Full Press Release Details
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
| For the Three Months Ended June 30, | For the Six Months Ended June 30, | |||||||||||||||||||
| Notes | 2018 | 2017 | 2018 | 2017 | ||||||||||||||||
| (in thousands, except per share data) | ||||||||||||||||||||
| Research and development expenses | (5,158 | ) | (2,077 | ) | (8,863 | ) | (3,689 | ) | ||||||||||||
| Administrative expenses | (1,402 | ) | (313 | ) | (2,642 | ) | (637 | ) | ||||||||||||
| Initial public offering related expenses | 3 | (1,034 | ) | (1,066 | ) | |||||||||||||||
| Net foreign exchange gains (losses) | 3,607 | (113 | ) | 1,059 | (161 | ) | ||||||||||||||
| Operating loss | (2,953 | ) | (3,537 | ) | (10,446 | ) | (5,553 | ) | ||||||||||||
| Finance income | 252 | 44 | 442 | 91 | ||||||||||||||||
| Loss before tax | (2,701 | ) | (3,493 | ) | (10,004 | ) | (5,462 | ) | ||||||||||||
| Income tax credit | 4 | 1,383 | 745 | 2,292 | 1,077 | |||||||||||||||
| Loss for the period | (1,318 | ) | (2,748 | ) | (7,712 | ) | (4,385 | ) | ||||||||||||
| Basic and diluted loss per share | 5 | (0.04 | ) | (0.11 | ) | (0.24 | ) | (0.18 | ) |
The accompanying notes form an integral part of these unaudited condensed consolidated financial statements.
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE LOSS
| For the Three Months Ended June 30, | For the Six Months Ended June 30, | |||||||||||||||
| 2018 | 2017 | 2018 | 2017 | |||||||||||||
| (in thousands) | ||||||||||||||||
| Loss for the period | (1,318 | ) | (2,748 | ) | (7,712 | ) | (4,385 | ) | ||||||||
| Other comprehensive expense: | ||||||||||||||||
| Items that may be reclassified subsequently to profit or loss: | ||||||||||||||||
| Exchange differences on translation of foreign operations | 9 | 4 | (1 | ) | ||||||||||||
| Other comprehensive income (expense) for the period | 9 | 4 | (1 | ) | ||||||||||||
| Total comprehensive loss for the period | (1,309 | ) | (2,748 | ) | (7,708 | ) | (4,386 | ) | ||||||||
| Attributable to: | ||||||||||||||||
| Equity holders of the Company | (1,309 | ) | (2,748 | ) | (7,708 | ) | (4,386 | ) |
The accompanying notes form an integral part of these unaudited condensed consolidated financial statements.
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF FINANCIAL POSITION
| June 30, 2018 | December 31, 2017 | |||||||||||
| (in thousands) | ||||||||||||
| Notes | ||||||||||||
| Assets | ||||||||||||
| Non-current assets | ||||||||||||
| Intangible assets | 6 | 2,485 | 1,938 | |||||||||
| Property, plant and equipment | 495 | 358 | ||||||||||
| Deferred tax asset | 4 | 32 | 81 | |||||||||
| 3,012 | 2,377 | |||||||||||
| Current assets | ||||||||||||
| Prepayments, accrued income and other receivables | 1,737 | 3,050 | ||||||||||
| Current income tax receivable | 4 | 4,660 | 4,225 | |||||||||
| Cash and cash equivalents | 7 | 81,469 | 86,703 | |||||||||
| 87,866 | 93,978 | |||||||||||
| Total assets | 90,878 | 96,355 | ||||||||||
| Equity and liabilities | ||||||||||||
| Capital and reserves | ||||||||||||
| Share capital and share premium | 9 | 80,508 | 80,508 | |||||||||
| Other reserves | 59,072 | 58,071 | ||||||||||
| Accumulated deficit | (52,871 | ) | (45,159 | ) | ||||||||
| Total equity attributable to equity holders of the Company | 86,709 | 93,420 | ||||||||||
| Non-current liabilities | ||||||||||||
| Provisions | 26 | 18 | ||||||||||
| Current liabilities | ||||||||||||
| Trade payables | 2,123 | 1,120 | ||||||||||
| Payroll taxes and social security | 103 | 157 | ||||||||||
| Accrued expenditure | 1,917 | 1,640 | ||||||||||
| 4,143 | 2,917 | |||||||||||
| Total liabilities | 4,169 | 2,935 | ||||||||||
| Total equity and liabilities | 90,878 | 96,355 |
The accompanying notes form an integral part of these unaudited condensed consolidated financial statements.
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY
| For the Six Months Ended June 30, | ||||||||||||||||||||||||||||||||
| Share capital | Share premium | Own share reserve | Share option reserve | Foreign currency translation reserve | Capital reserve | Accumulated deficit | Total equity attributable to equity holders | |||||||||||||||||||||||||
| (in thousands) | ||||||||||||||||||||||||||||||||
| Balance at December 31, 2016 | 663 | 42,770 | (339 | ) | 4,406 | (3 | ) | (22,256 | ) | 25,241 | ||||||||||||||||||||||
| Loss for the period | (4,385 | ) | (4,385 | ) | ||||||||||||||||||||||||||||
| Other comprehensive expense for the period | (1 | ) | (1 | ) | ||||||||||||||||||||||||||||
| Total comprehensive loss for the period | (1 | ) | (4,385 | ) | (4,386 | ) | ||||||||||||||||||||||||||
| Share-based payments | 532 | 532 | ||||||||||||||||||||||||||||||
| Reduction in share premium | (42,466 | ) | 42,466 | |||||||||||||||||||||||||||||
| Balance at June 30, 2017 | 663 | 304 | (339 | ) | 4,938 | (4 | ) | 42,466 | (26,641 | ) | 21,387 | |||||||||||||||||||||
| Balance at December 31, 2017 | 1,272 | 79,236 | (339 | ) | 15,955 | (11 | ) | 42,466 | (45,159 | ) | 93,420 | |||||||||||||||||||||
| Loss for the period | (7,712 | ) | (7,712 | ) | ||||||||||||||||||||||||||||
| Other comprehensive income for the period | 4 | 4 | ||||||||||||||||||||||||||||||
| Total comprehensive loss for the period | 4 | (7,712 | ) | (7,708 | ) | |||||||||||||||||||||||||||
| Share-based payments | 997 | 997 | ||||||||||||||||||||||||||||||
| Balance at June 30, 2018 | 1,272 | 79,236 | (339 | ) | 16,952 | (7 | ) | 42,466 | (52,871 | ) | 86,709 |
The accompanying notes form an integral part of these unaudited condensed consolidated financial statements.
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
| For the Six Months Ended June 30, | ||||||||
| 2018 | 2017 | |||||||
| (in thousands) | ||||||||
| Cash flows from operating activities | ||||||||
| Loss for the period | (7,712 | ) | (4,385 | ) | ||||
| Adjustments for: | ||||||||
| Income tax credit | (2,292 | ) | (1,077 | ) | ||||
| Amortization and depreciation | 164 | 84 | ||||||
| Finance income | (442 | ) | (91 | ) | ||||
| Share-based payments | 997 | 532 | ||||||
| Initial public offering (IPO) related expenses | 1,066 | |||||||
| Net foreign exchange (gains) losses | (1,112 | ) | 142 | |||||
| (10,397 | ) | (3,729 | ) | |||||
| Movements in working capital: | ||||||||
| Decrease in prepayments, accrued income and other receivables | 1,358 | 609 | ||||||
| Increase (decrease) in trade payables | 1,003 | (477 | ) | |||||
| Increase (decrease) in payroll taxes, social security and accrued expenditure | 231 | (230 | ) | |||||
| Movements in working capital | 2,592 | (98 | ) | |||||
| Cash used in operations | (7,805 | ) | (3,827 | ) | ||||
| Net income tax credit received | 1,906 | 235 | ||||||
| Net cash used in operating activities | (5,899 | ) | (3,592 | ) | ||||
| Cash flows from investing activities | ||||||||
| Interest received | 429 | 98 | ||||||
| Payments for property, plant and equipment | (200 | ) | (5 | ) | ||||
| Payments for intangible assets | (648 | ) | (492 | ) | ||||
| Net cash used in investing activities | (419 | ) | (399 | ) | ||||
| Cash flows from financing activities | ||||||||
| IPO related expenses included in statement of operations | (73 | ) | ||||||
| Net cash used in financing activities | (73 | ) | ||||||
| Net decrease in cash and cash equivalents | (6,318 | ) | (4,064 | ) | ||||
| Cash and cash equivalents at beginning of period | 86,703 | 19,990 | ||||||
| Foreign currency translation differences | 1,084 | (8 | ) | |||||
| Cash and cash equivalents at end of period | 81,469 | 15,918 |
The accompanying notes form an integral part of these unaudited condensed consolidated financial statements.
NOTES TO THE UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
1. General information
( NuCana or the Company ) is a clinical-stage biopharmaceutical company developing a portfolio of new medicines to treat cancer. We are harnessing the power of phosphoramidate chemistry to generate new medicines called
ProTides. These compounds have the potential to improve cancer treatment by enhancing the efficacy and safety of several current standards of care.
On August 29, 2017 the Company re-registered as a public limited company and changed its name from
NuCana BioMed Limited to NuCana plc.
The Company has had American Depository Receipts ( ADRs ) registered with the US Securities
and Exchange Commission ( SEC ) and is listed on Nasdaq since October 2, 2017. The Company is incorporated in England and Wales and domiciled in the United Kingdom.
The Company has two wholly owned subsidiaries, NuCana, Inc. and NuCana BioMed Trustee Company Limited (together referred to as the
The comparative figures for the year ended December 31, 2017 are not the Group s statutory accounts for that
financial year within the meaning of section 434 of the Companies Act 2006. Those accounts have been reported on by the Company s auditor and delivered to the Registrar of Companies. The report of the auditor was (i) unqualified, (ii) did
not include a reference to any matters to which the auditors drew attention by way of emphasis without qualifying their report, and (iii) did not contain a statement under section 498 (2) or (3) of the Companies Act 2006.
2. Significant accounting policies
Basis of preparation
The unaudited condensed consolidated financial statements (the financial statements ) for the three and six months ended
June 30, 2018 have been prepared in accordance with International Accounting Standard 34 Interim Financial Reporting (IAS 34). The significant accounting policies and methods of computation applied in the preparation of the
financial statements are consistent with those applied in the Company s annual financial statements for the year ended December 31, 2017. No new standards, amendments or interpretations have had an impact on the financial statements for
the six months ended June 30, 2018.
The financial statements comprise the financial statements of the Company and its subsidiaries at
June 30, 2018. The financial statements are presented in pounds sterling, which is also the Company s functional currency. All values are rounded to the nearest thousand, except where otherwise indicated.
The financial statements do not include all the information and disclosures required in the annual financial statements, and should be read in
conjunction with the Company s annual financial statements as at December 31, 2017.
The unaudited condensed consolidated
statement of cash flows for the six months ended June 30, 2017 has been restated to be consistent with the presentation of foreign exchange differences and IPO related expenses in the annual financial statements for the year ended
In common with many companies in the biopharmaceutical sector, the Company incurs significant expenditure in its early years as it researches
and develops its potential products for market.
The board of directors, having reviewed the operating budgets and development plans,
considers that the Company has adequate resources to continue in operation for the foreseeable future. The board of directors is therefore satisfied that it is appropriate to adopt the going concern basis of accounting in preparing the financial
statements. The Company believes that its cash and cash equivalents of 81.5 million at June 30, 2018, will be sufficient to fund its current operating plan for at least the next 12 months. As the Company continues to incur losses,
the transition to profitability is dependent upon the successful development, approval and commercialization of its product candidates and achieving a level of revenues adequate to support its cost structure. The Company may never achieve
profitability, and unless and until it does, it will continue to need to raise additional capital. There can be no assurances, however, that additional funding will be available on acceptable terms.
Judgements and estimates
The accounting estimates and judgements made by management in applying the Group s accounting policies that have the most significant
effect on the amounts included within these financial statements, were the same as those that applied to the annual financial statements for the year ended December 31, 2017.
NOTES TO THE UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
3. IPO related expenses
| For the Three Months Ended June 30, | For the Six Months Ended June 30, | |||||||||||||||
| 2018 | 2017 | 2018 | 2017 | |||||||||||||
| (in thousands) | (in thousands) | |||||||||||||||
| IPO related expenses | 1,034 | 1,066 |
IPO related expenses primarily relate to legal, accounting and other advisors fees in relation to the
Company s listing on Nasdaq which completed on October 2, 2017.
| For the Three Months Ended June 30, | For the Six Months Ended June 30, | |||||||||||||||
| 2018 | 2017 | 2018 | 2017 | |||||||||||||
| (in thousands) | (in thousands) | |||||||||||||||
| Current tax | 1,393 | 745 | 2,341 | 1,077 | ||||||||||||
| Deferred tax | (10 | ) | (49 | ) | ||||||||||||
| Income tax credit | 1,383 | 745 | 2,292 | 1,077 |
The income tax credit recognized primarily represents the U.K. research and development tax credit. In the U.K.
the Company is able to surrender some of its losses for a cash rebate of up to 33.35% of expenditure related to eligible research and development projects.
| June 30, 2018 | December 31, 2017 | |||||||
| (in thousands) | ||||||||
| Current income tax receivable | ||||||||
| U.K. tax | 4,641 | 4,207 | ||||||
| U.S. tax | 19 | 18 | ||||||
| 4,660 | 4,225 | |||||||
| Deferred tax asset | ||||||||
| U.S. deferred tax asset | 32 | 81 |
NOTES TO THE UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
5. Basic and diluted loss per share
| For the Three Months Ended June 30, | For the Six Months Ended June 30, | |||||||||||||||
| 2018 | 2017 | 2018 | 2017 | |||||||||||||
| (in thousands, except per share data) | ||||||||||||||||
| Loss for the period | (1,318 | ) | (2,748 | ) | (7,712 | ) | (4,385 | ) | ||||||||
| Basic and diluted weighted average number of shares | 31,811 | 24,185 | 31,811 | 24,185 | ||||||||||||
| Basic and diluted loss per share | (0.04 | ) | (0.11 | ) | (0.24 | ) | (0.18 | ) |
Basic loss per share is calculated by dividing the loss for the period attributable to the equity holders of
the Company by the weighted average number of shares outstanding during the period.
The potential shares issued through equity settled
transactions were considered to be anti-dilutive as they would have decreased the loss per share and were therefore excluded from the calculation of diluted loss per share.
NOTES TO THE UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
6. Intangible assets
Intangible assets comprise patents with a carrying value of 2.4 million as of June 30, 2018 (as of December 31, 2017:
1.8 million) and computer software with a carrying value of 0.1 million as of June 30, 2018 (as of December 31, 2017: 0.1 million).
During the six months ended June 30, 2018, the Company acquired intangible assets with a cost of 0.6 million in relation to
patents (six months ended June 30, 2017: 0.4 million in relation to patents and 0.1 million in relation to computer software).
There were no disposals of intangible assets in the six months ended June 30, 2018 (six months ended June 30, 2017: nil).
7. Cash and cash equivalents
| June 30, 2018 | December 31, 2017 | |||||||
| (in thousands) | ||||||||
| Cash and cash equivalents | 81,469 | 86,703 |
Cash and cash equivalents comprise cash at bank with maturities of three months or less and earn interest at
fixed or variable rates based on the terms agreed for each account.
NOTES TO THE UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
8. Share-based payments
The Company has three share-based payment plans for employees, directors and consultants. The share options granted will be settled in equity.
On April 11, 2018 and May 8, 2018, 79,000 and 62,000 share options respectively were granted under the U.K. share-based payment
plans. Options granted under these plans will vest if the option holder remains under respective contract of employment or contract of service for the agreed vesting period. The share options granted under these plans will vest equally over a period
of four years, with the exception of options granted to a consultant, which vested immediately.
The fair values of options granted were
determined using the Black-Scholes model that takes into account factors specific to the share incentive plan. As NuCana plc listed on October 2, 2017, it is not possible to derive historical volatility from the Company s own share price.
The underlying expected volatility was therefore determined by using the historical volatility of similar listed entities as a proxy. The volatility percentage applied to each tranche is the average of the historical volatility of comparable
companies to NuCana plc.
The following weighted average principal assumptions were used in calculating the fair values of options granted:
| Options granted on | ||||||||||||
| Apr 11, 2018 | Apr 11, 2018 | May 8, 2018 | ||||||||||
| Vesting dates | Apr 11, 2019 | Apr 11, 2018 | May 8, 2019 | |||||||||
| Apr 11, 2020 | May 8, 2020 | |||||||||||
| Apr 11, 2021 | May 8, 2021 | |||||||||||
| Apr 11, 2022 | May 8, 2022 | |||||||||||
| Volatility | 64.48 | % | 60.06 | % | 65.80 | % | ||||||
| Dividend yield | 0 | % | 0 | % | 0 | % | ||||||
| Risk-free investment rate | 1.04 | % | 0.83 | % | 1.02 | % | ||||||
| Fair value of option at grant date | 8.97 | 17.35 | 8.63 | |||||||||
| Fair value of share at grant date | 17.51 | 17.51 | 16.57 | |||||||||
| Exercise price at date of grant | 17.51 | 0.16 | 16.57 | |||||||||
| Lapse date | Apr 11, 2028 | Apr 11, 2028 | May 8, 2028 | |||||||||
| Expected option life (years) | 4.50 | 2.00 | 4.50 | |||||||||
| Number of options granted | 71,500 | 7,500 | 62,000 |
For the six months ended June 30, 2018, the Company has recognized 1.0 million of share-based
payment expense in the statement of operations (six months ended June 30, 2017: 0.5 million). For the three months ended June 30, 2018, the Company has recognized 0.6 million of share-based payment expense in the
statement of operations (three months ended June 30, 2017: 0.3 million).
NOTES TO THE UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
9. Share capital and share premium
| June 30, 2018 | December 31, 2017 | |||||||
| (in thousands) | ||||||||
| Share capital | 1,272 | 1,272 | ||||||
| Share premium | 79,236 | 79,236 | ||||||
| 80,508 | 80,508 | |||||||
| June 30, 2018 | December 31, 2017 | |||||||
| Number (in thousands) | ||||||||
| Issued share capital comprises: | ||||||||
| Ordinary shares of 0.04 each | 31,811 | 31,811 |
| Number of shares | Share capital | Share premium | ||||||||||
| (in thousands) | ||||||||||||
| Fully paid shares: | ||||||||||||
| Balance at December 31, 2017 | 31,811 | 1,272 | 79,236 | |||||||||
| Balance at June 30, 2018 | 31,811 | 1,272 | 79,236 |
10. Contingent liabilities
Under the U.K. share-based payment plan, the Company granted unapproved share options that have fully vested. If and when these share options are exercised,
the Company will be liable for the Employer Class 1 National Insurance payable to HMRC in the U.K. This contingent liability will be determined based on the market value of the shares on exercise less the exercise price paid by the option
holders, at the prevailing rate of Employer National Insurance (currently 13.8%). Based on the closing share price of ADSs on the Nasdaq Global Select Market on June 29, 2018, the last trading day of the period to which these financial
statements relate, and assuming full exercise of all outstanding and vested unapproved share options on that date, the Employer National Insurance contingent liability would have been 4.1 million (December 31, 2017: 2.1 million).