ABSCIENCES (EPA:AB) AB Science - 2010 Half year results
Transparency directive : regulatory news
08/09/2010 23:41
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Paris, 8 september 2010 - 8pmFirst half 2010 financial results
Progress reported in activity generated in veterinary medicine
End of patients' recruitment in phase 3 in pancreatic cancer in human medicine
AB Science SA (NYSE Euronext - FR0010557264- AB), pharmaceutical company
specialised in research, development and marketing of protein kinase inhibitors
(PKI), today reported its financial results for the six months ended
June 30, 2010 and provided an update on its activities.
Commenting on this publication, Alain Moussy, Chaiman and CEO of AB Science
declared:
" The progress made in sales from our first anticancer treatment in veterinary
medicine and the positive feedback we receive from veterinarians and
pet-owners is very encouraging. In human medicine, we completed the recruitment
of patients in our phase 3 in pancreatic cancer and the study is progressing
toward completion. The funds raised through our initial public offering will
allow us to continue our development, including through the initiation of new
phases 3 in human medicine with our lead drug masitinib ".
I. Key events of the first six months of 2010 :
* AB Science completed with success its listing on the B Compartment of
the NYSE Euronext exchange:
o The introduction price was EUR 12.65 per share
o 1,305,700 new shares were issued as part of the share offering
and 1,189,000 existing shares were sold (of which 137,574 for
extension clause and 325,515 for over allotment option)
o The net proceeds from the share issue was around EUR
31,6 million, of which EUR 16.5 million for capital increase
and EUR 15.1 million for the selling shareholders.
* On April 23rd 2010 following the share listing of AB Science, six
bonds were converted into 237.150 ordinary shares with a nominal
value of 0.01 euro each, resulting in a capital increase of about
EUR 3 million.
* Revenues, which are currently solely based on the veterinary
franchise, made good progress and were EUR423 thousand, compared to
EUR33 thousand for the first half 2009 and EUR316 thousand at
31 December 2009.
* Since the beginning of the year, the company continues its clinical
development program in both human and veterinary medicine, in
oncology, inflammatory diseases and central nervous system disease.
The company is currently preparing the initiation of new phases 3.
* OSEO, through its programme sustaining Strategic Industrial
Innovation, will provide, as part of the APAS-IPK project for the
development of a new generation of anti-cancerous drugs, a support to
AB Science for a total amount of EUR 6.2 million, EUR 1.8 million of
which as subsidies and EUR 4.4 million as repayable advances.
* A compensation and nomination committee was set up by the Board of
Directors ; it includes 3 members:
- Mr Jean-Pierre Kinet, Board member of AB Science and member of the
Board of Directors of UCB Pharma group;
- Mr John Pieters, Board member of AB Science and former Executive
Director of Amgen France;
- Mr Matthieu O'Neill, independent expert, Partner in charge of the
Benefits department of Hays group in France.
Mr Jean-Pierre Kinet chairs the compensation and nomination committee.
The Board of Directors is now assisted by a scientific committee, an
audit committee, and a compensation and nomination committee.
II. Recent events since the closing of the half-year
* In human medicine, the enrolment of patients in the phase III study
AB07012 testing masitinib in pancreatic cancer has reached the number
of patients set initially and enrolment for this study is therefore
completed. Patients continue to receive their treatment. Enrolment may
possibly resume beyond the initial objective, following
recommendations from IDMC. Study data should be known around the end
of 2011.
* In veterinary medicine, the American Journal of Veterinary Research,
one on the most influential peer-reviewed journal publishes an article
named "Masitinib significantly increases 12- and 24-month
survival rates in dogs with mast cell tumors". The company anticipated
that this publication, targeting a large audience and validating the
ability of masitinib to increase survival in canine mast cell tumour,
will contribute to set masitinib has the standard of care within the
veterinary community.
* The European Medicines Agency did not accept to extend the label of
masitinib in canine mast cell tumour to tumours not expressing the
JM mutation of tyrosine kinase receptor c-Kit, considering the that
the benefit/risk balance was less favorable in this sub-population
than in the population fr which the drug is already registered. The
company anticipate that this decision will have no impact on sales
volumes
III. Financial consolidated summary for the first half 2010 and 2009
Revenues for the first half of 2010 were EUR423 thousand, compared to
EUR33 thousand during the same period in 2009. These revenues were generated
as follows:
o EUR364 thousand from sales of masitinib in veterinary medicine, increasing
by 43,9% as compared to sales for the second semester 2009.
o EUR59 thousand from invoicing to US veterinarians of freight and handling
charges for the shipment of masitinib to US veterinarian under
compassionate import requests, increasing by 96.7% as compared to sales
for the second semester 2009.
In order to have at its disposal an established client base as soon as the
molecule is registered in the United States, the group has decided to provide
for free - excluding freight and handling charges, importation requests from
US veterinarians for an amount equivalent to around EUR 522 thousand in
revenues for the first half of 2010, against EUR218 thousand in the second half
of 2009, i.e. an increase of 139.4% versus the preceding period.
Moreover, the company recorded other operating revenue mainly related to a
EUR260 thousand compensation to be received within the settlement of a dispute.
Operating charges amounted as at 30 June 2010 to EUR5,621 thousand, as compared
with EUR4,333 thousand one year earlier, which is an increase of around 29.7%.
The Company's marketing expenses amounted to EUR552 thousand as at
30 June 2010, of which EUR322 thousand related to the veterinary franchise
in Europe, the remainder corresponding to the implementation of the structure
in anticipation of the marketing of masitinib in veterinary medicine in the
United States. These expenses increased by EUR78 thousand as compared at
30 June 2009 (+16.5% ). This change was mainly the consequence of the
recruitment of two sales representatives to reinforce capabilities in Germany
and in the United Kingdom.
Administrative expenses decreased by 34%, down from EUR676 thousand as at
30 June 2009 to EUR446 thousand as at 30 June 2010.
Research and development expenses increased by 35.2%, up from EUR3,177 thousand
as at 30 June 2009 to EUR4,295 thousand as at 30 June 2010.
This increase is explained mainly by the following factors:
the increase of other research and development expenses
(+ EUR526 thousand) due to the development of clinical studies,
including the launch of new studies and Phase 3 studies in particular.
The decrease in the research tax credit from EUR1,395 thousand as at
30 June 2009 to EUR 803 thousand as at 30 June 2010. This decrease
flows from the exclusion from the base for the tax credit of received
subsidies and conditional advance over the period. The calculation base
of the research tax credit was thus decreased by EUR 2,367 thousand
over the period, which represents an impact of EUR710 thousand.
Conditional advances will be added back to the calculation base for the
research tax credit on the same year they are paid back.
Operating result
The operating loss amounted to EUR4,935 thousand in the six months ended
June 30, 2010, compared to EUR 4,300 thousand in the same period of 2009
(increase of 14,8%).
Financial result
The group generated financial loss of 32 KEUR as at 30 June 2010, as compared
to a gain of 85 KEUR a year earlier. The decrease was primarily due to a
decrease in revenues from investment securities. The loss of 32kEUR was
primarily caused by exchange rate variations that were unfavourable to the
Company (56kEUR) and compounding of conditional advances (19kEUR), partially
offset by revenues from investment securities of 51kEUR).
Total net loss of the period
The total net loss for the period was EUR4,967 thousand on June 30, 2010,
compared to EUR4,215 thousand on June 30, 2009, increasing by 17,8%.
IV. Consolidated balance sheet information
Assets
Inventories amount to EUR829 thousand as at 30 June 2010 as compared to EUR985
as 31 December 2009. They are related to the inventory of raw materials and
principal ingredient (EUR481 thousand), to the inventory of work-in-progress
products (EUR328 thousand) and the inventory of finished products (EUR20
thousand).
Trade receivable increased from EUR107 thousand on 31 December 2009 to EUR133
thousand on 30 June 2010. The increase of this item is related to the increase
in revenues.
Pursuant to the listing of the company in April 2010, the current financial
assets increased from 3 506 KEUR to 16 938 KEUR and cash increased from
EUR1,785 thousand to EUR4,760 thousand. Other current assets of the Company
remain stable. They amounted to EUR6,746 thousand as at 31 December 2009,
versus EUR6,806 thousand as at 30 June 2010.
Liabilities
As at 30 June 2010, the Company's net equity stood at EUR17,403 thousand.
Current liabilities to 30 June 2010 amounted to EUR7,514 thousand as compared
with EUR7,965 thousand to 31 december, i.e an decrease of 9.4% due to the
decrease of trade payable.
Non-current liabilities are attributable to credit line amounting EUR1,000
thousand and to conditional advances. Non-current liabilities amount to
EUR5,725 thousand as at 30 June 2010 compared with EUR5,080 thousand as at
30 June 2009, i.e. an increase of EUR645 thousand linked mainly to a
conditional advance to be received from Oséo (EUR928 thousand) and to the
reclassifications of the part long/small term of conditionals advances
(EUR350 thousand).
About AB Science
Founded in 2001, AB Science is a pharmaceutical company specializing in the
research, development and commercialization of protein kinase inhibitors
(PKIs), a new class of targeted molecules whose action is to modify signalling
pathways within cells. Through these PKIs, the Company targets diseases with
high unmet medical needs (cancer, inflammatory diseases and central nervous
system diseases), in both human and veterinary medicines. Thanks to its
extensive research and development capabilities, AB Science has its own
portfolio of molecules. Masitinib, a lead compound, has already been registered
in veterinary medicine in Europe and is pursuing three on-going phases 3 in
human medicine.
Further information is available on AB Science's website: www.ab-science.com
Main risks and uncertainties
The main risks and main uncertainties that the Company is facing for the first
six months and for the next six months of the financial year 2010 are those
risks and uncertainties described under chapter 4 of the Registration Document
and its update registrered with the "Authorité des Marchés Financiers" on
February 10th 2010 and april 7th 2010.
AB Science - Communication financière & Relations Presse
Contacts Citigate Dewe Rogerson :
Agnès Villeret - Tel: +33 1 53 32 78 95 - agnes.villeret@citigate.fr
Lucie Larguier - Tel : +33 1 53 32 84 75 - lucie.larguier@citigate.fr
FINANCIAL STATEMENTS AS AT 30 JUNE 2010
Assets (in thousands of euros) June 30, December
2010 31, 2009
Intangible assets 864 785
Tangible assets 192 151
Non-current financial assets 119 21
Other non-current assets 0 0
Deferred tax assets 0 0
Non-current assets 1 175 957
Inventories 829 985
Trade receivables 133 107
Current financial assets 16 938 3 506
Other current assets 6 806 6 746
Cash and cash equivalents 4 760 1 785
Current assets 29 466 13 129
TOTAL ASSETS 30 641 14 086
Liabilities (in thousands of euros) June 30, December
2010 31,2009
Share capital 304 286
Additional paid-in capital 64 705 43 502
Translation reserve (28) 9
Other reserves and results (47 577) (42 756)
Total equity attribuable to
equity holders of the Compagny 17 403 1 041
Non controlling interests
Total equity 17 403 1 041
Non-current provisions 306 258
Non-current financial liabilities 5 418 4 822
Other non-current liabilities 0 0
Deferred tax liabilities 0 0
Non-current liabilities 5 725 5 080
Current provisions 130 130
Trade payables 4 738 5 485
Current financial liabilities 710 506
Tax liabilities / Tax payable 0 0
Other current liabilities 1 936 1 844
Current liabilities 7 514 7 965
TOTAL EQUITY AND LIABILITIES 30 641 14 086
STATEMENT OF COMPREHENSIVE INCOME AS AT 30 JUNE 2010
(in thousands of euros) First half First half
2010 2009
Revenue 423 33
Other operating revenues 263 -
Total revenues 686 33
Cost of sales (328) (6)
Marketing expenses (552) (474)
Administrative expenses (446) (676)
Research and development expenses (4 295) (3 177)
Other operating expenses 0 -
Operating income (loss) (4 935) (4 300)
Financial income 77 218
Financial expenses (109) (133)
Financial income (loss) (32) 85
Income tax expense 0 0
Net income (loss) (4 967) (4 215)
including :
Attributable to non-controlling interests - -
Attribuable to equity holders
of the parent (4 967) (4 215)
Translation differences (37) (4)
Total Comprehensive income for the period (5 005) (4 219)
including :
Attributable to non-controlling interests - -
Attribuable to equity holders
of the parent (5 005) (4 219)
Basic earnings per share - in euros (0,17) (148,00)
Diluted earnings per share - in euros (0,17) (148,00)
As at 30 June 2009, the earnings per share is calculated before the division by
1000 of the nominal value of shares, which occurred on 31 December 2009.
CONSOLIDATED STATEMENT OF CASH FLOWS
First half First half
2010 2009
Net income (loss) (4 967) (4 215)
Adjustment for :
- Depreciation, amortisation and charges to provisions 164 225
- Income (loss) from asset sale 0 0
- Non-cash income and expenses linked to share-based
payments 148 226
- Other non cash income and expenses (4) 25
- Income tax expense 0 0
- Change in deferred tax 0 0
- Income from interest on financial assets (27) (163)
Impact of change in working capital requirement
generated by operating activities 343 1 975
Cash flow from operations before tax and interest (4 343) (1 926)
Income Tax (paid)/received 0
Net cash flow from operating activities (4 343) (1 926)
Acquisitions of fixed assets (236) (156)
Sales of tangible and intangible assets 0 0
Acquisitions of financial assets (16 900) (5 500)
Proceeds from the sale of financial assets 3 500 8 987
Changes in loans and advances 0 (4)
Interest (paid)/received 20 223
Other cash flow related to investing activities 0
Net cash flow from investing activities (13 616) 3 550
Dividends paid
Capital increase(decrease) 21 221
Issuance of loans and receipt of conditional advances
Repayments of loans and conditional advances (150) (150)
Other cash flows from financing activities (100) 1
Net cash flow from financing activities 20 971 (149)
Effect of exchange rate fluctuations (37) (4)
Effect of assets held for sale 0
Impact of changes in accounting principles 0
Net increase (decrease) in cash and cash equivalents 2 975 1 471
Cash and cash equivalents opening balance 1 785 3 191
Cash and cash equivalents closing balance 4 760 4 662
Net increase / decrease in cash and cash equivalents 2 975 1 471
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