4basebio AG: 4basebio AG reports first quarter 2020 financial results

DGAP-News: 4basebio AG / Key word(s): Quarterly / Interim Statement
14.05.2020 / 07:30
The issuer is solely responsible for the content of this announcement.

4basebio AG reports first quarter 2020 financial results

- 4basebio reports strong Q1 net profit following Abcam transaction

- Significant cash position enables focus on further strategy

- Successful completion of 10% share buyback

- Continued development of DNA manufacturing technology

Heidelberg, Germany and Cambridge, UK, 14 May 2020 - 4basebio AG (Frankfurt: 4BSB; ISIN: DE000A2YN801; Prime Standard) today reported a very strong positive net profit for the quarter ended 31 March 2020, following the sale of its proteomics and immunology businesses to Abcam on 1 January 2020.

"We are pleased to report a strong overall performance for Q1 2020, demonstrating the success of the Company's buy and build strategy over the past three years," commented Dr Heikki Lanckriet, CEO. "With the transaction now completed, we have significantly strengthened our cash position and we are now extremely well placed to focus on the continued development of our proprietary synthetic DNA manufacturing technology. Alongside this, we will continue to focus on our buy and build strategy."

David Roth, CFO of 4basebio, added: "During Q1 we also successfully concluded a 10% share buyback, with the shares held in treasury at the end of the period. We have now announced our intention to cancel those shares and will be seeking approval from shareholders for a further share buyback authority at our AGM on 17 June. We closed the quarter with a total of EUR 101.3 million in cash equivalents including cash balances of EUR 86.9 million, with a further EUR 14.4 million in escrow following the Abcam transaction."

First quarter of 2020 Financial Results:
Following the sale of the proteomics and immunology businesses to Abcam, the shape of the ongoing operations, as highlighted in the market guidance for 2020, has changed significantly. Consistent with the annual report for 2019, the consolidated statement of financial position and the consolidated statement of comprehensive income which follow show the results for the period from continuing and discontinued operations separately.

Revenues in the first quarter of 2020 amounted to EUR 296 thousand (2019: EUR 295 thousand from continuing operations) in line with our guidance for the year. Total net operating expenses (including cost of goods sold) were EUR 925 thousand in 2020 (2019: EUR 1.2 million from continuing operations).

Finance costs were EUR 173 thousand for the period and relate to non-cash charges on equity instruments. Taxation for the period represents an estimate of the taxes due on the profit arising from the Abcam transaction.

The result for the period includes a profit of EUR 66.9 million from discontinued operations (2019: EUR 378 thousand). The current year result represents the profit from the sale of the proteomics and immunology businesses to Abcam on 1 January 2020.

As previously reported, the terms of the transaction provided for proceeds of EUR 120 million adjusted for debt and cash balances. The following table presents an analysis of the profit on the transaction:

In addition, EUR 360 thousand of transaction expenses were recognised in 2019.

As a result, the net profit for the first quarter of 2020 was EUR 65.7 million (2019: loss of EUR 464 thousand).

The balance sheet has significantly changed since 31 December 2019 as a result of the Abcam transaction. Total assets at 31 March 2020 were EUR 106.6 million (31 December 2019: EUR 62.3 million), including cash balances of EUR 86.9 million (31 December 2019: EUR 990 thousand in continuing operations and EUR 2.7 million in discontinued operations) and amounts held in escrow of EUR 14.4 million (31 December 2019: EUR nil).

Non-current assets were significantly higher at EUR 18.1 million (31 December 2019: EUR 3.6 million from continuing operations) due to the classification of the escrow balance as long term (the escrow balance is released 2 January 2022).

Overall cash flows for the quarter were a positive EUR 83.2 million (2019: outflow of EUR 775 thousand). This included net cash flows from the Abcam transaction of EUR 116.1 million, as follows:

Excluding the impact of the transaction, underlying cash outflows from operating activities before interest and taxes were EUR 693 thousand (2019: outflow of EUR 184 thousand). Cash outflows on interest and taxes relate primarily to obligations under discontinued operations.

Net cash inflows from investing activities amounted to EUR 105.4 million, compared to a EUR 175 thousand outflow in the previous year. Cash outflows from financing activities included EUR 6.5 million debt repayments relating primarily to discontinued operations, settlement of an option and EUR 9.7 million in relation to the share buyback which occurred in February 2020. Outflows for the prior year were EUR 260 thousand. The company closed the period with cash balances of EUR 86.9 million.

Outlook 2020:
For the fiscal year 2020, 4basebio reaffirms its guidance of 24 April 2020: The operational cash burn for 2020, excluding expenses relating to the Abcam transaction, is expected to be between EUR 2.5 million to EUR 3.5 million with revenues between EUR 0.5 million and EUR 1.0 million.

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4basebio AG, Heidelberg, Germany

Interim results for the three months ending 31 March 2020

Consolidated statement of financial position

Consolidated statement of comprehensive income

Consolidated statement of cash flows

Consolidated statement of changes in equity

For further information, please contact:

4basebio AG
Dr. Heikki Lanckriet, CEO/CSO
Phone: +44 1223 873 364
Email: heikki.lanckriet@4basebio.com

Dr. Robert Mayer, Manager IR
Phone: +49 171 3876540
Email: robert.mayer@4basebio.com

MC Services AG
Julia Hofmann
Phone: +49 89 210228 0
Email: 4basebio@mc-services.eu

About 4basebio AG:

4basebio AG, formerly operating under the name of Expedeon AG, is an enabler of exciting advances in medical science and patient care. After divestment of its immunology and proteomics products portfolio on 1 January 2020, the Company changed its name to 4basebio AG reflecting the enhanced focus on technologies and products centered around DNA. The Company is focusing on DNA manufacturing to supply DNA products for therapeutic and other uses requiring large amounts of high-purity DNA, such as the fast-growing market of novel gene therapies and gene vaccines. Besides DNA manufacturing, 4basebio aims at providing research and diagnostic products based on its RNA reverse transcriptase, DNA polymerase and DNA primase enzymes, addressing the research tools and diagnostic products markets.

4basebio AG has offices in Germany, Spain, UK, and the US. The Company is listed on the Prime Standard segment of the Frankfurt Stock Exchange (Ticker: 4BSB; ISIN: DE000A2YN801).

More information: www.investors.4basebio.com

# # # This publication is intended for information only and constitutes neither an offer to sell nor an invitation to buy securities. Some statements included in this press release, relating neither to proven financial results nor other historical data, should be viewed as forward-looking, i.e. not definite. Such statements are mainly predictions of future results, trends, plans or goals. These statements should not be considered to be total guarantees since given their very nature they are subject to known and unknown risks and imponderability and can be affected by other factors as a consequence of which the actual results, plans and goals of 4basebio AG may deviate greatly from the established conclusions or implied predictions contained in such statements. 4basebio does not undertake to publicly update or revise these statements in the light of new information or future results or for any other reason. # # #

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