Celyad
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Celyad |
CAR reaches the highest dose |
Clinical progress and FY15 |
Pharma & biotech |
1 June 2016 |
Share price performance
Business description
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Celyad is a research client of Edison Investment Research Limited |
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Celyad can now move to the highest planned dose of 3x107 cells in the important NKR-2 Phase II CAR trial. If the next 30m cell dose is also safe (and the MTD) it will lead to two separate six patient open label studies in Acute Myeloid Leukaemia and Multiple Myeloma. Further data is possible in late June. Efficacy indications in either of these could enable a series of solid tumour exploratory studies. The advantage of the NKR-T immuno-oncology approach is that it is easily transferred to multiple cancer types. FY15 accounts were as expected with year-end cash of €108m.
Year end |
Revenue |
PBT* |
EPS* |
DPS |
P/E |
Yield |
12/14 |
0.15 |
(18.46) |
(2.73) |
0.0 |
N/A |
N/A |
12/15 |
0.00 |
(28.35) |
(3.26) |
0.0 |
N/A |
N/A |
12/16e |
0.00 |
(32.54) |
(3.50) |
0.0 |
N/A |
N/A |
12/17e |
0.00 |
(37.74) |
(4.06) |
0.0 |
N/A |
N/A |
Note: *PBT and EPS are normalised, excluding intangible amortisation, exceptional items and share-based payments. EPS altered by the share increase from 7.8m to 9.3m in 2015.
CAR progress: high dose cohort can start
Celyad’s emphasis is now on the NKR-T CAR platform with its broad potential in multiple cancer types. The US NKR-2 immuno-oncology Phase I has completed the third dose level and with no safety issues can move to the 30m dose level. It is not certain if this will be the maximum tolerated dose (MTD) expected to be used in later solid tumour studies. Once an MTD is found, the trial will move into an expansion phase where six acute myeloid leukaemia (AML) and six multiple myeloma (MM) patients are recruited in total. Management expects further data by late June. Solid tumour indication studies are being planned at the highest dose level. An allogeneic technology is in preclinical development.
Pivotal cardiac data due in late June
The Phase III C-Cure CHART-1 cardiac regeneration result is expected at the end of June. The primary endpoint is a composite (Bartunek et al, 2015). The CHART-1 outcome will be fascinating and success would trigger the start of the part-US 240 patient Phase III CHART-2. Celyad aims to do a partnering deal, possibly to be signed in 2017. The will enable resources to be focussed onto NKR-T development.
Valuation: Unchanged at €846m/$947m
The core value remains C-Cure at 45% probability of success for CHART-1, and 40% for CHART-2. The probability for CAR in AML and MM remains at 17.5%, but could rise once the last safety hurdle is cleared. The indicative valuation assumes that C-Cure is partnered after Phase III in Europe with some upfront fees; C-Cure was always assumed to be partnered for US marketing. The value estimate remains at €846m/$947m (€88/$98 per share). The FY15 financial results were as expected with cash of €108m. We have updated our 2016 forecast based on the 2015 results. The 2017 forecast (Exhibit 1) does not assume any C-Cure royalties or deals and is preliminary pending the CHART-1 outcome.
Exhibit 1: Financial summary
€000s |
2014 |
2015 |
2016e |
2017e |
Year end 31 December |
IFRS |
IFRS |
IFRS |
IFRS |
PROFIT & LOSS |
||||
Revenue |
146 |
3 |
0 |
0 |
Cost of Sales |
(115) |
(1) |
0 |
0 |
Gross Profit |
31 |
2 |
0 |
0 |
EBITDA |
(18,247) |
(28,639) |
(32,769) |
(37,718) |
Operating Profit (before amort and except) |
(18,440) |
(28,912) |
(33,042) |
(37,991) |
Intangible Amortisation |
(677) |
(760) |
(760) |
(760) |
Other income and charges |
3,778 |
0 |
0 |
0 |
Share-based payments |
(1,098) |
(795) |
(795) |
(795) |
Operating Profit |
(16,437) |
(30,467) |
(34,597) |
(39,546) |
Net Interest |
(16) |
558 |
500 |
250 |
Profit Before Tax (norm) |
(18,456) |
(28,354) |
(32,542) |
(37,741) |
Profit Before Tax (FRS 3) |
(16,453) |
(29,909) |
(34,097) |
(39,296) |
Tax |
0 |
0 |
0 |
0 |
Profit After Tax (norm) |
(18,456) |
(28,354) |
(32,542) |
(37,741) |
Profit After Tax (FRS 3) |
(16,453) |
(29,909) |
(34,097) |
(39,296) |
Average Number of Shares Outstanding (m) |
6.8 |
8.7 |
9.3 |
9.3 |
EPS - normalised (c) |
(273.41) |
(326.28) |
(349.65) |
(405.50) |
EPS - (IFRS) (€) |
(2.44) |
(3.44) |
(3.66) |
(4.22) |
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 |
11,041 |
50,105 |
49,222 |
48,339 |
Intangible Assets |
10,266 |
48,789 |
48,029 |
47,269 |
Tangible Assets |
598 |
1,136 |
1,013 |
890 |
Investments |
177 |
180 |
180 |
180 |
Current Assets |
30,265 |
109,420 |
71,482 |
32,240 |
Stocks |
0 |
0 |
0 |
544 |
Debtors |
830 |
549 |
549 |
0 |
Cash |
27,633 |
107,513 |
69,679 |
30,442 |
Other |
1,802 |
1,358 |
1,254 |
1,254 |
Current Liabilities |
(6,053) |
(11,490) |
(11,592) |
(11,550) |
Creditors |
(5,276) |
(10,592) |
(10,592) |
(10,592) |
Deferred revenue |
0 |
0 |
0 |
0 |
Walloon loans for cash payment |
(777) |
(898) |
(1,000) |
(958) |
Long Term Liabilities |
(11,239) |
(36,561) |
(30,357) |
(30,357) |
Walloon loans (non-current) |
(10,778) |
(10,484) |
(9,280) |
(9,280) |
Other long term liabilities |
(461) |
(26,077) |
(21,077) |
(21,077) |
Net Assets |
24,014 |
111,474 |
78,755 |
38,672 |
CASH FLOW |
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Operating Cash Flow |
(17,398) |
(27,862) |
(37,178) |
(37,447) |
Net Interest |
(16) |
558 |
645 |
123 |
Tax |
0 |
0 |
0 |
0 |
Capex |
(640) |
(838) |
(150) |
(150) |
Acquisitions/disposals |
(1,550) |
(5,186) |
0 |
0 |
Financing |
26,417 |
109,155 |
0 |
0 |
Dividends |
0 |
0 |
0 |
0 |
Other |
1,638 |
(3,287) |
(1,151) |
0 |
Net Cash Flow |
8,451 |
72,540 |
(37,834) |
(37,473) |
Opening net debt/(cash) |
(9,557) |
(16,078) |
(96,131) |
(59,399) |
HP finance leases initiated |
0 |
0 |
0 |
0 |
Walloon loan recognition (non-cash) |
(1,930) |
7,513 |
1,102 |
6,603 |
Closing net debt/(cash) |
(16,078) |
(96,131) |
(59,399) |
(28,529) |
Source: Edison Investment Research estimates, Celyad reports and announcements. Note, no deal or 2017 royalties are assumed ahead of the June 2016 CHART-1 readout.
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