Full Press Release Details
Biotechnology Reports First Quarter 2020 Financial and Operating Results; Continues to Demonstrate Significant Progress Despite
Tel Aviv, Israel May 21, 2020 -
Cellect Biotechnology Ltd. (NASDAQ: "APOP"), a developer of innovative technology which enables the functional selection
of stem cells, today reported financial and operating results for the first quarter ended March 31, 2020 and provided an update
on recent operating developments, including the status of the previously announced LOIs with Canndoc Ltd, a wholly owned subsidiary
of publicly-traded Intercure Ltd. (TASE: INCR).
First Quarter and Recent Operating Milestones
"Although the COVID-19 pandemic has
delayed the initiation of our first U.S. trial (for which we have already received the IND approval from the U.S. Food and Drug
Administration and completed the technology transfer to our academic partner - Washington University) and slowed the recruitment
of the final patient in the Israel trial, we remain bullish on Cellect's long-term business prospects," commented Dr.
Shai Yarkoni, Chief Executive Officer. "In addition to these clinical opportunities, we are making considerable progress
elsewhere to advance our core capabilities and seeding potentially sizeable revenue opportunities."
While the Company is continuing to conduct
its due diligence and negotiate a definitive agreement with Canndoc Ltd., the business disruption caused by the ongoing COVID-19
pandemic is delaying the execution and completion of certain other closing conditions, such as delivery of a fairness opinion and
approval of the IMCA (Israeli Medical Cannabis Agency). Upon the closing of
the merger, the Company and Canndoc Ltd. intend to fulfill all of the requirements to ensure the Company's ADRs and warrants
continue trading on the Nasdaq Stock Market (Nasdaq). The proposed merger is also subject to approval of the Company's Board
and shareholders and other customary closing conditions.
The Company's cash and cash equivalents
totaled $7.08 million as of March 31, 2020. As previously disclosed on May 12, 2020, several investors exercised certain warrants
that were issued in February 2019 for cash proceeds of approximately $1.5 million.
First Quarter 2020 Financial Results:
About Cellect Biotechnology Ltd.
Cellect Biotechnology (APOP) has developed
a breakthrough technology, for the selection of stem cells from any given tissue, that aims to improve a variety of stem cell-based
The Company's technology is expected to
provide researchers, clinical community and pharma companies with the tools to rapidly isolate stem cells in quantity and quality
allowing stem cell-based treatments and procedures in a wide variety of applications in regenerative medicine. The Company's current
clinical trial is aimed at bone marrow transplantations in cancer treatment.
Forward Looking Statements
This press release contains forward-looking
statements about the Company's expectations, beliefs and intentions. Forward-looking statements can be identified by the use of
forward-looking words such as "believe", "expect", "intend", "plan", "may", "should",
"could", "might", "seek", "target", "will", "project", "forecast",
"continue" or "anticipate" or their negatives or variations of these words or other comparable words or by
the fact that these statements do not relate strictly to historical matters. For example, forward-looking statements are used in
this press release when we discuss Cellect's expectations regarding timing of the commencement of its planned U.S. clinical trial
and its plan to reduce operating costs. These forward-looking statements and their implications are based on the current expectations
of the management of the Company only and are subject to a number of factors and uncertainties that could cause actual results
to differ materially from those described in the forward-looking statements. In addition, historical results or conclusions from
scientific research and clinical studies do not guarantee that future results would suggest similar conclusions or that historical
results referred to herein would be interpreted similarly in light of additional research or otherwise. The following factors,
among others, could cause actual results to differ materially from those described in the forward-looking statements: the Company's
history of losses and needs for additional capital to fund its operations and its inability to obtain additional capital on acceptable
terms, or at all; the Company's ability to continue as a going concern; uncertainties of cash flows and inability to meet working
capital needs; the Company's ability to obtain regulatory approvals; the Company's ability to obtain favorable pre-clinical and
clinical trial results; the Company's technology may not be validated and its methods may not be accepted by the scientific community;
difficulties enrolling patients in the Company's clinical trials; the ability to timely source adequate supply of FasL; risks resulting
from unforeseen side effects; the Company's ability to establish and maintain strategic partnerships and other corporate collaborations;
the scope of protection the Company is able to establish and maintain for intellectual property rights and its ability to operate
its business without infringing the intellectual property rights of others; competitive companies, technologies and the Company's
industry; unforeseen scientific difficulties may develop with the Company's technology; the Company's ability to retain or attract
key employees whose knowledge is essential to the development of its products; and the Company's ability to pursue any strategic
transaction or that any transaction, if pursued, will be completed. Any forward-looking statement in this press release speaks
only as of the date of this press release. The Company undertakes no obligation to publicly update or review any forward-looking
statement, whether as a result of new information, future developments or otherwise, except as may be required by any applicable
securities laws. More detailed information about the risks and uncertainties affecting the Company is contained under the heading
"Risk Factors" in Cellect Biotechnology Ltd.'s Annual Report on Form 20-F for the fiscal year ended December 31, 2019
filed with the U.S. Securities and Exchange Commission, or SEC, which is available on the SEC's website, www.sec.gov, and in the
Company's periodic filings with the SEC.
Cellect Biotechnology Ltd.
Eyal Leibovitz, Chief Financial Officer
Cellect Biotechnology Ltd.
Consolidated Statement of Operation
| Convenience | ||||||||||||
| translation | ||||||||||||
| Three months ended | Three months ended | |||||||||||
| March 31, | March 31, | |||||||||||
| 2020 | 2020 | 2019 | ||||||||||
| Unaudited | Unaudited | |||||||||||
| U.S. dollars | NIS | |||||||||||
| Research and development expenses, net | 431 | 1,537 | 3,523 | |||||||||
| General and administrative expenses | 726 | 2,587 | 2,355 | |||||||||
| Total operating loss | 1,157 | 4,124 | 5,878 | |||||||||
| Financial expenses (income) due to warrants exercisable into ADS | (250 | ) | (890 | ) | (1,192 | ) | ||||||
| Other financial expenses (income), net | (191 | ) | (682 | ) | 418 | |||||||
| Total comprehensive loss | 716 | 2,552 | 5,104 | |||||||||
| Loss per share and ADS: | ||||||||||||
| Basic and diluted loss per share | 0.002 | 0.008 | 0.029 | |||||||||
| Weighted average number of shares outstanding used to compute basic and diluted loss per share | 324,311,822 | 324,311,822 | 177,277,833 |
Cellect Biotechnology Ltd.
Consolidated Balance Sheet Data
| Convenience | ||||||||||||
| translation | ||||||||||||
| March 31, | March 31, | December 31, | ||||||||||
| 2020 | 2020 | 2019 | ||||||||||
| Unaudited | Unaudited | Audited | ||||||||||
| U.S. dollars | NIS | |||||||||||
| (In thousands, except share and per share data) | ||||||||||||
| CURRENT ASSETS: | ||||||||||||
| Cash and cash equivalents | 7,077 | 25,231 | 18,106 | |||||||||
| Other receivables | 115 | 409 | 469 | |||||||||
| 7,192 | 25,640 | 18,575 | ||||||||||
| NON-CURRENT ASSETS: | ||||||||||||
| Restricted cash | 93 | 332 | 328 | |||||||||
| Right of use - Assets under operating lease | 280 | 1,000 | 1,035 | |||||||||
| Other long-term receivables | 24 | 85 | 94 | |||||||||
| Property, plant and equipment, net | 328 | 1,168 | 1,288 | |||||||||
| 725 | 2,585 | 2,745 | ||||||||||
| 7,917 | 28,225 | 21,320 | ||||||||||
| CURRENT LIABILITIES: | ||||||||||||
| Trade payables | 240 | 855 | 158 | |||||||||
| Other payables | 892 | 3,181 | 3,080 | |||||||||
| Current maturities of lease liability | 118 | 419 | 396 | |||||||||
| 1,250 | 4,455 | 3,634 | ||||||||||
| NON-CURRENT LIABILITIES: | ||||||||||||
| Warrants to ADS | 360 | 1,282 | 2,172 | |||||||||
| Lease liability | 175 | 625 | 677 | |||||||||
| 535 | 1,907 | 2,849 | ||||||||||
| EQUITY: | ||||||||||||
| Ordinary shares of no par value: | ||||||||||||
| Authorized: 500,000,000 shares at December 31, 2019 and March 31, 2020; Issued and outstanding: 224,087,799*) and 337,533,079*) shares as of December 31, 2019 and March 31, 2020, respectively. | - | - | - | |||||||||
| Additional Paid in Capital | 33,363 | 118,939 | 108,598 | |||||||||
| Share-based payments | 4,422 | 15,765 | 16,528 | |||||||||
| Treasury shares | (2,644 | ) | (9,425 | ) | (9,425 | ) | ||||||
| Accumulated deficit | (29,009 | ) | (103,416 | ) | (100,864 | ) | ||||||
| 6,132 | 21,863 | 14,837 | ||||||||||
| 7,917 | 28,225 | 21,320 |
Cellect Biotechnology Ltd.
Consolidated Cash Flow Data
| Convenience | ||||||||||||
| translation | ||||||||||||
| Three months ended | Three months ended | |||||||||||
| March 31, | March 31, | |||||||||||
| 2020 | 2020 | 2019 | ||||||||||
| Unaudited | Unaudited | |||||||||||
| U.S. dollars | NIS | |||||||||||
| Cash flows from operating activities: | ||||||||||||
| Total comprehensive loss | (716 | ) | (2,552 | ) | (5,104 | ) | ||||||
| Adjustments to reconcile net loss to net cash used in operating activities: | ||||||||||||
| Exchange rate difference | (195 | ) | (695 | ) | 372 | |||||||
| Loss from revaluation of financial assets presented at fair value through profit and loss | - | - | 4 | |||||||||
| Depreciation | 24 | 86 | 98 | |||||||||
| Share-based payment | 101 | 361 | (215 | ) | ||||||||
| Changes in fair value of traded and not traded warrants to ADS | (250 | ) | (890 | ) | (2,546 | ) | ||||||
| Finance expenses | 5 | 19 | - | |||||||||
| Interest received | 3 | 12 | - | |||||||||
| Decrease (increase) in other receivables | 20 | 71 | 70 | |||||||||
| Depreciation in right of use assets | 26 | 91 | 114 | |||||||||
| Increase (decrease) in other payables | 244 | 868 | 15 | |||||||||
| Net cash used in operating activities | (738 | ) | (2,629 | ) | (7,192 | ) | ||||||
| Cash flows from investing activities: | ||||||||||||
| Restricted deposit | (1 | ) | (4 | ) | - | |||||||
| Marketable securities measured at fair value through profit and loss, net | - | - | - | |||||||||
| Sales (Purchase) of property, plant and equipment | 9 | 34 | (120 | ) | ||||||||
| Net cash provided by investing activities | 8 | 30 | (120 | ) | ||||||||
| Cash flows from financing activities: | ||||||||||||
| Exercise of warrants and stock options into shares | 7 | 23 | - | |||||||||
| Issue of share capital and warrants, net of issue costs | 2,559 | 9,123 | 24,837 | |||||||||
| Interest paid | - | - | 37 | |||||||||
| Repayment of lease liability | (29 | ) | (104 | ) | (137 | ) | ||||||
| Net cash provided by financing activities | 2,537 | 9,042 | 24,737 | |||||||||
| Exchange differences on balances of cash and cash equivalents | 191 | 682 | (372 | ) | ||||||||
| Increase (decrease) in cash and cash equivalents | 1,998 | 7,125 | 17,053 | |||||||||
| Balance of cash and cash equivalents at the beginning of the period | 5,079 | 18,106 | 17,809 | |||||||||
| Balance of cash and cash equivalents at the end of the period | 7,077 | 25,231 | 34,862 |