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James Cooper | CEO

CEO statement 2025

I am pleased to present my first CEO statement for Cambridge Nutritional Sciences plc.

Introduction
I believe that CNS has the potential to grow substantially beyond its current size and cement itself as the gold standard in Food Sensitivity testing. I aim to bring a motivated, pragmatic and data approach which I believe will enable us to unlock the full potential of CNS. This year has been a transformative one both for me and the company as we took key strides in operational improvements, product development, strengthening our leadership team, and in actively driving cultural change.

In the past year there have been a number of changes, some proactive and others reactive. In all cases the changes and response has been overseen by a Board that is committed to increasing the accessibility and availability of a product that can make a real difference to people’s lives. There is a genuine desire within this team to grow the business not just for the benefit of the shareholders and employees, but for the benefit that it can deliver to those who use our products. The awareness of food sensitivity testing and its benefits remain limited, and we are committed to increasing the education and awareness so that more people may benefit from improved personal nutrition and the advantages that come with it.

One of the key objectives of the last year was to embed a number of new members within the senior team, to replace natural attrition and introduce new roles that are required for the future.

This has included the onboarding of our new CFO, Ajay Patel, who has brought valuable experience and a strategic mindset to the team. We are also pleased to report that all other senior roles have been successfully filled and for the past few months we have been operating with a full complement at the senior level. This has been an important step change as it increases the businesses capability to run projects aimed at future growth and ensure that our own processes are keeping pace with the requirements of a modern workplace. With this in mind I can confidently state that the business is in a better position now compared to last year and is set up to deliver meaningful results for patients, shareholders and employees alike.

Core business review
The business has continued to focus on its flagship products by delivering both a laboratory testing service in the UK and sales of FoodPrint and FoodDetective kits to labs across the world. The last year has seen a mixture of results with some areas like the UK (+9% YoY) performing strongly whilst others have not yet developed fully. The slowdown areas was quickly identified and we have already increased the sales team during the course of FY25 to grow the pipeline and future sales in new and existing markets. A constant in all areas has been that the market for food sensitivity is a market full of opportunity that is limited by the availability and awareness of food sensitivity testing. The sales team have identified a number of new partners that understand what is required to take advantage of new or untapped markets and we are excited to see what they can deliver going forwards. In other areas where there was already a base level of business, we are working with existing partners on new strategies to both capture and grow market share in these areas.

Looking within the business we have seen a continued improvement in the yield and productivity of our operation which has helped to keep costs in check despite increases in material prices across the wider industry. This continuous improvement has been driven by a sustained focus on understanding the cost basis of the business and continually challenging ourselves to improve this through targeted projects.

This approach areas from production through to sales and marketing. In the design of budgets all areas are tasked with identifying the value that any given spend delivers and must ensure that we are achieving a return on investment when spending our hard-earned cash. This approach is now being reflected in some of the key business metrics. The gross margin of the has identified savings in a wide range of business has now hit a very healthy 65% and with the ongoing work we are confident that despite increasing cost pressures of rising material and labour prices, we will be able to grow this margin.

Despite a slightly lower revenue than desired, the key measure of adjusted EBITDA which is a well-recognised barometer of the day-to-day profitability of a business, has hit its target of £0.4 million. This is a reflection of the efficiency with which the team are able to operate under a limited budget and marks the completion of our overhead reduction work.

Moving forward we intend to keep to our own “fiscal rules” to ensure that we are never spending beyond our means. However, if we are confident that targets are going to be exceeded, we will release budgets that were curtailed to help us grow the business further. This represents our promise to invest in growth over the coming years. The ongoing dispute with DHSC has now finally been resolved with an agreement that enables the company to recognise the deferred income (£2.5m) with no further liability hanging over us. We were confident that this would be the outcome, and this allows us to focus our time, effort and resources on the future. The historic HSE case that related to an old part of the business that was sold off in 2018 has also been resolved. Following legal advice, the company pleaded guilty to all charges and received a fine of £35k. This was considered to be the best course of action in order to prevent any protracted legal processes and fees that would hamper the business going forward.

Market and strategy
The gut health and well-being market continues to grow as awareness increases. We have seen this trend across a number of markets that we operate in and consider it a core part of our mission to educate the market regarding the utility of our test and the benefit that it can deliver. As the market grows, we are positioning ourselves to be a premier test that not only delivers an accurate and reliable result but also delivers the support and guidance as to how an individual should interpret that result and improve their health. This has been a vital differentiator in the marketplace with both existing and new partners valuing this highly over competitor tests

We believe that the general low awareness with regard to our IgG test and the benefits of a targeted elimination diet means that there is a much bigger market still to be captured. Our mission in the coming years is to grow both geographically and by increasing market share in existing markets. This is achieved by identifying and working with partners that have the reach and skills to access and educate those who previously have not come across our product. These two faceted approaches will help us to deliver significant growth in the near future and ensure that we maintain and strengthen our position as the gold standard of IgG testing.

Strategic progress and key initiatives
Our initiatives in the last year have been aligned with the goal of ensuring that the business is set up for future growth and success. Following a detailed risk analysis we have mapped out a series of initiatives in order of priority. A number of these are now already in progress, including the implementation of a new electronic Quality Management System (QMS). A functional QMS is crucial to ensure we meet our regulatory responsibilities; the old system was end of life and the QA team have overseen a smooth transition to a system which will be able to scale and support the business into the future.

Another priority is to upgrade to a Laboratory Information Management System (LIMS) that can scale and support the growth in the UK market. The LIMS project is fully underway, and a vendor has been appointed. The goal is to fully transition to this new system with no disruption to the UK business before the end of the calendar year. The new system has increased functionality and will help us to further improve the efficiency of the CNSLab.

The new In Vitro Diagnostic Regulations (IVDR) that will be required for CE marking must be adhered to by the end of 2029 when the transition period ends. The IVDR project has continued over the past year and remains on track to ensure that we will be compliant well ahead of the deadline. This futureproofs our product for the European market and supports easier entry into other regions where CE marking is recognised. to by the end of 2029 when the transition period ends. The IVDR project has continued over the past year and remains on track to ensure that we will be compliant well ahead of the deadline. This futureproofs our product for the European market and supports easier entry into other regions where CE marking is recognised.

People and culture
We aspire to create a culture where our people can excel and deliver results for our clients, our shareholders, and themselves. Our company values are designed to reflect this ambition, and we strive to hold ourselves to a high standard, accepting nothing less. In doing so, we are building a team of motivated, hard-working individuals who come together to help each other achieve their goals.

We continue to professionalise the business across a wide range of areas, including the benefits we offer our team. Our goal is to reward and retain the talent that makes this business successful. This ranges from healthcare and share incentive plans to our newly launched cycle-to work scheme. Through our employee engagement committee, we actively work with the team to identify and implement further improvements.

We also encourage collaboration and engagement across all departments and levels of the organisation. This is supported through regular company updates, focused deep-dive sessions, shop floor management walks, and company socials. Through these activities, our aim is to ensure everyone understands where we are as a business and what we are working to achieve so that we move forward together, as one team, towards our shared goals.

Outlook
CNS is in a strong position to grow through expansion into new markets and through greater penetration in existing markets over the coming years. The new sales team members that started in FY25 are filling up the pipeline with opportunities that will be converted through the course of this coming year. Our goal is to sign up a significant number of these over this financial year and begin the process of growing them into long term partners. This will ensure that moving into FY27 we will have a very strong set of clients that will begin to run at full speed, ready to support our growth plans and enable us to continue to invest in the growth of the business. We are continuing to launch new programmes to deliver strategic initiatives across a wide range of areas, with every member of the leadership team being responsible for at least one program, put together this means that FY26 will continue the transformation work started this year at CNS.

I would like to take this opportunity to thank all those that have been involved in this journey so far; the passionate team at CNS have enabled us to take big steps across a range of strategically vital areas. I am looking forward to working with a dedicated and talented team who share this vision for growth and I’m excited to demonstrate what we can achieve together.

James Cooper | Chief Executive Officer | 18 August 2025

CFO Statement

Ajay Patel | CFO

The year has been one of much change for the Group, with the following financial review demonstrating the group remains in a strong position, well prepared for the year ahead.

The key highlights have seen total income rise 12.7% from £9.9 million to £11.1 million, with the DHSC settlement of £2.5 million responsible for much of this. Total revenue has fallen in the year by14.8% from £9.8 million to £8.3 million, mainly from the one-off issues of overstocking from previous years and loss of a client by a distributor in North America.

Despite the fall in revenue, gross margin improved from 61.9% to 65.3%, resulting from some notable efforts by the teams to reduce costs, focus significant effort to lower scrap costs by 41% as well as optimise labour hours in the manufacturing and laboratory areas. The process of continuous improvement is now embedded in the team's ways of working and one that will serve well for the future.

The management of overheads in the year is also another key highlight, with net operating costs before exceptional items falling £0.7 million from £6.6 million to £5.8 million, with a £0.2 million boost from other income included here. The savings have been in people costs, as teams have been reduced in size, professional fees, marketing and running costs. As the year progressed more investment in teams has been made with the anticipation that overheads will rise in future years.

As a result of the above, adjusted EBITDA more than doubled from below £0.2 million to over £0.4 million, a growth the Group is very pleased with. The profit after taxation for the Group was £1.6 million (2024: loss of £0.3 million), which has enabled the total equity on the balance sheet to increase to £11.4 million from £9.7 million the previous year. Within this the total cash position (including short term deposits) has fallen from £5.4 million to£4.9 million. Investment in fixed assets as well as exceptional costs were the main reason for this fall.

The company is well placed from this financial position to drive more change in the future.

Ajay Patel | Chief Financial Officer | 18 August 2025