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Research: Healthcare
Pixium Vision recently announced that it has received a €3m bridge financing loan from shareholders Sofinnova (€1m) and Bpifrance (€2m), which extend its cash runway through to the end of November. The loan will bear interest at 12% pa and mature on 31 July 2024. The loan is a positive step and signal of confidence from these two institutional investors as Pixium works towards securing broader additional financing to bring it past the conclusion of the PRIMAvera European pivotal study, for which results are still anticipated in or around year-end 2023. We maintain our pipeline rNPV valuation of €140.1m but our equity valuation per pre-consolidation basic share is €0.90 (vs €0.92 previously) after adjusting for estimated H123 net debt.
Pixium Vision |
Shareholder loan extends runway |
Financing update |
Healthcare equipment |
11 August 2023 |
Share price performance
Business description
Next events
Analyst
Pixium Vision is a research client of Edison Investment Research Limited |
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Pixium Vision recently announced that it has received a €3m bridge financing loan from shareholders Sofinnova (€1m) and Bpifrance (€2m), which extend its cash runway through to the end of November. The loan will bear interest at 12% pa and mature on 31 July 2024. The loan is a positive step and signal of confidence from these two institutional investors as Pixium works towards securing broader additional financing to bring it past the conclusion of the PRIMAvera European pivotal study, for which results are still anticipated in or around year-end 2023. We maintain our pipeline rNPV valuation of €140.1m but our equity valuation per pre-consolidation basic share is €0.90 (vs €0.92 previously) after adjusting for estimated H123 net debt.
Year |
Revenue |
PBT* |
EPS* |
DPS |
P/E |
Yield |
12/21 |
2.7 |
(10.9) |
(0.23) |
0.0 |
N/A |
N/A |
12/22 |
2.0 |
(10.3) |
(0.21) |
0.0 |
N/A |
N/A |
12/23e |
1.8 |
(12.3) |
(0.09) |
0.0 |
N/A |
N/A |
12/24e |
0.8 |
(13.0) |
(0.09) |
0.0 |
N/A |
N/A |
Note: *PBT and EPS are normalised, excluding amortisation of acquired intangibles, exceptional items and share-based payments.
PRIMAvera milestone expected near year-end 2023
Having completed the required 38 implantations in late 2022, PRIMAvera is assessing the safety and clinical benefits of the wireless Prima System in patients with geographic atrophy due to age-related macular degeneration (GA-AMD). We view the Prima System as a potentially transformative treatment in GA-AMD given the visual function improvements already shown in the earlier five-patient 36-month European feasibility study, including a median visual acuity among evaluable subjects improving from 20/500 pre-implantation to 20/71 (device-assisted with magnification). Prima also holds FDA Breakthrough Device designation, which suggests that the FDA recognises GA-AMD is an irreversibly debilitating human disease and that Prima System has the potential to provide an effective treatment. If PRIMAvera study results are positive, a CE Mark regulatory marketing submission can be filed in 2024, which could lead to commercialisation in H125.
Valuation: Mild revisions pre-consolidation
Pixium plans a 1 for 50 reverse stock split and shares are expected to trade on a post-consolidation basis on 21 September. The company reported a gross debt position of €10.3m at end-FY22 and, given the Q123 gross cash position of €4.7m, the c €2.4m in ESGO debt converted to equity in the year to date and the receipt of a €1.8m research tax credit (RTC) in June, we estimate €5.9m (H123) net debt. We have adjusted our estimates for the RTC and we now estimate a FY23 net operating burn rate of €16.1m (vs €17.6m previously). We maintain a pipeline rNPV valuation of €140.1m, resulting in an equity valuation of €134.2m after including net debt, or €0.90 per basic share (vs €0.92 previously), on a pre-consolidation basis. We assume Pixium will require €36m in funding to reach profitability (in FY25) and, if this need is met through equity issuances at the current market price (€0.057/share) and if outstanding ESGO debt (€1.25m) is also converted at this price, the resulting equity valuation would be €0.21 per share (pre-consolidation).
Exhibit 1: Financial summary
€000s |
2018 |
2019 |
2020 |
2021 |
2022 |
2023e |
2024e |
||
31-December |
IFRS |
IFRS |
IFRS |
IFRS |
IFRS |
IFRS |
IFRS |
||
PROFIT & LOSS |
|||||||||
Revenue |
|
|
1,598 |
1,782 |
2,092 |
2,655 |
1,955 |
1,800 |
800 |
Cost of Sales |
(41) |
0 |
0 |
0 |
0 |
0 |
0 |
||
General & Administrative |
(2,019) |
(3,572) |
(4,008) |
(5,084) |
(4,650) |
(5,398) |
(6,628) |
||
Research & Development |
(5,297) |
(6,563) |
(5,704) |
(7,282) |
(8,793) |
(7,800) |
(4,500) |
||
EBITDA |
|
|
(5,758) |
(8,352) |
(7,620) |
(9,712) |
(11,488) |
(11,398) |
(10,328) |
Depreciation |
(677) |
(448) |
(366) |
(549) |
(456) |
(277) |
(226) |
||
Amortization |
0 |
0 |
0 |
0 |
0 |
0 |
0 |
||
Operating Profit (before exceptionals) |
|
(6,435) |
(8,801) |
(7,986) |
(10,261) |
(11,944) |
(11,675) |
(10,554) |
|
Exceptionals |
(5,859) |
(69) |
(448) |
0 |
0 |
0 |
0 |
||
Other |
0 |
0 |
0 |
0 |
0 |
0 |
0 |
||
Operating Profit |
(12,294) |
(8,870) |
(8,434) |
(10,261) |
(11,944) |
(11,675) |
(10,554) |
||
Net Interest |
(1,277) |
(1,006) |
(699) |
(669) |
1,632 |
(652) |
(2,442) |
||
Profit Before Tax (norm) |
|
|
(7,712) |
(9,806) |
(8,685) |
(10,930) |
(10,312) |
(12,328) |
(12,996) |
Profit Before Tax (FRS 3) |
|
|
(13,571) |
(9,876) |
(9,133) |
(10,930) |
(10,312) |
(12,328) |
(12,996) |
Tax |
0 |
0 |
0 |
0 |
0 |
0 |
0 |
||
Profit After Tax and minority interests (norm) |
(7,712) |
(9,806) |
(8,685) |
(10,930) |
(10,312) |
(12,328) |
(12,996) |
||
Profit After Tax and minority interests (FRS 3) |
(13,571) |
(9,876) |
(9,133) |
(10,930) |
(10,312) |
(12,328) |
(12,996) |
||
Average Number of Shares Outstanding (m) |
18.5 |
22.3 |
34.0 |
47.4 |
48.9 |
139.1 |
149.0 |
||
EPS - normalised (€) |
|
|
(0.42) |
(0.44) |
(0.26) |
(0.23) |
(0.21) |
(0.09) |
(0.09) |
EPS - normalised and fully diluted (€) |
|
|
(0.42) |
(0.44) |
(0.26) |
(0.23) |
(0.21) |
(0.09) |
(0.09) |
EPS - (IFRS) (€) |
|
|
(0.73) |
(0.44) |
(0.27) |
(0.23) |
(0.21) |
(0.09) |
(0.09) |
Dividend per share (€) |
0.0 |
0.0 |
0.0 |
0.0 |
0.0 |
0.0 |
0.0 |
||
BALANCE SHEET |
|||||||||
Fixed Assets |
|
|
3,666 |
4,507 |
3,410 |
2,684 |
2,030 |
1,798 |
1,592 |
Intangible Assets |
2,623 |
2,361 |
1,727 |
1,341 |
983 |
983 |
983 |
||
Tangible Assets |
1,042 |
2,145 |
1,683 |
1,343 |
1,047 |
815 |
609 |
||
Current Assets |
|
|
17,756 |
9,107 |
12,721 |
16,945 |
10,344 |
7,201 |
17,411 |
Short-term investments |
0 |
0 |
0 |
0 |
0 |
0 |
0 |
||
Cash |
15,629 |
6,792 |
10,566 |
14,505 |
7,687 |
4,544 |
14,667 |
||
Other |
2,126 |
2,316 |
2,155 |
2,440 |
2,657 |
2,657 |
2,745 |
||
Current Liabilities |
|
|
(2,044) |
(2,880) |
(3,885) |
(6,483) |
(8,698) |
(4,651) |
(4,651) |
Creditors |
(2,044) |
(2,880) |
(3,349) |
(4,895) |
(4,374) |
(327) |
(327) |
||
Short term borrowings |
0 |
0 |
(536) |
(1,588) |
(4,324) |
(4,324) |
(4,324) |
||
Long Term Liabilities |
|
|
(8,023) |
(7,033) |
(7,682) |
(7,332) |
(6,525) |
(17,095) |
(40,095) |
Long term borrowings |
(7,870) |
(5,787) |
(6,604) |
(6,500) |
(5,990) |
(16,560) |
(39,560) |
||
Other long term liabilities |
(153) |
(1,246) |
(1,078) |
(832) |
(535) |
(535) |
(535) |
||
Net Assets |
|
|
11,355 |
3,700 |
4,564 |
5,814 |
(2,849) |
(12,748) |
(25,743) |
CASH FLOW |
|||||||||
Operating Cash Flow |
|
|
(6,174) |
(7,282) |
(6,207) |
(8,160) |
(12,960) |
(15,445) |
(10,415) |
Net Interest |
(1,277) |
(1,006) |
(699) |
(669) |
1,632 |
(652) |
(2,442) |
||
Tax |
0 |
0 |
0 |
0 |
0 |
0 |
0 |
||
Net Operating Cash Flow |
(7,450) |
(8,288) |
(6,906) |
(8,829) |
(11,328) |
(16,097) |
(12,857) |
||
Capex |
(31) |
(34) |
(82) |
(48) |
(92) |
(45) |
(20) |
||
Acquisitions/disposals |
0 |
0 |
0 |
0 |
0 |
0 |
0 |
||
Financing |
14,068 |
2,034 |
9,055 |
13,170 |
(927) |
2,430 |
0 |
||
Net Cash Flow |
6,587 |
(6,288) |
2,067 |
4,293 |
(12,347) |
(13,712) |
(12,877) |
||
Opening net debt/(cash) |
|
|
(1,401) |
(7,760) |
(1,004) |
(3,426) |
(6,417) |
2,627 |
16,340 |
HP finance leases initiated |
0 |
0 |
0 |
0 |
0 |
0 |
0 |
||
Other |
(228) |
(468) |
354 |
(1,302) |
3,303 |
0 |
0 |
||
Closing net debt/(cash) |
|
|
(7,760) |
(1,004) |
(3,426) |
(6,417) |
2,627 |
16,339 |
29,217 |
Lease debt |
na |
1,346 |
1,258 |
1,045 |
765 |
765 |
765 |
||
Closing net debt/(cash) inclusive of IFRS16 lease debt |
(7,760) |
342 |
(2,168) |
(5,372) |
3,392 |
17,104 |
29,982 |
||
Source: Edison Investment Research, company accounts
|
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Research: Metals & Mining
Sylvania Platinum has announced a 50:50 joint venture (JV) with Limberg Mining Company to process platinum group metals (PGM) and chrome ores from Limberg’s historical tailings dumps and run-of-mine ore. The mine, located in the northern part of the western limb of the Bushveld Complex, will start producing from H225, could add to Sylvania’s production and will diversify its resource mix to include chrome concentrate. Sylvania is investing $32m in capital expenditure (of which 50% will be paid back by Limberg from JV cash flow after the start of production) and $5m in working capital from its large cash resources in exchange for c 6,500koz of forecast PGM and 200kt of chrome concentrate production. Management is forecasting an internal rate of return more than Sylvania’s minimum requirement of 20% pa and a three-year cash payback. Our forecasts and valuation are under review.