TIDMSBTX
RNS Number : 7630E
SkinBioTherapeutics PLC
03 March 2020
SkinBioTherapeutics plc
Half year results
Manchester, UK - 03 March 2020 - SkinBioTherapeutics plc (AIM:
SBTX or the "Company") a life sciences company focused on skin
health, announces its unaudited half year results for the six
months to 31 December 2019.
Operational and financial highlights
-- New strategy presented to shareholders, defining five pillars
of development and commercial focus
-- Signed first commercial agreement in November 2019, with
Croda International Plc ("Croda"), using SkinBiotix (R) as the
foundation of an active skincare ingredient
-- Post period end, signed a development agreement around the
skin-gut axis with Winclove Probiotics B.V. ("Winclove") to create
a specialist probiotic food supplement targeting psoriasis
-- Loss from operations of GBP889k (H1 2018: GBP632k) with
increase due to R&D and operating expenditure
-- Cash as at 31 December 2019 GBP2.5m (30 June 2019: GBP3.1m),
in line with management's expectations
Stuart Ashman, CEO of SkinBioTherapeutics, said:
"The first half of the year has been focused on refining and
starting to deliver on our strategy to commercialise the SkinBiotix
(R) technology. The five pillars of the strategy comprise
SkinBiotix(R), AxisBiotix(TM), MediBiotix(TM), CleanBiotix(TM) and
PharmaBiotix(TM) demonstrating our belief in the applicability of
our technology.
"From talks initiated by Prof. Cath O'Neill, we have concluded
agreements around two of the pillars already - SkinBiotix (R) and
AxisBiotix(TM) - with Croda and Winclove respectively. Both
companies are specialists in their fields and we believe both deals
offer good growth and value opportunities to the Company, whilst
aligning with our current cash position and timeline.
"As we integrate these initial agreements into our day to day
working practices, we continue to seek other commercial partners as
well as furthering the scientific base behind our technology."
The information communicated within this announcement is deemed
to constitute inside information as stipulated under the Market
Abuse Regulations (EU) No. 596/2014 and has been arranged for
release by Doug Quinn, CFO of the Company. Upon the publication of
this announcement, this inside information is now considered to be
in the public domain.
-Ends-
For more information, please contact:
SkinBioTherapeutics plc Tel: +44 (0) 161 468 2760
Stuart Ashman, CEO
Doug Quinn, CFO
Cairn Financial Advisers LLP Tel: +44 (0) 20 7213 0880
(Nominated Adviser)
Tony Rawlinson / Sandy Jamieson
Turner Pope Investments (Joint Tel: +44 (0) 20 3657 0050
Broker)
Andy Thacker / Zoe Alexander
Tel: +44 (0) 20 3470 0470
SP Angel Corporate Finance (Joint
Broker)
Vadim Alexandre / Abigail Wayne
Instinctif Partners Tel: +44 (0) 20 7457 2020
Melanie Toyne-Sewell / Phillip SkinBio@instinctif.com
Marriage / Nathan Billis
About SkinBioTherapeutics plc
SkinBioTherapeutics is a life science company focused on skin
health. The Company's proprietary platform technology,
SkinBiotix(R), is based upon discoveries made by Professor
Catherine O'Neill and Professor Andrew McBain.
The Company has demonstrated, through scientific testing, that
the SkinBiotix(R) platform can improve the barrier effect of skin
models, protect from infection and repair wounds. Proof of
principle studies have also shown that the SkinBiotix(R) platform
has beneficial attributes applicable to each of these areas. The
technology achieved positive results in clinical studies in human
volunteers in early 2019.
The Company listed on AIM in April 2017 and is based in
Manchester, UK. For more information, visit:
www.skinbiotherapeutics.com .
Chairman and Chief Executive's Statement
During the first half of the financial year, the Company began
its transition from one of scientific focus to progressing
opportunities to commercialise its technology. SkinBioTherapeutics
seeks to harness the microbiome for human health and has identified
five channels in which it intends to develop its focus,
encompassing both existing and new technology.
-- SkinBiotix (R) - the Company's core technology that is
designed to promote skin health by harnessing the beneficial
properties of probiotic bacteria
-- AxisBiotix(TM) - addressing the emerging area of science that
is focused on the gut-skin axis and its role in various
diseases
-- MediBiotix(TM) - this channel is targeting the use of the
SkinBiotix(R) technology for medical device applications including
the treatment of eczema and woundcare
-- CleanBiotix(TM) - targeting the use of the SkinBiotix (R)
technology to address certain categories of health care acquired
infections
-- PharmaBiotix(TM) - an extension to the medical device and
AxisBiotix(TM) applications through a pathway of medicinal
prescription registrations.
In support of the commercial focus and broader technology scope
for the Company, Stuart Ashman and Prof. Cath O'Neill transitioned
to their respective roles of Chief Executive Officer and Chief
Scientific Officer in July 2019. This change coincided with both
Prof. Cath O'Neill and Stephen O'Hara stepping down from the Board
of the Company.
The first step on the delivery of the new strategy was a
commercial agreement with Croda International Plc (RNS 20 November
2019) for the development and commercialisation of a new active
skincare cosmetic ingredient, incorporating the Company's
SkinBiotix(R) technology.
The Company has also been exploring other opportunities for
microbiome-related technologies, and post period end, in February
2020 (RNS 19 February 2020), signed an agreement with Winclove
Probiotics B.V. for the joint development and subsequent
commercialisation of a food supplement to help manage symptoms
associated with the skin condition psoriasis. This is the second
channel of the five identified by the Company.
Financial review
Research and development expenditure in the period was GBP455k
(H1 2018: GBP392k), incorporating development work with the
University of Manchester and ongoing formulation work. All such
expenditure was expensed in the period. Ongoing operating costs
were GBP434k (H1 2018: GBP240k) covering employment, consultancy,
PLC support costs and marketing. Overall the Company made a loss
from operations of GBP889k (H1 2018: GBP632k).
Cash burn during the period was GBP642k (H1 2018: GBP666k) and
in line with management's expectations. Having raised GBP1.5m in
gross proceeds through a placing in February 2019 the Company
finished the six month period to 31 December 2019 with a cash
balance of GBP2.5m (H1 2018: GBP2.5m).
Operational review
SkinBiotix(R)
The Company completed its human safety study for the cosmetic
application in early 2019 and having generated positive data,
progressed its discussions with third parties interested in
licencing the technology. This culminated in the agreement with
Croda (RNS 20 November 2019).
Under the terms of the agreement, SkinBioTherapeutics'
proprietary SkinBiotix(R) platform will be paired with Croda's
expertise in the development and commercialisation of unique,
sustainable, cosmetic ingredients, focusing specifically on the
growing skincare actives market. Sederma, part of Croda
International plc, is a specialist manufacturer of bioactive
ingredients for the cosmetic industry, and will be responsible for
the development, manufacturing and commercialisation of the
SkinBiotix(R) technology.
Croda will be creating a separate manufacturing line for the
technology and as design and manufacture of the active ingredient
is carried out, there will be concurrent testing in focused
ingredient application areas which will be detailed in further,
additional agreements.
Any licensed products resulting from these agreements will be
sold to Croda's global portfolio of Personal Care customers, which
amount to >12,000, some of which are the leading companies and
brands in the market. SkinBioTherapeutics will be paid tiered
royalties based on global sales revenues on any licensed products
subsequently derived from the successful development of the
partnership. Recognising the development activity required by
Croda, the Company anticipates revenue generation to commence from
these additional agreements during 2021.
Sales and distribution rights are for the cosmetic sector alone,
leaving SkinBioTherapeutics to focus on further applications of its
technology in other sectors. A key component of the Croda agreement
is access to a reliable supply of material and Croda will supply
SkinBiotix(R) for the Company to be able to use in sectors outside
of those covered by this agreement.
AxisBiotix(TM)
Within the emerging area of science focused on the gut-skin
axis, one disease that is considered to be influenced by the
gut-skin axis is psoriasis. This is a chronic relapsing
inflammatory condition of the skin with a prevalence of c.2-3% in
the western world. The worldwide market for psoriasis treatments
was valued at approximately $30bn in 2018 and is expected to grow
to $47bn in 2022 with a CAGR of 11.5%.
Current treatments include emollients for relatively mild
disease, through to the biologic therapies in severe cases. For the
group with mild-to-moderate psoriasis, the mainstay therapies tend
to be steroid-based, which cannot be used long term and have side
effects. Thus, there is an unmet clinical need for new, safer ways
of treating patients with mild to moderate psoriasis. Anecdotal
evidence from patients suggests that many of them have turned to
oral probiotics as an 'alternative' therapy and report success in
control of their disease. However, the effects of probiotics on
psoriasis has been investigated in only two studies which did not
make the choice of probiotic organisms based on known disease
pathways.
As detailed in the RNS of 19 February 2020, SkinBioTherapeutics
has signed an agreement with Winclove Probiotics to jointly develop
a probiotic food supplement to help manage the symptoms associated
with psoriasis. SkinBioTherapeutics and Winclove will design and
develop a probiotic blend of 'good' bacterial strains based on the
modifying properties of specific bacterial species on known
psoriasis disease pathways.
This blend will be developed into a probiotic food supplement
which will be called AxisBiotix(TM). SkinBioTherapeutics will be
responsible for the identification and selection of the bacterial
strains and patient testing; Winclove will be responsible for the
formulation and manufacture of AxisBiotix (TM) . The development
agreement is for a period of three years but can be extended by
mutual agreement. Each party retains ownership of its respective
intellectual property and will be responsible for their own costs
in relation to the development programme.
As a pre-requisite to commercialisation, AxisBiotix(TM) will be
tested in a UK human study for patients suffering from mild to
moderate psoriasis. The study, to be managed by
SkinBioTherapeutics, is expected to start in 2020 on completion of
the development phase and is estimated to take approximately 12-18
months to complete. On the basis of a positive read-out of the
study, SkinBioTherapeutics will then proceed with
commercialisation, concluding discussions with third parties that
will run in parallel to the human study.
MediBiotix(TM)
The MediBiotix channel will focus on medical device applications
incorporating the SkinBiotix(R) technology. The initial target is
eczema and, having completed its lab work to demonstrate the
required characteristics of a medical device application, the
Company is preparing a data pack for review by the MHRA (Medicines
and Healthcare products Regulatory Agency).
The management also believes there is utility for the technology
in the treatment of various classes of skin wounds and is in
discussion with a number of global advanced woundcare companies in
this regard. The Company is targeting a commercial agreement to
develop and test the SkinBiotix(R) technology in these indications
by the end of 2020.
CleanBiotix(TM)
Healthcare acquired infections (HAI) remains an area of critical
concern for healthcare providers. The growing resistance of certain
infection strains and the lack of new antibiotics is driving the
need to discover and develop new methods of controlling bacterial
growth and infection.
Staphylococcus aureus (SA) is the most common skin pathogen and
one of the major causes of HAI. The Company's SkinBiotix(R)
technology has been shown to have capabilities in preventing SA
from adhering to and growing on the skin and thus offers a
potential route of protection from SA-induced healthcare acquired
infections.
The Company is investigating whether SkinBiotix(R) offers
utility to protect other non-human surfaces and interfaces from SA
induced healthcare acquired infections. This potential application
of the SkinBiotix(R) technology is attracting early attention from
potential partners.
Outlook
Securing its first commercial agreement with Croda, a FTSE 100
company, has been a significant achievement for SkinBioTherapeutics
and is a strong validation of the technology and its potential. The
agreement with Winclove incorporates a different aspect of the
microbiome, recognising the influence of the gut-skin axis and in
an area of significant unmet clinical need. However, this second
agreement also demonstrates the management team's commitment and
drive to deliver on the commercial strategy. The team is targeting
further commercial progress in the areas of MediBiotix (TM) and
CleanBiotix (TM) during the course of the year. The scientific
focus will also continue with the intended commencement of a human
study for psoriasis and clarity on the regulatory pathway for the
treatment of eczema.
Martin Hunt (Non-executive Chairman)
Stuart J. Ashman (Chief Executive Officer)
2 March 2020
Statement of Comprehensive Income
For the 6 months ended 31 December 2019
Notes 6 months 6 months 12 months
to to to
31 Dec 31 Dec 2018 30 Jun
2019 2019
Unaudited Unaudited Audited
GBP GBP GBP
Continuing operations
Research and development (455,052) (391,907) (708,081)
Operating expenses (433,950) (240,372) (652,400)
-------------------------------- ------ ---------- ------------- ------------
Loss from operations (889,002) (632,279) (1,360,481)
Loss before taxation (889,002) (632,279) (1,360,481)
Taxation 4 64,698) 99,546) 212,388)
-------------------------------- ------ ---------- ------------- ------------
Loss for the period (824,304) (532,733) (1,148,093)
Total comprehensive loss for
the period (824,304) (532,733) (1,148,093)
Basic and diluted loss per
share (pence) 6 (0.64) (0.45) (0.94)
-------------------------------- ------ ---------- ------------- ------------
Statement of Financial Position
As at 31 December 2019
As at As at As at
Note 31 Dec 31 Dec 2018 30 Jun 2019
2019
Unaudited Unaudited Audited
GBP GBP GBP
ASSETS
Non-current assets
Property, plant & equipment 4,250 9,350 6,800
Intangible assets 378,949 308,104 346,870
-------------------------------- ------- ------------ ------------- -------------
Total non-current assets 383,199 317,454 353,670
-------------------------------- ------- ------------ ------------- -------------
Current assets
Other receivables 78,167 26,227 242,580
Corporation tax receivable 275,049 185,818 210,351
Cash and cash equivalents 2,483,243 2,516,876 3,124,864
-------------------------------- ------- ------------ ------------- -------------
Total current assets 2,836,459 2,728,921 3,577,795
-------------------------------- ------- ------------ ------------- -------------
Total assets 3,219,658 3,046,375 3,931,465
-------------------------------- ------- ------------ ------------- -------------
EQUITY AND LIABILITIES
Equity
Capital and reserves
Called up share capital 5 1,280,835 1,187,085 1,280,835
Share premium 4,923,890 3,577,640 4,923,890
Other reserves 301,554 205,166 247,672
Accumulated deficit (3,466,570) (2,026,906) (2,642,266)
-------------------------------- ------- ------------ ------------- -------------
Total equity 3,039,709 2,942,985 3,810,131
-------------------------------- ------- ------------ ------------- -------------
Liabilities
Current liabilities
Trade and other payables 179,949 103,390 121,334
Total current liabilities 179,949 103,390 121,334
-------------------------------- ------- ------------ ------------- -------------
Total liabilities 179,949 103,390 121,334
-------------------------------- ------- ------------ ------------- -------------
Total equity and liabilities 3,219,658 3,046,375 3,931,465
-------------------------------- ------- ------------ ------------- -------------
Statement of Cash Flows
For the 6 months ended 31 December 2019
6 months 6 months 12 months
to to to
31 Dec 2019 31 Dec 30 Jun 2019
2018
Unaudited Unaudited Audited
GBP GBP GBP
Cash flows from operating activities
Loss before tax for the period (889,002) (632,279) (1,360,481)
Depreciation 2,550 850 3,400
Share option expenses 53,882 34,748 77,254
(832,570) (596,681) (1,279,827)
---------------------------------------------- ------------- ---------- -------------
Changes in working capital
Decrease / (increase) in trade and
other receivables 164,413 67,194 (146,160)
Increase / (decrease) in trade and
other payables 58,615 (105,903) (90,958)
---------------------------------------------- ------------- ---------- -------------
Cash generated by / (used in) operations 223,028 (38,709) (237,118)
---------------------------------------------- ------------- ---------- -------------
Taxation received - - 88,309
Net cash used in operating activities (609,542) (635,390) (1,428,636)
---------------------------------------------- ------------- ---------- -------------
Cash flows from investing activities
Purchase of property, plant & equipment - (10,200) (10,200)
Payments for intangible assets (32,079) (20,432) (59,198)
---------------------------------------------- ------------- ---------- -------------
Net cash used in investing activities (32,079) (30,632) (69,398)
---------------------------------------------- ------------- ---------- -------------
Cash flows from financing activities
Net proceeds from issue of equity
instruments of the Company - - 1,440,000
---------------------------------------------- ------------- ---------- -------------
Net cash generated by financing activities - - 1,440,000
---------------------------------------------- ------------- ---------- -------------
Net decrease in cash and cash equivalents (641,621) (666,022) (58,034)
Cash and cash equivalents at the beginning
of the period 3,124,864 3,182,898 3,182,898
---------------------------------------------- ------------- ---------- -------------
Cash and cash equivalents at the end
of the period 2,483,243 2,516,876 3,124,864
---------------------------------------------- ------------- ---------- -------------
Statement of Changes in Equity
For the 6 months ended 31 December 2019
Other Retained
Share capital Share premium reserves earnings Total
GBP GBP GBP GBP GBP
As at 1 Jul 2018 1,187,085 3,577,640 170,418 (1,494,173) 3,440,970
Loss for the period - - - (532,733) (532,733)
Share-based payments - - 34,748 - 34,748
As at 31 Dec 2018 1,187,085 3,577,640 205,166 (2,026,906) 2,942,985
------------------------ -------------- -------------- ---------- ------------ ----------
As at 1 Jan 2019 1,187,085 3,577,640 205,166 (2,026,906) 2,942,985
Loss for the period - - - (615,360) (615,360)
Issue of shares 93,750 1,406,250 - - 1,500,000
Costs of share issue - (60,000) - - (60,000)
Share-based payments - - 42,506 - 42,506
As at 30 Jun 2019 1,280,835 4,923,890 247,672 (2,642,266) 3,810,131
------------------------ -------------- -------------- ---------- ------------ ----------
As at 1 Jul 2019 1,280,835 4,923,890 247,672 (2,642,266) 3,810,131
Loss for the period - - - (824,304) (824,304)
Share-based payments - - 53,882 - 53,882
As at 31 Dec 2019 1,280,835 4,923,890 301,554 (3,466,570) 3,039,709
------------------------ -------------- -------------- ---------- ------------ ----------
Share capital is the amount subscribed for shares at nominal value.
Share premium is the amount subscribed for share capital in excess
of nominal value.
Other reserves arise from the equity element of a convertible loan
issued and converted in the period to
30 June 2017, and from share options granted on 5 April 2017.
Retained earnings represents accumulated profit or losses to date.
Notes to the half yearly report
1. General information
SkinBioTherapeutics plc is a public limited company incorporated
in England under the Companies Act and quoted on the AIM market of
the London Stock Exchange (AIM: SBTX). The address of its
registered office is 15 Silk House, Park Green, Macclesfield, SK11
7QJ.
The principal activity of the Company is that of research and
development into the effects of lysates derived from the human
microbiome on skin.
The financial information set out in this half yearly report
does not constitute statutory accounts as defined in Section 434 of
the Companies Act 2006. The statutory financial statements for the
year ended 30 June 2019, prepared under International Financial
Reporting Standards ("IFRS"), have been filed with the Registrar of
Companies. The auditor's report on those financial statements was
unqualified and did not contain statements under Sections 498(2)
and 498 (3) of the Companies Act 2006.
Copies of the annual statutory accounts and the half yearly
report can be found on the Company's website at
www.skinbiotherapeutics.com/ .
2. Significant accounting policies and basis of preparation
2.1 Statement of compliance
This half yearly report has been prepared using the historical
cost convention, on a going concern basis and in accordance with
International Financial Reporting Standards ("IFRS") as adopted by
the European Union, IFRS Interpretations Committee (IFRIC) and the
Companies Act 2006 applicable to companies reporting under IFRS,
using accounting policies which are consistent with those set out
in the financial statements for the year ended 30 June 2019.
2.2 Application of new and revised International Financial Reporting Standards (IFRSs)
There are no IFRSs or IFRIC interpretations that are effective
for the first time in this financial period that would be expected
to have a material impact on the Company.
3. Segmental reporting
The Company has one reportable segment, namely the research and
development of the SkinBiotix(R) technology, all within the United
Kingdom.
4. Taxation
6 months 6 months 12 months
to to to
Income taxes recognised in 31 Dec 31 Dec 2018 30 Jun
profit or loss 2019 2019
GBP GBP GBP
Current tax
R&D tax credit 64,698 97,509 210,350
R&D tax credit - prior
year - 2,037 2,038
--------------------------------------- ---- ---- ---- ----------------- ------------------ ------------
Tax credit for the period 64,698 99,546 212,388
--------------------------------------- ---- ---- ---- ----------------- ------------------ ------------
5. Share capital
Issued share capital 31 Dec 31 Dec 2018 30 Jun 2019
comprises 2019
GBP GBP GBP
128,083,494 ordinary shares
of GBP0.01 each 1,280,835 1,187,085 1,280,835
6. Loss per share
6 months 6 months 12 months
to to to
31 Dec 31 Dec 2018 30 Jun
2019 2019
GBP GBP GBP
Basic and diluted loss per
share
Loss after tax (GBP) (824,304) (532,733) (1,148,093)
Weighted average number of
shares 122,047,535 118,708,494 122,047,535
Basic and diluted loss per
share (pence) (0.64) (0.45) (0.94 )
--------------------------------------------- ---- ---- ----------------- ------------------ ------------
As the Company is reporting a loss from continuing operations for the period
then, in accordance with IAS 33, the share options are not considered dilutive
because the exercise of the share options would have an anti-dilutive effect.
The basic and diluted earnings per share as presented on the face of the
income statement are therefore identical.
7. Events after the reporting date
The Company has evaluated all events and transactions that occurred after
31 December 2019 up to the date of signing of the financial statements.
No material subsequent events have occurred that would require adjustment
to or disclosure in the financial statements.
Caution regarding forward looking statements
Certain statements in this announcement, are, or may be deemed
to be, forward looking statements. Forward looking statements are
identi ed by their use of terms and phrases such as "believe",
"could", "should" "envisage", "estimate", "intend", "may", "plan",
"potentially", "expect", "will" or the negative of those,
variations or comparable expressions, including references to
assumptions. These forward looking statements are not based on
historical facts but rather on the Directors' current expectations
and assumptions regarding the Company's future growth, results of
operations, performance, future capital and other expenditures
(including the amount, nature and sources of funding thereof),
competitive advantages, business prospects and opportunities. Such
forward looking statements re ect the Directors' current beliefs
and assumptions and are based on information currently available to
the Directors.
This information is provided by RNS, the news service of the
London Stock Exchange. RNS is approved by the Financial Conduct
Authority to act as a Primary Information Provider in the United
Kingdom. Terms and conditions relating to the use and distribution
of this information may apply. For further information, please
contact rns@lseg.com or visit www.rns.com.
END
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