TIDMAVO
RNS Number : 2543C
Advanced Oncotherapy PLC
28 September 2018
ADVANCED ONCOTHERAPY PLC
("Advanced Oncotherapy" or the "Company")
Half-year Report
Advanced Oncotherapy (AIM: AVO), the developer of a next
generation proton therapy system for cancer treatment, announces
its unaudited results for the six months ended 30 June 2018 and
post-period events.
Highlights:
-- LIGHT system now generating proton beams with energies
sufficient to treat superficial tumours
-- Improved financial position thanks to the completion of c.
GBP40m financing since January 2018 and the elimination of
financial pledges over the Company's assets
-- Science and Technology Facilities Council agreement to
establish a UK testing and assembly site at the Accelerator Science
and Technology Centre in Daresbury, home of the Cockcroft
Institute
-- Harley Street site building work on schedule, first patient
treatment expected by the second half of 2020
-- Completion of commercial distribution agreement with Liquid
Harmony for China and other parts of Asia
-- Ongoing commercial discussions with sites in the USA, Europe, Asia and Middle East
-- Non-Executive Director appointments to the Board
Nicolas Serandour, CEO of Advanced Oncotherapy, said: "We are
delighted with the progress we have made over the first six months
of 2018, especially in terms of the significant advances in the
beam testing and our reinforced financial position following the
further funding received. We have strengthened the Board with some
key changes and we have total confidence in our ability as a team
to deliver on our milestones. The sub-structural work at the Harley
Street facility remains on schedule and we are pleased with the
progress at the site. We have exciting plans for the future
commercialisation of the LIGHT system once completely developed,
and our discussions with potential partners around the world are
ongoing. On behalf of the Board, we would like to thank all of our
shareholders for their continued support and belief, and we look
forward to further success ahead."
Advanced Oncotherapy Plc www.avoplc.com
Dr. Michael Sinclair, Executive Tel: +44 20 3617 8728
Chairman
Nicolas Serandour, CEO
Stockdale Securities (Nomad &
Joint Broker)
Antonio Bossi / Edward Thomas Tel: +44 20 7601 6100
Stifel Nicolaus Europe (Joint
Broker)
Jonathan Senior / Ben Maddison Tel: +44 20 7710 7600
Walbrook PR (Financial PR & IR) Tel: +44 20 7933 8780 or avo@walbrookpr.com
Paul McManus / Anna Dunphy Mob: +44 7980 541 893 / Mob: +44
7876 741 001
About Advanced Oncotherapy Plc www.avoplc.com
Advanced Oncotherapy is a provider of particle therapy in the
treatment of cancer, which harnesses the very best in modern
technology. Advanced Oncotherapy's R&D team, ADAM, in Geneva,
focuses on the development of a proprietary proton accelerator -
LIGHT (Linac Image Guided Hadron Technology). LIGHT accelerates
protons to the energy levels achieved in legacy machines but in a
compact and truly modular unit, offering significant cost
advantages. LIGHT also delivers proton beams in a way that
facilitates greater precision and electronic control, which are not
achievable with currently available alternative technologies.
Advanced Oncotherapy offers healthcare providers affordable
systems that will enable them to treat cancer with an innovative
technology, intended to offer better health outcomes and lower
treatment related side effects.
Advanced Oncotherapy continually monitors the market for any
emerging improvements in delivering proton or particle therapy and
actively seeks working relationships with providers of these
innovative technologies. Through these relationships, the Company
remains the prime provider of cutting edge, cost-effective systems
for particle therapy.
EXECUTIVE CHAIRMAN'S STATEMENT
I am pleased to update shareholders with our report for the six
months ended 30 June 2018 and to provide a review of the further
progress the Company has made in the technical development of our
next generation proton therapy system, as well as an update on the
establishment of our UK testing and assembly site, the building
work at the site of our first installation in Harley Street, and
the securing of additional financing to provide a stable platform
to support our continued progress.
Technology update
We are delighted with the ongoing progress being made in the
technology development and manufacture of our first LIGHT
system.
The first system under development at the Company's testing
facility at CERN, Geneva is now generating a proton beam with
sufficient energy required for treating some superficial tumours.
This follows the substantial progress made during the period with
the successful testing and integration of the key accelerating
structures of the LIGHT accelerator. This installation and
integration process continues to confirm our modelled expectations
with proton beams accelerated through the integrated proton source,
RFQ and SDTLDs at the design-anticipated energy.
Furthermore the simulation of the treatment plan of a periocular
tumour case based on the data and the proton acceleration reached
with the LIGHT system showed an excellent iso-dosimetry profile:
the current LIGHT system comfortably covered the simulated clinical
case, as well as some marginally deeper tumours whilst the healthy
tissue was dramatically spared from radiation dose. This result
further supports some of the advantages of the LIGHT system which
is designed to offer a higher beam precision and targeting as well
as more conformal dose and greater adjustability at source. The
progress made to date and the conclusive test results also reduce
the already known low risk in the technological development
process.
We have made further advances in the development, integration
and testing of the Patient Positioning System ("PPS") software,
which is designed to prepare and position patients for the high
accuracy and dose sparing proton treatments produced by the LIGHT
system.
During the period, we announced the successful development of
our system's Time-of-Flight ("TOF") measurement system which
measures the speed of the beam and allows us to evaluate the energy
of each proton pulse, an important clinical parameter. Successful
TOF testing has demonstrated good results for beam control and
adjustment, which is a crucial part of our ability to offer a
system with superior precision and adjustment sensitivity to
provide more accurate and versatile patient outcomes.
In addition, we entered into a strategic collaboration agreement
with RaySearch AB, a global leader in software solutions for x-ray
and particle therapies, to provide the treatment planning software
("TPS") for the LIGHT system in Harley Street. RaySearch's software
will provide superior functionality for treatment planning,
encompassing patient positioning through to treatment solutions.
The software is well established and familiar to oncologists,
having been installed in 466 centres across 31 Countries in the
last year alone.
We have also made strong progress in establishing our UK testing
and assembly site within the UK Government's Science and Technology
Facilities Council's Daresbury Laboratory in Cheshire, home to the
UK's Accelerator Science and Technology Centre. Building work for
site preparation continues as per the plan.
Harley Street update
Progress at our 141/143 Harley Street site remains on track. The
sub-structural work continues to advance, and we continue on
schedule to create central London's first compact proton therapy
centre with site work expected to conclude by the first half of
next year to enable first patient treatment by the second half of
2020.
A time-lapse video of the construction work on site is available
on our website and was most recently updated in August 2018 (see:
www.avoplc.com/Our-Technology/Toward-the-First-Installation-of-LIGHT)
The Howard de Walden Estate, the site freeholder, continues to
bear the costs of construction.
Future plans for commercialisation
Whilst the technical development of our first LIGHT system is
the key focus of the Group, we continue in our efforts to prepare
to meet the demand that we anticipate for an advanced, affordable
proton therapy technology that can be easily installed and safely
operated in areas of high patient population density. Our key
supply partners are extremely supportive in regard to the increased
capacity, shorter delivery lead time and cost reduction based upon
our ongoing dialogues.
Discussions for a second UK site in Birmingham are ongoing, and
we remain in discussions regarding the installation of our LIGHT
system, once fully developed, in sites in the USA and others across
in Europe, Asia and the Middle East.
We are very pleased with the exclusive distribution agreement
signed with Liquid Harmony Ltd. ("Liquid Harmony") to market and
sell our LIGHT system across China, Macau, Taiwan, Hong-Kong and
South Korea. In addition, the support provided through their direct
equity investment demonstrates our shared vision that China and
other geographies in Asia represent a significant commercial
opportunity for our technology; we are very happy to benefit from
the knowledge, contacts and experience of the Han family, who
ultimately owns Liquid Harmony.
Financing
Having secured GBP39.3m of funding during the period and
concluded a placing to raise an additional GBP6.4m following the
period end, our assets are now free of any financial pledge, which
provides us with greater flexibility in our ongoing financing
strategy.
During the period we completed the subscription by Liquid
Harmony who invested GBP13.5m in equity in the Company. The Company
also received payment of the GBP16.5m license fee associated with
the exclusive distribution agreement from Liquid Harmony who is
providing a valuable commercial partnership for the roll-out of our
LIGHT system in Asia.
In addition, we placed all the remaining Bracknor shares with a
long-term shareholder, M3T PTE Ltd, a Special Purpose Vehicle
created by a Singaporean Family Office.
Following the period end we announced the completion of a
successful funding round which raised GBP6.4m (before
expenses) and attracted participation from several prominent
Swiss Private Banks, including healthcare providers based in
Switzerland. This investment by stakeholders of the Swiss medical
space is of paramount importance for the Company as another
acknowledgement of the LIGHT system. AVO through its wholly-owned
subsidiary ADAM has strong links with Switzerland given the roots
of the technology grew out from CERN and that our ADAM testing
facility is based on the CERN campus, and so we were delighted to
receive support from this investment base.
Board changes
Having announced several proposed Board appointments in July we
were able to confirm the appointments of five Non-Executive
Directors last month. Mr Peter Sjöstrand, who has a long career as
an independent Non-Executive Director for many public and private
companies within the Healthcare, Industrial and Financial areas has
joined as Non-Executive Director and Vice-Chairman. A long-term
supporter of the Company, Gabriel Urwitz, founding Partner and
Executive Chairman of Segulah Advisor AB, a Nordic private equity
firm, has been involved with a large number of successful listed
and private companies during his career. Mr Urwitz, who is a
Director of AB Segulah which owns a 3.8% of the Company, has joined
as a Non-Executive Director. In addition, Mrs Zhang RenHua, Mr
Chunlin Han and Dr Yuelong Huang, representing Liquid Harmony, have
all joined the Board as Non-Executive Directors. Liquid Harmony and
the Han family's extensive knowledge and experience of rolling out
high-end medical equipment in China and internationally is of great
benefit to the Company's commercialisation strategy.
Mr Sanjeev Pandya, Dr Euan Thomson and Prof Chris Nutting have
stood down from the Board. Dr Thomson and Prof Nutting will
continue to contribute to the Company's development by becoming
members of the Medical Advisory Board. On behalf the Board, I would
like to thank Chris, Euan and Sanjeev for all they have contributed
to the Company. Chris's medical background provided the Company
with useful insights from a practitioner point of view, Euan's
Board experience has been invaluable to the Group and both will
remain close with the Company acting as advisors going forward.
Finally, I would personally like to thank Sanjeev for the
tremendous contribution he has made to the business over the past
five years and I wish him all the very best for his next
venture.
Financials
The Company recorded a loss of GBP11.48 million in the six
months to 30 June 2018 (H1 2017: GBP7.14 million), with shareholder
funds increasing to GBP34.79 million over the same period (H1 2017:
GBP32.01 million).
Cash and cash equivalents at 30 June 2018 were GBP3.32 million
(as at 30 June 2017: GBP235,437), excluding the fund raising of
GBP6.41 million and a tax credit of GBP2.92 million, both being
post-period events.
Outlook
To conclude, we believe the we have the necessary technology to
deliver a system which offers more affordable, adaptive and precise
proton therapy treatment. The LIGHT system is designed to have
clear advantages over current proton therapy technologies in terms
both of cost and clinical effectiveness. The technological
development of our LIGHT system remains on-track with our given
timetable. Our ability to generate proton beams with energies
required to treat superficial tumours and the key intermediary
steps to achieve such result - all as per the schedule communicated
18 months ago - have been significant steps forward. The additional
funding we have received has contributed to de-risk the business
model and provides a better position and security to pursue
longer-term financing options. As indicated in the directors'
report of our latest annual report, the Board remains committed to
maintain the pace of our development and manufacture activities in
order to treat first patients in the second half of 2020. This will
involve further funding to include - in particular - the cost of
software development and the testing assembly centre at STFC, two
key activities required for successful commercial deployment.
Yesterday's announcement is placing the Company on a stronger
foothold to deliver such a strategy.
Finally, work at our Harley Street facility remains on track and
we have complete confidence in our ability to deliver on our plan.
On behalf of the Board and the rest of the staff, I would like to
thank our shareholders for their continued support and I look
forward to updating the market with positive news very soon.
Dr. Michael Sinclair
Executive Chairman
28 September 2018
Consolidated statement of profit or loss and other comprehensive
income
Unaudited Unaudited Audited
6 months to 6 months to Year to
30-Jun-18 30-Jun-17 31-Dec-17
GBP GBP GBP
Revenue - - -
Cost of sales - - -
Gross profit - - -
Administrative expenses (11,309,701) (7,320,943) (14,492,595)
Operating loss (11,309,701) (7,320,943) (14,492,595)
Finance income - 51 -
Finance costs (173,239) (535,616) (1,994,891)
Loss on ordinary activities before taxation (11,482,940) (7,856,508) (16,487,486)
Taxation - 712,295 2,827,115
Loss after taxation from continuing operations (11,482,940) (7,144,213) (13,660,371)
Discontinued operations
Loss for the period from discontinued
operations - - -
Loss after discontinued operations (11,482,940) (7,144,213) (13,660,371)
Equity shareholders of the parent Company (11,482,940) (7,144,213) (13,660,371)
Non-controlling interests - - -
Other comprehensive income
Items that will not be subsequently reclassified
to profit or loss:
Exchange differences on translation of foreign
operations 444,122 368,922 (1,065,130)
Total comprehensive loss for the period net of
tax (11,038,818) (6,775,291) (14,725,501)
Total comprehensive loss attributable to:
Equity shareholders of the parent Company (11,038,818) (6,775,291) (14,725,501)
Non-controlling interests - - -
(11,038,818) (6,775,291) (14,725,501)
Consolidated statement of financial position
Unaudited Unaudited Audited
6 months to 6 months to Year to
30-Jun-18 30-Jun-17 31-Dec-17
GBP GBP GBP
Non-current assets
Intangible assets 35,198,019 26,701,419 30,569,979
Property, plant and equipment 1,198,155 1,372,943 1,180,937
Investment property 310,000 310,000 310,000
Trade and other receivables 850,592 - 838,887
37,556,766 28.384.362 32,899,803
Current Assets
Trade and other receivables 1,327,881 2,255,581 1,964,792
Corporation tax R&D refund 2,850,000 3,786,094 2,850,000
Cash and cash equivalents 3,321,835 235,437 56,479
Inventories 9,681,042 9,024,226 7,629,292
17,180,758 15,301,338 12,500,563
Total assets 54,737,524 43,685,700 45,400,366
Current liabilities
Trade and other payables (3,445,434) (4,979,171) (7,491,290)
Borrowings - (6,695,000) (9,247,218)
(3,445,434) (11,674,171) (16,738,508)
Non-current liabilities
Borrowings - - -
Deferred income (16,500,000) - -
Deferred tax - -
Total liabilities (19,945,434) (11,674,171) (16,738,508)
Net assets 34,792,090 32,011,529 28,661,858
Equity
Share capital 38,907,308 20,192,132 20,233,799
Share premium reserve 47,405,823 43,301,056 43,259,389
Share option reserve 6,100,016 4,843,698 5,743,609
Reverse acquisition reserve 11,038,204 11,038,204 11,038,204
Loan note conversion reserve - 1,950,000 5,650,631
Exchange movements reserve 558,762 1,894,461 460,410
Accumulated losses (69,218,023) (51,208,022) (57,724,185)
Equity attributable to shareholders
of the Parent Company 34,792,090 32,011,529 28,661,858
Non-controlling interests - - -
Total equity funds 34,792,090 32,011,529 28,661,858
Consolidated statement of cash flows
Unaudited Unaudited Audited Audited
6 months to 6 months to Year to Year to
30-Jun-18 30-Jun-17 31-Dec-17 31-Dec-17
Continuing Discontinued
operations operations
GBP GBP GBP GBP
Cash flow from operating
activities
Loss after taxation (11,482,940) (7,144,213) (13,660,371) -
Adjustments:
Taxation - (712,295) (2,827,115) -
Finance costs 173,239 535,666 1,994,891 -
Finance income - (51) - -
Depreciation 182,858 180,863 365,470 -
Share based payments 2,411,351 644,050 1,543,961 -
Cash flows from operations before
changes in working capital (8,715,492) (6,495,979) (12,583,163) -
Changes in inventories (2,051,750) (1,586,718) (191,784) -
Property deposits made (11,705) - (838,887) -
Change in trade and other
receivables 636,911 (1,701,887) (2,139,752) -
Change in trade and other
payables (3,157,737) 2,326,427 4,341,687 (8,530)
Cash (used) / generated from
operations (13,299,773) (7,458,157) (11,411,899) (8,530)
Interest paid (644,947) (340,008) (568,667) -
Convertible loan costs paid (229,589) (721,327) -
Change in deferred income 16,500,000 - - -
Corporation tax receipt - 74,207 3,125,121 -
Cash flows from operating
activities 2,325,691 (7,723,958) (9,576,772) (8,530)
Cash flows from investing
activities:
Capital expenditure on intangible
assets (4,628,040) (3,346,354) (8,437,115) -
Purchase of buildings, plant and
equipment (200,076) (89,542) (123,597) -
Interest received - 51 - -
Cash flows from investment
activities (4,828,116) (3,435,845) (8,560,712) -
Cash flows from financing
activities:
Equity share capital raised 14,415,000 250,000 250,000 -
Convertible loans - 3,794,967 7,800,000 -
Other short term loans (8,647,218) 5,901,750 8,703,968 -
Intra Group Cash Transfers - - (9,163) 9,163
Cash flows from financing
activities 5,767,782 9,946,717 16,744,805 9,163
Increase/(decrease) in cash and
cash equivalents 3,265,357 (1,213,086) (1,392,679) 633
Cash and cash equivalents at the
beginning of the period 56,478 1,448,523 1,431,502 17,021
Cash and cash equivalents at the
end of the period 3,321,835 235,437 38,824 17,654
A copy of the unaudited interim accounts for the six months
ended 30 June 2018 is available from the Company's website at
www.avoplc.com
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
IR DBGDCCBDBGIR
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