Celyad |
Progressing a broad clinical strategy |
Placing announcement |
Pharma & biotech |
30 May 2018 |
Share price performance
Business description
Next events
Analysts
|
The placing has given Celyad a cash boost of €46.1m gross adding to the €34m on 31 December 2017. Celyad is designing a set of sophisticated clinical trials to expand understanding of its novel NKR CAR T-cell therapy. The THINK study, focused on AML and colorectal cancers, showed a near complete response (CR) in AML in Q417 plus two other AML responses and two colorectal stable disease cases. The highest THINK dose range should complete in H218. The SHRINK study, NKR CAR T-cells plus chemotherapy in metastatic colorectal cancer (mCRC), has dosed its first patient. The indicative value has been adjusted to €1040m, €85 per share.
Year |
Revenue (€m) |
PBT* |
EPS* |
DPS |
P/E |
Yield |
12/16 |
8.52 |
(20.00) |
(2.09) |
0.0 |
N/A |
N/A |
12/17 |
3.54 |
(26.80) |
(2.79) |
0.0 |
N/A |
N/A |
12/18e |
0.00 |
(27.25) |
(2.43) |
0.0 |
N/A |
N/A |
12/19e |
0.00 |
(28.50) |
(2.38) |
0.0 |
N/A |
N/A |
Note: *PBT and EPS are normalised, excluding amortisation of acquired intangibles, exceptional items and share-based payments.
2017 accounts with increased 2018 cash
Celyad recognised €26.27m of one-off items in the 2017 accounts. There were non-cash write-offs and government loans on the C-Cure heart project (net €1.93m) and the buy-back of some of NKR technology royalty obligations potentially due to Dartmouth College and Celdara (€24.34m, of which €13.28m was cash). This reduced non-current liabilities by about €14m. There was a payment of €3.5m from Novartis for a non-exclusive licence to the allogeneic patent. Management state that the May placing proceeds, €46.1m gross, could fund Celyad through H2 2020.
Clinical validity and revised programme
In 2017, Celyad found an acute myeloid leukaemia (AML) patient given three doses of 1x109 NKR CAR T-cells had a near CR with markedly reduced blast counts and, importantly, a strong recovery in normal blood cell levels that enabled a stem cell transplant. The case report is published. Celyad is completing the higher 3x109 cell doses in the THINK study with preferential recruitment of AML and colorectal patients. Celyad is also evaluating combination therapies in the mCRC SHRINK trial with CYAD-01 in combination with FOLFOX chemotherapy. The LINK study, is testing direct tumour injection to avoid the need for cell migration to the cancer site. A trial in allogeneic NKR CAR therapy could start if there is THINK efficacy seen.
Valuation: Revised and diluted to €84 per share
The valuation (fully revised 30 October 2017) is focused on AML at 25% probability and colorectal at 20%. The C-Cure €10m nominal value has now been removed. Cash flows have been adjusted in line with the 2017 annual report. This gives an adjusted indicative value of €1,040m (formerly €1,047m) given the weaker Euro US$ rate. The number of shares and ADRs in issue has increased from 9.9m to 11.94m so the indicative value per share is now €85 (formerly €103). Value progression depends on CYAD-01 patient responses plus further deals and progression of the allogenic CAR opportunity, now a fashionable area.
Exhibit 1: Financial summary
€000s |
2016 |
2017 |
2018e |
2019e |
||
Year end 31 December |
IFRS |
IFRS |
IFRS |
IFRS |
||
PROFIT & LOSS |
||||||
Revenue |
|
|
8,523 |
3,540 |
0 |
0 |
Cost of Sales |
(53) |
(515) |
(500) |
(500) |
||
Gross Profit |
8,470 |
3,025 |
(500) |
(500) |
||
EBITDA |
|
|
(21,246) |
(22,317) |
(26,500) |
(27,750) |
Operating Profit (before amort. and except). |
|
|
(22,006) |
(23,283) |
(27,500) |
(28,750) |
Intangible Amortisation |
(756) |
(748) |
(750) |
(750) |
||
Other income and charges |
0 |
(26,273) |
0 |
0 |
||
Share-based payments |
(2,847) |
(2,569) |
(2,600) |
(2,600) |
||
Operating Profit |
(25,609) |
(52,873) |
(30,850) |
(32,100) |
||
Net Interest |
1,997 |
(3,521) |
250 |
250 |
||
Profit Before Tax (norm) |
|
|
(20,009) |
(26,804) |
(27,250) |
(28,500) |
Profit Before Tax (FRS 3) |
|
|
(23,612) |
(56,394) |
(30,600) |
(31,850) |
Tax |
6 |
1 |
0 |
0 |
||
Profit After Tax (norm) |
(20,003) |
(26,803) |
(27,250) |
(28,500) |
||
Profit After Tax (FRS 3) |
(23,606) |
(56,393) |
(30,600) |
(31,850) |
||
Average Number of Shares Outstanding (m) |
9.3 |
9.6 |
11.2 |
12.0 |
||
EPS - normalised (c) |
|
|
(209) |
(279) |
(243) |
(238) |
EPS - (IFRS) (c) |
|
|
(253) |
(586) |
(273) |
(267) |
Dividend per share (c) |
0.0 |
0.0 |
0.0 |
0.0 |
||
Gross Margin (%) |
N/A |
N/A |
N/A |
N/A |
||
EBITDA Margin (%) |
N/A |
N/A |
N/A |
N/A |
||
Operating Margin (before GW and except) (%) |
N/A |
N/A |
N/A |
N/A |
||
BALANCE SHEET |
||||||
Fixed Assets |
|
|
53,440 |
41,232 |
40,492 |
39,752 |
Intangible Assets |
49,566 |
36,508 |
35,768 |
35,028 |
||
Tangible Assets |
3,563 |
3,290 |
3,290 |
3,290 |
||
Investments |
311 |
1,434 |
1,434 |
1,434 |
||
Current Assets |
|
|
85,366 |
36,393 |
50,659 |
22,149 |
Stocks |
0 |
0 |
0 |
0 |
||
Debtors |
1,359 |
233 |
233 |
233 |
||
Cash (cash plus deposits) |
82,587 |
33,905 |
48,171 |
19,661 |
||
Other |
1,420 |
2,255 |
2,255 |
2,255 |
||
Current Liabilities |
|
|
(11,275) |
(7,944) |
(7,944) |
(7,944) |
Creditors |
(9,960) |
(7,509) |
(7,509) |
(7,509) |
||
Deferred revenue |
0 |
0 |
0 |
0 |
||
Walloon loans and bank loan |
(1,315) |
(435) |
(435) |
(435) |
||
Long Term Liabilities |
|
|
(36,646) |
(22,146) |
(22,146) |
(22,146) |
Loans (non-current) Bank and Walloon |
(7,866) |
(1,870) |
(1,870) |
(1,870) |
||
Other long term liabilities |
(28,780) |
(20,276) |
(20,276) |
(20,276) |
||
Net Assets |
|
|
90,885 |
47,535 |
61,061 |
31,811 |
CASH FLOW |
||||||
Operating Cash Flow |
|
|
(26,695) |
(46,027) |
(26,514) |
(27,471) |
Net Interest |
1,997 |
(3,521) |
264 |
(29) |
||
Tax |
0 |
0 |
0 |
0 |
||
Capex |
(1,782) |
(858) |
(1,010) |
(1,010) |
||
Acquisitions/disposals |
(1,561) |
0 |
0 |
0 |
||
Financing |
0 |
625 |
46,140 |
0 |
||
Dividends |
0 |
0 |
0 |
0 |
||
Other |
3,109 |
1,099 |
(4,614) |
0 |
||
Net Cash Flow |
(24,932) |
(48,682) |
14,266 |
(28,510) |
||
Opening net debt/(cash) |
|
|
(96,131) |
(73,406) |
(31,600) |
(45,866) |
HP finance leases initiated |
0 |
0 |
0 |
0 |
||
Loan and finance movements |
2,207 |
6,876 |
(0) |
0 |
||
Closing net debt/(cash) |
|
|
(73,406) |
(31,600) |
(45,866) |
(17,356) |
Source: Edison Investment Research estimates, Celyad reports and announcements
Edison is an investment research and advisory company, with offices in North America, Europe, the Middle East and AsiaPac. The heart of Edison is our world-renowned equity research platform and deep multi-sector expertise. At Edison Investment Research, our research is widely read by international investors, advisers and stakeholders. Edison Advisors leverages our core research platform to provide differentiated services including investor relations and strategic consulting. Edison is authorised and regulated by the Financial Conduct Authority. Edison Investment Research (NZ) Limited (Edison NZ) is the New Zealand subsidiary of Edison. Edison NZ is registered on the New Zealand Financial Service Providers Register (FSP number 247505) and is registered to provide wholesale and/or generic financial adviser services only. Edison Investment Research Inc (Edison US) is the US subsidiary of Edison and is regulated by the Securities and Exchange Commission. Edison Investment Research Limited (Edison Aus) [46085869] is the Australian subsidiary of Edison. Edison Germany is a branch entity of Edison Investment Research Limited [4794244]. www.edisongroup.com DISCLAIMER |
Frankfurt +49 (0)69 78 8076 960 Schumannstrasse 34b 60325 Frankfurt Germany |
London +44 (0)20 3077 5700 280 High Holborn London, WC1V 7EE United Kingdom |
New York +1 646 653 7026 295 Madison Avenue, 18th Floor 10017, New York US |
Sydney +61 (0)2 8249 8342 Level 12, Office 1205 95 Pitt Street, Sydney NSW 2000, Australia |
Frankfurt +49 (0)69 78 8076 960 Schumannstrasse 34b 60325 Frankfurt Germany |
London +44 (0)20 3077 5700 280 High Holborn London, WC1V 7EE United Kingdom |
New York +1 646 653 7026 295 Madison Avenue, 18th Floor 10017, New York US |
Sydney +61 (0)2 8249 8342 Level 12, Office 1205 95 Pitt Street, Sydney NSW 2000, Australia |