ASIT biotech |
Building to a crescendo |
H119 results |
Pharma & biotech |
19 September 2019 |
Share price performance
Business description
Next events
Analyst
ASIT Biotech is a research client of Edison Investment Research Limited |
Having reported H119 financials, ASIT’s main focus remains on the results of the second Phase III study of gp-ASIT+ for the prevention of grass pollen allergy. These are expected towards the end of 2019 and the H119 results reflected an increased cash burn of €6.0m (vs €4.1m in H118) on the back of the ongoing study. The first tranche of the €9.225m convertible bond, which funds ASIT through the trial results, closed in July.
Year end |
Revenue (€m) |
PBT* |
EPS* |
DPS |
P/E |
Yield |
12/17 |
0.0 |
(12.0) |
(0.94) |
0.0 |
N/A |
N/A |
12/18 |
0.0 |
(14.3) |
(0.86) |
0.0 |
N/A |
N/A |
12/19e |
0.0 |
(15.7) |
(0.81) |
0.0 |
N/A |
N/A |
12/20e |
0.0 |
(5.7) |
(0.21) |
0.0 |
N/A |
N/A |
Note: *PBT and EPS are both as reported.
H119 financials
ASIT’s H119 operating loss increased to €7.8m from €5.4m in H118 due to the costs of the second Phase III (ABT011) study. R&D remained the largest operating expense at €6.9m compared to €4.5m in H118. Consequently, net loss was higher at €7.8m (from €5.4m in H118). Cash at end H119 was €2.5m (vs €13.5m at end H118), although this is now academic after the company received the first €5.0m tranche from the convertible note offering in July. We now estimate ASIT’s cash position at c €8m and to last through to the second convertible note tranche after the results of the ABT011 study in December. The second tranche should extend the cash runway until the end of Q320, by which time we expect gp-ASIT+ to have been filed and ex-European partnerships to have been signed. We have revised our financials to account for the higher R&D costs of the Phase III study and its extension to 2020.
€9.225m convertible note placing completed
The purpose of the €9.2m convertible note financing in July was to complete the ABT011 study, including the preparation of the data package for filing with the German regulators, the extension of the ABT011 study through a second pollen season in 2020, building and qualification of manufacturing capacity and finalising the preclinical packages that would enable ASIT’s peanut allergy and house dust mite products to be out-licensed. To minimise the risk for investors, the convertible note offering has two tranches. The first was paid-up at issue and covers the cash requirements until the ABT011 study reports the primary endpoints (a statistically significant and at least 0.3 reduction in combined clinical symptoms and medication scores at the peak of the season, equalling a 20% treatment effect between active and placebo arms).
Valuation: Updated for note financing
We have updated our valuation for the first tranche of the convertible note (received in July), the higher cash burn and spot exchange rates. All in all, our valuation remains unchanged at €119m or €6.4 per share. The Phase III study results in December will be the main share price catalyst for ASIT in 2019.
Exhibit 1: Financial summary
|
|
€'000s |
2017 |
2018 |
2019e |
2020e |
|
Year end 31 December |
|
|
IFRS |
IFRS |
IFRS |
IFRS |
|
INCOME STATEMENT |
|
|
|
|
|
|
|
Revenue |
|
|
|
0 |
0 |
0 |
0 |
Cost of Sales |
|
|
|
0 |
0 |
0 |
0 |
Gross Profit |
|
|
|
0 |
0 |
0 |
0 |
General and Administrative Expenses |
|
(1,676) |
(2,468) |
(2,959) |
(2,930) |
||
Research and Development Expenses |
|
(10,903) |
(10,856) |
(13,770) |
(3,480) |
||
Other Operating Income |
|
|
604 |
557 |
1,040 |
1,092 |
|
Reported operating profit |
|
|
(11,975) |
(12,767) |
(15,690) |
(5,318) |
|
Net Interest |
|
|
|
(9) |
(1,557) |
(2) |
(412) |
Profit before tax (as reported) |
|
|
(11,984) |
(14,324) |
(15,692) |
(5,730) |
|
Reported tax |
|
|
|
(2) |
3 |
2 |
1,719 |
Profit after tax (reported) |
|
|
(11,986) |
(14,321) |
(15,690) |
(4,011) |
|
Minority interests |
|
|
0 |
0 |
0 |
0 |
|
Net income (reported) |
|
|
(11,986) |
(14,321) |
(15,690) |
(4,011) |
|
Basic average number of shares outstanding (m) |
|
12.8 |
16.7 |
19.5 |
20.2 |
||
EPS - basic, as reported (€) |
|
(0.94) |
(0.86) |
(0.81) |
(0.21) |
||
BALANCE SHEET |
|
|
|
|
|
|
|
Non Current Assets |
|
|
1,837 |
2,398 |
2,737 |
2,702 |
|
Property Plant and equipment, net |
|
691 |
810 |
876 |
801 |
||
Other intangible assets |
|
|
0 |
0 |
98 |
98 |
|
Other Non Current Assets |
|
|
1,146 |
1,588 |
1,763 |
1,803 |
|
Current Assets |
|
|
2,448 |
9,156 |
6,736 |
6,265 |
|
Cash and cash equivalents |
|
|
2,126 |
8,458 |
5,341 |
3,670 |
|
Accounts receivable |
|
|
0 |
0 |
0 |
0 |
|
Inventories |
|
|
|
0 |
0 |
0 |
0 |
Other current assets |
|
|
322 |
698 |
1,395 |
2,595 |
|
Current Liabilities |
|
|
2,654 |
4,621 |
4,433 |
2,126 |
|
Accounts payable |
|
|
1,264 |
2,980 |
3,606 |
1,299 |
|
Short term debt and borrowings |
|
34 |
25 |
38 |
38 |
||
Other current liabilities |
|
|
1,356 |
1,616 |
789 |
789 |
|
Non Current Liabilities |
|
|
432 |
465 |
9,865 |
16,865 |
|
Loans and borrowings |
|
|
432 |
465 |
9,671 |
16,671 |
|
Other non-current liabilities |
|
|
0 |
0 |
194 |
194 |
|
Equity |
|
|
|
1,199 |
6,468 |
(4,824) |
(8,065) |
Common stock / Capital |
|
|
9,989 |
14,350 |
15,976 |
15,976 |
|
Additional paid-in capital / Share premium |
|
21,957 |
37,034 |
31,586 |
28,175 |
||
Other reserves and surplus |
|
|
(28,645) |
(42,889) |
(50,021) |
(49,851) |
|
Other Equity |
|
|
|
(2,102) |
(2,027) |
(2,365) |
(2,365) |
CASH FLOW |
|
|
|
|
|
|
|
Cash Flow from Operations |
|
|
|
|
|
|
|
Net income (loss) |
|
|
(11,986) |
(14,321) |
(15,690) |
(4,011) |
|
Depreciation and Amortization |
|
|
205 |
253 |
268 |
230 |
|
Interest income/expense |
|
|
9 |
1,557 |
2 |
412 |
|
Stock-based compensation |
|
|
54 |
73 |
170 |
170 |
|
Non Cash Adjustments |
|
|
(492) |
(564) |
(1,200) |
(1,200) |
|
(Increase) decrease in inventories |
|
0 |
0 |
0 |
0 |
||
(Increase) decrease in trade receivables |
|
74 |
(376) |
21 |
0 |
||
(Increase) decrease in other current assets |
|
(112) |
360 |
(600) |
(1,200) |
||
Increase (decrease) in trade payables |
|
(586) |
0 |
(1,085) |
(2,307) |
||
Net cash used in Operating activities |
|
(12,834) |
(13,018) |
(15,945) |
(7,906) |
||
Cash Flow from Investing |
|
|
|
|
|
|
|
Purchases of fixed assets |
|
|
(161) |
(371) |
(315) |
(155) |
|
Other Investing Activities |
|
|
0 |
0 |
10 |
10 |
|
Net cash used in Investing activities |
|
(161) |
(371) |
(305) |
(145) |
||
Cash Flow from Financing |
|
|
|
|
|
|
|
Change in Debt |
|
|
0 |
0 |
9,225 |
7,000 |
|
Change in Capital Stock |
|
|
0 |
19,591 |
1,982 |
1,800 |
|
Interest paid |
|
|
|
(10) |
(2) |
(13) |
(485) |
Other Financing Activities |
|
|
1,743 |
134 |
(21) |
23 |
|
Net cash used in Financing activities |
|
1,733 |
19,723 |
11,173 |
8,338 |
||
Net Changes in Cash and Cash Equivalent |
|
(11,262) |
6,334 |
(5,077) |
288 |
||
Net cash/(debt) at the beginning of the period |
|
12,956 |
1,660 |
7,968 |
(4,368) |
||
Net cash/(debt) at the end of the period |
|
1,660 |
7,968 |
(4,368) |
(13,039) |
Source: ASIT biotech, Edison Investment Research
|
|