TIDMSLN
RNS Number : 6204O
Silence Therapeutics PLC
23 September 2013
SILENCE THERAPEUTICS plc
INTERIM RESULTS FOR THE SIX MONTHS ENDED 30 JUNE 2013
23 September 2013
Silence Therapeutics Plc (AIM: SLN), a leading international
RNAi therapeutics company, today provides a corporate update and
announces its interim results for the six months to 30 June
2013.
Ali Mortazavi, Chief Executive, said: "2013 has been a new
beginning for Silence Therapeutics. We have been afforded an
opportunity by our shareholders with the cGBP19m fundraise in April
to pursue our quest to develop RNAi based therapeutics. We believe
that we are on our way towards our promise to new and existing
shareholders to create a new generation of biotechnology
products."
Operational highlights
During H1:
-- Completed a GBP19m fundraising in April at 200p per share
-- Appointed Ali Mortazavi as Chief Executive
-- Appointed Annie Cheng as Director of Corporate Development
-- Presented a report on the Phase I trial and discussed Phase
Ib/IIa outline at the American Society of Clinical Oncology (ASCO)
annual meeting
-- Completed the safety lead-in part of the Atu027 Phase Ib/IIa
trial in combination with gemcitabine
-- GBP24.7m in cash and on deposit at 30 June 2013
Since 1(st) July:
-- Began dosing patients in Phase IIa for Atu027 in pancreatic cancer
-- Developing DBTC and DACC, our delivery systems for the liver and lung, towards the clinic
-- Investigating potential of Micro RNA (miRNAs) using delivery platforms
-- Appointed Simon Sturge as a non-executive director, bringing
over 32 years of senior biotech experience to the board
We are in the process of building a sustainable R&D engine,
including adding personnel and strengthening our infrastructure.
Additionally, evaluations are ongoing for further Atu027 clinical
trials. In addition, as promised in the spring, we are in the
process of assessing non oncology related programs using our
delivery expertise.
For further information, please contact:
Silence Therapeutics N+1 Singer
Ali Mortazavi/Timothy Shaun Dobson/Jenny Wyllie
Freeborn T: +44 20 7496 3000
T: +44 (0)333 988 0140 shaun.dobson@n1singer.com
a.mortazavi@silence-therapeutics.com jenny.wyllie@n1singer.com
t.freeborn@silence-therapeutics.com
OPERATIONAL STATEMENT
In the first half of 2013 Silence continued its growth,
alongside a backdrop of positive news from our space:
-- Progress and broadening of both our clinical and pre-clinical
programs, with exciting new pre-clinical work in lung and liver
delivery systems.
-- Further strengthening of our scientific teams, and formation of a specific clinical team.
-- Significant fundraising in April supported by our key
shareholders and some new shareholders, allowing us to fund further
programs.
-- Strengthening of the board in both executive and non-executive capacities.
-- Ali Mortazavi moved to Chief Executive from Director of
Corporate Strategy after leading the April fundraise. Under his
guidance the company has raised GBP30m since August 2012.
-- Annie Cheng was appointed our Director of Corporate
Development following the April fundraise after being heavily
involved in its planning and marketing. Her experience as a
healthcare analyst in both bulge bracket and boutique banks has
given her a breadth of industry knowledge.
-- Simon Sturge joined us as a non-executive Director on 21(st) August. He has been involved in pharmaceuticals and biotechnology for 32 years, including 11 years as Chief Executive of the company which later became Vernalis plc. We are already benefiting from his valuable experience.
-- The GBP19m placing at 200p (4p pre-consolidation) was
approved by shareholders on 29 April 2013. We appreciate the
confidence shown by investors in Silence's potential.
-- At the ASCO meeting in Chicago we presented our Phase I data
and Phase Ib/IIa plans. In the Phase Ib/IIa study, covering
first-line patients with loco-regionally advanced or metastatic
pancreatic cancer treated with Atu027 in combination with
gemcitabine.
-- We continue to advance our DBTC and DACC delivery systems to enable clinical development.
-- miRNAs are an emerging area of RNA therapeutics. We have used
all three of our delivery platforms in miRNA experiments and we
plan to continue and expand this work.
-- In Berlin we have added project managers and created separate
clinical and pre-clinical teams. We intend to continue adding
experienced scientific staff in Berlin while concentrating
commercial activities in London.
CHAIRMAN'S STATEMENT
"The progress reported here demonstrates that we are delivering
on the key commitments made at the April 2013 fundraising.
The Board extends its deepest thanks for the fantastic continued
support of its existing shareholders, and the participation of some
key new shareholders. This support gives the Board the resource and
timeframe to move significantly closer to its stated aim of
transforming Silence into a fully-fledged therapeutics company
based on our RNAi platform technology."
Jerry Randall ACA MIoD
Chairman
FINANCIAL REVIEW
Revenues were modest in H1 2013 and in line with H1 2012.
Research and development spending has increased 11% to GBP2.1m.
Within this there was a shift in the nature of spend. Consulting
services have declined while materials costs, for clinical grade
drugs, have risen sharply, as has spending with FGK, the clinical
research organisation which is carrying out our Atu027 trial in
Germany.
Administration expenses in H1 rose GBP0.25m to GBP1.38m, but
there was an underlying fall of GBP0.14m due to the non-cash impact
of share option amortisation, which rose GBP0.39m to GBP0.57m,
GBP0.50m within administration expenses and GBP0.07m within
R&D.
There were no impairment charges in H1 2013, versus GBP20.57m in
H1 2012. We remain confident that the remaining GBP7.73m of
goodwill on our balance sheet does not exceed its recoverable
amount.
There was a net cash inflow of GBP10.76m, versus a net cash
ouflow of GBP2.72m in H1 2012, reflecting the GBP18.72m net
proceeds from share issues. Our closing cash position at 30 June
2013 was GBP19.72m, up from GBP0.95m at 30 June 2012. At 30 June
2013 the underlying closing cash position was GBP24.72m, as
GBP5.00m is on deposit until May 2014 with Investec Bank plc and is
included within in Trade and Other Receivables. The rate of
interest on this deposit is linked to the sterling euro exchange
rate. Our cash is banked with RBS in the UK and Commerzbank in
Germany.
RISKS AND UNCERTAINTIES
There are a number of potential risks and uncertainties that
could have a material impact on the Group's performance over the
remaining six months of the financial year and could cause actual
results to differ materially from expected and historical results.
The risks (identified and outlined in the Annual Report and
Accounts 2012 in the Directors' Report on pages 13-15, which does
not form part of this interim statement), include:
-- Clinical and regulatory risk - our drug trials may not be successful.
-- Competition and intellectual property risk - several
companies are developing RNAi technology. Intellectual property may
expire before products are successful commercially.
-- Economic and financial risk - with no recurring revenue, the
Group is reliant on receiving additional funds.
These risks have not changed since the date of the Annual
Report.
SILENCE THERAPEUTICS PLC
CONSOLIDATED INCOME STATEMENT
SIX MONTHS ENDED 30 JUNE 2013
Six months Six months Year ended
ended ended
30 June 2013 30 June 31 December
2012 2012
(Un-audited) (Un-audited) (Audited)
GBP000s GBP000s GBP000s
Revenue 41 37 163
Research
and development
costs (2,110) (1,893) (3,378)
Gross loss (2,069) (1,856) (3,215)
Impairment
of intangible
assets - (20,565) (20,486)
Administrative
expenses (1,382) (1,128) (2,613)
Operating
loss (3,451) (23,549) (26,314)
Finance income 45 9 18
Gain on sale
of fixed
assets - 14 12
Loss for
the period
before taxation (3,406) (23,526) (26,284)
Taxation - - -
Retained
loss for
the period
after taxation (3,406) (23,526) (26,284)
Loss per
ordinary
equity share
(basic and
diluted) (8.4p) (205.0p) (135.0p)
------------------- -------- ------------- ------------
All transactions, with the exception of the impairment of
intangible assets relating to Intradigm Corporation, arose from
continuing activities.
SILENCE THERAPEUTICS PLC
CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
SIX MONTHS ENDED 30 JUNE 2013
Six months Six months Year ended
ended ended
30 June 30 June 31 December
2013 2012 2012
(Un-audited) (Un-audited) (Audited)
GBP000s GBP000s GBP000s
--------------------------- ------------- ------------- ------------
Loss for the
period after
taxation (3,406) (23,526) (26,284)
Other comprehensive
income:
Exchange differences
arising on consolidation
of foreign operations (456) (696) (714)
--------------------------- ------------- ------------- ------------
Total comprehensive
income for the
period (3,862) (24,222) (26,998)
--------------------------- ------------- ------------- ------------
SILENCE THERAPEUTICS PLC
CONSOLIDATED BALANCE SHEET
AT 30 JUNE 2013
30 June 30 June 31 December
2013 2012 2012
(Un-audited) (Un-audited) (Audited)
GBP000s GBP000s GBP000s
----------------------------- ------------- ------------- ------------
Non--current assets
Property, plant and
equipment 165 181 157
Goodwill 7,733 7,289 7,333
Other intangible assets 420 513 526
----------------------------- ------------- ------------- ------------
8,318 7,983 8,016
----------------------------- ------------- ------------- ------------
Current assets
Trade and other receivables 5,354 113 148
Investments held for
sale 2 - 2
Cash and cash equivalents 19,718 950 8,909
----------------------------- ------------- ------------- ------------
25,074 1,063 9,059
Current liabilities
Trade and other payables (931) (981) (959)
----------------------------- ------------- ------------- ------------
Total assets less current
liabilities 32,461 8,065 16,116
----------------------------- ------------- ------------- ------------
Net assets 32,461 8,065 16,116
----------------------------- ------------- ------------- ------------
Capital and reserves
attributable to the
company's equity holders
Share capital 2,351 5,771 1,872
Capital reserves 113,625 80,981 94,849
Translation reserve 2,779 2,342 2,323
Profit and loss account (86,294) (81,029) (82,928)
----------------------------- ------------- ------------- ------------
Total equity 32,461 8,065 16,116
----------------------------- ------------- ------------- ------------
SILENCE THERAPEUTICS PLC
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
SIX MONTHS ENDED 30 JUNE 2013
(Un-audited) Share Capital Translation Profit Total
and
Capital Reserves Reserve loss account
GBP000s GBP000s GBP000s GBP000s GBP000s
------------------------------ --------- --------- ------------ ------------- --------
At 1 January 2013 1,872 94,849 2,323 (82,928) 16,116
Recognition of share-based
payments - 574 - - 574
Transfer upon:
- exercise of warrants
in period - (32) - 34 2
- lapse of vested options
in period - (6) - 6 -
Shares issued in period,
net of expenses 479 18,240 - - 18,719
------------------------------- -------- --------- ------------ ------------- --------
Transactions with owners 479 18,776 - 40 19,295
Loss for six months to
30 June 2013 - - - (3,406) (3,406)
Other comprehensive income
Exchange differences
on consolidation of foreign
operations - - 456 - 456
At 30 June 2013 2,351 113,625 2,779 (86,294) 32,461
------------------------------- -------- --------- ------------ ------------- --------
SILENCE THERAPEUTICS
PLC
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
SIX MONTHS TO 30 JUNE 2012
(Un-audited) Share Capital Translation Profit Total
and
Capital Reserves Reserve loss
account
GBP000s GBP000s GBP000s GBP000s GBP000s
---------------------------- -------- --------- ------------ --------- ---------
At 1 January 2012 5,771 81,141 3,038 (57,772) 32,178
Recognition of share-based
payments - 109 - - 109
Issuance of warrants - - - - -
Transfer upon:
- exercise of options - - - - -
in period
- lapse of vested
options in period - (269) - 269 -
Shares issued in - - - - -
period, net of expenses
---------------------------- -------- --------- ------------ --------- ---------
Transactions with
owners - (160) - 269 109
Loss for six months
to 30 June 2012 - - - (23,526) (23,526)
Other comprehensive -
income
Exchange differences
on consolidation
of foreign operations - - (696) - (696)
At 30 June 2012 5,771 80,981 2,342 (81,029) 8,065
---------------------------- -------- --------- ------------ --------- ---------
SILENCE THERAPEUTICS PLC
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
YEAR ENDED 31 DECEMBER 2012
(Audited) Share Capital Translation Profit
and
capital reserves reserve loss Total
account
GBP000s GBP000s GBP000s GBP000s GBP000s
----------------------------- -------- --------- ------------ --------- ---------
At 1 January 2012 5,771 81,141 3,037 (57,772) 32,177
Recognition of share--based
payments - 656 - - 656
Transfer to capital
redemption reserve (5,194) 5,194 - - -
Transfer upon:
- lapse of vested
options in the period - (1,128) - 1,128 -
Shares issued in
period, net of expenses 1,295 8,986 - - 10,281
----------------------------- -------- --------- ------------ --------- ---------
Transactions with
owners (3,899) 13,708 - 1,128 10,937
Loss for the year
to 31 December 2012 - - - (26,284) (26,284)
----------------------------- -------- --------- ------------ --------- ---------
Other comprehensive
income
Exchange differences
on consolidation
of foreign operations - - (714) - (714)
----------------------------- -------- --------- ------------ --------- ---------
At 31 December 2012 1,872 94,849 2,323 (82,928) 16,116
----------------------------- -------- --------- ------------ --------- ---------
SILENCE THERAPEUTICS PLC
CONSOLIDATED CASH FLOW STATEMENT
SIX MONTHS ENDED 30 JUNE
2013
Six months Six months Year
ended ended ended
December
30 June 30 June 2012
2013 2012
(Un-audited) (Un-audited) (Audited)
GBP000s GBP000s GBP000s
------------------------------- ------------- ------------- ----------
Loss before taxation (3,406) (23,526) (26,284)
Adjustments for:
Impairment of intangible
assets - 20,565 20,486
Depreciation charges 27 36 63
Amortisation charges 152 104 189
(Gain) on sale of property,
plant and equipment - (14) (12)
Charge for the period
in respect of share-based
payments 574 109 656
Charge for warrants - - 32
Foreign exchange movement 11 1 -
Finance and other income (45) (9) (18)
------------------------------- ------------- ------------- ----------
(2,687) (2,734) (4,888)
(Increase)/decrease
in trade and other
receivables (5,169) 53 17
(Decrease)/increase
in trade payables (78) 2 (5)
------------------------------- ------------- ------------- ----------
Cash absorbed by operations (7,934) (2,679) (4,876)
Interest paid - - -
------------------------------- ------------- ------------- ----------
Net cash outflow from
operating activities (7,934) (2,679) (4,876)
------------------------------- ------------- ------------- ----------
Cash flows from investing
activities
Investment in assets
held for sale - - 39
Proceeds from the sale
of property, plant
and equipment - 16 15
Interest received 15 6 15
Proceeds from sale - 39
of assets held for
sale -
Additions to property,
plant and equipment (27) - (3)
Additions to intangible
assets (17) (104) (199)
------------------------------- ------------- ------------- ----------
Net cash used in investing
activities (29) (43) (133)
------------------------------- ------------- ------------- ----------
Cash flows from financing
activities
Net proceeds from issue
of share capital 18,719 - 10,248
Net cash generated
from financing activities 18,719 - 10,248
------------------------------- ------------- ------------- ----------
Net increase/(decrease)
in cash and cash equivalents 10,756 (2,722) 5,240
------------------------------- ------------- ------------- ----------
Cash and cash equivalents
at beginning of period 8,909 3,688 3,688
Net increase/(decrease)
in cash and cash equivalents 10,756 (2,722) 5,240
Effect of exchange
rate fluctuations on
cash held 53 (16) (19)
Cash and cash equivalents
at end of period 19,718 950 8,909
------------------------------- ------------- ------------- ----------
Cash and cash equivalents
include
Instant access bank
accounts 19,718 950 8,909
19,718 950 8,909
------------------------------- ------------- ------------- ----------
SILENCE THERAPEUTICS PLC
NOTES TO THE FINANCIAL STATEMENTS
SIX MONTHS ENDED 30 JUNE 2013
1. Basis of Preparation and Accounting Policies
This condensed consolidated interim financial information for
the six months ended 30 June 2013 has been prepared in accordance
with the Disclosure and Transparency Rules of the Financial
Services Authority and with IAS 34 - 'Interim Financial Reporting'
as adopted by the European Union.
This condensed consolidated interim financial information has
been neither reviewed nor audited. The interim financial statements
do not comprise statutory accounts within the meaning of Section
434 of the Companies Act 2006. The comparative figures for the six
months ended 30 June 2012 are not the Company's statutory accounts
for that financial year. The 2012 full year accounts have been
reported on by the Company's auditors and delivered to the
Registrar of companies. The report of the auditors was unqualified
and did not contain a statement under section 498(2) or (3) of the
Companies Act 2006.
2. Going concern
The financial statements have been prepared on a going concern
basis that assumes that the Group will continue in operational
existence for the foreseeable future.
During the period the Group met its day-to-day working capital
requirements through existing cash resources. The Group had a net
cash inflow in the six months ended 30 June 2013 of GBP10.76m and
at 30 June 2013 had cash balances of GBP19.72m. In addition there
was GBP5m held on deposit at Investec Bank plc which matures in May
2014. The directors have reviewed the working capital requirements
of the Group for the next 12 months from the date of the approval
of these interim financial statements and are confident that these
can be met.
NOTES TO THE FINANCIAL STATEMENTS
(continued)
SIX MONTHS ENDED 30 JUNE
2013
3. Segment Reporting
Six Months Ended 30 June
2013
Business Segments RNAi Therapeutics Unallocated Consolidated
Corporate
items
GBP000s GBP000s GBP000s
Revenue 41 - 41
------------------------------------
Operating results (2,397) (1,054) (3,451)
Finance and other
income (net) - 45 45
------------------------------------ ------------------ ------------ -------------
Net loss for
the period (2,397) (1,009) (3,406)
------------------------------------ ------------------ ------------ -------------
Segment assets 10,105 23,287 33,392
Segment liabilities (784) (147) (931)
------------------------------------ ------------------ ------------ -------------
Costs to acquire
property, plant
and equipment (26) (1) (27)
Costs to acquire
other intangible
assets (17) - (17)
Depreciation
and amortisation 178 1 179
Charge for non-cash
expenses 504 70 574
------------------------------------ ------------------ ------------ -------------
Six Months Ended 30 June
2012
Business Segments RNAi Therapeutics Unallocated Consolidated
Corporate
items
GBP000s GBP000s GBP000s
Revenue 37 - 37
------------------------------------
Operating results (22,691) (858) (23,549)
Finance and other
income (net) 16 7 23
------------------------------------ ------------------ ------------ -------------
Net loss for
the period (22,675) (851) (23,526)
------------------------------------ ------------------ ------------ -------------
Segment assets 8,356 690 9,046
Segment liabilities (808) (173) (981)
------------------------------------ ------------------ ------------ -------------
Costs to acquire - - -
property, plant
and equipment
Costs to acquire
other intangible
assets 104 - 104
Depreciation
and amortisation 139 1 140
Charge for non-cash
expenses 20,565 - 20,565
--------------------- ------- -------
In accordance with IFRS 8 'Operating Segments', the
identification of the Group's operating segments is based on
internal management reporting as reviewed by the senior management
team in order to assess performance and allocate resources.
The Group is managed on a business segment basis - RNAi
Therapeutics and unallocated corporate items. Transfer prices
between segments are set on an arm's length basis. Segment revenue
and profit include transfers between segments, which are eliminated
on consolidation. The operations, segment assets and liabilities of
the RNAi Therapeutics segment are located in Germany and the US.
The remaining operations segment assets and liabilities are located
in the United Kingdom.
In accordance with IAS 36 Impairment of Assets, the carrying
value of goodwill is assessed comparing its carrying value to its
recoverable amount. The recoverable amount is calculated by the
Directors as being the value in use. For the purpose of impairment
testing of goodwill, the Directors perform risk adjusted discounted
cash flow analysis of the RNAi Therapeutics business segment, the
cash generating unit that encompasses Silence Therapeutics AG and
Intradigm Corporation.
The goodwill in the RNAi Therapeutics segment, which totals
GBP7.73 million, is supported by the value in use of the on-going
business.
4. Earnings per share
The loss per share is based on the loss for the period after
taxation attributable to equity holders of GBP3.41m (year ended 31
December 2012 - loss GBP26.28m; six months ended 30 June 2012 -
loss GBP23.53m) and on the weighted average of 40,766,920 ordinary
shares in issue during the period (year ended 31 December 2012
-19,688,121; six months ended 30 June 2012 -11,542,290).
The options outstanding at 30 June 2013, 31 December 2012 and 30
June 2012 are considered to be non-dilutive in that their
conversion into ordinary shares would decrease the net loss per
share. Consequently, there is no diluted loss per share to report
for the periods reported.
5. Related party transactions
Transactions between the Company and its subsidiaries, which are
related parties, have been eliminated on consolidation and are not
disclosed in this note.
On 26 June 2013 the company paid GBP70,000 to cancel warrants
for 66,600 shares issued to Darwin Strategic Limited ('Darwin').
The exercise price was 75p and the terms agreed reflected the fair
value of the warrants at that time. Ali Mortazavi, Chief Executive
of Silence Therapeutics plc, owns 37% of Darwin. Separately Silence
signed a one year agreement on commercial terms in April 2013 to
pay Darwin GBP25,000 over twelve months in return for services
preparing corporate presentations.
At 30 June 2013 the Company was owed GBP20,309 by Jerry Randall,
Chairman. This followed a settlement in February with HM Revenue
and Customs where remuneration paid to a service company was
reclassified as emoluments taxable at source. Silence settled the
liability in February, without penalty, and gave Mr Randall six
months to claim back tax paid via the service company. Mr Randall
repaid the balance due to Silence in full in August, as agreed.
This information is provided by RNS
The company news service from the London Stock Exchange
END
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