Full Press Release Details
Summit Therapeutics plc
( Summit , the Company or the Group )
SUMMIT THERAPEUTICS REPORTS FINANCIAL RESULTS FOR THE
SECOND QUARTER AND HALF YEAR ENDED 31 JULY 2017 AND
OPERATIONAL PROGRESS
Oxford, UK, 31 August 2017
Summit Therapeutics plc (AIM: SUMM, NASDAQ: SMMT), the drug discovery and development company advancing therapies for Duchenne muscular dystrophy ( DMD ) and C. difficile infection ( CDI ), today reports its
financial results for the second quarter and half year ended 31 July 2017.
Mr Glyn Edwards, Chief Executive Officer of Summit, commented:
It has been a strong first half of the year with progress being made across all areas of the business. Ezutromid, our lead utrophin modulator for DMD, achieved an important development milestone following completion of enrolment into
our clinical trial called PhaseOut DMD, triggering a $22 million payment from our licence and collaboration partner Sarepta Therapeutics. PhaseOut DMD aims to show proof of concept for ezutromid, and we look forward to reporting 24-week data from the trial in the first quarter of 2018.
Ridinilazole, our highly selective and potent
antibiotic for the treatment of C. difficile infection, also continues to progress as we prepare the asset to start Phase 3 clinical trials in the first half of 2018. We believe ridinilazole can become a new, urgently needed frontline therapy for
this serious infectious disease.
We look forward to an exciting and important period ahead as we continue advancing these two assets that
have the potential to improve the quality of life of patients and families living with DMD and CDI.
Utrophin Modulation Programme for DMD
Ezutromid - Highlights
Ridinilazole - Highlights
Operational Highlights
Financial Highlights
Conference Call and Webcast Information
a conference call and webcast to review the financial results for the second quarter and half year ended 31 July 2017 today at 1:00pm BST / 8:00am EDT. To participate in the conference call, please dial +44(0)20 3427 1916 (UK and international
participants) or +1 212 444 0412 (US local number) and use the conference confirmation code 9691365. Investors may also access a live audio webcast of the call via the investors section of the Company s website www.summitplc.com. A replay of
the webcast will be available shortly after the completion of the call.
About Summit Therapeutics
Summit is a biopharmaceutical company focused on the discovery, development and commercialisation of novel medicines for indications for which there are no
existing or only inadequate therapies. Summit is conducting clinical programmes focused on the genetic disease Duchenne muscular dystrophy and the infectious disease C. difficile infection. Further information is available at
www.summitplc.com and Summit can be followed on Twitter (@summitplc).
For more information, please contact:
| Summit Therapeutics Glyn Edwards / Richard Pye (UK office) Erik Ostrowski / Michelle Avery (US office) | Tel: +44 (0)1235 443 951 +1 617 225 4455 | |
| Cairn Financial Advisers LLP (Nominated Adviser) Liam Murray / Tony Rawlinson | Tel: +44 (0)20 7213 0880 | |
| N+1 Singer (Broker) Aubrey Powell / Lauren Kettle | Tel: +44 (0)20 7496 3000 | |
| MacDougall Biomedical Communications (US media contact) Karen Sharma | Tel: +1 781 235 3060 ksharma@macbiocom.com |
Forward Looking Statements
Any statements in this press release about our future expectations, plans and prospects, including statements about the development and potential
commercialisation of our product candidates, the therapeutic potential of our product candidates, the timing of initiation, completion and availability of data from clinical trials, the potential benefits and future operation of the collaboration
with Sarepta including any potential future payments thereunder, any other potential third-party collaborations and expectations regarding the sufficiency of our cash balance to fund operating expenses and capital expenditures, and other statements
containing the words anticipate, believe, continue, could, estimate, expect, intend, may, plan, potential, predict,
project, should, target, would, and similar expressions, constitute forward-looking statements within the meaning of The Private Securities Litigation Reform Act of 1995. Actual results may differ
materially from those indicated by such forward-looking statements as a result of various important factors, including: the uncertainties inherent in the initiation of future clinical trials, availability and timing of data from ongoing and future
clinical trials and the results of such trials, whether preliminary results from a clinical trial will be predictive of the final results of that trial or whether results of early clinical trials will be indicative of the results of later clinical
trials, expectations for regulatory approvals, availability of funding sufficient for our foreseeable and unforeseeable operating expenses and capital expenditure requirements and other factors discussed in the Risk Factors section of
filings that we make with the Securities and Exchange Commission, including our Annual Report on Form 20-F for the fiscal year ended 31 January 2017. In addition, any forward-looking statements included
in this press release represent our views only as of the date of this release and should not be relied upon as representing our views as of any subsequent date. We specifically disclaim any obligation to update any forward-looking statements
included in this press release.
Revenue was 18.9 million for the
three months ended 31 July 2017 compared to nil for the three months ended 31 July 2016. Revenue was 20.7 million for the six months ended 31 July 2017 compared to nil for the six months ended 31 July
2016. These increases were principally due to the receipt, and recognition in full, of a 17.2 million ($22.0 million) development milestone paid by Sarepta during the three months ended 31 July 2017, pursuant to Summit s
exclusive licence and collaboration agreement with Sarepta. In addition, 1.7 million relating to the upfront payment of 32.8 million ($40.0 million) made by Sarepta in October 2016 was recognised in the three months ended
31 July 2017. To date an aggregate of 5.8 million of the upfront payment has been recognised while the remaining 27.0 million is classified as deferred revenue and will continue to be recognised as revenue over the
Other Operating Income
were no sources of other operating income during the three and six months ended 31 July 2017. Operating income recognised in comparative periods relates to the Innovate UK funding agreement, from which the Company withdrew in order to enable it
to take advantage of more tax efficient opportunities related to research and development expenditure, and the Wellcome Trust funding agreement, for which all monies and income have been received and accounted for in connection with the completion
of our CoDIFy Phase 2 clinical trial of ridinilazole.
Research and Development Expenses
development expenses increased by 1.2 million to 6.6 million for the three months ended 31 July 2017 from 5.4 million for the three months ended 31 July 2016. Research and development expenses increased
by 1.4 million to 11.6 million for the six months ended 31 July 2017 from 10.2 million for the six months ended 31 July 2016. These increases reflected the increased investment in the DMD programme and
an increase in research and development related staffing costs, offset by a decrease in CDI clinical programme related activities.
Administration Expenses
General and administration expenses increased by 0.6 million to 2.5 million for the three months ended
31 July 2017 from 1.9 million for the three months ended 31 July 2016. General and administration expenses increased by 1.6 million to 4.9 million for the six months ended 31 July 2017 from
3.3 million for the six months ended 31 July 2016. These increases were primarily due to a net negative movement in exchange rate variances and increased staff-related costs, offset by a decrease in legal and professional fees.
Following an International Financial
Reporting Standards Interpretations Committee agenda decision in May 2016 on the application of International Accounting Standards 20 Accounting for Government Grants and Disclosure of Government Assistance , the Company changed
its accounting policy regarding charitable funding arrangements from the Wellcome Trust and US not for profit organisations for the year ended 31 January 2017. See Note 1 Change in accounting policy in respect of July 2016
comparatives below. This change in accounting policy has been reflected retrospectively in the comparative financial statements for the three and six months ended 31 July 2016. Finance costs relate to the subsequent re-measurement of the financial liability recognised in respect of income arrangements and the unwinding of the discounts associated with the liabilities. Finance costs remained consistent at 0.2 million
for the three months ended 31 July 2017 and for the three months ended 31 July 2016 (adjusted). Finance costs remained consistent at 0.4 million for the six months ended 31 July 2017 and for the six months ended
31 July 2016 (adjusted).
tax credit increased by 0.2 million to 1.3 million for the three months ended 31 July 2017 from 1.1 million for the three months ended 31 July 2016. The income tax credit increased by
0.5 million to 2.5 million for the six months ended 31 July 2017 from 2.0 million for the six months ended 31 July 2016. These increases were as a result of increased expenditure on research and
income for the three months ended 31 July 2017 was 10.9 million with a basic earnings per share of 18 pence compared to a total comprehensive loss of 6.4 million for the three months ended 31 July 2016 (adjusted)
and a basic loss per share of 10 pence. Total comprehensive income for the six months ended 31 July 2017 was 6.2 million with a basic earnings per share of 10 pence compared to a total comprehensive loss of 11.8 million
for the six months ended 31 July 2016 (adjusted) and a basic loss per share of 19 pence.
Operating Activities
For the six months ended
31 July 2017, the Company generated 1.5 million in cash from operating activities. This compares to net cash used in operating activities of 9.5 million for the six months ended 31 July 2016 (adjusted). This net
movement of 11.0 million was primarily driven by the receipt of a 17.2 million ($22.0 million) development milestone payment from Sarepta, offset by an increase of 3.0 million in research and development expenses
and general and administration expenses and a decrease of 3.1 million in research and development tax credits received due to timing, as the Company expects to receive this year s research and development tax credit payment in the
Investing Activities
Net cash used in investing activities for the six months ended 31 July 2017 and the six months ended 31 July 2016 includes the net amount of bank
interest received on cash deposits less amounts paid to acquire property, plant and equipment. Amounts paid to acquire property, plant and equipment during the six months ended 31 July 2017 relate to the Company s relocation of its UK
offices, for which the Company signed a ten-year lease in February 2017.
Financing Activities
Net cash inflow from financing activities for the six months ended 31 July 2017 relates to proceeds of 0.03 million received following the
exercise of warrants and the exercise of share options. For the six months ended 31 July 2016, the Company received net proceeds of 0.11 million following the exercise of warrants and share options.
As at 31 July 2017, cash and
cash equivalents were 28.3 million compared to 28.1 million as at 31 January 2017.
| Glyn Edwards | Erik Ostrowski | |||
| Chief Executive Officer | Chief Financial Officer |
FINANCIAL STATEMENTS
CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME (unaudited)
For the three months ended 31 July 2017
| Three months ended 31 July 2017 | Three months ended 31 July 2017 | Three months ended 31 July 2016 | ||||||||||||
| Adjusted* | ||||||||||||||
| Note | $000s | 000s | 000s | |||||||||||
| Revenue | 2 | 25,009 | 18,952 | |||||||||||
| Other operating income | 13 | |||||||||||||
| Operating expenses | ||||||||||||||
| Research and development | (8,720 | ) | (6,608 | ) | (5,399) | |||||||||
| General and administration | (3,284 | ) | (2,488 | ) | (1,910) | |||||||||
| Total operating expenses | (12,004 | ) | (9,096 | ) | (7,309) | |||||||||
| Operating profit / (loss) | 13,005 | 9,856 | (7,296) | |||||||||||
| Finance income | 1 | 1 | 2 | |||||||||||
| Finance costs | (289 | ) | (219 | ) | (210) | |||||||||
| Profit / (loss) before income tax | 12,717 | 9,638 | (7,504) | |||||||||||
| Income tax | 1,693 | 1,283 | 1,076 | |||||||||||
| Profit / (loss) for the period | 14,410 | 10,921 | (6,428) | |||||||||||
| Other comprehensive income / (loss) | ||||||||||||||
| Exchange differences on translating foreign operations | 9 | 7 | 21 | |||||||||||
| Total comprehensive income / (loss) for the period | 14,419 | 10,928 | (6,407) | |||||||||||
| Basic earnings / (loss) per Ordinary Share from operations | 3 | 23 cents | 18 pence | (10)pence | ||||||||||
| Diluted earnings / (loss) per Ordinary Share from operations | 3 | 22 cents | 17 pence |
* See Note 1 Change in Accounting Policy in respect of July 2016 comparatives
CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME (unaudited)
For the six months ended 31 July 2017
| Six months ended 31 July 2017 | Six months ended 31 July 2017 | Six months ended 31 July 2016 | ||||||||||||
| Adjusted* | ||||||||||||||
| Note | $000s | 000s | 000s | |||||||||||
| Revenue | 2 | 27,289 | 20,680 | |||||||||||
| Other operating income | 72 | |||||||||||||
| Operating expenses | ||||||||||||||
| Research and development | (15,364 | ) | (11,643 | ) | (10,204) | |||||||||
| General and administration | (6,496 | ) | (4,922 | ) | (3,342) | |||||||||
| Total operating expenses | (21,860 | ) | (16,565 | ) | (13,546) | |||||||||
| Operating profit / (loss) | 5,429 | 4,115 | (13,474) | |||||||||||
| Finance income | 3 | 2 | 5 | |||||||||||
| Finance costs | (585 | ) | (443 | ) | (404) | |||||||||
| Profit / (loss) before income tax | 4,847 | 3,674 | (13,873) | |||||||||||
| Income tax | 3,280 | 2,486 | 2,011 | |||||||||||
| Profit/(loss) for the period | 8,127 | 6,160 | (11,862) | |||||||||||
| Other comprehensive income / (loss) | ||||||||||||||
| Exchange differences on translating foreign operations | (11 | ) | (8 | ) | 16 | |||||||||
| Total comprehensive income / (loss) for the period | 8,116 | 6,152 | (11,846) | |||||||||||
| Basic earnings / (loss) per Ordinary Share from operations | 3 | 13 cents | 10 pence | (19)pence | ||||||||||
| Diluted earnings / (loss) per Ordinary Share from operations | 3 | 13 cents | 10 pence |
* See Note 1 Change in Accounting Policy in respect of July 2016 comparatives
CONSOLIDATED STATEMENT OF FINANCIAL POSITION (unaudited)
| 31 July 2017 $000s | 31 July 2017 000s | 31 January 2017 000s | ||||||||||
| ASSETS | ||||||||||||
| Non-current assets | ||||||||||||
| Goodwill | 876 | 664 | 664 | |||||||||
| Intangible assets | 4,526 | 3,430 | 3,470 | |||||||||
| Property, plant and equipment | 739 | 560 | 116 | |||||||||
| 6,141 | 4,654 | 4,250 | ||||||||||
| Current assets | ||||||||||||
| Prepayments and other receivables | 1,818 | 1,378 | 1,027 | |||||||||
| Current tax receivable | 9,019 | 6,835 | 4,248 | |||||||||
| Cash and cash equivalents | 37,333 | 28,291 | 28,062 | |||||||||
| 48,170 | 36,504 | 33,337 | ||||||||||
| Total assets | 54,311 | 41,158 | 37,587 | |||||||||
| LIABILITIES | ||||||||||||
| Non-current liabilities | ||||||||||||
| Deferred revenue | (26,602 | ) | (20,159 | ) | (23,615 | ) | ||||||
| Financial liabilities on funding arrangements | (8,395 | ) | (6,362 | ) | (5,919 | ) | ||||||
| Provisions for other liabilities and charges | (198 | ) | (150 | ) | (85 | ) | ||||||
| Deferred tax liability | (745 | ) | (565 | ) | (565 | ) | ||||||
| (35,940 | ) | (27,236 | ) | (30,184 | ) | |||||||
| Current liabilities | ||||||||||||
| Trade and other payables | (4,632 | ) | (3,510 | ) | (3,984 | ) | ||||||
| Deferred revenue | (9,121 | ) | (6,912 | ) | (6,912 | ) | ||||||
| (13,753 | ) | (10,422 | ) | (10,896 | ) | |||||||
| Total liabilities | (49,693 | ) | (37,658 | ) | (41,080 | ) | ||||||
| Net assets/(liabilities) | 4,618 | 3,500 | (3,493 | ) | ||||||||
| EQUITY | ||||||||||||
| Share capital | 817 | 619 | 618 | |||||||||
| Share premium account | 61,299 | 46,453 | 46,420 | |||||||||
| Share-based payment reserve | 7,842 | 5,943 | 5,136 | |||||||||
| Merger reserve | (2,564 | ) | (1,943 | ) | (1,943 | ) | ||||||
| Special reserve | 26,383 | 19,993 | 19,993 | |||||||||
| Currency translation reserve | 55 | 42 | 50 | |||||||||
| Accumulated losses reserve | (89,214 | ) | (67,607 | ) | (73,767 | ) | ||||||
| Total equity/(deficit) | 4,618 | 3,500 | (3,493 | ) |
CONSOLIDATED STATEMENT OF CASH FLOWS (unaudited)
For the six months ended 31 July 2017
| Six months ended 31 July 2017 | Six months ended 31 July 2017 | Six months ended 31 July 2016 | ||||||||||
| $000s | 000s | Adjusted* 000s | ||||||||||
| Cash flows from operating activities | ||||||||||||
| Profit / (loss) before income tax | 4,847 | 3,674 | (13,873 | ) | ||||||||
| 4,847 | 3,674 | (13,873 | ) | |||||||||
| Adjusted for: | ||||||||||||
| Finance income | (3 | ) | (2 | ) | (5 | ) | ||||||
| Finance costs | 585 | 443 | 404 | |||||||||
| Foreign exchange loss / (gain) | 1,312 | 994 | (60 | ) | ||||||||
| Depreciation | 77 | 58 | 23 | |||||||||
| Amortisation of intangible fixed assets | 5 | 4 | 5 | |||||||||
| Loss on disposal of assets | 55 | 42 | ||||||||||
| Research and development expenditure credit | (3 | ) | ||||||||||
| Share-based payment | 1,065 | 807 | 764 | |||||||||
| Adjusted profit / (loss) from operations before changes in working capital | 7,943 | 6,020 | (12,745 | ) | ||||||||
| (Increase) / decrease in prepayments and other receivables | (463 | ) | (351 | ) | 135 | |||||||
| (Decrease) / increase in trade and other payables | (630 | ) | (478 | ) | 122 | |||||||
| (Decrease) / increase in provisions for other liabilities and charges | (112 | ) | (85 | ) | 12 | |||||||
| Decrease in deferred revenue | (4,561 | ) | (3,456 | ) | ||||||||
| Cash generated from / (used in) operations | 2,177 | 1,650 | (12,476 | ) | ||||||||
| Taxation (paid) / received | (135 | ) | (102 | ) | 3,005 | |||||||
| Net cash generated from / (used in) operating activities | 2,042 | 1,548 | (9,471 | ) | ||||||||
| Investing activities | ||||||||||||
| Purchase of property, plant and equipment | (471 | ) | (357 | ) | (28 | ) | ||||||
| Interest received | 3 | 2 | 5 | |||||||||
| Net cash used in investing activities | (468 | ) | (355 | ) | (23 | ) | ||||||
| Financing activities | ||||||||||||
| Proceeds from exercise of warrants | 13 | 10 | 107 | |||||||||
| Exercise of share options | 32 | 24 | 3 | |||||||||
| Cash received from funding arrangements accounted for as financial liabilities | 23 | |||||||||||
| Net cash generated from financing activities | 45 | 34 | 133 | |||||||||
| Increase/ (decrease) in cash and cash equivalents | 1,619 | 1,227 | (9,361 | ) | ||||||||
| Effect of exchange rates in cash and cash equivalents | (1,317 | ) | (998 | ) | 53 | |||||||
| Cash and cash equivalents at beginning of the period | 37,031 | 28,062 | 16,304 | |||||||||
| Cash and cash equivalents at end of the period | 37,333 | 28,291 | 6,996 |