Company Announcement no. 2/2011
To: NASDAQ OMX Copenhagen A/S Hørsholm, Denmark, 1 March 2011
LifeCycle Pharma Publishes Annual Report 2010
LifeCycle Pharma A/S (OMX:LCP) (‘LCP’) today published the annual report of LifeCycle Pharma A/S for the financial year 2010. The annual report has been prepared in accordance with International Financial Reporting Standards as adopted by the EU and additional Danish disclosure requirements for annual reports of listed companies.
This company announcement should be read in conjunction with LCP’s annual report 2010 published separately today.
Full Year 2010 Highlights
- Positive results of phase 2 clinical trial for LCP-Tacro™ in de novo kidney transplant patients.
- Received Special Protocol Assessment (SPA) from FDA for LCP-Tacro™ pivotal phase 3 study in de novo kidney transplant patients.
- First patient dosed in LCP-Tacro™ pivotal phase 3 study in de novo kidney transplant patients.
- Fully subscribed offering of 395,974,670 new shares of DKK 1 nominal value each subscribed at DKK 1.20 per share.
- Positive one-year top-line results of phase 2 clinical trial for LCP-Tacro™ in de novo liver transplant patients.
- During 2010, LCP recognized DKK 1.5 million in revenue compared to DKK 2.5 million in 2009. Revenue consists of payments under LCP’s collaboration agreements.
- Research and development costs are in line with 2009 with DKK 210.1 million in 2009 and DKK 210.4 million in 2010. Although total research and development costs increased only slightly between the periods, the increase in costs due to the increased research and development costs related to the Phase 3 clinical study for LCP-Tacro in stable kidney transplant patients, was almost completely offset by the decrease in costs due to the reduction in the number of employees that took place in August 2009 and in January 2010.
- Administrative expenses decreased by DKK 10.2 million or by 16.4%, from DKK 62.4 million in 2009 to DKK 52.2 million in 2010. The reduction in cost is attributable to the continued focus of reducing overall cost, combined with the effect of the reduction in the number of employees that took place in August 2009 and January 2010.
- One-off restructuring cost mainly includes salary payments to former employees in connection with the reduction in the number of employees in August 2009 and in January 2010.
- During 2010, LCP recognized DKK 272.0 million in operating loss compared to DKK 279.5 million in 2009, and DKK 274.2 million in net loss compared to DKK 271.0 million in 2009. The net loss is in line with management’s expectations for 2010, which projected a net loss of DKK 260-290 million.
- As per 31 December 2010, the balance sheet reflects cash and cash equivalents of DKK 531.5 million compared to DKK 333.4 million as per 31 December 2009. The increase in cash position reflects the total net proceeds from the Offering of approximately DKK 445 million, partially offset by expenditures associated with LCP’s business activities.
Conference Call
On 2 March, 2011, LCP’s Management will host a conference call, at 4:00 PM CET (Denmark); 3:00 PM GMT (London), 10:00 AM ET (New York), 7:00 AM PT (San Francisco).
To access the live conference call, please dial one of the following numbers:
+45 32 72 76 25 Denmark
+44 (0) 1452 555 566 UK
+1 631 510 7498 USA
Access code 48073383
Following the conference call, a recording will be available on the company’s website www.lcpharma.com. A presentation will be available on LCP’s website (under ‘Investors’) one hour prior to the scheduled time of the conference call.
| Financial Highlights | ||||||
| 2010 | 2009 | 2008 | 2007 | 2006 | ||
| DKK'000 | DKK'000 | DKK'000 | DKK'000 | DKK'000 | ||
| Income Statement | ||||||
| Revenue | 1,496 | 2,476 | 170,122 | 64,705 | 9,740 | |
| Research and development costs | (210,426) | (210,140) | (270,875) | (183,608) | (129,403) | |
| Administrative expenses | (52,198) | (62,381) | (73,311) | (54,033) | (29,395) | |
| One-off restructuring cost | (10,894) | (9,489) | - | - | - | |
| Operating loss | (272,022) | (279,534) | (174,064) | (172,936) | (149,058) | |
| Net financial income / (expenses) | (759) | 8,540 | 24,285 | 12,697 | 1,345 | |
| Loss before tax | (272,781) | (270,994) | (149,779) | (160,239) | (147,713) | |
| Tax for the period | (1,425) | - | - | - | - | |
| Net loss for the period | (274,206) | (270,994) | (149,779) | (160,239) | (147,713) | |
| Balance Sheet | ||||||
| Cash and cash equivalents | 531,519 | 333,429 | 600,130 | 331,740 | 464,658 | |
| Total assets | 562,906 | 379,269 | 646,293 | 381,912 | 507,057 | |
| Share capital | 452,543 | 56,568 | 56,288 | 31,771 | 30,370 | |
| Total equity | 498,238 | 317,281 | 572,323 | 325,689 | 458,083 | |
| Investment in property, plant and equipment | 2,583 | 11,043 | 6,571 | 5,900 | 7,222 | |
| Cash Flow Statement | ||||||
| Cash flow from operating activities | (238,148) | (251,158) | (102,560) | (129,291) | (125,813) | |
| Cash flow from investing activities | (2,658) | (11,011) | (6,628) | (7,298) | (7,222) | |
| Cash flow from financing activities | 440,014 | 729 | 373,637 | 3,769 | 510,469 | |
| Cash and cash equivalents at period end | 531,519 | 333,429 | 600,130 | 331,740 | 464,658 | |
| Financial Ratios | ||||||
| Basic and diluted EPS (DKK) | (2.84) | (4.80) | (3.06) | (5.19) | (7.65) | |
| Weighted average number of shares | 96,707,708 | 56,443,701 | 49,006,500 | 30,875,434 | 19,313,737 | |
| Average number of employees (FTEs) | 59 | 93 | 102 | 64 | 44 | |
| Assets/equity | 1.13 | 1.20 | 1.13 | 1.17 | 1.11 | |
Fourth Quarter 2010 Highlights
- Research and development cost were realized at DKK 48.3 million compared to DKK 45.7 million in same period in 2009, and DKK 66.2 million in the previous quarter.
- Administrative expenses were realized at DKK 13.4 million compared to DKK 14.7 million in same period in 2009, and DKK 12.8 million in the previous quarter.
- Operating loss amounted to DKK 61.7 million, while net loss was realized at DKK 61.4 million.
| Financial Highlights | |||||||||
| Quarterly Numbers in DKK | |||||||||
| Q4 | Q3 | Q2 | Q1 | Q4 | Q3 | Q2 | Q1 | ||
| 2010 | 2010 | 2010 | 2010 | 2009 | 2009 | 2009 | 2009 | ||
| DKK'000 | DKK'000 | DKK'000 | DKK'000 | DKK'000 | DKK'000 | DKK'000 | DKK'000 | ||
| Income Statement | |||||||||
| Revenue | - | 3 | 871 | 623 | 182 | 447 | 1,499 | 349 | |
| Research and development costs | (48,302) | (66,150) | (39,625) | (56,349) | (45,740) | (43,986) | (57,604) | (62,810) | |
| Administrative expenses | (13,439) | (12,829) | (12,773) | (13,157) | (14,713) | (14,330) | (16,357) | (16,981) | |
| One-off restructuring cost | - | - | - | (10,894) | - | (9,489) | - | - | |
| Operating loss | (61,741) | (78,976) | (51,527) | (79,777) | (60,271) | (67,358) | (72,462) | (79,443) | |
| Net financial income / (expenses) | 461 | (695) | (313) | (212) | 516 | 394 | (2,105) | 9,735 | |
| Loss before tax | (61,281) | (79,671) | (51,840) | (79,989) | (59,755) | (66,964) | (74,567) | (69,708) | |
| Tax for the period | (168) | (862) | (395) | - | - | - | - | - | |
| Net loss for the period | (61,448) | (80,533) | (52,235) | (79,989) | (59,755) | (66,964) | (74,567) | (69,708) | |
| Balance Sheet | |||||||||
| Cash and cash equivalents | 531,519 | 134,022 | 205,136 | 261,918 | 333,429 | 392,133 | 439,809 | 520,228 | |
| Total assets | 562,906 | 163,651 | 245,345 | 302,353 | 379,269 | 444,915 | 500,455 | 574,148 | |
| Share capital | 452,543 | 56,568 | 56,568 | 56,568 | 56,568 | 56,568 | 56,439 | 56,439 | |
| Total equity | 498,238 | 111,902 | 189,958 | 240,383 | 317,281 | 373,583 | 436,727 | 507,712 | |
| Investment in property, | |||||||||
| plant and equipment | 1,548 | 441 | 101 | 493 | 489 | 890 | 7,149 | 2,515 | |
| Cash Flow Statement | |||||||||
| Cash flow from operating activities | (45,568) | (67,109) | (55,659) | (69,812) | (56,800) | (44,714) | (71,872) | (77,772) | |
| Cash flow from investing activities | (1,548) | (281) | (246) | (583) | (504) | (843) | (7,064) | (2,600) | |
| Cash flow from financing activities | 444,519 | (2,059) | (1,351) | (1,095) | (1,312) | (446) | 2,593 | (105) | |
| Cash and cash equivalents at period end | 531,519 | 134,022 | 205,136 | 261,918 | 333,429 | 392,133 | 439,809 | 520,228 | |
| Financial Ratios | |||||||||
| Basic and diluted EPS | (0.64) | (1.42) | (0.92) | (1.41) | (1.06) | (1.19) | (1.32) | (1.24) | |
| Weighted average number of shares | 96,707,708 | 56,567,810 | 56,567,810 | 56,567,810 | 56,443,701 | 56,467,878 | 56,438,320 | 56,297,561 | |
| Average number of employees (FTEs) | 54 | 51 | 60 | 69 | 77 | 88 | 99 | 102 | |
| Assets/equity | 1.13 | 1.46 | 1.29 | 1.26 | 1.20 | 1.19 | 1.15 | 1.13 | |
| The quarterly numbers have not been audited. | |||||||||
Outlook for 2011
LCP is expecting an operating loss of DKK 250–280 million compared to the realized operating loss of DKK 272.0 million in 2010. The net loss is likewise expected to be in the range of DKK 250–280 million compared to the net loss of DKK 274.2 million in 2010. As of 31 December 2010, the Company’s cash position equaled DKK 531.5 million and the Company’s 31 December 2011 cash position is expected to be in the range of DKK 250-300 million.
The above estimates are subject to possible changes primarily due to the timing and variation of clinical activities, related costs, royalty and other partner income, and fluctuating exchange rates.
Important Events following the Balance Sheet Date
Following the balance sheet date no material events have occurred, and consequently no material stock exchange announcements have been issued.
Grant of Warrants
At a Board meeting held on 1 March 2011, the Board of Directors decided to issue 2,612,052 warrants to employees of LCP. Of the total number of warrants granted, 1,260,052 was granted to the President & CEO William J. Polvino, and 752,000 was granted to SVP, Commercial Development and Strategic Planning, John Weinberg.
By application of the Black-Scholes formula, the market value of the warrant program can be calculated as DKK 0.55 per warrant assuming an exercise price of DKK 1.23, equal to the closing price of LCP's share at the NASDAQ OMX Copenhagen on 1 March 2011, based on an interest rate of 2.47 % and a volatility of LCPs shares set to 55%.
The volatility is based on the Company’s historical share prices since its IPO in November 2006.
For more information, please contact:
|
LifeCycle Pharma A/S John Weinberg, M.D. SVP, Commercial Development and Strategic Planning Phone: +1 732 321 3208 Email: jdw@lcpharma.com |
Johnny Stilou CFO Phone: + 45 2055 3817 Email: jst@lcpharma.com |
The forward looking statements and targets contained herein are based on LifeCycle Pharma A/S’ management’s current view and assumptions. Such statements involve known and unknown risks and uncertainties that may cause actual results, performance or events to differ materially from those anticipated herein. LifeCycle Pharma A/S expressly disclaim any obligation or undertaking to update or revise any forward looking statements, targets or estimates contained in this interim report to reflect any change in events, conditions, assumptions, or circulations on which any such statements are based unless required by applicable law.
About LifeCycle Pharma A/S (LCP)
Based in Hørsholm, Denmark, with an office in New Jersey, LCP is a specialty pharmaceutical company. Clinical development is the core of LCP's efforts to develop a product portfolio which includes the Company’s lead product candidate, LCP-Tacro™, for immunosuppression, specifically organ transplantation, and products to combat certain cardiovascular diseases. LCP adapts new technologies on a fast commercial timetable. LCP's unique, patented delivery technology, MeltDose®, can improve absorption and bioavailability - at low-scale up costs - not only for a broad spectrum of drugs already on the market but also for new chemical entities. LCP has a lipid-lowering product, Fenoglide®, currently on the U.S. market and a diversified near and medium-term pipeline with three clinical stage product candidates and a number of projects in preclinical development. LCP is listed on the NASDAQ OMX Copenhagen under the trading symbol OMX: LCP. For further information, please visit www.lcpharma.com.
