Cellect Biotechnology Reports Second Quarter 2019 Financial and Operating Results
TEL AVIV, Israel, Aug. 13, 2019 /PRNewswire/ -- 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 second quarter ended June 30, 2019 and provided a corporate update.
"We are making solid clinical progress in Israel and we are optimistic as we move closer to commencing our first clinical trial in the U.S.," commented Dr. Shai Yarkoni, Chief Executive Officer. "In Israel, we successfully transplanted the 9(th) patient earlier this quarter and we received the independent safety board approval to escalate to the final dose. We are optimistic that we will complete the final cohort later this year."
"In the U.S., the signing of the Accelerated Clinical Trial Agreement with Washington University and the approval of the WU scientific committee were significant achievements, and upon obtaining the regulatory approvals, and subject to sufficient funding and the outcome of the strategic review process, we plan to ramp up our activities later this year and begin enrolling patients in the first half of 2020."
Strategic Review Progress Update
In May 2019, the Company commenced plans to explore strategic alternatives to maximize shareholder value. Potential strategic alternatives that may be evaluated include, but are not limited to, an acquisition, merger, business combination, in-licensing, or other strategic transaction involving the Company or its assets. The Company continues to evaluate strategic opportunities and plans to keep shareholders informed as they mature or warrant disclosure.
Complementing the strategic review, the Company initiated a cost reduction plan, including a reduction in workforce, lowering its quarterly cash usage to advance its ongoing clinical trial in Israel and work towards initiating the clinical trial in the United States. The Company's cash and cash equivalents were $7.64 million as of June 30, 2019.
"On the corporate side, our actions have significantly reduced our monthly cash burn and we believe that based on our current anticipated cash needs, our current cash burn rate gives us over 18 months of cash, sufficient to achieve our primary objective of reaching clinical results," said Eyal Leibovitz, Chief Financial Officer.
Second Quarter 2019 Financial Results:
-- Research and development (R&D) expenses for the second quarter of 2019
were $0.99 million compared to $0.99 million in the first quarter of
2019 and to $0.69 million in the second quarter of 2018. There was no
difference between the first and second quarters of 2019. In the first
quarter of 2019, we incurred expenses related to the establishment of
our US clinical site while in the second quarter we incurred further
expenses related to our current clinical activity.
-- General and administrative (G&A) expenses for the second quarter of 2019
were $0.76 million compared to $0.66 million in the first quarter of
2019 and to $1.01 million in the second quarter of 2018. The increase
was mainly due to an increase in stock-based compensation.
-- Finance income for the second quarter of 2019 was $1.53 million compared
to finance income of $0.22 million in the first quarter of 2019 and to
$0.03 million in the second quarter of 2018. The increase was primarily
due to changes related to fair value of the tradable and non-tradable
warrants issued in prior fundraisings.
-- Net loss for the second quarter of 2019 was $0.23 million, or $0.001 per
share and $0.02 per ADS, compared to $1.43 million, or $0.008 per share
and $0.16 per ADS, in the first quarter of 2019 and to $1.64 million, or
$0.013 per share and $0.26 per ADS, in the second quarter of 2018.
* For the convenience of the reader, the amounts above have been translated from NIS into U.S. dollars, at the representative rate of exchange on June 30, 2019 (U.S. $1 = NIS 3.566).
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 therapies.
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 its clinical trials and cash position. 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 consummate a strategic alternative that enhances shareholder value; the Company's ability to remain listed on the Nasdaq Capital Market; 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; and the Company's ability to retain or attract key employees whose knowledge is essential to the development of its products. 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, 2018 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
Consolidated Statement of Operation
Convenience
translation
Six months Six months ended Three months ended
ended
June 30,
June 30,
June 30,
2019 2019 2018 2019 2018
Unaudited
Unaudited
U.S. dollars
NIS
(In thousands, except share and per
share data)
Research and development expenses 1,987 7,086 5,348 3,564 2,491
General and administrative expenses 1,420 5,064 7,072 2,709 3,620
Operating loss 3,407 12,150 12,420 6,273 6,111
Financial expenses (income) due to (1,994) (7,111) (1,615) (5,919) 609
warrants exercisable into shares
Other financial expenses (income), net 247 880 (1,241) 462 (731)
Total comprehensive loss 1,660 5,919 9,564 816 5,989
Loss per share:
Basic and diluted loss per share 0.008 0.029 0.074 0.004 0.046
Basic and diluted loss per ADS 0.17 0.58 1.48 0.08 0.92
Weighted average number of shares 200,942,871 200,942,871 128,600,812 224,087,799 130,192,799
outstanding used to compute basic and
diluted loss per share
Cellect Biotechnology Ltd.
Consolidated Balance Sheet Data
ASSETS
Convenience
translation
June 30, June 30, December 31,
2019 2019 2018
Unaudited Unaudited Audited
U.S. dollars
NIS
(In thousands, except share and per
share data)
CURRENT ASSETS:
Cash and cash equivalents 7,640 27,244 17,809
Other receivables 193 690 816
7,833 27,934 18,625
NON-CURRENT ASSETS:
Restricted cash 93 331 337
Right-of-use assets 364 1,299
Other long-term receivables 32 113 132
Property, plant and equipment, net 413 1,472 1,544
902 3,215 2,013
8,735 31,149 20,638
LIABILITIES AND
SHAREHOLDERS' EQUITY
CURRENT LIABILITIES:
Trade payables 279 994 887
Other payables 894 3,190 4,012
Current maturities of lease liability 131 468
1,304 4,652 4,899
NON-CURRENT LIABILITIES:
Warrants 1,044 3,722 1,816
Lease liability 243 867
1,287 4,589 1,816
EQUITY:
Ordinary shares of no par value: -
Authorized: 500,000,000 shares at December 31, 2018
and June 30, 2019; Issued and outstanding:
130,414,799*) and 224,087,799*) shares as of
December 31, 2018 and June 30, 2019, respectively.
Additional Paid in Capital 30,371 108,305 95,085
Share-based payments 3,647 13,003 12,319
Treasury shares (2,643) (9,425) (9,425)
Accumulated deficit (25,231) (89,975) (84,056)
6,144 21,908 13,923
8,735 31,149 20,638
*) Net of 2,641,693 treasury shares of the Company held by the Company.
Cellect Biotechnology Ltd
Consolidated Cash Flow Data
Convenience
translation
Six months Six months ended Three months ended
ended
June 30, June 30, June 30,
2019 2019 2018 2019 2018
Unaudited
Unaudited
U.S. dollars
NIS
(In thousands)
Cash flows from operating activities:
---
Total comprehensive loss (1,660) (5,919) (9,564) (816) (5,989)
Adjustments to reconcile net loss to net
cash used in operating activities:
Net financing expenses 229 815 (837) 443 (314)
Loss (gain) from revaluation of financial 2 6 (148) 2 (148)
assets presented at fair value through
profit and loss
Depreciation 54 192 215 94 110
Changes in fair value of traded and not (2,368) (8,442) (1,888) (5,895) 608
traded warrants
Share-based payment 148 529 2,184 744 937
Decrease (increase) in other receivables 40 145 (87) 75 (150)
Increase (decrease) in other payables (201) (715) (1,115) (730) (204)
Decrease in right-of-use assets 89 314 200
Interest received during the period (13) (46) (15) (46) (15)
Net cash used in operating activities (3,680) (13,121) (11,255) (5,929) (5,165)
Cash flows from investing activities:
---
Short term deposits, net (3,503) (3,503)
Restricted deposit, net (28) 135
Sales of marketable securities measured at 8,498 3,998
fair value through profit and loss
Purchase of property, plant and equipment (34) (120) (228) (88)
Net cash provided by investing activities (34) (120) 4,739 542
Cash flows from financing activities:
---
Exercise of warrants and stock options into 399
shares
Leases liabilities (77) (278) (178)
Issue of share capital and warrants, net of 6,653 23,723 12,360 (1,114) (5)
issue costs
Net cash provided (used) by financing 6,576 23,445 12,759 (1,292) (5)
activities
Exchange differences on balances of cash (216) (769) 852 (397) 329
and cash equivalents
Increase (decrease) in cash and cash 2,646 9,435 7,095 (7,618) (4,299)
equivalents
Balance of cash and cash equivalents at the 4,994 17,809 13,734 34,862 25,128
beginning of the period
Balance of cash and cash equivalents at 7,640 27,244 20,829 27,244 20,829
the end of the period
Contact
Cellect Biotechnology Ltd.
Eyal Leibovitz, Chief Financial Officer
www.cellect.co
+972-9-974-1444
Or
EVC Group LLC
Michael Polyviou
(732) 933-2754
mpolyviou@evcgroup.com
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SOURCE Cellect Biotechnology Ltd.
