MAINSTAY MEDICAL INTERNATIONAL
Mainstay Medical International Plc: Mainstay Medical legt Halbjahresergebnisse vor
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DGAP-News: Mainstay Medical International Plc / Schlagwort(e):
Halbjahresergebnis/Umsatzentwicklung
Mainstay Medical International Plc: Mainstay Medical legt
Halbjahresergebnisse vor (News mit Zusatzmaterial)
05.09.2017 / 09:29
Für den Inhalt der Mitteilung ist der Emittent verantwortlich.
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Mainstay Medical legt Halbjahresergebnisse vor
- Klinische Studie ReActiv8-B kommt gut voran - Einschluss voraussichtlich
Ende 2017 komplett
- Vertrieb von ReActiv8(R) in Europa hat begonnen
- Barmittelbestand am 30. Juni 2017 - 24,5 Millionen US-Dollar
Dublin - Irland, 5. September 2017 - Mainstay Medical International plc
("Mainstay",
oder das "Unternehmen", Euronext Paris: MSTY.PA und ESM an der Irish Stock
Exchange: MSTY.IE) gibt heute die Vorlage des Halbjahresberichts zum
Stichtag 30. Juni 2017 bekannt. Das Medizintechnik-Unternehmen Mainstay
betreibt die Markteinführung von ReActiv8(R), eines implantierbaren
wiederherstellenden Neurostimulationssystems zur Behandlung von
einschränkenden chronischen Kreuzschmerzen (Chronic Low Back Pain, CLBP).
Peter Crosby, Vorstandsvorsitzender von Mainstay, sagte:
"Die klinische Studie ReActiv8-B ist ein entscheidender Schritt voran auf
dem Weg zum Vertrieb in den Vereinigten Staaten, unserem bedeutendsten
Zielmarkt. Die Studie kommt gut voran, und die Einschlussrate hat sich
beschleunigt, weil die Zahl der aktiven Zentren im Laufe des Jahres 2017
gestiegen ist. Auf der Grundlage unserer bisherigen Erfahrungen erwarten
wir, den Einschluss von Teilnehmern gegen Ende dieses Jahres abzuschließen.
Ergebnisse werden 2018 verfügbar sein."
"Inzwischen haben wir mit dem Vertrieb von ReActiv8 in Europa begonnen. Seit
dem ersten Verkauf samt Implantation Anfang 2017 gewinnen unsere
anfänglichen Kunden an Erfahrung mit ReActiv8 und wir arbeiten mit Ihnen
daran, die Therapie in ihre klinische Routine zu integrieren. Wir treiben
unsere Strategie weiter voran,
mit wichtigen Referenzzentren in Deutschland zusammenzuarbeiten, und dann
auf diese Erfahrungen und auf die Daten aus der Studie ReActiv8-B
aufzubauen, um den Vertrieb auf zusätzliche Zentren und andere Länder
auszuweiten."
Business-Update:
- Die klinische Studie ReActiv8-B ist eine internationale, multizentrische,
prospektive, randomisierte, Placebo-kontrollierte und dreifach verblindete
Studie mit einmaligem Crossover. Sie wird mit einer Ausnahmegenehmigung für
Forschungszwecke (Investigational Device Exemption, IDE) der US Food and
Drug Administration (FDA) durchgeführt. Die klinische Studie ReActiv8-B soll
Daten gewinnen, die Teil eines Pre-Market-Approval-Antrags (PMAA) für
ReActiv8 bei der FDA werden sollen. Weitere Details finden sich unter
https://clinicaltrials.gov/show/NCT02577354.
Im Jahr 2017 haben wir die klinische Studie ReActiv8-B vorangebracht, und
mehr als die Hälfte der erforderlichen Implantationen sind inzwischen
ausgeführt worden.
- Im Februar 2017 haben wir den ersten Verkauf samt Implantation am
Katholischen Krankenhaus Koblenz-Montabaur in Koblenz, Deutschland,
bekanntgegeben. Wir konzentrieren uns darauf, die Akzeptanz von ReActiv8 in
ausgewählten multidisziplinären Wirbelsäulenzentren voranzutreiben, die eine
große Patientenpopulation haben. In dem Maße wie unsere Pionier-Kunden an
Erfahrung mit ReActiv8 gewinnen, arbeiten wir mit Ihnen daran, die Therapie
in ihre klinische Routine zu integrieren. Wir machen Fortschritte bei
unseren Gesprächen mit anderen wichtigen Zentren in Deutschland, und
Implanteurs-Schulungen für diese Zentren laufen. Es ist unsere Strategie,
mit wichtigen Referenzzentren in Deutschland zusammenzuarbeiten, und dann
auf diese Erfahrungen und auf die Daten aus der Studie ReActiv8-B
aufzubauen, um den Vertrieb auf zusätzliche Zentren und andere Länder
auszuweiten. Erst kürzlich, im Mai 2017, haben wir den Vertriebsstart in
Irland bekanntgegeben, Mainstays Heimatmarkt.
Finanz-Update:
- Die Umsatzerlöse während der Halbjahresperiode vor dem Stichtag 30. Juni
2017 beliefen sich auf 0,25 Millionen US-Dollar.
- Die betrieblichen Aufwendungen betrugen 12,3 Millionen US-Dollar (8,0
Million US-Dollar im 1. Halbjahr 2016). Der Anstieg wurde maßgeblich vom
Hochfahren der Einschlüsse und Implantationen in der klinischen Studie
ReActiv8-B verursacht, sowie von den Ausgaben bei den Vertriebsaktivitäten
(die 2017 begonnen haben).
- Der Barmittelbestand lag am 30. Juni bei 24,5 Millionen US-Dollar, und der
operative Mittelabfluss beziffert sich in der Periode auf 11,4 Millionen
US-Dollar.
- Ende -
Über Mainstay
Mainstay ist ein Medizintechnik-Unternehmen mit dem Ziel, das innovative
implantierbare Neurostimulationssystem ReActiv8 für Menschen mit
einschränkenden chronischen Kreuzschmerzen (chronic low back pain, CLBP) auf
den Markt zu bringen. Das Unternehmen hat seinen Hauptsitz in Dublin,
Irland. Es ist mit Tochtergesellschaften in Irland, in den USA, in
Australien und in Deutschland tätig. Seine Aktien sind zum Handel an der
Börse Euronext Paris (MSTY.PA) und am ESM der Irish Stock Exchange (MSTY.IE)
zugelassen.
Über die klinische Studie ReActiv8-B
Die klinische Studie ReActiv8-B ist eine internationale, multizentrische,
prospektive, randomisierte, Placebo-kontrollierte und verblindete Studie mit
einmaligem Crossover. Sie wird mit einer Ausnahmegenehmigung für
Forschungszwecke (Investigational Device Exemption, IDE) durchgeführt. Die
klinische Studie ReActiv8-B soll Daten gewinnen, die Teil eines
Pre-Market-Approval-Antrags (PMAA) für ReActiv8 bei der US Food and Drug
Administration (FDA) werden sollen. Weitere Details finden sich unter
https://clinicaltrials.gov/show/NCT02577354.
Über chronische Kreuzschmerzen
Eine der anerkannten Ursachen von chronischen Kreuzschmerzen (chronic low
back pain, CLBP) ist die gestörte Kontrolle des Nervensystems über die
Muskeln, die für die dynamische Stabilisierung der Wirbelsäule im unteren
Rücken zuständig sind. Eine instabile Wirbelsäule kann zu Rückenschmerzen
führen. ReActiv8 ist so konstruiert, dass es diejenigen Nerven elektrisch
stimuliert, die für die Kontraktion dieser Muskeln zuständig sind. Dadurch
hilft es, die Kontrolle über die Muskeln wieder herzustellen und die
dynamische Stabilisierung der Wirbelsäule zu verbessern, was dem Körper eine
Genesung von den chronischen Kreuzschmerzen erlaubt.
Menschen mit chronischen Kreuzschmerzen haben üblicherweise eine stark
reduzierte Lebensqualität und weisen erhöhte Werte bei Schmerz,
Einschränkungen, Depressionen, Angstzuständen und Schlafstörungen auf. Ihre
Schmerzen und Einschränkungen können trotz bester verfügbarer medizinischer
Behandlung fortbestehen. Nur ein kleiner Teil der Fälle lässt sich auf einen
pathologischen Befund oder einen anatomischen Defekt zurückführen, der mit
einem wirbelsäulenchirurgischen Eingriff korrigierbar wäre. Die Betroffenen
sind durch die Beschwerden in ihrer Arbeitsfähigkeit und Alltagstauglichkeit
stark eingeschränkt. Die Verluste an Arbeitstagen, Hilfeleistungen bei
Schwerbehinderung und Inanspruchnahme medizinischer Leistungen ist eine
erhebliche Belastung für den Einzelnen, seine Familie, die Wirtschaft, die
öffentliche Verwaltung und für die Allgemeinheit.
Weitere Einzelheiten finden sich unter www.mainstay-medical.com
ACHTUNG - in den USA ist ReActiv8 durch Bundesgesetze auf den Einsatz in der
Forschung beschränkt.
PR- und IR-Anfragen:
Consilium Strategic Communications (International Strategische Kommunikation
- Wirtschafts- und Fachmedien)
Chris Gardner, Mary-Jane Elliott, Jessica Hodgson, Hendrik Thys
Tel: +44 203 709 5700 / +44 7921 697 654
Email: mainstaymedical@consilium-comms.com
FTI Consulting (für Irland)
Jonathan Neilan
Tel: +353 1 663 3686
Email: jonathan.neilan@fticonsulting.com
NewCap (für Frankreich)
Louis-Victor Delouvrier
Tel: +: +33 1 44 71 98 53
Email: lvdelouvrier@newcap.fr
AndreasBohne.Com/Kötting Consulting (für Deutschland)
Andreas Bohne
Tel : +49 2102 1485368
Email : abo@andreasbohne.com
Investor Relations:
LifeSci Advisors, LLC
Brian Ritchie
Tel: + 1 (212) 915-2578
Email: britchie@lifesciadvisors.com
ESM Advisers:
Davy
Fergal Meegan or Barry Murphy
Tel: +353 1 679 6363
Email: fergal.meegan@davy.ie or barry.murphy2@davy.ie
PR and IR Enquiries:
In die Zukunft gerichtete Aussagen
Diese Mitteilung enthält Aussagen, die in die Zukunft gerichtet sind oder so
verstanden werden könnten. Diese in die Zukunft gerichteten Aussagen sind
kenntlich durch Formulierungen, die in die Zukunft weisen, einschließlich
Ausdrücken wie "antizipiert", "glaubt", "schätzt", "erwartet",
"beabsichtigt", "mag", "plant", "projektiert", "sollte", "will" oder
"untersucht", oder jeweils durch deren negative oder andere Varianten, oder
durch vergleichbare Formulierungen, oder durch Darlegungen von Strategie,
Plänen, Planzielen, Zielsetzungen, künftigen Ereignissen oder Absichten.
Diese in die Zukunft gerichteten Aussagen schließen alles jenseits der
historischen Fakten ein. Sie sind Teil dieser Mitteilung und schließen
Absichten des Unternehmens, Überzeugungen oder gegenwärtige Erwartungen
unter anderem betreffend die Erlöse des Unternehmens, seine finanzielle
Lage, Vorstellungen, Finanzstrategien, Erwartungen an Produktentwurf oder
Entwicklung, regulatorische Anträge und Zulassungen, Erstattungsregelungen,
Vermarktungskosten und Marktdurchdringung ein, sie sind aber darauf nicht
beschränkt.
Es liegt in der Eigenart von in die Zukunft gerichteten Aussagen, dass sie
Risiken und Unwägbarkeiten einschließen, weil sie sich auf künftige
Ereignisse und Umstände beziehen. In die Zukunft gerichtete Aussagen sind
keine Garantien künftiger Leistungsfähigkeit, und die tatsächlichen
Ergebnisse der Tätigkeit des Unternehmens, die Entwicklung seines
Hauptproduktes, der Märkte und der Branche in der das Unternehmen tätig ist,
können wesentlich von jenen abweichen, die durch in die Zukunft gerichtete
Aussagen in dieser Mitteilung beschrieben oder angedeutet werden. Sogar wenn
die Ergebnisse der Tätigkeit des Unternehmens, seine finanzielle Lage und
sein Wachstum, sowie die Entwicklung seines Hauptproduktes, der Märkte und
der Branche, in der es tätig ist, mit den in dieser Mitteilung enthaltenen
in die Zukunft gerichteten Aussagen überein stimmen, sind diese Ergebnisse
oder Entwicklungen nicht unbedingt ein Hinweis auf Ergebnisse oder
Entwicklungen in Folgeperioden. Zahlreiche Faktoren könnten dafür sorgen,
dass Ergebnisse und Entwicklungen des Unternehmens erheblich von jenen
abweichen, die ausdrücklich oder implizit in den in die Zukunft gerichteten
Aussagen genannt sind. Das schließt den erfolgreichen Marktstart und die
Vermarktung von ReActiv8(R), den Fortschritt und Erfolg der klinischen
Studie ReActiv8-B, die allgemeinen wirtschaftlichen und geschäftlichen
Umstände, die Bedingungen am weltweiten Medizintechnik-Markt,
Branchentrends, Wettbewerb, gesetzliche oder regulatorische Veränderungen,
steuerliche Veränderungen, die Verfügbarkeit und Kosten von Kapital, die zur
Auflage und zum Abschuss klinischer Studien benötigte Zeit, die zur
Erlangung regulatorischer Zulassungen erforderliche Zeit und Prozesse,
Wechselkursveränderungen, Veränderungen der Geschäftsstrategie sowie
politische und wirtschaftliche Unwägbarkeiten ein, ohne sich darauf zu
beschränken. Die hier genannten in die Zukunft gerichteten Aussagen sind nur
aussagekräftig zum Zeitpunkt dieser Mitteilung.
Mainstay Medical International plc and its subsidiaries
Half Year Report comprising Interim Management Report and condensed
consolidated Financial Statements for the half year ended 30 June 2017
Mainstay Medical International plc
Table of contents
Corporate and shareholder information 3
Interim Management Report 4
Director's Responsibilities Statement 8
Condensed consolidated statement of profit or loss and other 9
comprehensive income
Condensed consolidated statement of financial position 10
Condensed consolidated statement of changes in shareholders' 11
equity
Condensed consolidated statement of cash flows 12
Notes to the condensed consolidated Financial Statements 13
Forward looking statements
This report includes statements that are, or may be deemed to be, forward
looking statements. These forward looking statements can be identified by
the use of forward looking terminology, including the terms "anticipates",
"believes", "estimates", "expects", "intends", "may", "plans", "projects",
"should", "will", or "explore" or, in each case, their negative or other
variations or comparable terminology, or by discussions of strategy, plans,
objectives, goals, future events or intentions. These forward looking
statements include all matters that are not historical facts. They appear
throughout this report and include, but are not limited to, statements
regarding the Company's intentions, beliefs or current expectations
concerning, among other things, the Company's results of operations,
financial position, prospects, financing strategies, expectations for
product design and development, regulatory applications and approvals,
reimbursement arrangements, costs of sales and market penetration.
By their nature, forward looking statements involve risk and uncertainty
because they relate to future events and circumstances. Forward looking
statements are not guarantees of future performance and the actual results
of the Company's operations, and the development of its main product, the
markets and the industry in which the Company operates, may differ
materially from those described in, or suggested by, the forward looking
statements contained in this report. In addition, even if the Company's
results of operations, financial position and growth, and the development of
its main product and the markets and the industry in which the Company
operates, are consistent with the forward looking statements contained in
this annual report, those results or developments may not be indicative of
results or developments in subsequent periods. A number of factors could
cause results and developments of the Company to differ materially from
those expressed or implied by the forward looking statements including,
without limitation, the successful launch and commercialization of ReActiv8,
the progress and success of the ReActiv8-B Clinical Trial, general economic
and business conditions, the global medical device market conditions,
industry trends, competition, changes in law or regulation, changes in
taxation regimes, the availability and cost of capital, the time required to
commence and complete clinical trials, the time and process required to
obtain regulatory approvals, currency fluctuations, changes in its business
strategy, political and economic uncertainty. The forward-looking statements
herein speak only at the date of this report.
Mainstay Medical International plc
Corporate and shareholder information
Directors Oern Stuge MD, Independent Non-Executive
Chairman
Peter Crosby, Chief Executive Officer and
Executive Director
David Brabazon, Independent Non-Executive
Director
Greg Garfield, Non-Executive Director
Nael Karim Kassar, Non-Executive Director
Antoine Papiernik, Non-Executive Director
James Reinstein, Independent Non-Executive
Director
Manus Rogan PhD, Non-Executive Director
Dan Sachs MD, Non-Executive Director
Secretary Tom Maher
Registered office Clonmel House
Forster Way
Swords, K67F2K3
County Dublin, Ireland
Registered number 539688
Website www.mainstay-medical.com
ISIN / Symbol IE00BJYS1G50 / MSTY.PA (Paris) and MSTY.IE
Solicitors/ Lawyers McCann FitzGerald
Riverside One
Sir John Rogerson's Quay
Dublin 2, Ireland
Jones Day
2, rue Saint-Florentin
75001 Paris, France
Independent Auditor KPMG
Chartered Accountants
1 Stokes Place
St Stephen's Green
Dublin 2, Ireland
Principal Bankers HSBC
Bank of Ireland
ESM Adviser and J&E Davy
Broker
Davy House
49 Dawson Street
Dublin 2, Ireland
Registrar Computershare Investor Services (Ireland)
Limited
Heron House
Corrig Road
Sandyford Industrial Estate
Dublin 18, Ireland
Paying Agent (in Caceis Corporate Trust
France)
1/3, Place Valhubert
75013 Paris
France
Mainstay Medical International plc
Interim Management Report
The Board of Directors is pleased to report on the progress of Mainstay
Medical International plc (Mainstay or the Company) and present the Half
Year Report for the half year ended 30 June 2017 of the Company and its
subsidiaries (the Group or we).
Principal activities
Mainstay is a medical device company focused on bringing to market
ReActiv8(R),
an implantable restorative neurostimulation system to treat disabling
Chronic Low Back Pain (CLBP). ReActiv8 is designed to electrically stimulate
the nerves responsible for contracting muscles which stabilize the lumbar
spine. Activation of these muscles to restore functional stability has been
shown to facilitate recovery from CLBP. Mainstay received CE Marking for
ReActiv8 based on positive results from the ReActiv8-A Clinical Trial which
demonstrated a clinically important, statistically significant and lasting
improvement in pain, disability and quality of life in people with disabling
CLBP and few other treatment options.
The Company is incorporated in Ireland as a public limited company. The
Company's ordinary shares are listed on the ESM of the Irish Stock Exchange
and Euronext Paris.
As at 30 June 2017, the Company together with its operating subsidiaries
Mainstay Medical Limited, Mainstay Medical Distribution Limited, Mainstay
Medical GmbH, MML US, Inc. and Mainstay Medical (Australia) Pty. Limited
form the Mainstay Medical Group.
Business review
ReActiv8-B Clinical Trial - The ReActiv8-B Clinical Trial (the Trial) is an
international, multi-center, prospective randomized sham-controlled triple
blinded trial with one-way crossover, conducted under an Investigational
Device Exemption (IDE) from the US Food and Drug Administration (FDA). The
statistical design of the Trial requires data from 128 subjects at the
120-day primary outcome assessment visit. Total subjects implanted will also
include some enrolled and implanted as part of the surgical roll-in phase,
in addition to subjects in the pivotal cohort.
The Trial is intended to gather data in support of an application for
pre-market approval (PMA) from the FDA, a key step towards the
commercialization of ReActiv8 in the US. Information about the trial can be
found at https://clinicaltrials.gov/ct2/show/study/NCT02577354.
During the first half of 2017, we have continued to advance the Trial which
commenced in September 2016. In August 2017, we announced that over half the
required number of implants have been performed. The enrollment has been
accelerating as the number of active sites increased during 2017.
The Trial is designed with an interim analysis of the primary efficacy end
point (the Interim Analysis) for sample size re-estimation when primary
outcome data are available from half the subjects in the pivotal cohort. The
Interim Analysis will be performed by a third-party independent statistician
under the direction of the Data Monitoring Committee (DMC), and the Interim
Analysis, other than a DMC recommendation regarding the findings, will
remain blinded to the Group, study subjects, investigators and Clinical
Trial sites.
The primary efficacy endpoint of the Trial is a comparison of responder
rates between the treatment and control arms. The Trial will be considered a
success if there is a statistically significant difference in responder
rates between the treatment and control arms. The Trial, if successful, will
provide Level 1A Evidence of efficacy of ReActiv8, which may be used to
support applications for favorable reimbursement in the USA. Evidence from
the Trial will be used to support market development activities worldwide.
Based on our experience to date, we anticipate that enrollment will complete
around the end of 2017, with results available in 2018.
Commercialization - In February 2017, we announced the first sale and
implant had been performed at the Catholic Hospital Koblenz-Montabaur in
Koblenz, Germany. We are focusing commercialization of ReActiv8 initially on
Germany, where we aim to drive adoption of ReActiv8 in a select number of
high volume multi-disciplinary spine care centers. As our pioneering
customers are gaining more experience with the ReActiv8 therapy we are
working with them towards the goal of making ReActiv8 part of their clinical
practice. We are progressing discussions with other key centers in Germany,
and implanter training for these centers is underway. Our strategy is to
work with key reference centers in Germany, and then build on that
experience and data from the ReActiv8-B Trial to expand commercialization to
additional centers and other countries.
More recently, in May 2017, we announced that commercialization has begun in
Ireland, Mainstay's home market.
On 12 January 2017, we announced we had applied for ReActiv8 to be admitted
to the Australian Register of Therapeutic Goods (ARTG) to allow for
commercialization in Australia. The ARTG application included the results of
the ReActiv8-A Clinical Trial. The Therapeutic Goods Agency will review the
application and may request additional data during the review process.
ReActiv8-A Clinical Trial/ PMCF Study - The ReActiv8-A Clinical Trial (the
ReActiv8-A Trial) is an international, multi-center, prospective, single arm
clinical trial of ReActiv8. We announced the results of the first 47
subjects implanted in the ReActiv8-A Trial, of whom, 46 reached the 90-day
end point in August 2015. On 20 September 2016, we announced the one-year
results from the ReActiv8-A Trial, which showed long term sustained
performance. As at 30 June 2017, 6 additional subjects had been implanted in
the ReActiv8-A Trial.
The results from 53 subjects at one year show clinically important,
statistically significant and lasting improvement in pain, disability and
quality of life in a population of people with few treatment options, with
94% of subjects showing a clinically important improvement in at least one
of the three major endpoints at 90 days, which was substantially maintained
through one year. The one year results of these 53 subjects implanted, were
presented at the 13th World Congress of the International Neuromodulation
Society in Edinburgh at the end of May 2017. The presentation was judged as
one of the "best abstracts" presented in the plenary session.
Following CE Mark approval, a range of activities is required for Post
Market Clinical Follow Up to gather additional data on the long term
performance and safety of ReActiv8. The ReActiv8-A Post Market Clinical
Follow-up (PMCF) Study is a continuation of the ReActiv8-A Trial (but with
CE Marked ReActiv8). 40 additional subjects are planned to be implanted as
part of the continuation of the ReActiv8-A PMCF Study.
ReActiv8-C Registry - In addition to the ReActiv8-A PMCF Study, the Group
will conduct a registry. The ReActiv8-C Registry is an international,
multi-center, data collection registry. All patients implanted with ReActiv8
during commercialization will be invited to enroll in the ReActiv8-C
Registry until the target enrollment numbers have been reached. The purpose
is to gather additional summary data on the long-term performance of
ReActiv8 in at least 50 patients.
Financial review
Income Statement - The first sales of ReActiv8 were recorded in the
six-month period ending 30 June 2017. Our customers are hospitals and are
served through our direct sales force. Revenue during the six-month period
ending 30 June 2017 was $0.25 million (nil during the same period in 2016).
Revenue was generated from sales of ReActiv8 systems to customers in Germany
and in Ireland.
Operating expenses related to on-going activities were $12.3 million during
the half year ended 30 June 2017 (30 June 2016: $8.0 million). On-going
activities during the financial year included research and development,
clinical and regulatory activities, selling, general and administrative
activities.
Research and development expenses increased by $0.3 million to $2 million
during the six-month period ended 30 June 2017. The increase is primarily
due to additional team members engaged in research, quality and regulatory
activities required for our ReActiv8-B Clinical Trial, and maintenance of
our quality system as we expand commercial activities.
Clinical and regulatory expenses were $5.2 million during the six-month
period ended 30 June 2017, and increased by $2.5 million from $2.7 million
during the same period in 2016. The increase is primarily driven by the ramp
up of enrollments in the ReActiv8-B Trial. As detailed above over half the
required subjects have been implanted in this trial by physicians in centers
in Australia, Europe and the US. The costs incurred include (without
limitation) the cost of the device, direct hospital costs (for example
operating theatre fees and costs related to the physicians and nurses time),
clinical and legal consulting, training costs, clinical database fees,
clinical monitoring fees and the payroll costs of our direct employees.
Our selling, general and administrative expenses were $5.1 million during
the six-month period ended 30 June 2017, and $3.5 million during the same
period in 2016. The increase of $1.6 million is primarily driven by
commercialization and the related increase in our direct sales force during
2016 and 2017 (impacting recruitment fees, payroll, travel and training
costs), as well as marketing, reimbursement consulting and market research
costs.
Statement of financial position - Total assets of the Group at 30 June 2017
end were $27.9 million (31 December 2016: $39 million). Cash on hand at 30
June 2017 was $24.5 million (31 December 2016: $36.7 million). Cash used in
operating activities was $11.4 million during the period (30 June 2016: $7.5
million), and is reflective of our increased operating expenses (excluding
non-cash expenses, for example share based payments, and adjusted for
outstanding payables at period end), and a build-up of inventory held for
commercialization.
During the period ended 30 June 2017, we commenced repayment of our debt
facility. As at 31 December 2016, the Group had drawn the full facility of
$15 million, and during the period we made the first repayment of $0.75
million.
Principal risks and uncertainties
The principal risks and uncertainties faced by the Group and/or its industry
for the remaining six months of 2017 remain substantially unchanged from the
risks disclosed in the 2016 Annual Report which is available on our website.
A summary of the principal risks relating to the Company and/or its industry
include the following:
- We have incurred significant operating losses and may not be able to
achieve or subsequently maintain profitability
- We expect to require additional funds in the future in order to meet our
capital and expenditure needs and further financing may not be available
when required or, if available, could require us to agree to terms which are
specifically favorable to new investors, or to restrictions significantly
limiting our access to additional capital
- Our future financial performance is substantially dependent on the
commercial success of ReActiv8, our only product which at the date of this
Half Year report is launched commercially in Germany and Ireland only
- We operate in a highly-regulated environment and regulatory approval is
required before we can market or sell ReActiv8 in any market
- Seeking and obtaining regulatory approval for medical devices can be a
long and uncertain process. Strict or changing regulatory regimes,
government policies and legislation in any of our target markets may delay,
prohibit or reduce potential sales
- We are required to conduct clinical trials for regulatory approvals and
other purposes. Clinical trials carry substantial risks and are costly and
time consuming, with uncertain results
- The availability of coverage and adequate reimbursement for our product by
government and private payers will be critical to market adoption for the
existing and future products
A more extensive description of the existing and future potential risks to
Mainstay's business and to the Company's ordinary shares are outlined in the
Risk Factors section of the 2016 Annual Report, on pages 23 to 41, and
should be considered carefully by Shareholders and prospective investors.
Outlook and future developments
We are pleased with the progress of the ReActiv8-B Trial. The Trial is
advancing well, and in August 2017 we announced that over half the required
number of implants in the Trial have been performed. We anticipate that
enrollment will complete around the end of 2017, with results available in
2018. If successful, the ReActiv8-B Clinical Trial will yield level 1A
Evidence of efficacy, which may be used to support applications for
favorable reimbursement in the USA. Evidence from the ReActiv8-B Trial will
also be used to support market development activities worldwide.
Our initial commercialization of ReActiv8 in Europe is underway. Our
strategy is to work with key reference centers in Germany, and then build on
that experience and data from the ReActiv8-B Trial to expand
commercialization to additional centers and other countries.
Related party transactions
Refer to note 13.
Going concern
The Directors note the following relevant matters:
- The Group has an accumulated retained losses reserve of $108 million and a
reorganization reserve of $44.6 million as at 30 June 2017 (31 December
2016: $94.7 million and $44.6 million respectively).
- The Group had operating cash out-flows of $11.4 million for the 6 months
ended 30 June 2017 (year ended 31 December 2016: $16.7 million).
- The Group has funded operations to date through the proceeds of equity
funding of approximately $85 million and as at 30 June 2017, debt with an
outstanding principal of $14.25 million. The Group will require additional
funding.
- The group expects to incur losses due to the ongoing investment in
research and development, clinical and commercial activities.
- The Group has cash of $24.5 million as at 30 June 2017 ($36.7 million as
at 31 December 2016).
The Directors have considered the conditions noted above and other factors,
the potential of the Group to raise additional funding, and the potential to
manage expenditure and believe that the Group will have sufficient funds to
be able to meet its liabilities as they fall due for a period of at least 12
months from the date of the Financial Statements and are satisfied that the
Financial Statements should be prepared on a going concern basis.
Auditors
The condensed consolidated Financial Statements have not been reviewed by
the Company's auditors.
Mainstay Medical International plc
Directors' responsibilities statement
Statement of the Directors in respect of Half Year Financial Report
Each of the Directors of the Company (the Directors), whose names and
functions are listed in the Corporate and Shareholder Information, confirm
that, to the best of each person's knowledge and belief:
(a) the condensed consolidated Financial Statements comprising the condensed
consolidated statement of profit or loss and other comprehensive income, the
condensed consolidated statement of financial position, the condensed
consolidated statement of changes in equity, the condensed consolidated
statement of cash flows and related notes 1 to 14 have been prepared in
accordance with IAS 34 Interim Financial Reporting as adopted by the EU.
(b) the interim management report includes a fair review of the information
required by:
a. Regulation 8(2) of the Transparency (Directive 2004/109/EC) Regulations
2007, being an indication of important events that have occurred during the
first six months of the financial year and their impact on the condensed
consolidated Financial Statements; and a description of the principal risks
and uncertainties for the remaining six months of the year; and
b. Regulation 8(3) of the Transparency (Directive 2004/109/EC) Regulations
2007, being related party transactions that have taken place in the first
six months of the current financial year and that have materially affected
the financial position or performance of the entity during that period; and
any changes in the related party transactions described in the last annual
report that could do so.
On behalf of the Board on 04 September 2017,
Oern Stuge MD Peter Crosby
Chairman CEO
Mainstay Medical International plc
Condensed consolidated statement of profit or loss and other comprehensive
income
for the half year ended 30 June 2017
($'000) No- Half year Half year
te- ended 30 June ended 30 June
s 2017 2016
Unaudited Audited
Revenue 4 250 -
Cost of sales (136) -
Gross profit 114 -
Operating expenses (12,282) (7,987)
Operating loss (12,168) (7,987)
Finance income 10 -
Finance expense (986) (784)
Net finance expense (976) (784)
Loss before income taxes (13,144) (8,771)
Income taxes 6 (131) (71)
Loss for the half year (13,275) (8,842)
Net loss attributable to equity (13,275) (8,842)
holders
Other Comprehensive Income
Items that may be reclassified
subsequently to the statement of
profit or loss:
Foreign currency translation (50) -
differences of foreign operations
Total comprehensive loss for the half (13,325) (8,842)
year
Total comprehensive loss attributable (13,325) (8,842)
to equity holders
Basic and diluted loss per share (in 5 (2.01) (1.98)
$)
The accompanying notes form an integral part of these condensed consolidated
Financial Statements.
Mainstay Medical International plc
Condensed consolidated statement of financial position
at 30 June 2017
($'000) Notes 30 June 2017 31 December 2016
Unaudited Audited
Non-current assets
Property, plant and equipment 238 255
Current assets
Inventory 2,070 1,123
Trade and other receivables 7 877 889
Income tax receivable 217 103
Cash and cash equivalents 24,499 36,670
Total current assets 27,663 38,785
Total assets 27,901 39,040
Equity
Share capital 9 64 64
Share premium 106,364 106,360
Share based payment reserve 5,899 4,606
Other reserves 4,685 4,735
Retained loss (107,979) (94,707)
Surplus on shareholders' equity 9,033 21,058
Non-current liabilities
Loans and borrowings 8 12,119 13,276
Total non-current liabilities 12,119 13,276
Current liabilities
Loans and borrowings 8 3,006 2,268
Income tax payable 58 58
Trade and other payables 3,685 2,380
Total current liabilities 6,749 4,706
Total liabilities 18,868 17,982
Total equity and liabilities 27,901 39,040
The accompanying notes form an integral part of these condensed consolidated
Financial Statements.
Mainstay Medical International plc
Condensed consolidated statement of changes in shareholders' equity
for the half year ended 30 June 2017
($'000) Share Share Other Share based Retained Total
capi- premium reser- payment loss equity
tal ves reserve
Balance as at 61 72,588 4,700 2,691 (74,816) 5,224
1 January 2016
Loss for the - - - - (8,842) (8,842)
half year
Other - - - - - -
comprehensive
income for the
half year
Total - - - - (8,842) (8,842)
comprehensive
loss for the
half year
Transactions
with owners of
the Company:
Issue of 3 33,725 - - (1,053) 32,675
shares
Share based - - - 942 - 942
payments
Issue of - 9 - - - 9
shares on
exercise of
share options
or warrants
Balance at 30 64 106,322 4,700 3,633 (84,711) 30,008
June 2016
(Unaudited)
Loss for the - - - - (9,916) (9,916)
year
Other - - 35 - - 35
comprehensive
income
Total - - 35 - (9,916) (9,881)
comprehensive
loss for the
half year
Transactions
with owners of
the Company:
Issue of - - - - (124) (124)
shares
Share based - - - 1,017 - 1,017
payments
Issue of - 38 - (44) 44 38
shares on
exercise of
share options
or warrants
Balance at 31 64 106,360 4,735 4,606 (94,707) 21,058
December 2016
Loss for the - - - - (13,275) (13,275)
half year
Other - - (50) - - (50)
comprehensive
income for the
half year
Total - - (50) - (13,275) (13,325)
comprehensive
loss for the
half year
Transactions
with owners of
the Company:
Share based - - - 1,296 - 1,296
payments
Issue of - 4 - (3) 3 4
shares on
exercise of
share options
or warrants
Balance at 30 64 106,364 4,685 5,899 (107,979) 9,033
June 2017
(Unaudited)
The accompanying notes form an integral part of these condensed consolidated
Financial Statements.
Mainstay Medical International plc
Condensed consolidated statement of cash flows
for the half year ended 30 June 2017
($'000) No- Half year ended Half year ended
tes 30 June 2017 30 June 2016
Unaudited Unaudited
Cash flow from operating
activities
Net loss for the half year (13,275) (8,842)
Add/(less) non-cash items
Depreciation 52 54
Finance income (10) -
Finance expense 986 784
Share-based compensation 11 1,296 942
Add/(less) changes in working
capital
Trade and other receivables 12 (273)
Inventory (831) -
Trade and other payables 1,274 293
Taxes paid (238) (114)
Interest paid (656) (389)
Net cash used in operations (11,390) (7,545)
Cash flow from investing
activities
Acquisition of property and (35) (21)
equipment
Net cash used in investing (35) (21)
activities
Cash flow from financing
activities
Gross proceeds from issue of 4 33,737
shares
Transaction costs on issue of - (27)
shares
Repayment of borrowings 8 (750) -
Net cash (outflow)/inflow from (746) 33,710
financing activities
Net (decrease)/increase in cash (12,171) 26,144
and cash equivalents
Cash and cash equivalents at 36,670 16,624
beginning of year
Cash and cash equivalents at 30 24,499 42,768
June 2017
The accompanying notes form an integral part of these condensed consolidated
Financial Statements.
Mainstay Medical International plc
Notes to the condensed consolidated Financial Statements
1 General information and reporting entity
Mainstay Medical International plc (the Company) is a company incorporated
and registered in Ireland. Details of the registered office, the officers
and advisers to the Company are presented on the Corporate and Shareholder
Information page.
The Half Year Report and condensed consolidated Financial Statements for the
periods ended 30 June 2017 and 30 June 2016 comprise the results of the
Company and of its subsidiaries (together the Group).
At 30 June 2017, the Group comprises the Company and its operating
subsidiaries Mainstay Medical Limited, Mainstay Medical Distribution
Limited, Mainstay Medical GmbH, MML US, Inc. and Mainstay Medical
(Australia) Pty. Limited.
The Company's shares are quoted on Euronext Paris and ESM of the Irish Stock
Exchange.
Mainstay is a medical device company focused on bringing to market
ReActiv8(R),
a restorative implantable neurostimulation system to treat disabling Chronic
Low Back Pain (CLBP).
2 Basis of preparation
Statement of compliance
The condensed consolidated Financial Statements have been prepared in
accordance with IAS 34 Interim Financial Reporting as adopted by the EU.
They do not include all the information and disclosures necessary for a
complete set of IFRS Financial Statements. However, selected explanatory
notes are included to explain events and transactions that are significant
to an understanding of the changes in the Group's financial position and
performance since the last annual consolidated financial statements as at
and for the year ended 31 December 2016.
The comparative information provided in the condensed consolidated Financial
Statements relating to the periods ended 30 June 2016 and 31 December 2016
does not comprise the statutory financial statements of the Group. Those
statutory financial statements for the year ended 31 December 2016 on which
the auditors gave an unqualified audit opinion, have been delivered to the
Companies Registry Office.
The half year ended 30 June 2017 is the first period in which the Group has
recognized revenue, following CE Marking approval for the Group's product,
ReActiv8, in May 2016. Therefore, except for revenue recognition, related
warranties and trade and other receivables, (refer to significant accounting
policies below), there are no significant or material changes to judgements
or estimates used in these condensed consolidated Financial Statements
compared with those used in the consolidated Financial Statements for the
year ended 31 December 2016.
The condensed consolidated Financial Statements were authorized for issue by
the Board of Directors, on 04 September 2017.
Going concern
The Directors note the following relevant matters:
- The Group has an accumulated retained losses reserve of $108 million and a
reorganization reserve of $44.6 million as at 30 June 2017 (31 December
2016: $94.7 million and $44.6 million respectively).
- The Group had operating cash out-flows of $11.4 million for the 6 months
ended 30 June 2017 (year ended 31 December 2016: $16.7 million).
- The Group has funded operations to date through the proceeds of equity
funding of approximately $85 million and as at 30 June 2017, debt with an
outstanding debt principal of $14.25 million. The Group will require
additional funding.
- The group expects to incur losses due to the ongoing investment in
research and development, clinical and commercial activities.
- The Group has cash of $24.5 million as at 30 June 2017 ($36.7 million as
at 31 December 2016).
The Directors have considered the conditions noted above and other factors,
the potential of the Group to raise additional funding, and the potential to
manage expenditure and believe that the Group will have sufficient funds to
be able to meet its liabilities as they fall due for a period of at least 12
months from the date of the Financial Statements and are satisfied that the
Financial Statements should be prepared on a going concern basis.
Currency
The condensed consolidated Financial Statements are presented in US Dollars
($), which is the functional and presentational currency of the Company.
Balances in the condensed consolidated Financial Statements are rounded to
the nearest thousand ($'000) except where otherwise indicated.
Basis of consolidation
The condensed consolidated Financial Statements comprise the consolidated
results of Mainstay Medical International plc and its subsidiaries.
Significant accounting policies
The condensed consolidated Financial Statements have been prepared applying
the accounting policies that were applied in the preparation of the Group's
consolidated Financial Statements for the year ended 31 December 2016
prepared in accordance with IFRS, as adopted by the EU and available on the
Company's website (www.mainstay-medical.com). These accounting policies have
been applied consistently for all periods presented. New accounting policies
implemented during the half year ended 30 June 2017 are listed below:
a) Revenue recognition
Revenue is measured at the fair value of the consideration
received/receivable for the sale of goods to external customers net of value
added tax and discounts. The Group recognizes revenue when the amount of
revenue can be reliably measured and when it is probable that future
economic benefits of the transaction will flow to the Group. Revenue from
the sale of goods is recognized when significant risks and rewards of
ownership of the goods are transferred to the buyer. This may arise on
shipment, delivery or in accordance with specific terms and conditions
agreed with customers and provided there are no material remaining
performance obligations required of the Group. Discounts are provided for
based on agreements or contracts with customers, agreed promotional
arrangements and accumulated experience. Discounts are recorded in the same
period as the original revenue. Service revenues (relating to training and
implant support) are recognized when the related services are rendered.
When a customer is invoiced or cash is received but conditions for
recognition of the related revenues have not been met, revenue is deferred
until all conditions are met.
The Group occasionally sells goods and services as a bundled arrangement.
Such sales are unbundled based on the relative fair value of the individual
goods and services components and each component is recognized separately in
accordance with the Group's recognition policy.
b) Warranties
The Group offers a warranty on certain components of our product. The Group
estimates the costs that may be incurred under its warranties and records a
liability in the amount of such costs at the time the product is sold. The
amount of the reserve recorded is equal to the net costs to repair or
otherwise satisfy the obligation.
c) Financial instruments
Non-derivative financial assets
Financial assets are initially recognized on the date they are originated
and when the Group obtains contractual rights to receive cash flows. The
Group derecognizes financial assets when the contractual rights to cash
flows expire or it transfers the right to receive cash flows in a
transaction which transfers substantially all the risks and rewards of
ownership of the asset.
Trade and other receivables
Trade and other receivables are recognized initially at fair value and
subsequently measured at amortized cost using the effective interest method
less provision for impairment.
d) Impairment of trade and other receivables
The Group evaluates customer accounts with past-due outstanding balances,
and analyses customer credit worthiness, payment patterns and trends. Based
upon a review of these accounts and management's analysis and judgement, we
estimate the future cash flows expected to be recovered from these
receivables. The amount of the impairment on doubtful receivables is
measured individually and recorded as a specific allowance against the
customer's receivable balance. The allowance is re-evaluated and adjusted
periodically as additional information is received. The net movement in the
provision for impairment of receivables is included within the income
statement.
In addition, the Group applied the standards listed below for the first time
in the current period:
- Disclosure initiative (amendments to IAS 7) (effective 1 January 2017)
- IAS 12 (amended) - recognition of deferred tax assets for unrealized
losses (effective 1 January 2017)
None of these have had any material impact on the Group's implementation of
accounting policies or on its reported results.
A number of new standards and amendments to standards are effective for
future periods:
- IFRS 15 - Revenue from contracts with customers (effective 1 January 2018)
- IFRS 9 - Financial Instruments (effective 1 January 2018)
- IFRS 2 (amended) - Share Based Payments (effective 1 January 2018)
- IFRS 16 - Leases (effective 1 January 2019)
The above listed new standards and amendments to standards with an effective
date after 1 January 2018 are not expected to have a material impact on the
Group's results.
3 Segment reporting
Due to the nature of the Group's current activities, the Group considers
there to be one operating segment Active Implantable Medical Devices
(AIMDs). The results of the Group are reported on a consolidated basis to
the Chief Operating Decision Maker of the Group, the Chief Executive
Officer. There are no reconciling items between the Group's reported
consolidated statement of profit or loss and other comprehensive income and
statement of financial position and the results of the AIMDs segment.
The Group has operations in Europe, the US and Australia. The non-current
assets held in these jurisdictions are detailed below:
($'000) 30 June 2017 31 December 2016
Ireland 60 75
Germany 7 -
United States 171 180
Australia - -
Total non-current assets 238 255
4 Revenue
($'000) Half year ended 30 Half year ended 30
June 2017 June 2016
Revenue arising from the 242 -
sale of goods
Revenue arising from the 8 -
sale of services
250 -
5 Earnings per share
As the Group is incurring operating losses, there is no difference between
basic and diluted earnings per share.
Half year ended Half year ended
30 June 2017 30 June 2016
Weighted average number of 6,612,012 4,476,421
ordinary shares in issue
Loss per share 2.01 1.98
6 Taxes
Current income tax assets and liabilities for the current and prior periods
are measured at the amount expected to be recovered from or paid to the
relevant taxation authorities. The tax charge has been prepared based on the
Group's best estimate of the weighted average tax rate that is expected for
the full financial year. The tax rates and tax laws used to compute the
amount are those used in Ireland, Germany, the United States and Australia.
The Group has unrecognized potential deferred tax assets in relation to
carryforward losses and other temporary differences. These potential assets
are not recognized because future taxable profits against which they can be
utilized are not sufficiently certain. The availability of these losses does
not expire. Further information on these unrecognized potential deferred tax
assets is available in the 2016 Annual Report.
($'000) Half year ended Half year ended
30 June 2017 30 June 2016
Income tax in Ireland - -
Income tax in other jurisdictions 131 71
Total income tax charge 131 71
7 Trade and other receivables
($'000) 30 June 31 December
2017 2016
Trade receivables, net 105 -
VAT and sales tax receivable 64 100
Prepaid expenses and other current 708 789
assets
Total 877 889
8 Interest bearing loans and borrowings
IPF Debt Financing
On 24 August 2015, Mainstay Medical Limited entered into an agreement with
IPF Partners for a debt facility of up to $15 million. The facility was
available to be drawn in three tranches. Each tranche has a repayment term
of 60 months from drawdown, with interest only payments for the first 12
months.
The initial tranche (Tranche A) of $4.5 million was received on 9 September
2015. The interest rate on Tranche A is 3-month Euribor plus a margin of
12.5%.
A second tranche (Tranche B) of $6 million was received on 3 December 2015.
The interest rate on Tranche B is 3-month Euribor plus a margin of 11.5%.
A third tranche (Tranche C) of $4.5 million was received on 28 July 2016.
The interest rate on Tranche C is 3-month Euribor plus a margin of 10.5%.
Other expenses directly associated with the facility of $466,000 were
deferred and are amortized to profit or loss over the term of the loan on an
effective interest rate basis.
The facility is secured by way of fixed and floating charges over the assets
and undertakings of Mainstay Medical Limited, and the Mortgage Debenture
includes customary terms and conditions. In addition, Mainstay Medical
International plc has created a first fixed charge in favor of IPF over its
present and future shares held in Mainstay Medical Limited.
The terms of the agreement include a requirement that Mainstay Medical
Limited hold a minimum cash balance of $2 million, or achieve revenue
targets within an agreed timeframe. It also includes monthly and quarterly
reporting requirements. The Group is not in breach of any covenants at 30
June 2017 and has not been in breach at any reporting date.
($'000) 30 June 31 December
2017 2016
Loans and borrowings - current
Term loan 2,775 2,025
Deferred finance cost (91) (91)
Accrued interest 322 334
Total current loans and borrowings 3,006 2,268
Loans and borrowings - non-current
Term loan 11,475 12,975
Deferred finance cost (25) (142)
Accrued interest 669 443
Total non-current loans and 12,119 13,276
borrowings
Total loans and borrowings 15,125 15,544
9 Called up share capital
The Company's ordinary shares are quoted in Euro and have been translated in
US Dollars at the rates prevailing at the date of issue.
On 2 May 2014, the Company listed its ordinary shares on the ESM of the
Irish Stock Exchange and on 5 May 2014, the Company listed its ordinary
shares on Euronext Paris.
Authorized and Issued Share Capital
Authorized 30 June 31 December
2017 EUR 2016 EUR
20,000,000 ordinary shares of EUR0.001 20,000 20,000
each
40,000 deferred shares of EUR1.00 each 40,000 40,000
60,000 60,000
Issued, called up and fully paid 2017 $ 2016 $
6,612,452 (31 December 2016: 6,611,952) 8,556 8,555
ordinary shares of EUR0.001 each
40,000 deferred shares of EUR1.00 each 55,268 55,268
63,824 63,823
In $'000 64 64
During the half year ended 30 June 2017, 500 warrants over ordinary shares
were exercised by the holders and the Company issued 500 ordinary shares.
Proceeds of $3,850 were received on issue of the shares.
10 Financial instruments
Financial risk management
In terms of financial risks, the Group has exposure to credit risk,
liquidity risk and market risk (comprising foreign currency risk and
interest rate risk). This note presents information about the Group's
exposure to each of the above risks together with the Group's objectives,
policies and processes for measuring and managing those risks.
Risk management framework
Mainstay's Board of Directors has overall responsibility for the
establishment and oversight of the Group's risk management framework. The
Group's risk management policies are established to identify and analyze the
risks faced by the Group, to set appropriate risk limits and controls and to
monitor risks and adherence to the limits. Risk management systems and
policies will be reviewed regularly as the Group expands its activities and
resource base to take account of changing conditions.
The Group has no significant concentrations of financial risk other than
concentration of cash with individual banks. During January 2017, the Group
made its first commercial sale of ReActiv8, and consequently the six-month
period ended 30 June 2017 is the first period during which the group is
exposed to credit risk arising on trade receivables. Further information is
provided under credit risk below. There has been no other significant change
during the half year, or since the end of the half year to the types or
quantum of financial risks faced by the Group or the Group's approach to the
management of those risks.
Credit risk
Credit risk is the risk of financial loss to the Group if a customer or
counterparty to a financial instrument fails to meet contractual
obligations, and arises principally from the Group's cash and cash
equivalents and trade and other receivables. Credit risk is managed on a
Group basis. The maximum exposure to credit risk is represented by the
carrying amount of each asset. The carrying value of receivables is a
reasonable approximation of fair value. The Group's objective is to manage
credit risk.
The Group maintained its cash balances with its principal financial
institutions throughout the year, and the Group limits its exposure to any
one financial institution by holding cash balances across several financial
institutions. The Group's principal financial institutions have investment
grade ratings at 30 June 2017. The credit rating status of the Group's
principal financial institutions is reviewed by the Audit Committee or the
Board annually. The cash balance is reported to the Board of Directors on a
monthly basis, and a monthly review of all cash balances held at each
institution is carried out by the CFO. The Group maintains most of its cash
in USD denominated accounts. The Group held cash and cash equivalents of
$24.5 million as at 30 June 2017.
The Group's credit risk management policy and process in relation to trade
receivables involves carrying out credit checks where appropriate, and by
active credit management. The utilization of credit limits is regularly
monitored. In addition, it involves periodically assessing the financial
reliability of customers, taking into account their financial position, past
experience and other factors. As at 30 June 2017 our trade and other
receivables balances amounted to $105,000, and we have not recognized any
impairment losses at this time. The total outstanding balance as at 30 June
2017 was received post period end.
The below table provides an analysis of aging of receivables as at 30 June
2017:
($'000) Cur- 1 - 30 31 - 60 61 - 90
rent Days Days Days
Trade and other 86 19 - -
receivables
Liquidity risk
Liquidity risk is the risk that the Group will not be able to meet its
financial obligations as they fall due.
Since inception the Group has funded its operations primarily through (i)
the issuance of equity securities and (ii) debt funding. The Group continues
to explore funding strategies (e.g.: equity, debt, partnering) to support
its activities into the future. Adequate additional financing may not be
available on acceptable terms, or at all. The Group's inability to raise
capital as and when needed would have a negative impact on the Group's
financial position and its ability to pursue its business strategy.
Foreign currency risk
The Group's reporting currency is the US Dollar. The Group's exposure to
foreign currency risk arises through expenditure incurred in Euro and
Australian Dollars.
The Group's Australian subsidiary has an Australian Dollar functional
currency. Mainstay Medical Distribution Limited and Mainstay Medical GmbH
have a Euro functional currency.
The Group did not have material asset or liability amounts in foreign
currencies at 30 June 2017 other than trade payables and accruals (net of
cash) of EUR540,000 and AU$36,000. A strengthening (or weakening) of the US
Dollar against the Euro of 5% would have (decreased)/increased the loss for
the period by $27,000 (June 2016: $84,000). Any reasonable or likely
movement between the US Dollar and the Australian Dollar is considered not
likely to have a material impact on the Group's statement of profit or loss
and other comprehensive income.
Interest rate risk
The Group's cash balances are maintained in short term access accounts and
carry a 0% rate of interest.
At 30 June 2017, the principal outstanding on MML's loan from IPF was
$14,250,000. This loan carries a variable rate of 3-month Euribor plus a
margin ranging from 10.5% to 12.5%. The terms of the debt agreement
stipulate that if Euribor is less than zero, it is deemed to be zero. Any
change in the Euribor rate above zero will directly affect the amount of
interest repayable on this debt.
A 25-basis point increase in Euribor above zero would have increased the
loss for the period by $35,189.
11 Share based payments
Share Options
The terms and conditions of the Group's share option plan are disclosed in
the most recent, published, Annual Report. The charge of EUR1.3 million for
the half year ended 30 June 2017 (30 June 2016: $0.9 million) is the grant
date fair value of various share options granted in the current and prior
years, which are being recognized within the statement of profit or loss and
other comprehensive income over the vesting period related to service.
30,000 options were granted in the six months ended 30 June 2017 (30 June
2016: 47,500 options).
Warrants
On 2 December 2011, Silicon Valley Bank provided Mainstay Medical Limited
(MML) with a loan of $2,000,000. This loan was repaid in full on 7 March
2014.
In connection with these borrowings, MML issued immediately exercisable
warrants to purchase up to 13,000 shares at $7.70 per share with an
expiration date of 2 December 2021. The fair value of these warrants on the
date of issue was $69,000.
As at 30 June 2017 6,445 warrants were outstanding. During July 2017, all
the remaining warrants were exercised by the holder.
12 Contingencies
The Directors and management are not aware of any contingencies that may
have a significant impact on the financial position of the Group.
13 Related party transactions
There were no balances due to or from related parties as at 30 June 2017 and
30 June 2016.
Key management compensation and Directors' remuneration
>The Group defines key management as its non-executive directors, executive
directors and senior management. Details of remuneration for key management
personnel are provided below:
($'000) 30 June 2017 30 June 2016
Salaries 876 715
Non-executive directors' fees 111 108
Other remuneration 595 512
Payroll taxes 102 63
Share based payments 931 788
Pension 11 11
Total remuneration 2,626 2,197
14 Events subsequent to 30 June 2017
There were no events subsequent to the half year ended 30 June 2017 that
would have a material impact on the condensed consolidated Financial
Statements.
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Dokument: http://n.eqs.com/c/fncls.ssp?u=WKINGPBALP
Dokumenttitel: 170905 Mainstay Medical H1 2017 DE FINAL
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606811 05.09.2017
°
Mainstay Medical International Plc: Mainstay Medical legt Halbjahresergebnisse vor
Am 05. September 2017 um 09:30 Uhr
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