drug candidate to first patient in less than 12 months, both time frames were considerably faster than the standard industry timelines.
The clinical development of AVA6103 is a true catalyst for the Company, given the exceptional innovative chemistry that was developed by our team using the clinical and translational data collected in the AVA6000 clinical trial and this chemistry enables many more payloads to be implemented as pre|CISION® medicines. Crucially, the AVA6000 trial data has enabled the discovery of our newest innovation, the sustained release mechanism of AVA6103.
The innovation of this program and the sustained release mechanism of delivery are critically important to the next stage of the pre|CISION® platform development for three reasons:
- the development of the suite of chemical linkers that sit in the active site between the FAP-cleavable peptide and the payload, dramatically widens the types of payloads that can be attached to the pre|CISION® mechanism,
- the sustained release mechanism of the capping group (the therapeutic molecules added to improve stability and effectiveness) and linker together allows our scientists to dial-in the exact kinetics of release desired for a given payload, and
- the linker chemistry developed allows the attachment of two payloads that can be released simultaneously with one FAP cleavage event allowing combination therapy in a single pre|CISION® molecule
We believe that AVA6103 will enable patients to obtain the therapeutic benefit associated with delivering exatecan directly to tumors in a sustained release mechanism, while limiting systemic exposure that was associated with poor tolerability in the original development of conventional exatecan.
The clinical data with AVA6103 in the chemistry allows many more payloads to be delivered through a pre|CISION® mechanism and the exact kinetics to be designed into the peptide drug conjugate in both single and dual payload formats.
In December 2025, we published new pharmacology data in support of the IND process and the design of the Phase 1 trial. Clinical testing has now started at a number of US specialty oncology centers covering four cancer tumor types: pancreatic, gastric, small cell lung and cervical.
Expertise
Our recent updates from both programs demonstrate the unwavering commitment of the management team and their attention to both flawless execution in the clinic and a highly favorable regulatory interaction.
This was demonstrated by the recent lifting of the lifetime maximum of doxorubicin exposure in the AVA6000 program and rapid filing and efficient clearance of the AVA6103 IND to allow clinical development of this program to commence quickly at our US sites.
We have strengthened our team with the appointments of Brian Hahn as Chief Financial Officer (non-Board) (CFO), Francis Wilson as Chief Scientific Officer (CSO) and David Liebowitz as Chief Medical Officer.
Mr. Hahn, appointed in January 2025, brings 25 years’ senior financial and operational experience, including a 15-year tenure as CFO and Senior Vice President of GlycoMimetics, Inc., where he led the company’s 2014 initial public offering (IPO) on Nasdaq and the build-out of its finance, accounting, investor relations and corporate affairs functions.
Dr. Wilson joined Avacta in September 2022 as Vice President of Chemistry and has been one of the key drivers in the chemistry field of our platform, notably the development of the sustained release mechanism. He was appointed CSO in February 2026.
Dr. Liebowitz is a seasoned hematologist-oncologist and drug development leader with more than 30 years of experience across academia and industry and has contributed to the successful filing of more than 25 Investigational New Drug (IND) applications. He was appointed CMO in July 2025.
We are exceptionally proud of the efforts and innovation of our team at Avacta, our team is a great advantage. This team has driven several creative initiatives to drive our business forward at speeds not seen in traditional drug development, including two examples here of the use of large data and AI in drug development:
- Our strategic collaboration with Tempus has allowed us to access very large data sets and manipulate these data to answer key pipeline strategy questions; and
- The recent use of data mining and synthetic comparator arms which have enabled the direct comparison of the kinetics of the pre|CISION® payload release with data published by the developers of the highly successful ADCs, Enhertu® and Datroway®.
The coming period promises to be transformative for Avacta and our patients, and we look forward to reporting further significant progress in the months ahead.
Christina Coughlin,
Chief Executive Officer
Financial Review
Reported Group revenues for the year ended 31 December 2025 was £6.31 million (2024: £24.42 million), This includes contributions from both continuing and discontinued operations.
Revenues for the continuing operations of the Therapeutics Division were £0.11 million (2024: £0.11 million).
Revenues for the discontinuing operations of the Diagnostics Division were £6.20 million (2024: £24.31 million). The decrease is due to them being sold part year.
Overall, the loss before tax from continuing operations for the year were £36.84 million (2024: £28.98 million)
The Company completed its transition to a pure-play therapeutics business via the sale of its two non-core diagnostics businesses Coris Bioconcept SRL for £2.2 million upfront in September 2025 and Launch Diagnostics Holdings Ltd. for £12.9 million in March 2025.
Research costs
During the year, the Group expensed through the income statement £18.76 million (2024: £14.27 million) research costs from continuing operations relating to the ongoing expansion of the preCISION™ and Affimer® therapeutic programs with AVA6103 and increased clinical and Chemistry, Manufacturing, and Controls (CMC) expenses related to AVA6000, which are expensed given their early stage in the development pathway.
Selling, general and administrative expenses
Administrative expenses have decreased during the year to £10.03 million (2024: £12.05 million). The decreases are primarily due to costs incurred during 2024 relating to personnel expenses due to executive management changes and additional legal and professional expenses related to the strategic shift toward becoming a pure-play biotech company.
Amortization and impairment expense
Amortization charges of £0.01 million (2024: £0.02 million) have been recognized in the period. In the prior year Launch Diagnostics Holdings Ltd and its subsidiary entities and Coris Holdings SRL and its subsidiary entity were all held for sale at 31 December 2024. The fair value less costs to sell were compared with the net asset value of the entities based on the latest information available during the divestment process. This resulted in total impairment charges in the prior year of £22.41 million, of which £15.64 million related to Launch Diagnostics and £6.77 million related to Coris Holding respectively.
Share of loss of associate
The share of loss of associate of £0.45 million (2024: £0.75 million) arises from the Group’s equity-accounted investment in AffyXell Therapeutics Co., Ltd. The share of losses reflects the Group’s 21% ownership share of the losses accumulated in the year. The Group investment remained at 21% at 31 December 2025.
Share-based payment expense
The non-cash charge for the year from continuing operations decreased to £2.13 million (2024: £4.11 million). This decrease was due to modifications to certain executive options awards and new options issued in respect of the hiring of new executives in the prior year.
The non-cash charge for the year from discontinued operations decreased to £0.07 million (2024: £0.87 million). The prior year charge was due to both additional option awards and modification to existing agreements.
Convertible bond
In October 2022, the Group issued senior unsecured convertible bonds (the “Bonds”) with a principal value of £55.00 million to a fund advised by Heights Capital Ireland LLC. The Bonds were issued at 95% of par, generating net proceeds of £52.25 million after placement fees, and bear interest at a fixed coupon of 6.5% per annum, payable quarterly in arrears. The Bonds have an original maturity of five years and are subject to mandatory quarterly amortisation repayments of principal and interest over the term.
The Bonds are repayable in either cash or, at the Group’s option, in ordinary shares of Avacta Group plc. Where repayments are settled in shares, the number of shares issued is determined in accordance with the contractual terms of the bond and is linked to the market price of the Company’s ordinary shares. The Bonds also include bondholder conversion rights allowing partial conversion of the Bonds at the holder’s discretion.
The convertible bond is accounted for as a hybrid financial instrument comprising a host debt liability and an embedded derivative representing the equity linked conversion and settlement features. The host debt liability is measured at amortised cost, while the embedded derivative is measured at fair value through profit or loss. The embedded derivative is valued using a Monte Carlo option pricing model and is classified as a Level 3 fair value measurement under the IFRS fair value hierarchy.
On 28 August 2025, the Group announced amendments to the terms of the Bonds. The revised terms became effective on 20 October 2025 following satisfaction of the amendment conditions. The amendments were assessed in accordance with IFRS 9 and were determined to be substantial, principally due to changes in the timing and contractual profile of the bond’s cash flows. Accordingly, the original host debt liability was derecognized and a new host debt liability was recognized at fair value on the effective date.
The difference between the carrying amount of the original host debt liability and the fair value of the new host debt liability resulted in a gain on derecognition of financial liabilities of £2.03 million, which has been recognized in profit or loss. Following derecognition, the new host debt liability is measured at amortized cost using an effective interest rate determined at initial recognition. Finance costs recognized in the period reflect the unwinding of the discount on the new host liability together with the contractual coupon.
The embedded derivative continued to meet the definition of a derivative following the amended bond terms and remained bifurcated from the host debt liability. The derivative was remeasured at fair value on the effective date to reflect the amended contractual terms, including the revised conversion price, and is subsequently remeasured at each reporting date, with movements recognized in profit or loss.
During the year ended 31 December 2025, repayments of the Bonds were settled partly in cash and partly through the issue of ordinary shares. Settlements in shares resulted in the derecognition of the corresponding portions of the host debt and derivative liabilities, with the aggregate amounts recognized within share capital and share premium in accordance with IFRS.
At 31 December 2025, the carrying amount of the host debt liability was £13.36 million (2024: £20.50 million) and the carrying amount of the derivative liability was £2.79 million (2024: £1.28 million). Interest expense recognized in respect of the host debt liability during the year amounted to £6.98 million (2024: £9.85 million). A loss of £1.51 million arose from remeasurement of the derivative liability during the year (2024: gain of £13.72 million).
Net finance costs
Finance income decreased to £0.37 million (2024: £0.66 million) due to a lower average cash balance during the year.
Other finance costs of £0.07 million (2024: £0.24 million) relate primarily to IFRS 16 interest charges.
Losses before taxation
Losses before taxation from continuing operations for the year were £36.84 million (2024: £28.98 million).
Taxation
The taxation debit decreased to £0.21 million (2024: £0.44 million). This is due to a reversal of temporary differences incurred in the prior year related to discontinued operations of (£2.27) million and the R&D expenditure credit in the current year now being classified within operational costs. The current tax asset held on the balance sheet has increased to £3.36 million (2024: £2.45 million)
Loss for the period
The reported loss for the period from continuing operations was £37.06 million (2024: £29.43 million). The loss per ordinary share from continuing operations reduced to 9.27p (2024: 8.54p) based on a weighted average number of shares in issue during the period of 399,920,000 (2024: 344,577,451).
The reported loss for the period from discontinued operations was £1.32 million (2024: £23.41 million). Operating loss from discontinued operations decreased to £1.15 million (2024: £2.17 million), impairment charges from discontinued operations all were incurred in the prior year (2024: £22.41 million) at the point of being held for sale. The loss of the disposal of subsidiaries in the current year was £0.24 million.
Cash flow
The Group reported cash and cash equivalent balances of £16.86 million at 31 December 2025 (2023: £12.87 million).
Net operating cash outflows from continuing operations amounted to (£22.64) million (2024: (£24.94) million). The decrease relates to higher operating losses in the prior year due to elevated R&D expenditure and one-off costs associated with organisational realignment. Research and development tax credit cash rebates were received in relation to the years ending 31 December 2023, resulting in a cash inflow of £0.78 million from income tax received (2024: £1.17 million).
Net cash inflows from investing activities amounted to £9.90 million (2024: outflow (£1.43) million). Due to the sale of Launch Diagnostics Holdings and Coris BioConcept
There was a net cash inflow from continuing financing activities of £16.6 million (2024: £26.7 million), arising primarily from the proceeds of issue of share capital of £22.5 million (2024: £31.1 million) as well as the repayment of the convertible bond of £5.1 million (2024: £2.6 million).
Financial position
At 31 December 2025, the Group reported net assets of £2.48 million (2024: £9.28 million), following the impact of the strategic disposal of its diagnostics business.
Total assets decreased to £29.42 million (2024: £48.27 million), primarily due to the clear down of £22.92 million of ‘assets held for sale’, following the divestment process of the diagnostics division and wind down of ALS-Dx. This strategic move is expected to simplify the Group’s operations and provide greater focus and capital allocation towards the therapeutic platform.
Non-current assets declined to £6.22 million (2024: £8.07 million), primarily due to depreciation. Investment in associate reduced to £3.10 million (2024: £3.45 million) due to recognised losses for the period.
Current assets decreased to £23.20 million (2024: £40.20 million), primarily due to the clear down of £22.92 million of ‘assets held for sale’. Cash and cash equivalents were £16.9 million (2024: £12.9 million), after investing and financing activities, including the £22.5 million gross proceeds from successful share placings during the year. Current cash runway take us into early Q1 2027.
Total liabilities decreased to £26.9 million (2024: £39.0 million), primarily due to the clear down of £8.69 million of ‘liabilities held for sale’, following the divestment process of the diagnostics division
Share capital and share premium increased by a combined £28.9 million following the equity placing and debt service. The accumulated deficit widened to £175.3 million (2024: £138.8 million), reflecting continued operating losses and non-cash finance charges.
Dividends
No dividends have been proposed for the year ended 31 December 2025 (2024: £nil).
Key performance indicators
At this stage of the Group’s development, the non-financial key performance indicators focus on:
- The progression of the preCISION® technology innovations into clinical stage assets and successful clinical development of these assets.
Unaudited Consolidated Statement of Profit or Loss
for the Year Ended 31 December 2025
| 2025 | 2024 | ||||
| Note | £000 | £000 | |||
| Continuing operations | |||||
| Revenue | 3 | 113 | 113 | ||
| Cost of sales | - | - | |||
| ------------- | ------------- | ||||
| Gross profit | 113 | 113 | |||
| Research costs | 7 | (18,761 | ) | (14,266 | ) |
| R&D expenditure credit (RDEC) | 9 | 1,852 | - | ||
| Selling, general and administrative expenses | 7 | (10,034 | ) | (12,046 | ) |
| Depreciation expense | 12,21 | (1,268 | ) | (1,489 | ) |
| Amortisation expense | 11 | (11 | ) | (16 | ) |
| Share of loss of associate | 24 | (454 | ) | (747 | ) |
| Share-based payment expense | 6 | (2,126 | ) | (4,107 | ) |
| ------------- | ------------- | ||||
| Operating loss | 7 | (30,689 | ) | (32,558 | ) |
| Convertible bond – interest expense | 23 | (6,980 | ) | (9,854 | ) |
| Convertible bond – revaluation of derivative | 23 | (1,507 | ) | 13,719 | |
| Gain on modification of financial liabilities | 23 | 2,031 | |||
| Loss on earnout receivable | - | (717 | ) | ||
| Finance income | 8 | 371 | 663 | ||
| Other finance costs | 8 | (69 | ) | (237 | ) |
| ------------- | ------------- | ||||
| Loss before tax | (36,843 | ) | (28,983 | ) | |
| Taxation | 9 | (216 | ) | (444 | ) |
| ------------- | ------------- | ||||
| Loss from continuing operations | (37,059 | ) | (29,427 | ) | |
| ------------- | ------------- | ||||
| Discontinued operation | |||||
| Gain on disposal of subsidiaries | 28 | (236 | ) | - | |
| Loss from discontinued operation, net of tax | 27 | (1,317 | ) | (23,414 | ) |
| ------------ | ------------ | ||||
| Loss for the year | (38,612 | ) | (52,841 | ) | |
| ----------- | ----------- | ||||
| Loss per share: | |||||
| Basic and diluted | 10 | (9.66p | ) | (15.34p | ) |
| Loss per share – continuing operations: | |||||
| Basic and diluted | 10 | (9.27p | ) | (8.54p | ) |
Unaudited Consolidated Statement of Other Comprehensive Income
for the Year Ended 31 December 2025
| 2025 | 2024 | ||||
| Note | £000 | £000 | |||
| Loss for the year | 7 | (38,612 | ) | (52,841 | ) |
|
Other comprehensive income Items that may be reclassified to profit or loss |
|||||
| Foreign operations – foreign currency translation differences | |||||
| Continuing operations |
165 |
(6) |
) | ||
| Discontinued operations | 27 | 150 | (436 | ) | |
| ----------- | ----------- | ||||
| Other comprehensive income/(loss) | 315 | (442 | ) | ||
| ------------ | ------------ | ||||
| Total comprehensive loss for the period | (38,297 | ) | (53,283 | ) | |
| ----------- | ----------- | ||||
| Total comprehensive loss for the period attributable to the shareholders arises from: | |||||
| Continuing operations | (36,894 | ) | (29,433 | ) | |
| Discontinued operations | 27 | (1,403 | ) | (23,850 | ) |
| ----------- | ----------- | ||||
| (38,297 | ) | (53,283 | ) | ||
| ------------ | ------------ | ||||
Unaudited Consolidated Statement of Financial Position as of 31 December 2025
| 2025 | 2024 | |||||
| Note | £000 | £000 | ||||
| Assets | ||||||
| Property, plant and equipment | 12 | 251 | 543 | |||
| Right-of-use assets | 21 | 1,319 | 2,242 | |||
| Intangible assets | 11 | 1,548 | 1,844 | |||
| Investment in associate |
24 |
3,104 |
3,445 |
|||
| Deferred tax asset | 16 | - | - | |||
| ------------- | ------------- | |||||
| Non-current assets | 6,222 | 8,074 | ||||
| ------------- | ------------- | |||||
| Trade and other receivables | 13 | 2,979 | 1,960 | |||
| Income tax receivable | 9 | 3,361 | 2,447 | |||
| Cash and cash equivalents | 14 | 16,855 | 12,873 | |||
| ------------- | ------------- | |||||
| 23,195 | 17,280 | |||||
| Assets directly associated with the assets held for sale | 27 | - | 22,916 | |||
| ------------- | ------------- | |||||
| Current assets | 23,195 | 40,196 | ||||
| ------------- | ------------- | |||||
| Total assets | 29,417 | 48,270 | ||||
| ------------- | ------------- | |||||
| Liabilities | ||||||
| Lease liabilities | 21 | (496 | ) | (1,482 | ) | |
| Provisions | 22 | (288 | ) | (208 | ) | |
| Deferred tax liability | 16 | - | - | |||
| ------------- | ------------- | |||||
| Non-current liabilities | (784 | ) | (1,690 | ) | ||
| ------------- | ------------- | |||||
| Trade and other payables | 15 | (8,948 | ) | (5,877 | ) | |
| Lease liabilities | 21 | (1,059 | ) | (956 | ) | |
| Convertible bond – debt | 23 | (13,362 | ) | (20,497 | ) | |
| Convertible bond – derivative | 23 | (2,788 | ) | (1,281 | ) | |
| ------------- | ------------- | |||||
| (26,157 | ) | (28,611 | ) | |||
| Liabilities directly associated with the assets held for sale | 27 | - | (8,688 | ) | ||
| ------------- | ------------- | |||||
| Current liabilities | (26,157 | ) | (37,299 | ) | ||
| ------------- | ------------- | |||||
| Total liabilities | (26,941 | ) | (38,989 | ) | ||
| ------------- | ------------- | |||||
| Net assets | 2,476 | 9,281 | ||||
| ------------- | ------------- | |||||
| Equity | ||||||
| Share capital | 17 | 44,119 | 37,018 | |||
| Share premium | 18 | 137,371 | 115,585 | |||
| Reserves | 18 | (3,727 | ) | (4,493 | ) | |
| Accumulated Deficit | 18 | (175,287 | ) | (138,829 | ) | |
| ------------- | ------------- | |||||
| Total equity | 2,476 | 9,281 | ||||
| ------------- | ------------- | |||||
Unaudited Consolidated Statement of Changes in Equity
for the Year Ended 31 December 2025
| Share capital | Share premium | Other reserve | Translation reserve | Reserve for own shares | Retained earnings | Total equity | ||||||||
| Note | £000 | £000 | £000 | £000 | £000 | £000 | £000 | |||||||
| ------------- | ------------- | ------------- | ------------- | ------------ | ------------- | ------------- | ||||||||
| Balance at 1 January 2024 | 28,501 | 83,408 | (1,729 | ) | 51 | (2,485 | ) | (90,843 | ) | 16,903 | ||||
| Loss for the year | - | - | - | - | - | (52,841 | ) | (52,841 | ) | |||||
| Other comprehensive loss for the year | - | - | - | (442 | ) | - | - | (442 | ) | |||||
| ------------ | ------------ | ------------ | ------------ | ------------ | ------------ | ------------ | ||||||||
| Total comprehensive loss for the year | - | - | - | (442 | ) | - | (52,841 | ) | (53,283 | ) | ||||
| Transactions with owners of the Company: | ||||||||||||||
| Issue of shares net of transaction costs | 17 | 6,230 | 23,175 | - | - | - | - | 29,405 | ||||||
| Own shares acquired | 17 | 1 | 9 | - | - | (10 | ) | - | - | |||||
| Convertible bond-issue of shares | 17 | 1,689 | 8,863 | - | - | - | - | 10,552 | ||||||
| Exercise of share options | 17 | 597 | 130 | - | - | - | - | 727 | ||||||
| Transfer of own shares | 18 | - | - | - | - | 122 | (122 | ) | - | |||||
| Equity-settled share-based payment | 6 | - | - | - | - | - | 4,977 | 4,977 | ||||||
| ------------- | ------------- | ------------- | ------------- | ------------ | ------------ | ------------ | ||||||||
| 8,517 | 32,177 | - | - | 112 | 4,855 | 45,661 | ||||||||
| ------------- | ------------- | ------------- | ------------- | ------------ | ------------ | ------------ | ||||||||
| Balance at 31 December 2024 | 37,018 | 115,585 | (1,729 | ) | (391 | ) | (2,373 | ) | (138,829 | ) | 9,281 | |||
| Loss for the period | - | - | - | - | - | (38,612 | ) | (38,612 | ) | |||||
| Other comprehensive income for the year | - | - | - | 315 | - | - | 315 | |||||||
| ------------ | ------------ | ------------ | ------------ | ------------ | ------------ | ------------ | ||||||||
| Total comprehensive loss for the year | - | - | - | 315 | - | (38,612 | ) | (38,297 | ) | |||||
| Transactions with owners of the Company: | ||||||||||||||
| Disposal of subsidiaries | - | - | - | (264 | ) | - | 150 | 414 | ||||||
| Issue of shares net of transaction costs | 17 | 4,273 | 16,993 | - | - | - | - | 21,266 | ||||||
| Convertible bond – issue of shares | 17 | 1,605 | 4,592 | - | - | - | - | 6,197 | ||||||
| Exercise of share options | 17 | 1,223 | 201 | - | - | - | - | 1,424 | ||||||
| Transfer of own shares | 18 | - | - | - | - | 187 | (187 | ) | - | |||||
| Equity-settled share-based payment | 6 | - | - | - | - | - | 2,191 | 2,191 | ||||||
| ------------- | ------------- | ------------- | ------------- | ------------ | ------------ | ------------ | ||||||||
| 7,101 | 21,786 | - | 264 | 187 | 2,154 |
31,492 | ||||||||
| ------------- | ------------- | ------------- | ------------- | ------------ | ------------ | ------------ | ||||||||
| Balance at 31 December 2025 | 44,119 | 137,371 | (1,729 | ) | 188 | (2,186 | ) | (175,287 | ) | 2,476 | ||||
| ------------- | ------------- | ------------- | ------------- | ------------ | ------------ | ------------ | ||||||||
* The comparative information is restated due to adjustments to revenue and the convertible bond.
Unaudited Consolidated Statement of Cash Flows
for the Year Ended 31 December 2025
| Note | 2025 | 2024 | |||
| £000 | £000 | ||||
| Operating cash outflow from continuing operations | 26 | (23,691 | ) | (26,051 | ) |
| Interest received | 370 | 83 | |||
| Interest elements of lease payments | 21 | (103 | ) | (138 | ) |
| Income tax received | 9 | 784 | 1,170 | ||
| ------------- | ------------- | ||||
| Net cash used in continuing operating activities | (22,640 | ) | (24,936 | ) | |
| Net cash from/(used in) discontinued operating activities | (2,111 | ) | 1,339 | ||
| ------------- | ------------- | ||||
| Net cash used in operating activities | (24,751 | ) | (23,597 | ) | |
| ------------- | ------------- | ||||
| Cash flows from investing activities | |||||
| Purchase of property, plant and equipment | 12 | (53 | ) | (323 | ) |
| Disposal of subsidiary, net of cash disposed of | 28 | 9,984 | - | ||
| Purchase of intangible assets | 11 | - | (16 | ) | |
| ------------- | ------------- | ||||
| Net cash used in continuing investing activities | 9,931 | (339 | ) | ||
| Net cash(used in)/from discontinued investing activities | (31 | ) | (1,092 | ) | |
| ------------- | ------------- | ||||
| Net cash used in investing activities | 9,901 | (1,431 | ) | ||
| Cash flows from financing activities | |||||
| Proceeds from issue of share capital | 17 | 22,500 | 31,148 | ||
| Transaction costs related to issue of share capital | 18 | (1,234 | ) | (1,744 | ) |
| Proceeds from exercise of share options | 17 | 1,424 | 728 | ||
| Principal elements of lease payments | 21 | (1,001 | ) | (913 | ) |
| Cash repayment of convertible bonds | 23 | (5,100 | ) | (2,550 | ) |
| ------------- | ------------- | ||||
| Net cash from/(used in) continuing financing activities | 16,589 | 26,669 | |||
| Net cash from/(used in) discontinuing financing activities | (2,977 | ) | (574 | ) | |
| ------------- | ------------- | ||||
| Net cash from/(used in) financing activities | 13,612 | 26,095 | |||
| Net increase / (decrease) in cash and cash equivalents | (1,239 | ) | 1,067 | ||
| Cash and cash equivalents at beginning of year | 17,778 | 16,627 | |||
| Effects of movements in exchange rates on cash held | 316 | 84 | |||
| ------------- | ------------- | ||||
| Cash and cash equivalents at end of year, including held in disposal group | 16,855 | 17,778 | |||
| ------------- | ------------- | ||||
| Cash held by disposal group | 27 | - | (4,905 | ) | |
| ------------- | ------------- | ||||
| Cash and cash equivalents at end of year | 16,855 | 12,873 | |||
1 Basis of preparation
Avacta Group plc (the “Company”) is a public company incorporated under the laws of England and Wales and domiciled in London, United Kingdom. These consolidated financial statements for the year ended 31 December 2025 comprise the Company and its Subsidiaries (together referred to as the ‘Group’).
Basis of preparation
The financial information set out above and below, does not constitute the company’s statutory accounts for the years ended 31 December 2025 or 2024 but is derived from those accounts. Statutory accounts for 2024 have been delivered to the registrar of Companies. The financial information for 2025 is unaudited.
This preliminary announcement was approved by the board of directors on 18 May 2026. It is not the Group's statutory accounts. Copies of the Group's audited statutory accounts for the year ended 31 December 2025 are expected to be available at the company's website in the coming days.
While the financial information included in this preliminary announcement has been prepared in accordance with the recognition and measurement criteria of UK-adopted international accounting standards and as applied in accordance with the provisions of the Companies Act 2006, this announcement does not itself contain sufficient information to comply with UK-adopted international accounting standards.
Basis of measurement
The consolidated financial statements and financial information have been prepared on the historical cost basis, except for the following items (refer to individual accounting policies for details):
- Financial instruments – fair value through profit and loss
The preparation of financial statements in compliance with IFRS requires the use of certain critical accounting estimates. It also requires Group management to exercise judgment in applying the Group’s accounting policies. The areas where significant judgments and estimates have been made in preparing the consolidated financial statements and their effect are disclosed in note 1c.
Going concern
The Financial Statements have been prepared on a going concern basis. The Company’s going concern assessment has been performed as part of the Group’s going concern assessment.
During the year ended 31 December 2025, the Group reported a loss from continuing operations of £37.0 million and incurred net cash used in operating activities of £25.2 million.
As at 31 December 2025, the Group's accumulated losses were £175.2 million, and cash and cash equivalents were £16.9 million. The Group has external borrowings in the form of a convertible bond, with a principal amount outstanding of £20.4 million as at 31 December 2025.
As disclosed in Note 17, gross proceeds of £22.5 million were received, net of costs of £1.2 million, through a placing of ordinary shares. As disclosed in Note 28 of the financial statements for the year ended 31 December 2025, the Group completed the disposal of Launch Diagnostics Holdings Limited and its subsidiaries (“Launch Diagnostics”) in March 2025 and the disposal of Coris BioConcept in August 2025. The combined net proceeds from these disposals totalled £10.0 million.
The Group continues to advance its clinical trials and generate successful data and expects to report further findings in late 2026 and early 2027. Following the data, the Group will evaluate partnering and out-licensing opportunities.
The Group faces significant risks associated with successful execution of its strategy. These risks include, but are not limited to technology and product development, introduction and market acceptance of new products and services, changes in the marketplace, liquidity, competition from existing and new competitors which may enter the marketplace and retention of key personnel. As a clinical stage oncology business, the Directors anticipate operating losses to continue for the foreseeable future due to, among other things, costs related to research funding, growth plans and further development of our technology.
The Directors have considered detailed cash flow forecasts that extended to 31 December 2027, which is at least twelve months from the date of approval of these financial statements (“the going concern period”). The forecasts indicate that we currently have enough cash to fund our planned operations into the first quarter of 2027. The forecasts consider current and future economic conditions that are expected to prevail over the period. These forecasts include assumptions regarding the timing and quantum of investment in the therapeutic development programs together with various scenarios which reflect growth plans, opportunities, risks and mitigating actions. The Board is focused on both the short-term and long-term financing strategy to achieve the company goals including obtaining additional funding through the capital markets.
The forecast therefore shows the Group and the Parent Company are dependent on raising funds to advance their key projects and investments to remain cash positive during the going concern period. There are currently no agreements in place and there is no certainty that funds will be raised within the appropriate timeframe. This indicates that a material uncertainty exists that may cast significant doubt on the Group and the Parent Company’s ability to continue as a going concern, and therefore they may be unable to realise their assets and discharge their liabilities in the normal course of business.
However, the directors have a reasonable expectation that the required funding will be forthcoming. As a result, the directors believe that the Group and the Company will continue as a going concern for a period of at least 12 months from the date of approval of these financial statements and have therefore prepared the financial statements on a going concern basis.
The financial statements do not include any adjustments that would result from the basis of preparation being inappropriate.
Segment reporting
Operating segments – continuing operations
In the view of the Board of Directors, the Group has one (2024: one) reportable segment in continuing operations: Therapeutics. Segment reporting has been presented on this basis for continuing operations. The Directors recognise that the operations of the Group are dynamic and therefore this position will be monitored as the Group develops.
The principal activity of Therapeutics is the development of novel cancer therapies harnessing proprietary technology
The previous second reportable segment was the Diagnostics division, which had been classified as held for sale under the Group’s divestment strategy in the prior year. During the current year, this division was disposed of: Launch was sold on 24 March 2025 and Coris was sold on 29 August 2025. The ALS Diagnostics division, which formed part of this segment was discontinued in the prior year.
Segment revenue represents revenue from external customers arising from sale of goods and services, plus inter-segment revenues. Inter-segment transactions are priced on an arm’s length basis. Segment results, assets and liabilities include items directly attributable to a segment as well as those that can be allocated on a reasonable basis.
The Group’s revenue to destinations outside the UK amounted to 100% (2024: 100%) of total revenue. The revenue analysis below is based on the country of registration of the customer:
| 2025 | 2024 | ||
| £’000 | £’000 | ||
| South Korea | 113 | 113 | |
| ------------- | ------------- | ||
| 113 | 113 | ||
| ------------- | ------------- | ||
During the year, transactions with one external customer in the Therapeutics segment amounted individually to 10% or more of the Group’s revenues from continuing operations, being £113,000 (2024: £113,000)
Operating segment analysis 2025
| Therapeutics | Central overheads1 | Total (continuing) |
Diagnostics (discontinued) | |||||
| £000 | £000 | £000 | £000 | |||||
| Revenue | 113 | - | 113 | 6,199 | ||||
| Cost of goods sold | - | - | - | (3,272 | ) | |||
| ------------- | ------------- | ------------- | ------------- | |||||
| Gross profit | 113 | - | 113 | 2,927 | ||||
| Research costs | (18,761 | ) | - | (18,761 | ) | - | ||
| R&D expenditure credit (RDEC) | 1,852 | - | 1,852 | - | ||||
| Selling, general and administrative expenses | (4,378 | ) | (5,656 | ) | (10,034 | ) | (4,009 | ) |
| ------------- | ------------- | ------------- | ------------- | |||||
| Adjusted EBITDA | (21,174 | ) | (5,656 | ) | (26,830 | ) | (1,082 | ) |
| Depreciation expense | (1,121 | ) | (147 | ) | (1,268 | ) | - | |
| Amortisation expense | (6 | ) | (5 | ) | (11 | ) | - | |
| Share of loss of associate | (454 | ) | - | (454 | ) | - | ||
| Share-based payment expense | (827 | ) | (1,299 | ) | (2,126 | ) | (65 | ) |
| ------------- | ------------- | ------------- | ------------- | |||||
| Segment operating loss | (23,582 | ) | (7,107 | ) | (30,689 | ) | (1,147 | ) |
| ------------- | ------------- | ------------- | ------------- | |||||
1Central overheads, which relate to operations of the Group functions, are not allocated to the operating segments.
Operating profit/loss is the lowest measure of profit or loss regularly reviewed by the Board. Other items comprising the Group’s loss before tax are not monitored on a segmental basis.
Segment operating loss is equivalent to the Group’s operating loss and therefore a reconciliation between segment operating loss and reported loss before tax is set out in the Consolidated Statement of Profit or Loss and Other Comprehensive income.
Adjusted EBITDA, a measure reported to the Board, is defined as earnings before interest, tax, depreciation and amortization, adjusted to additionally remove items of expenditure for which the relative magnitudes year-on year are not directly reflective of year-on-year performance, or are not closely linked to the underlying cashflows from operations. Adjusted EBITDA further excludes impairment charges, acquisition-related expenses, share of operating loss of associate and share-based payment expense from EBITDA.
The information reported to the Board does not include balance sheet information at the segment level.
All material segmental non-current assets of continuing operations are located in the UK.
Operating segment analysis 2024
| Therapeutics | Central overheads1 | Total (continuing) | Diagnostics (discontinued) | |||||
| £000 | £000 | £000 | £000 | |||||
| Revenue | 113 | - | 113 | 24,311 | ||||
| Cost of goods sold | - | - | - | (13,134 | ) | |||
| ------------- | ------------- | ------------- | ------------- | |||||
| Gross profit | 113 | - | 113 | 11,177 | ||||
| Research costs | (14,266 | ) | - | (14,266 | ) | (280 | ) | |
| Selling, general and administrative expenses | (3,135 | ) | (8,910 | ) | (12,045 | ) | (10,336 | ) |
| ------------- | ------------- | ------------- | ------------- | |||||
| Adjusted EBITDA | (17,288 | ) | (8,910 | ) | (26,198 | ) | 561 | |
| Impairment charge | - | - | - | (23,388 | ) | |||
| Depreciation expense | (1,238 | ) | (251 | ) | (1,489 | ) | (991 | ) |
| Amortisation expense | (11 | ) | (5 | ) | (16 | ) | (870 | ) |
| Share of loss of associate | (747 | ) | - | (747 | ) | - | ||
| Share-based payment expense | (707 | ) | (3,400 | ) | (4,107 | ) | (871 | ) |
| ------------- | ------------- | ------------- | ------------- | |||||
| Segment operating loss | (19,991 | ) | (12,566 | ) | (32,557 | ) | (25,559 | ) |
| ------------- | ------------- | ------------- | ------------- | |||||
1Central overheads, which relate to operations of the Group functions, are not allocated to the operating segments.
Operating profit/loss is the lowest measure of profit or loss regularly reviewed by the Board. Other items comprising the Group’s loss before tax are not monitored on a segmental basis.
Segment operating loss is equivalent to the Group’s operating loss and therefore a reconciliation between segment operating loss and reported loss before tax is set out in the Consolidated Statement of Profit or Loss and Other Comprehensive income.
Adjusted EBITDA, a measure reported to the Board, is defined as earnings before interest, tax, depreciation and amortization, adjusted to additionally remove items of expenditure for which the relative magnitudes year on year are not directly reflective of year-on-year performance, or are not closely linked to the underlying cashflows from operations. Adjusted EBITDA further excludes impairment charges, acquisition-related expenses, share of operating loss of associate and share-based payment expense from EBITDA.
The information reported to the Board does not include balance sheet information at the segment level.
All material segmental non-current assets of continuing operations are located in the UK.
Exceptional items
Included within Selling, general and administrative expenses the group has identified a number of items which are material due to the significance of their nature and/or amount, and it has disclosed them in this separate note to provide a better understanding of the group’s financial performance.
| 2025 | 2024 | |
| £000 | £000 | |
| Termination payments and settlement agreements | 300 | 1,130 |
| Consultancy and legal fees | 454 | 668 |
| Professional fees associated with the divestment of the discontinued operations | 795 | 161 |
| ------------- | ------------- | |
| 1,549 | 1,959 | |
| ------------- | ------------- | |
Termination payments and settlement agreements
These are the costs associated with the restructuring of the business and resulting reduction in employee numbers throughout 2025.
Consultancy and legal fees
These are outside fees related to legal expenses during reorganization, consulting expenses related to strategic input on divestment plans and legal guidance for possible deal structures.
Professional fees
These are the costs to the Group of the divestment of Launch Diagnostics Holdings Ltd and its subsidiaries and Coris Holding SRL and its subsidiary.
Loss per ordinary share
The calculation of earnings per ordinary share is based on the profit or loss for the period and the weighted average number of equity voting shares in issue excluding own shares held jointly by the Avacta Employees’ Share Trust and certain employees and the shares held within the Avacta Share Incentive Plan (‘SIP’).
At 31 December 2025, 12,562,886 options (2024: 22,684,252) have been excluded from the diluted weighted-average number of ordinary shares calculation because, due to the loss for the period, their effect would have been anti-dilutive. Further details on share options are set out in Note 6.
At 31 December 2025, no potentially dilutive shares relating to the convertible bond (2024: nil) have been excluded from the diluted weighted-average number of ordinary shares calculation because, due to the loss for the period, their effect would have been anti-dilutive. Further details on the convertible bond are set out in Note 23.
|
2025 |
2024 |
||||||||||||||||
| Continuing operations | Discontinued operations | Total | Continuing operations | Discontinued operations | Total | ||||||||||||
| Loss after taxes (£000) | (37,059 | ) | (1,553 | ) | (38,612 | ) | (29,427 | ) | (23,414 | ) | (52,841 | ) | |||||
| --------------- | --------------- | ----------------- | --------------- | --------------- | ----------------- | ||||||||||||
| Weighted average number of shares (number) | 399,920,000 | 344,577,451 | |||||||||||||||
| --------------- | -------------- | ----------------- | --------------- | -------------- | ---------------- | ||||||||||||
| Basic and diluted loss per ordinary share (pence) | (9.27p) | (0.39p) | (9.66p) | (8.54p) | (6.79p) | (15.34p) | |||||||||||
| --------------- | -------------- | ----------------- | -------------- | -------------- | --------------- | ||||||||||||
In addition to various share issues relating to the exercise of share options, the following share transactions occurred after the end of the reporting period and have not been retrospectively adjusted in the calculation of earnings per share:
On 27 March 2026, the Group announced the successful completion of an oversubscribed placing and subscription to raise gross proceeds of £10.0 million. A total of 15,000,000 new ordinary shares of 10p each were issued pursuant to the placing, together with a further 873,016 new ordinary shares issued under a director subscription, at an issue price of 63 pence per share.
Convertible bond
In October 2022, the Group issued senior unsecured convertible bonds (the “Bonds”) with a principal value of £55,000,000 to a fund advised by Heights Capital Ireland LLC. The Bonds were issued at 95% of par, generating net proceeds of £52,250,000 after placement fees, and bear interest at a fixed coupon of 6.5% per annum, payable quarterly in arrears. The Bonds have an original maturity of five years and are subject to mandatory quarterly amortisation repayments of principal and interest over the term. The effective interest rate of the instrument is 49.99%.
The Bonds are repayable in either cash or, at the Group’s option, in ordinary shares of Avacta Group plc. Where repayments are settled in shares, the number of shares issued is determined in accordance with the contractual terms of the bond and is linked to the market price of the Company’s ordinary shares. The Bonds also include bondholder conversion rights allowing partial conversion of the Bonds at the holder’s discretion.
The convertible bond is accounted for as a hybrid financial instrument comprising a host debt liability and an embedded derivative representing the equity-linked conversion and settlement features. The host debt liability is measured at amortised cost, while the embedded derivative is measured at fair value through profit or loss. The embedded derivative is valued using a Monte-Carlo option pricing model and is classified as a Level 3 fair value measurement under the IFRS fair value hierarchy.
On 28 August 2025, the Group announced amendments to the terms of the Bonds. The revised terms became effective on 20 October 2025 following satisfaction of the amendment conditions. The amendments were assessed in accordance with IFRS 9 and were determined to be substantial, principally due to changes in the timing and contractual profile of the bond’s cash flows. Accordingly, the original host debt liability was derecognised and a new host debt liability was recognised at fair value on the effective date.
The difference between the carrying amount of the original host debt liability and the fair value of the new host debt liability resulted in a gain on derecognition of financial liabilities of £2,031,000, which has been recognised in profit or loss. Following derecognition, the new host debt liability is measured at amortised cost using an effective interest rate determined at initial recognition. Finance costs recognised in the period reflect the unwinding of the discount on the new host liability together with the contractual coupon.
The embedded derivative continued to meet the definition of a derivative following the amended bond terms and remained bifurcated from the host debt liability. The derivative was remeasured at fair value on the effective date to reflect the amended contractual terms, including the revised conversion price, and is subsequently remeasured at each reporting date, with movements recognised in profit or loss.
During the year ended 31 December 2025, repayments of the Bonds were settled partly in cash and partly through the issue of ordinary shares. Settlements in shares resulted in the derecognition of the corresponding portions of the host debt and derivative liabilities, with the aggregate amounts recognised within share capital and share premium in accordance with IFRS.
At 31 December 2025, the carrying amount of the host debt liability was £13,362,000 (2024: £20,497,000) and the carrying amount of the derivative liability was £2,788,000 (2024: £1,281,000). Interest expense recognised in respect of the host debt liability during the year amounted to £6,980,000 (2024: £9,854,000). A loss of £1,507,000 arose from remeasurement of the derivative liability during the year (2024: gain of £13,719,000).
| Convertible bond – derivative |
Convertible bond – debt |
||||
| £000 | £000 | ||||
| At 1 January 2024 | 15,000 | 24,325 | |||
| Repayments (equity settled)1 | - | (10,552 | ) | ||
| Repayments (cash settled)1 | - | (3,130 | ) | ||
| Interest expense | - | 9,854 | |||
| Revaluation of derivative | (13,719 | ) | - | ||
| ----------- | ----------------- | ||||
| At 1 January 2025 | 1,281 | 20,497 | |||
| Modification of financial liabilities | - | (2,031 | ) | ||
| Repayments (equity settled)1 | - | (6,197 | ) | ||
| Repayments (cash settled)1 | - | (5,887 | ) | ||
| Interest expense | - | 6,980 | |||
| Revaluation of derivative | 1,507 | - | |||
| ----------- | ----------------- | ||||
| At 31 December 2024 | 2,788 | 13,362 | |||
| ----------- | ----------------- | ||||
Disposal group and discontinued operations
In 2024, the Group decided to discontinue its diagnostics division. This resulted in the decision to sell its diagnostic subsidiaries and close down the Wetherby Diagnostics laboratory, which formed part of the Avacta Life Sciences Ltd company. All associated costs of the closure of the Diagnostics division have been recategorised and included into discontinued operations on the Statement of Profit or Loss in section A below. All assets relating to the division have been transferred to other group entities.
Management committed to a plan to sell Launch Diagnostics Holdings Ltd and its subsidiary entities and Coris Holdings SRL and its subsidiary entity in 2024 follow a strategic decision to place focus on the development of the Therapeutics division. At the prior year reporting date, an active programme to locate appropriate buyers had been initiated and the division was being actively marketed for sale at a price that was reasonable to its fair value and a sale was expected to qualify for recognition as a completion sale within one year from the date of classification. As a result, this division was presented as a disposal group held for sale in the prior year.
In 2024, an impairment loss of £22,413,000 was recognised in the Consolidated Statement of Profit and Loss and OCI, as the carrying amount of the disposal group at the reporting date exceeded the fair value less costs to sell value.
On 24 March 2025, the Group sold part of its diagnostics division, Launch Diagnostics Holdings Ltd and its subsidiaries. An up-front payment of £12,900,000 was received.
On 29 August 2025, the Group sold part of its diagnostics division, Coris Holdings SRL and its subsidiaries. An up-front payment of £2,150,000 was received.
A. Results of discontinued operation
| 2025 | 2024 | ||||
| £000 | £000 | ||||
| Revenue | 6,199 | 24,311 | |||
| Cost of sales | (3,272 | ) | (13,134 | ) | |
| ---------- | ---------- | ||||
| Gross profit | 2,927 | 11,177 | |||
| Research costs | - | (280 | ) | ||
| Selling, general and administrative expenses | (4,009 | ) | (10,336 | ) | |
| Depreciation expense | - | (991 | ) | ||
| Amortisation expense | - | (870 | ) | ||
| Share-based payment charge | (65 | ) | (871 | ) | |
| ---------- | ---------- | ||||
| Operating loss | (1,147 | ) | (2,171 | ) | |
| Finance income | 34 | 150 | |||
| Other finance costs | (204 | ) | (238 | ) | |
| ---------- | ---------- | ||||
| Loss before tax | (1,317 | ) | (2,259 | ) | |
| Taxation | - | 1,258 | |||
| ---------- | ---------- | ||||
| Loss for the period | (1,317 | ) | (1,001 | ) | |
| Impairment charge | - | (22,413 | ) | ||
| Loss on disposal of subsidiaries | (236 | ) | - | ||
| Tax on disposal of subsidiaries | - | - | |||
| ---------- | ---------- | ||||
| Loss from discontinued, net of tax | (1,553 | ) | (23,414 | ) | |
| Exchange difference on translation of discontinued operation | 150 | (436 | ) | ||
| ---------- | ---------- | ||||
| Other comprehensive loss from discontinued operation | (1,403 | ) | (23,850 | ) | |
| ---------- | ---------- | ||||
B. Effect of the disposal on the financial position of the Group
The table below shows the balances of the disposal companies in the group accounts in the prior year when they were classed as held for sales. All assets have been cleared down in 2025 to loss on disposal of subsidiaries.
| 2024 | ||
| £000 | ||
| Property, plant and equipment | (1,628 | ) |
| Right of use asset | (1,726 | ) |
| Intangible asset | (8,277 | ) |
| Inventories | (2,482 | ) |
| Trade and other receivables | (3,898 | ) |
| Cash and cash equivalents | (4,905 | ) |
| ------------ | ||
| Total Assets directly associated with assets held for sale | (22,916 | ) |
| Current liabilities | 4,418 | |
| Non current liabilities | 4,270 | |
| ------------ | ||
| Total Liabilities directly associated with the liabilities held for sale | 8,688 | |
| ------------ | ||
| Net assets and liabilities | (14,228 | ) |
| ------------ | ||
In 2024, an impairment loss of £22,413,000 was recognised in the Consolidated Statement of Profit and Loss and OCI, as the carrying amount of the disposal group at the reporting date exceeded the fair value less costs to sell value.
Events after the reporting period
On 27 March 2026, the Group announced the successful completion of an oversubscribed placing and subscription to raise gross proceeds of £10.0 million. A total of 15,000,000 new ordinary shares of 10p each were issued pursuant to the placing, together with a further 873,016 new ordinary shares issued under a director subscription, at an issue price of 63 pence per share.
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