- Revenues of €1.3 million associated with a milestone payment from Serum Institute of India Private Ltd.
- Cash position of €12.9 million at December 31, 2016
Genticel (Euronext Paris & Brussels: FR00011790542 – GTCL presents today its 2016 full year results in accordance with International Financial Reporting Standards (IFRS). Genticel's 2016 Annual Financial Report including the Management Report is available on the company website (www.genticel.com – Investors/Financial information section) in French. An English version will be made available before mid-March.
euros in thousands | 2016 | 2015 |
Revenues associated with the SIIL contract | 1,304 | 178 |
Research & Development expenses | (7,178) | (10,935) |
Research Tax Credit & Subsidies | 3,705 | 2,940 |
General & Administration expenses | (5,242) | (3,599) |
Operating Loss | (7,411) | (11,417) |
Net Loss of the period | (7,241) | (11,193) |
Loss per share (in euros) | (0.47) | (0.72) |
Cash and liquid investments | 12,937 | 32,803 |
Income statement
In 2016, Genticel again recorded revenues from its agreement with Serum Institute of India Ltd (SERUM INSTITUTE) for a total of €1.3 million, resulting mainly from a milestone payment (US$ 1.2 million) as Genticel's proprietary, reengineered adenylate cyclase “GTL003” fulfilled its predetermined objectives in preclinical in vivo experiments.
SERUM INSTITUTE is evaluating the use of Vaxiclase in the development of acellular multivalent combination vaccines against a variety of infectious diseases, including whooping cough. The license agreement, limited to the authorized indications in emerging markets, includes development and sales upfront and milestones payments depending on the criteria defined within the agreement for potentially up to $57 million, as well as single-digit royalties on net sales.
On December 31, 2016, Genticel had an operating loss of €7.4 million compared with a loss of €11.4 million in 2015. This reduction in operating loss is mostly due to:
- a €1.1 million increase in the Company's revenues in 2016 versus 2015;
- the cancellation of €0.7 million of the Company's financial debt, increasing the total indicated under “Research Tax Credit & Subsidies”;
- a €3.7 million reduction in R&D investment (€7.2 million, versus €10.9 million in 2015):
- a €2.5 million reduction in study and service charges associated with the discontinuation of the GTL001 manufacturing process scaling-up project and expenses relating to its GTL002 program.
- a €0.6 million reduction in research personnel costs associated with a cut in its workforce.
- A €0.8 million reduction in ‘General & Administration expenses' (resulting from the operating expense-reduction program put in place by Genticel in early 2016) following the announcement of the initial results of the phase 2 clinical trial undertaken on the GTL001 product.
These reductions in expenses were partly offset by one-time restructuring costs (€2.2 million) and €0.2 million of expenses incurred in the preparation of the transaction with Genkyotex, i.e. a total of €2.4 million of non-recurrent expenses.
After taking into account 2016 financial revenues, the 2016 net loss of €7.2 million (vs. €11.2 million in 2015) is consistent with the Company's expectations.
Balance sheet and cash at the end of 2016
Genticel completed 2016 with cash & cash equivalents and liquid investments of €12.9 million consisting of €8.3 million in current financial assets and €4.7 million in cash and cash equivalents.
This cash and liquid investments balance, versus the €21.8 million at the end of 2015, is mostly explained by the cash consumed by the operations in 2016 (€8.2 million). This is fully in line with Genticel's expectations and the expected impact on the Company's burn rate of the restructuring process initiated after the publication of disappointing results obtained in the clinical phase 2 trial on the GTL001 product.
Registration of Document E pertaining to the planned strategic combination between Genticel and Genkyotex
The French financial market authority (Autorité des Marchés Financiers – AMF) has registered under reference number E.17-004 on January 31, 2017 the information document (Document E) drawn up in relation to the planned strategic combination between Genticel and Genkyotex's shareholders announced on December 22, 2016.
Shareholders meeting at 11 am on February 28, 2017
The Genticel Shareholders' Meeting scheduled for 11 am today is primarily to approve the contribution of all Genkyotex shares to Genticel and the issue of new shares by Genticel to Genkyotex's shareholders in remuneration of their contributed shares. Within the framework of the merger, shareholders will notably also be asked to approve certain structural modifications (adoption of a mode of governance with a Board of Directors, change in the Company's name to “Genkyotex”), certain delegations to the Board of Directors and the appointment of new Board members. Today's meeting will not examine Genticel's annual accounts as reported in this press release – these will be submitted to a subsequent Shareholders' Meeting.
About Genticel
Genticel's versatile platform, Vaxiclase, is well suited for the development of various immunotherapies. A partnership on the use of Vaxiclase as an antigen per se (GTL003) has been established with Serum Institute of India Pvt. Ltd. (Serum Institute), the largest producer of vaccine dose worldwide. This agreement covers territories in emerging markets only, and could generate up to $57 million in revenues for Genticel, before royalties on sales. It will enable Serum Institute to develop acellular multivalent combination vaccines against a variety of infectious diseases, including whooping cough. The last preclinical milestone foreseen by the agreement was reached in Novermber 2016, opening the path to formal preclinical testing prior to clinical development and subsequent commercialization.
On 22 December 2016, Genticel signed a contribution agreement with the shareholders of Genkyotex pursuant to which, subject to the approval of today's Genticel Shareholders' Meeting, Genkyotex's shareholders will contribute in kind 100% of the Genkyotex share capital (on a fully diluted basis) to Genticel, which will issue new shares in remuneration for the contribution. Upon completion of the proposed transaction, Genkyotex's shareholders will hold 80% of Genticel's share capital & voting rights (on a non-diluted basis).
Genkyotex is developing a portfolio of NADPH oxidase (NOX) oral small molecule inhibitors, which have therapeutic potential for the treatment of multiple significant clinical indications with substantial unmet need, including fibrosis, inflammatory pain, angiogenesis, cancer growth, and neurodegeneration. Genkyotex is currently developing two clinical stage, first-in-class NOX inhibitors and is conducting research on several other pre-clinical molecules.
For more information, visit us at www.genticel.com
Disclaimer
This press release and the information it contains does not constitute an offer or solicitation to buy, sell or hold Genticel shares in any country. This press release may contain forward-looking statements by the company with respect to its objectives. These statements are based on the current estimates and forecasts of the company's management and are subject to risks and uncertainties such as the company's ability to implement its chosen strategy, customer market trends, changes in technologies and in the company's competitive environment, changes in regulations, clinical or industrial risks and all risks linked to the company's growth. These factors as well as other risks and uncertainties may prevent the company from achieving the objectives outlined in the press release. No guarantee is given on forward-looking statements which are subject to a number of risks, notably those described in the registration document filed with the French Markets Authority (the AMF) on 1 April 2015 under number R.15-015, as updated in the Document E filed with the AMF on 31 January 2017 under number E.17-004, and those linked to changes in economic conditions, the financial markets, or the markets on which Genticel is present. Genticel products are currently used for clinical trials only and are not otherwise available for distribution or sale.
EU INVESTORS | US INVESTORS | MEDIA |
NewCap Dušan Orešanský / Emmanuel Huynh +33 1 44 71 94 92 genticel@newcap.eu |
LifeSci Advisors Brian Ritchie +1 212 915 2578 britchie@lifesciadvisors.com |
ALIZE RP Caroline Carmagnol / +33 6 64 18 99 59 genticel@alizerp.com |
Appendix: detailed financial information 2016
The following financial statements have been prepared in accordance with IFRS, as adopted by the European Union, and are taken from the financial information contained in Genticel's 2016 annual financial report, which can be found on the Company's website, www.genticel.com, in the Investors/Financial information section[1].
IFRS financial statements for the year to December 31, 2016 have been audited by Grant Thornton and Sygnatures.
Statement of Financial Position
Genticel | | | 31/12/2016 | | 31/12/2015 |
Statement of Financial Position | Notes | | | | |
| | | € | | € |
| | | | | |
ASSETS | | | | | |
Intangible assets | 3.1 | | 41 664 | | 54 017 |
Property, plant and equipment | 3.2 | | 41 766 | | 155 874 |
Other non-current financial assets | 4 | | 140 268 | | 5 290 657 |
Total non-current assets | | | 223 698 | | 5 500 549 |
Inventories | 5 | | – | | 52 560 |
Trade receivables and related accounts | 6.1 | | 53 342 | | – |
Other receivables | 6.2 | | 3 512 354 | | 3 653 694 |
Current financial assets | 4 | | 8 274 109 | | 5 021 938 |
Cash and cash equivalents | 7 | | 4 663 013 | | 11 659 829 |
Total current assets | | | 16 502 817 | | 20 388 021 |
Total Assets | | | 16 726 515 | | 25 888 570 |
LIABILITIES | | | | | |
Shareholders' equity | | | | | |
Capital | 8 | | 1 557 006 | | 1 554 109 |
Additional paid-in capital | | | 48 348 830 | | 48 420 039 |
Other comprehensive income | | | 43 413 | | 4 948 |
Reserves – Group share | | | (29 409 020) | | (18 451 210) |
Result – Group share | | | (7 240 271) | | (11 193 323) |
Shareholders' equity, Group share | | | 13 299 958 | | 20 334 563 |
Non-controlling interests | | | – | | – |
Total shareholders' equity | | | 13 299 958 | | 20 334 563 |
Non-current liabilities | | | | | |
Employee benefit obligations | 11 | | 111 767 | | 322 060 |
Non-current financial debt | 10 | | 335 638 | | 1 900 781 |
Non-current liabilities | | | 447 405 | | 2 222 842 |
Current liabilities | | | | | |
Current financial debt | 10 | | 597 933 | | 621 347 |
Provisions | 12 | | 720 061 | | – |
Trade payables and related accounts | | | 571 262 | | 1 886 424 |
Tax and social security liabilities | 13.1 | | 1 081 497 | | 821 340 |
Other creditors and miscellaneous liabilities | 13.2 | | 8 398 | | 2 055 |
Current liabilities | | | 2 979 151 | | 3 331 166 |
Total Liabilities | | | 16 726 515 | | 25 888 570 |
Income Statement
Genticel | | | 31/12/2016 | | 31/12/2015 |
Income Statement | Notes | | 12 months | | 12 months |
| | | € | | € |
Sales | 15 | | – | | – |
Cost of sales | | | – | | – |
Gross margin | | | – | | – |
| | | | | |
Other income | 15 | | 1 304 060 | | 177 742 |
| | | | | |
Net R&D expenses | | | | | |
R&D expenses | 16.1 | | (7 177 808) | | (10 935 343) |
Subsidies | 16.1 | | 3 705 131 | | 2 940 037 |
| | | | | |
General and administrative expenses | 16.2 | | (5 242 354) | | (3 599 155) |
| | | | | |
Operating profit (loss) | | | (7 410 971) | | (11 416 719) |
| | | | | |
Financial expenses | 17 | | (47 874) | | (64 535) |
Financial income | 17 | | 218 574 | | 287 931 |
Pre-tax profit (loss) | | | (7 240 271) | | (11 193 323) |
| | | | | |
Tax expense | | | – | | – |
Net income | | | (7 240 271) | | (11 193 323) |
Group share | | | (7 240 271) | | (11 193 323) |
Non-controlling interests | | | – | | – |
| | | | | |
Earnings per share | Notes | | 31/12/2016 | | 31/12/2015 |
Weighted average number of outstanding shares | | | 15 561 352 | | 15 463 263 |
Basic earnings per share (€/share) | 20 | | (0.47) | | (0.72) |
Diluted earnings per share (€/share) | 20 | | (0.47) | | (0.72) |
Statement of Comprehensive Income
Genticel | | | 31/12/2016 | | 31/12/2015 |
Statement of Comprehensive Income | Notes | | 12 months | | 12 months |
| | | € | | € |
Profit (loss) for the year | | | (7 240 271) | | (11 193 323) |
Actuarial gains (losses) | 11 | | 38 465 | | 122 504 |
Items not recyclable in income | | | 38 465 | | 122 504 |
| | | | | |
Items recyclable in income | | | – | | – |
| | | | | |
Other items of comprehensive income (net of tax) | | | 38 465 | | 122 504 |
| | | | | |
Comprehensive income | | | (7 201 806) | | (11 070 819) |
Group share | | | (7 201 806) | | (11 070 819) |
Non-controlling interests | | | – | | – |
Change in Shareholders' Equity
Genticel | Notes | Capital | Capital | Premiums linked to capital | Reserves and profit | Actuarial gains (losses) | Shareholders' equity, Group share | Non-controlling interests | Shareholders' equity |
Change in Shareholders' Equity | | Number of shares | | | | | | | |
| | € | € | € | € | € | € | € | |
At 31 December 2014 | | 15 440 235 | 1 544 024 | 48 112 032 | (19 321 595) | (117 555) | 30 216 905 | – | 30 216 905 |
Net income 2015 | | | | | (11 193 323) | | (11 193 323) | – | (11 193 323) |
Other comprehensive income | | | | | | 122 504 | 122 504 | – | 122 504 |
Comprehensive income | | | – | – | (11 193 323) | 122 504 | (11 070 819) | – | (11 070 819) |
BSPCE exercised | | 100 851 | 10 085 | 308 007 | | | 318 092 | – | 318 092 |
Liquidity contract | | | | | 29 689 | | 29 689 | – | 29 689 |
Share-based payments | | | | | 840 695 | | 840 695 | – | 840 695 |
At 31 December 2015 | | 15 541 086 | 1 554 109 | 48 420 039 | (29 644 533) | 4 948 | 20 334 563 | – | 20 334 563 |
Net income 2016 | | | | | (7 240 271) | | (7 240 271) | – | (7 240 271) |
Other comprehensive income | | | | | – | 38 465 | 38 465 | – | 38 465 |
Comprehensive income | | | – | – | (7 240 271) | 38 465 | (7 201 806) | – | (7 201 806) |
BSPCE exercised | 8 | 28 969 | 2 897 | 87 399 | | | 90 296 | – | 90 296 |
Liquidity contract | | | | | 3 704 | | 3 704 | – | 3 704 |
Share-based payments | 9 | | | | 231 810 | | 231 810 | – | 231 810 |
Capital increase transaction expenses (1) | | | | (158 608) | | | (158 608) | – | (158 608) |
At 31 December 2016 | | 15 570 055 | 1 557 005 | 48 348 830 | (36 649 291) | 43 413 | 13 299 958 | – | 13 299 958 |
(1) As part of the strategic merger with Genkyotex, the Company incurred costs amounting to €383K as at 31 December 2016, including €159K premiums in accordance with IAS 32 (see Note 2.3).
Cash Flow Statement
Genticel | | | 31/12/2016 | | 31/12/2015 |
| Notes | | 12 months | | 12 months |
Cash Flow Statement | | | € | | € |
| | | | | |
Cash flow from operating activities | | | | | |
Net income | | | (7 240 271) | | (11 193 323) |
(-) Elimination of depreciation of intangible assets | 3.1 | | (18 072) | | (4 240) |
(-) Elimination of depreciation of property, plant and equipment | 3.2 | | (54 496) | | (51 716) |
(-) Provision additions | 11, 12 | | (548 233) | | (64 847) |
(-) Expenses linked to share-based payments | 9 | | (231 810) | | (840 695) |
(-) Gain (loss) on assets sold | | | (44 077) | | – |
(+) interest from investments | | | 142 725 | | 280 090 |
(-) MAgenTA debt waiver | 10.1 | | 768 816 | | – |
(-) Discounting / unwinding of advances | 10.1 | | (64 651) | | (33 730) |
Self-financing capacity before cost of net financial debt and taxes | | | (7 190 474) | | (10 478 184) |
(-) Change in working capital requirements (net of impairment of trade receivables and inventories) | | | 998 336 | | 1 265 996 |
Cash flow from operating activities | | | (8 188 810) | | (11 744 180) |
| | | | | |
Cash flow from investing activities | | | | | |
Acquisitions of intangible assets | 3.1 | | (7 613) | | (39 126) |
Acquisitions of property, plant and equipment | 3.2 | | (5 771) | | (112 727) |
Asset disposals | | | 23 200 | | – |
Dismantling of time deposits recorded in other financial assets | | | 5 000 000 | | 12 500 000 |
Dismantling of capitalization contract recorded in other financial assets | | | 2 000 000 | | – |
Subscription of time deposits recorded in other financial assets | | | (5 000 000) | | – |
Interest from investments | | | 44 035 | | 236 956 |
Cash flow from investing activities | | | 2 053 852 | | 12 585 103 |
| | | | | |
Cash flow from financing activities | | | | | |
Capital increase transaction expenses | 9 | | (68 376) | | – |
BSPCE exercised | | | 90 296 | | 318 092 |
Encashment of conditional advances and subsidies | 10.1 | | – | | 853 099 |
Repayment of conditional borrowings and advances | 10.1 | | (883 774) | | (495 600) |
Bond repayments | | | – | | (26 798) |
Cash flow from financing activities | | | (861 854) | | 648 793 |
| | | | | |
Increase (decrease) in cash & equivalents | | | (6 996 812) | | 1 489 716 |
| | | | | |
Cash & cash equivalents at period-start (including bank overdrafts) | 8 | | 11 659 656 | | 10 169 940 |
Cash & cash equivalents at period-end (including bank overdrafts) | 8 | | 4 662 844 | | 11 659 656 |
Increase (decrease) in cash & equivalents | | | (6 996 812) | | 1 489 716 |
Cash and cash equivalents at period-end | Notes | | 31/12/2016 | | 31/12/2015 |
Cash and cash equivalents | 8 | | 4 663 013 | | 11 659 829 |
Bank overdrafts | 10 | | (169) | | (174) |
Cash & cash equivalents at period-end (including bank overdrafts) | | | 4 662 844 | | 11 659 656 |
Breakdown of Change in Working Capital Requirements (WCR)
Breakdown of change in WCR | | | 31/12/2016 | | 31/12/2015 |
Other non-current financial assets | | | - | | (6 763) |
Inventories (net of inventory impairment) | | | (52 560) | | 21 091 |
Trade receivables and related accounts (net of impairment of trade receivables) | | | 53 342 | | - |
Other receivables | | | (141 341) | | 513 628 |
Trade payables and related accounts | | | 1 405 395 | | 776 353 |
Tax and social security liabilities | | | (260 157) | | (36 982) |
Other creditors and miscellaneous liabilities | | | (6 344) | | (1 332) |
Total change | | | 998 336 | | 1 265 996 |
[1] Subject to the decisions taken by the Genticel Shareholders' Meeting of February 28, 2017 called to approve (a) the contribution of Genkyotex shares to Genticel and the subsequent issuance of new Genticel shares in payment for the latter, and (b) the change in the Company's name to “Genkyotex”. This document can also be found in the Investors/Financial information section of the Company's new website: www.genkyotex.com.
News releases under ongoing reporting obligations:
– News release on accounts, results
Full and original press release in PDF:
https://www.actusnews.com/documents_communiques/ACTUS-0-47571-pr_genticel_fyr_2016_en.pdf