Earnings Release • Feb 28, 2019
Earnings Release
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Gentian Diagnostics AS is a medical diagnostics company listed on Merkur Market, Oslo Stock Exchange with the ticker "GENT-ME".
Gentian is headquartered in Moss, Norway, with a representative office in China and distribution subsidiaries in Sweden and USA.
Gentian designs, develops and markets in vitro diagnostic reagents (IVD) based on its proprietary NanosenseTM technology. The goal is to offer efficient and accurate reagents within the areas of kidney disease, cardiac disease, inflammation and veterinary medicine. The NanosenseTM technology will enable users to move assays from low volume immunology platforms to fully automated, high throughput instruments with shorter turnaround times, better workflow and improved cost efficiency. The subsidiary PreTect AS develops and manufactures molecular diagnostic tests to detect oncogenic activity in cervical samples. The products PreTect SEE and PreTect HPV Proofer contribute to earlier detection of cervical cancers.
Comparative numbers for Gentian 2017 in ()
Total operating revenue ended at MNOK 11.4 (MNOK 10.4) for 4Q18, and MNOK 52.0 (MNOK 35.0) for 2018.
Sales revenue in 4Q18 ended at MNOK 11.1 (MNOK 7.8), a 42 % increase compared to 4Q17. Sales revenue for the full year ended at MNOK 39.9 (MNOK 27.8), a 43 % increase compared to the same period last year.
| MNOK | 4Q18 | 4Q17 | 1Q-4Q18 | 1Q-4Q17 |
|---|---|---|---|---|
| US | 0.9 | 0.3 | 2.2 | 1.3 |
| Europe | 7.5 | 4.8 | 27.1 | 17.2 |
| Asia | 2.7 | 2.6 | 10.6 | 9.4 |
| Total | 11.1 | 7.8 | 39.9 | 27.8 |
Royalties ended at MNOK 0.0 (MNOK 0.0) for 4Q18, and MNOK 6.2 (MNOK 0.1) for the year. Other operating revenue ended at MNOK 0.8 (MNOK 0.9) for 4Q18, and MNOK 2.5 (MNOK 2.9) for the year. SkatteFUNN funding ended at MNOK -0.4 (MNOK 1.7) for 4Q18. The fall in SkatteFUNN deposition in 4Q18 is due to an account reconciliation at the end of the year. SkatteFUNN funding ended at MNOK 3.4 (MNOK 4.1) for 2018.
COGS ended at MNOK 2.5 (MNOK 3.5) in 4Q18, which represents 23 % (45 %) of sales revenue. Total COGS year to date ended at MNOK 9.0 (MNOK 7.3), which represents 22 % (26 %) of sales revenue.
Total operating expenses before capitalization of R&D expenses ended at MNOK 18.5 (MNOK 12.9) in 4Q18, and MNOK 60.0 (MNOK 46.4) year to date.
Operating expenses include total salary and social expenses of MNOK 10.1 (MNOK 7.8) and other expenses of MNOK 8.5 (MNOK 5.1) for 4Q18. Total salary and social expenses YTD ended at MNOK 34.1 (MNOK 28.4) and other expenses ended at MNOK 25.9 (MNOK 18.0). The increase is according to the planned acceleration of activities. SG&A also include a share-based compensation of MNOK 0.7 with no cash effect.
Total operating expenses after capitalization of R&D expenses ended at MNOK 16.5 (MNOK 11.9) in 4Q18, and MNOK 54.8 (MNOK 40.9) year to date.
R&D expenses amounted to 26 % (37 %) of total operating expenses before capitalization for 4Q18, and 32 % (36 %) year to date.
Operating profit before depreciation and amortization (EBITDA) ended at MNOK -7.4 (MNOK -5.0) for 4Q18, and MNOK -11.7 (MNOK - 13.2) year to date.
In September 2018, Gentian announced that one of its subsidiaries had entered into an agreement to license out a portfolio of patents to an undisclosed party. Gentian received MUSD 0.75 as part of this agreement. Partly due to this license, Gentian has decided to write down goodwill in 4Q18 of MNOK 5.0 related to the acquisition of Pretect in 2016.
Net financial income ended at MNOK 0.5 (MNOK 0.5) for 4Q18, and MNOK 1.0 (MNOK 1.1) year to date.
Net profit ended at MNOK -13.0 (MNOK -5.3) for 4Q18, and MNOK -19.8 (MNOK -15.2) year to date.
Cash and cash equivalents as of 31.12.2018 were MNOK 198.6 (MNOK 147.0). The cash is placed in both savings accounts and current accounts.
Accounts receivables as of 31.12.2018 were MNOK 9.3 (MNOK 6.8). The increase is in line with the company's sales growth.
Inventory as of 31.12.2018 were MNOK 13.1 (MNOK 11.1). The increase in inventory is due a broader product portfolio, higher sales and build-up of an inventory buffer.
Cash flow from operating activities ended at MNOK 0.9 (MNOK -0.8) for 4Q18 and MNOK - 16.0 (MNOK -18.7) for 2018.
Cash flow from investment activities ended at MNOK 2.8 (MNOK -1.6) for 4Q18 and MNOK - 1.0 (MNOK -6.9) for 2018. Included in investment activities are capitalization of R&D expenses, which in 4Q18 amounted to MNOK 2.1 (MNOK 1.0). This gives a total capitalization of MNOK 5.2 (MNOK 5.5) year to date.
Cash flow from financial activities ended at MNOK 0.0 (MNOK 0.5) for 4Q18 and MNOK 68.8 (MNOK 96.5) for 2018.
Sales in 4Q18 showed an increase of 42 % compared to 4Q17, ending the quarter with a sales revenue of MNOK 11.1. The increase is mostly driven by record sales of fCAL® turbo, with an increase of 77 % compared to 4Q17. Cystatin C sales increased by 26 % compared to 4Q17.
For 2018 sales revenue ended at 39.9 MNOK, which is 43 % up from 2017. Cystatin C sales ended at MNOK 21.7 (MNOK 16.3) and fCAL® turbo sales ended at MNOK 9.9 (MNOK 5.5) for 2018.
G-1001 and Fecal Pancreatic Elastase1 product developments continue to deliver the expected milestones on plan.
The company continued to strengthen its IP and a revised international patent application for G-1001 has been filed.
The company expects continuous sales growth in 2019 versus 2018, with normal quarterly variations.
For Cystatin C the company expects continued growth, primarily driven by increased demand in China and an increased focus on the US market.
Our fCAL® turbo partner, Bühlmann Laboratories AG, has applied for FDA clearance and a decision is expected during 1H19. In addition, Gentian expects continued sales growth in Europe for fCAL® turbo.
The market development efforts for calprotectin as a biomarker for severe infections, sepsis and rheumatoid arthritis will continue with presentations at scientific congresses and articles in international journals. In addition, the company will intensify its efforts to engage with key opinion leaders.
Within R&D it is expected to achieve the validation phase for Fecal Pancreatic Elastase with the aim to launch in 2020. The development of G-1001 is on track for launch in 2021.
1 The test to be developed from this concept is a measure of Pancreatic Exocrine Insufficiency (PEI) associated with various health conditions, e.g.
chronic pancreatitis, cystic fibrosis, celiac disease, diabetes, post-pancreatic surgery, gastrectomy etc. Ref. Stock exchange release dated 22.06.2018.
| EVENTS AFTER THE BALANCE SHEET DATE | ||
|---|---|---|
| There are no events to report after the balance | ||
| sheet date. | ||
| SHAREHOLDER INFORMATION | ||
| 20 largest shareholders in Gentian Diagnostics | ||
| AS as of 31.12.2018 according to VPS: | ||
| Shareholder | No of Shares | % |
| Holta Life Sciences AS | 2 014 702 | 13,09 % |
| Vatne Equity AS | 1 735 340 | 11,27 % |
| Safrino AS | 1 300 000 | 8,44 % |
| Salix AS | 1 218 630 | 7,92 % |
| Norron Sicav - Target | 812 366 | 5,28 % |
| Silvercoin Industries AS | 564 181 | 3,66 % |
| Vingulmork Predictor AS | 535 710 | 3,48 % |
| Storebrand Veks t |
533 652 | 3,47 % |
| Portia AS | 425 000 | 2,76 % |
| Statoil Pens jon |
391 631 | 2,54 % |
| Verdipapirfondet DNB SMB | 384 249 | 2,50 % |
| Bård Sundrehagen | 307 010 | 1,99 % |
| Cressida AS | 235 000 | 1,53 % |
| Norda ASA | 225 447 | 1,46 % |
| OM Holding AS | 209 000 | 1,36 % |
| Marstal AS | 202 000 | 1,31 % |
| Strawberry Capital AS | 200 300 | 1,30 % |
| Spar Kapital Inves tor AS |
192 291 | 1,25 % |
| Mutus AS | 187 210 | 1,22 % |
| 174 990 | 1,14 % | |
| Viola AS | ||
| Other Shareholders | 3 547 212 | 23,04 % |
| 2018 | 2018 | 2017 | 2017 | |
|---|---|---|---|---|
| (figures in NOK thousands) | Q4 | 01.01-31.12 | Q4 | 01.01-31.12 |
| Operating Revenue | ||||
| Sales revenue | 11 079 | 39 928 | 7 794 | 27 845 |
| Other operating revenue | 361 | 12 109 | 2 598 | 7 144 |
| Total Operating Revenue | 11 440 | 52 036 | 10 392 | 34 989 |
| Operating Expenses/Costs | ||||
| Cost of goods sold | -2 512 | -8 978 | -3 502 | -7 263 |
| Production costs | -3 384 | -13 471 | -3 193 | -10 861 |
| R&D costs | -4 800 | -18 960 | -4 804 | -16 553 |
| Selling, general & administrative costs | -10 281 | -27 541 | -4 894 | -19 033 |
| Capitalization | 2 098 | 5 165 | 1 033 | 5 534 |
| Total Operating Expenses/Costs | -18 878 | -63 785 | -15 359 | -48 175 |
| EBITDA | -7 438 | -11 748 | -4 967 | -13 186 |
| Depreciation | -981 | -3 897 | -776 | -3 016 |
| Impairment of Goodwill | -5 040 | -5 040 | - | - |
| EBIT | -13 459 | -20 685 | -5 743 | -16 202 |
| Financial income/expense | 499 | 954 | 466 | 1 032 |
| Tax | -66 | -66 | - | - |
| Net Profit | -13 027 | -19 797 | -5 277 | -15 170 |
4 th quarter Statement of Comprehensive Income is not audited
| Statement of Financial Position Gentian Group | ||
|---|---|---|
| 2018 | 2017 | |
| (figures in NOK thousands) | 31.12 | 31.12 |
| Assets | ||
| Non-Current Assets | ||
| Property, plants and equipment | 4 736 | 5 097 |
| Capitalized development costs | 19 459 | 16 357 |
| Other intangible assets Financial assets |
8 116 329 |
13 641 1 949 |
| Total Non-Current Assets | 32 639 | 37 043 |
| Current Assets | ||
| Inventory | 13 098 | 11 092 |
| Accounts receivables | 9 285 | 6 809 |
| Other receivables | 4 720 | 5 283 |
| Cash and cash equivalents | 198 305 | 145 003 |
| Total Currents Assets | 225 408 | 168 187 |
| Total Assets | 258 047 | 205 230 |
| Equity and Liabilities Equity |
||
| Net profit (Loss) | 19 797 | 15 170 |
| Other equity | -265 073 | -211 645 |
| Equity | -245 276 | -196 475 |
| Non-Current Liabilities | ||
| Interest-bearing loans and dept | -698 | -466 |
| Total Non-Current Liabilities | -698 | -466 |
| Current liabilities Accounts payable |
-3 295 | -3 549 |
| Public dept | -2 244 | -1 694 |
| Accrued expenses | -6 534 | -3 046 |
| Total Current Liabilities | -12 074 | -8 288 |
| -258 047 |
| Cash Flow Statement | ||||
|---|---|---|---|---|
| 2018 | 2018 | 2017 | 2017 | |
| (figures in NOK thousands) | Q4 | 01.01-31.12 | Q4 | 01.01-31.12 |
| Cash Flow from Operating Activities | ||||
| Net profit (loss) | -13 027 | -19 797 | -5 279 | -15 172 |
| Depreciation | 981 | 3 897 | 776 | 3 016 |
| Change Inventory | 156 | -2 006 | 791 | -3 546 |
| Change Accounts Receivables | 4 512 | -2 476 | -996 | -3 954 |
| Change Accounts Payables | -710 | -253 | 188 | 29 |
| Change in other short-term receivables/ liabilities | 9 010 | 4 601 | 3 685 | 953 |
| Net Cash Flow from Operating Activities | 921 | -16 034 | -836 | -18 673 |
| Cash Flows from Investment Activities | ||||
| Acquisition of Property, plant and equipment | -92 | -913 | -574 | -1 357 |
| Investment in intangible assets | -2 098 | -5 165 | -1 033 | -5 534 |
| Other changes in financial items | 5 040 | 5 040 | - | - |
| Net Cash Flow from Investment Activities | 2 850 | -1 037 | -1 607 | -6 891 |
| Cash Flow from Financial Activities New debt |
- | 379 | 466 | 466 |
| Downpayment of loans | -39 | -147 | - | - |
| Cash flows from share issues | - | 68 519 | - | 96 069 |
| Dividend payment | - | - | - | - |
| Net Cash Flow from Financial Activities | -39 | 68 751 | 466 | 96 535 |
| Net Change in Cash and Cash Equivalents | 3 733 | 51 680 | -1 977 | 70 971 |
| Cash flow from last period | 194 835 | 146 951 | 148 905 | 75 958 |
| Currency adjustment | 67 | 3 | 24 | 23 |
| Net Cash and Cash Equivalents | 198 634 | 198 634 | 146 951 | 146 951 |
| Statement of Changes in Equity | |||||
|---|---|---|---|---|---|
| (figures in NOK thousands) | |||||
| Share | Share | Other paid-in | Retained | Total | |
| Equity at 01.01.2017 | capital 1 114 |
premium 128 359 |
capital 1 467 |
earnings -15 399 |
equity 115 541 |
| Net result for the year | -15 170 | -15 170 | |||
| Other comprehensive income | 35 | 35 | |||
| Proceeds from share issue | 286 | 99 714 | 100 000 | ||
| Cost of share issue | -3 931 | -3 931 | |||
| Other changes in equity | |||||
| Equity at 31.12.2017 | 1 400 | 224 143 | 1 467 | -30 534 | 196 475 |
| Equity at 01.01.2018 | 1 400 | 224 143 | 1 467 | -30 534 | 196 475 |
| Net result for the year | -19 797 | -19 797 | |||
| Other comprehensive income | 78 | 78 | |||
| Proceeds from share issue | 140 | 69 841 | 69 981 | ||
| Cost of share issue | -1 462 | -1 462 | |||
| Other changes in equity | |||||
| Equity at 30.09.2018 | 1 540 | 292 522 | 1 467 | -50 253 | 245 276 |
| th Quarter Statement of Changes in Equity is not audited 4 |
|||||
| NOTES | |||||
| Accounting Principles |
| Other changes in equity | |||
|---|---|---|---|
The interim report for Q4 2018 has been prepared in accordance with IAS 34 Interim Reporting. The accounting policies applied in the interim report corresponds to what was used in preparing the annual financial statements for 2017.
The Company uses currency rates given by DNB ASA.
There are currently three projects where the Gentian Group is capitalizing R&D expenses.
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