ASIT’s FY18 preliminary results were dominated by the initiation of the second Phase III study of gp-ASIT+ where randomisation is now complete. The company’s FY18 operating loss increased slightly to €12.8m compared to FY17. R&D comprised the bulk of operating expense at €10.9m and included €9.9m on the Phase III study. Cash at the end of FY18 and March 19 was €8.5m and €5.9m, respectively, while the previously announced convertible note offering should extend the cash runway from Q319 until Q320.
Written by
ASIT biotech |
All the bases loaded for ASIT011 |
FY18 results |
Pharma & biotech |
3 April 2019 |
Share price performance
Business description
Next events
Analyst
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ASIT’s FY18 preliminary results were dominated by the initiation of the second Phase III study of gp-ASIT+ where randomisation is now complete. The company’s FY18 operating loss increased slightly to €12.8m compared to FY17. R&D comprised the bulk of operating expense at €10.9m and included €9.9m on the Phase III study. Cash at the end of FY18 and March 19 was €8.5m and €5.9m, respectively, while the previously announced convertible note offering should extend the cash runway from Q319 until Q320.
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 |
(9.7) |
(0.52) |
0.0 |
N/A |
N/A |
12/20e |
0.0 |
(5.4) |
(0.21) |
0.0 |
N/A |
N/A |
Note: *PBT and EPS are both as reported.
FY18 results include the pivotal Phase III study
The improvements that ASIT and its CRO have implemented to improve the likelihood of success in the larger ASIT011 Phase III study in grass allergy patients have come at a lower R&D spend than we had estimated. The first of 624 patients was dosed at the end of January for the 2019 allergy season and enrolment is now complete. ASIT’s FY18 operating loss increased slightly to €12.8m from €12.0m. R&D was the largest operating expense but was flat at €10.9m compared to FY17. Our estimates of FY18 operating loss and R&D spend were higher at €13.8m and €12.0m, respectively. Net loss increased to €14.3m (from €12m in FY17) after €1.6m in expenses associated with the 2018 offerings. Cash at end-FY18 was €8.5m (vs €2.1m at end-FY17). Including its existing equity line, ASIT estimates that its cash runway will last until Q319 before the convertible note issue announced in February, which is required to complete the ASIT011 study. This should extend the cash needs until the end of Q320. By that time, we expect gp-ASIT+ to have been filed and partnerships to have been signed.
Busy time in business development
ASIT has provided more detail on the out-licensing of its pipeline, which includes hdm-ASIT+ and pnt-ASIT+ for house dust mite and peanut allergies, respectively. These earlier two products will enter Phase I in partnership or with co-financing. This means that business development (BD) moves to centre stage, adding to the ongoing BD effort to secure a marketing partner for gp-ASIT+ in the US. While the optimal partnering strategy for shareholders may result in different partners for each product, clinical success in the ASIT011 Phase III study that reports at the end of 2019 will validate the platform and likely assist all ASIT’s BD.
Valuation: Virtually unchanged
Our valuation of ASIT is unchanged at €119m, or €6.4 per share. We have made minor changes to our financial model but will update the valuation after the €9–12m convertible note offering has completed and the full FY18 financials published.
Exhibit 1: Financial summary
|
|
|
€'000s |
2017 |
2018 |
2019e |
2020e |
2021e |
Year end 31 December |
|
|
IFRS |
IFRS |
IFRS |
IFRS |
IFRS |
|
INCOME STATEMENT |
|
|
|
|
|
|
|
|
Revenue |
|
|
|
0 |
0 |
0 |
0 |
0 |
Cost of Sales |
|
|
|
0 |
0 |
0 |
0 |
0 |
Gross Profit |
|
|
|
0 |
0 |
0 |
0 |
0 |
General and Administrative Expenses |
|
(1,676) |
(2,481) |
(2,456) |
(2,432) |
(2,407) |
||
Research and Development Expenses |
|
(10,903) |
(10,856) |
(8,000) |
(3,480) |
(2,000) |
||
Other Operating Income |
|
|
604 |
570 |
599 |
628 |
660 |
|
Reported operating profit |
|
|
(11,975) |
(12,767) |
(9,858) |
(5,283) |
(3,747) |
|
Net Interest |
|
|
|
(9) |
(1,557) |
180 |
(144) |
(274) |
Profit before tax (as reported) |
|
|
(11,984) |
(14,324) |
(9,678) |
(5,427) |
(4,021) |
|
Reported tax |
|
|
|
(2) |
3 |
2 |
1,628 |
1,206 |
Profit after tax (reported) |
|
|
(11,986) |
(14,321) |
(9,676) |
(3,779) |
(2,815) |
|
Minority interests |
|
|
0 |
0 |
0 |
0 |
0 |
|
Net income (reported) |
|
|
(11,986) |
(14,321) |
(9,676) |
(3,779) |
(2,815) |
|
Basic average number of shares outstanding ('m) |
|
12,806 |
16,704 |
18,434 |
18,434 |
18,434 |
||
EPS - basic, as reported (€) |
|
(0.94) |
(0.86) |
(0.52) |
(0.21) |
(0.15) |
||
BALANCE SHEET |
|
|
|
|
|
|
|
|
Non-Current Assets |
|
|
1,837 |
1,998 |
2,011 |
1,935 |
1,849 |
|
Property Plant and equipment, net |
|
691 |
683 |
686 |
620 |
534 |
||
Other intangible assets |
|
|
0 |
0 |
0 |
0 |
0 |
|
Other Non-Current Assets |
|
|
1,146 |
1,315 |
1,315 |
1,315 |
1,315 |
|
Current Assets |
|
|
2,448 |
8,753 |
17,097 |
28,512 |
25,571 |
|
Cash and cash equivalents |
|
|
2,126 |
8,500 |
16,844 |
28,265 |
25,318 |
|
Accounts receivable |
|
|
0 |
0 |
0 |
0 |
0 |
|
Inventories |
|
|
|
0 |
0 |
0 |
0 |
0 |
Other current assets |
|
|
322 |
253 |
253 |
253 |
253 |
|
Current Liabilities |
|
|
2,654 |
4,196 |
3,340 |
2,684 |
2,467 |
|
Accounts payable |
|
|
1,264 |
2,354 |
1,498 |
842 |
625 |
|
Short term debt and borrowings |
|
34 |
38 |
38 |
38 |
38 |
||
Other current liabilities |
|
|
1,356 |
1,804 |
1,804 |
1,804 |
1,804 |
|
Non-Current Liabilities |
|
|
432 |
446 |
9,446 |
16,446 |
16,446 |
|
Loans and borrowings |
|
|
432 |
446 |
9,446 |
16,446 |
16,446 |
|
Other non-current liabilities |
|
|
0 |
0 |
0 |
0 |
0 |
|
Equity |
|
|
|
1,199 |
6,617 |
4,140 |
2,141 |
(673) |
Common stock / Capital |
|
|
9,989 |
13,125 |
13,125 |
13,125 |
13,125 |
|
Additional paid-in capital / Share premium |
|
21,957 |
27,449 |
24,972 |
22,973 |
20,159 |
||
Other reserves and surplus |
|
|
(28,645) |
(33,957) |
(33,957) |
(33,957) |
(33,957) |
|
Other Equity |
|
|
|
(2,102) |
0 |
0 |
0 |
0 |
CASH FLOW |
|
|
|
|
|
|
|
|
Cash Flow from Operations |
|
|
|
|
|
|
|
|
Net income (loss) |
|
|
(11,986) |
(12,807) |
(9,676) |
(3,779) |
(2,815) |
|
Depreciation and Amortization |
|
|
205 |
176 |
184 |
181 |
160 |
|
Interest income/expense |
|
|
9 |
40 |
(180) |
144 |
274 |
|
Stock-based compensation |
|
|
54 |
0 |
0 |
0 |
0 |
|
Non-Cash Adjustments |
|
|
(492) |
0 |
0 |
0 |
0 |
|
(Increase) decrease in inventories |
|
0 |
0 |
0 |
0 |
0 |
||
(Increase) decrease in trade receivables |
|
74 |
0 |
0 |
0 |
0 |
||
(Increase) decrease in other current assets |
|
(112) |
69 |
0 |
0 |
0 |
||
Increase (decrease) in trade payables |
|
(586) |
2,180 |
(856) |
(656) |
(217) |
||
Net cash used in Operating activities |
|
(12,834) |
(10,342) |
(10,527) |
(4,129) |
(2,598) |
||
Cash Flow from Investing |
|
|
|
|
|
|
|
|
Purchases of fixed assets |
|
|
(161) |
(255) |
(197) |
(106) |
(75) |
|
Other Investing Activities |
|
|
0 |
0 |
0 |
0 |
0 |
|
Net cash used in Investing activities |
|
(161) |
(255) |
(197) |
(106) |
(75) |
||
Cash Flow from Financing |
|
|
|
|
|
|
|
|
Change in Debt |
|
|
0 |
0 |
9,000 |
7,000 |
0 |
|
Change in Capital Stock |
|
|
0 |
16,900 |
7,200 |
1,800 |
0 |
|
Interest paid |
|
|
|
(10) |
(42) |
(24) |
(474) |
(824) |
Other Financing Activities |
|
|
1,743 |
2 |
204 |
330 |
550 |
|
Net cash used in Financing activities |
|
1,733 |
16,860 |
16,380 |
8,656 |
(274) |
||
Net Changes in Cash and Cash Equivalent |
|
(11,262) |
6,262 |
5,655 |
4,421 |
(2,947) |
||
Net cash (debt) at the beginning of the period |
|
12,968 |
1,694 |
8,054 |
7,398 |
11,819 |
||
Net cash (debt) at the end of the period |
|
1,694 |
8,054 |
7,398 |
11,819 |
8,872 |
||
Source: ASIT Biotech SA, Edison Investment Management
|
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Research: Healthcare
Telix Pharmaceuticals has added significant value by acquiring ANMI, the developer of its TLX591-CDx prostate cancer imaging kit and underlying ‘cold kit’ technology. It also announced plans to accelerate its TLX591 prostate cancer therapeutic into Phase III, based on a third-party review of clinical data that formed part of the Atlab acquisition in September. Following the ANMI acquisition we increase our valuation to A$380m (vs A$303m) or A$1.74 per share (vs A$1.43 per share). FDA agreement to the TLX591 Phase III design would likely prompt a further valuation uplift.