BBS-Bioactive Bone Substitutes Plc (BBS) Interim Report 1.1.-30.6.2020 (unaudited)
January-June shortly (comparison season 1-6/2019)
Key financial figures
|Other operating income||18||29||2 262|
|Depreciation and impairments||100||112||229|
|Other operating expenses||897||340||757|
|Operating profit (Loss) of the period||-1 376||-809||-447|
|Cash flow from business operations||-950||-786||-1 701|
|Equity ratio %||50.3||34,6||39,6|
|Earnings per share €||-0,27||-0,16||-0,076|
|The number of the shares at the end of the period||6 571 525||5 090 520||5 204 820|
|The average number of the shares during the period||5 220 006||5 090 520||5 148 453|
|Cash and securities||5 019||878||1 685|
|Equity||7 399||3 558||4 417|
|Equity and liability total||14 301||10 298||11 156|
The equity ratio = equity/equity and liabilities total
Earnings per share = earnings for the period/the average number of the shares during the period
Guidance for 2020
For the year 2019, substantial net sales are not expected to be generated. CE marking will not to be obtained during 2019.
Outlook for 2021
The company will complete the processing of the CE-marking application with the Notified Body at the beginning of the year. The company’s production processe are being prepared to start the actual production. Preparations for the marketing and sales have already begun in 2020, and preparations for the launch will continue from the beginning of the year. The launch expected to begin between April and June 2021. From the end of the year 2021, the development of turnover is expected to start even more slowly, as is typical for the industry.
Ilkka Kangasniemi, CEO
the first half of 2020 was significantly more positive for the company than the previous year. The positive result of the clinical trial published by the company in the early part of the year, contributed to the succesfull share issue in June 2020. As a result of the issues, the company raised a total of EUR 5,74 million gross in in Finnish and Swedish First North Growth Market lists. The issue was marked about one and half times over. We are pleased to say that the company has been able to operate for about two years at turning point in the company’s future. we expect the company to receive a marketing authorization for its first Artebone® product during spring 2021.
In spring 2020 we still had to experience the effects of the problem that arose on the part of the authorities in our operations. Due to new medical Device Regulation (MDR 2017/745), the Notified Body (BSI) with which we have previously worked and from which we requested a new contract for the processing of the application was unable to receive the application here for half a year, because the regulation caused a large change of appeal is if congested by their organization. By EU-commission decision, the date of entry inti force of the amendments to the regulation has been postponed 50 May 2021. Then the congested work queu of the Notified Body was released and in Juny 2020 we received a contract from BSI for approval. So, we finally got the CE-marking process to start one.
Preliminary results from an animal test carried out at yhe request of authority were obtained in June 2020. The results were as expected. The timetable for obtaining the final results is expected to be confirmed by the supplier.
Marketing and sales construction activities will begin when the authority receives the first positive interim information on the questions and comments raised by the processing of yhe application. We will then implement in the end of 2020 sales recryiment and measures. Due to the long-term nature of marketing, it is necessary to start these measures months before the actual launch.
FINANCIAL REVIEW 1th January – 30th June, 2020
BBS owns 100% of the subsidiary Bio Bones Oy, which owns the real estate for production in Reisjärvi. Bio Bones has no other business.
Operating income and development costs
BBS did not have any significant net sales during the review period and the corresponding period of the previous year.
Financing and investments
The company’s cash assets at 30th June 2020 were EUR 5,019 (0,878) million. The company estimates that the current funding will be adequate approximately two year after the date of this release. The company’s management may decide on the adequacy of money.
The group’s cash flow from operating activities during the review period was EUR -0,950 (-0,786)
Acquisitions and directed share issues
No acquisitions were made during the review period.
In June 2021, a rights issue was arranged in Finland and Sweden. The offer comprised up to 1.301.205 new shares, representing approximately 25% of the company’s existing shares, for subscription by investors. 1.059.634 shares were subscribed for eith the rights issue and the remaining 241.571 shares were issued for allocation in accordance with the terms of the share issue. The company organized a rights issue in June 2.-18. 2021. The rights issue raised EUR 5,47 million worth in gross assets. Following the rights issue, it became apparent that the subscription and payment of 65.500 shares bu an existing shareholder who had given acommitment, has not been registered by the Board of Directors on 24th June 2020 allocation. On June 26, 2020, the Board of Directors decided to direct the issue of 65.500 share to this investor at the same subscription price as in the subsrcription rights issue was. EUR 0,27 million was collected by the directes share issue. EUR 5,74 million gross was received from issues. A short-term loan of EUR 0,200 million was converted into shares in connection with the right issue. After the shares issue ffees, loan conversion and the share issu costs, approximately EUR 4,85 million remained in cash.
After the subscription on June 29,2020, of the rights issue and directed issue, the total number of the company’s share is 6.571.525.
The consolidated balance sheet total on 30th June 2020 was EUR 14,30 (10,30) million. On the 30th June 2020 the company had a short-term debts EUR 1,34 (1,37) million, long-term loans to financial institutions EUR 5,76 (5,37) million, capital loans of EUR 0,18 (0,18) million. Financial income and expenses amounted to EUR -0,04 (-0,05) million.
The company’s investment and working capital loans amounts of EUR 78.520, EUR 1.844.212, EUR 2.732.000, ja EUR 578.680 was restructured in March 2020. Repayments of restructured loans will begin on June 30, 2020 and end on June 30, 2028.. The arrangement will significantly reduce the debt service burden.
During the review period no capitalized and product investments have been made in balance sheet.
Equity on 30th June 2020 was EUR 7,20 (3,56) million. In the financial statement at December 2019, the shareholders equity was EUR 3,08 million.
Staff and administration
The number of employees was 12 at the end of review period on 30th June 2019. Members of the board were Jarmo Halonen (chairman), Ilkka Kangasniemi, Auvo Kaikkonen, Tomi Numminen, Pekka Jalovaara and Hannu Säynäjäkangas. Ilkka Kangasniemi is acting as the CEO.
The annual general meeting 2020
The annual general meeting (AGM) of BBS was held in Oulu on 17th August 2020.
The AGM approved the financial statements for 2019 and discharged the members of the board of directors and the CEO from liability. The AGM decided, in accordance with the proposal of the board of directors, that no dividend be paid for the financial year 2019 and that the loss for the financial year is recorded in the profit/loss account.
The AGM approved the remuneration of board members for EUR 500 and for the chairman EUR 750 per meeting.
The AGM decided that a reasonable fee would be paid to the auditor in accordance with the invoice approved by the company. Auditing society Ernst&Young Oy was elected as the auditor of BBS, with KHT Juhani Rönkkö as the principal auditor and KHT Milla Karjalainen as a deputy auditor.
Share-based incentive plan
The company has a valid stock option program for 2012 approved by the AGM in 18th July 2012. The board of directors has decided on options for the 2th January 2013 as authorized by the AGM. Options have been issued to key personnel and by each option can subscribe for one share at the price of one euro until 31th December 2019. The board of directors, on 9th January 2018, continued the subscribe period until 31th December 2023. Stock options may be issued up to 170 000 new shares and this has no perceptible impact on the earnings per share.
Risks and uncertainties
The rights issue and directed issue carried out during the review period have significally reduced the financing risk in the near future. Investment and working capital loans restructuring in March 2020 have also lowered the financial risk. The CE-marking process schedule has been refine. In the opinion of the management, there have been no significant changes in the risks and uncertainties related to the company’s business in the first half 0f 2020.
There are significant risks and uncertainties associated with product development and commercialization that are beyond the control of the company, such as regulatory actions, regulatory changes and market willingness to receive a new product. Capitalization and capitalization of confirmed losses is not certain.
Shares and shareholders
The BBS’s market capitalization at the end of the review period of outside the company 30th June 2020 was EUR 30,2 million. The closing price of the share on 30th June 2020 was EUR 4,60. The highest price for the review period was EUR 9,68 and the lowest was EUR 4,00.
BBS had 2341 (1025, 28th June 2019) registered shareholders and 6 572 525 (5 090 520), according to a register of shareholders dated 30th June 2020.
The BBS’s board of directors and the CEO held 30th June 2020 total of 576 219 (543 650) shares including shares held through controlled companies, i.e. 8,8% of the company’s shares. Information about the company’s insider trading in the company’s shares is published on the company’s website.
Event after the review period
In order to enable the participants in the right issue to participate equally in the Annual General Meeting, scheduled for June 28,2020, the AGM was postponed to August 17, 2020. The decisions of the AGM have been announced separately after the review period.
After the review period, a contract was received from Notified Body in July 2020 to start the process of CE-marking of the Artebone product. BBS accepted the agreement and has begun preparations with BSI to launch the process.
Half-year accounting principles
The half-yearly review has been prepared in accordance with the Finnish Accounting Act and rules of the First North marketplace. Figures for the half-yearly review are unaudited.
Financial information 2020
The financial statement bulletin for January-December 2020 will be published on 20th March 2021. Interim Report H1/2021 will be released in August 31th 2020.
Financial Statement 30th June 2020
Cash Flow Statement 30th June 2020
Statement of changes in equity
Distribution: NASDAQ and key media
|BBS-Bioactive Bone Substitutes||1.1.-30.6. 2020||1.1.-30.6. 2019||1.1.-31.12. 2019|
|CONSOLIDATED INCOME STATEMENT|
|Other operating income||18 409,69||29 050,60||52 775,85|
|Material and services|
|Raw material and consumables|
|Purchase during the period||0,00||-6 996,90||-11 047,22|
|External services||-63 339,24||-29 399,36||-94 641,70|
|Raw materials and services total||-63 339,24||-36 396,26||-105 688,92|
|Wages and salaries||-291 255,92||-301 676,59||-568 867,89|
|Social security expenses|
|Pension expenses||-38 131,40||-41 883,80||-83 042,60|
|Other personnel expenses||-4 930,02||-6 159,02||-13 101,44|
|Personnel expenses total||-334 317,34||-349 719,41||-665 011,93|
|Depreciation and amortization|
|Depreciation according to plan||-99 847,65||-112 388,67||-225 417,46|
|Impairment of non-current assets||0,00||0,00||0,00|
|Depreciation and amortization total||-99 847,65||-112 388,67||-225 417,46|
|Other operating expenses||-896 677,57||-339 542,53||-592 597,71|
|OPERATING PROFIT (LOSS)||-1 375 772,11||-808 996,27||-1 535 940,17|
|Financial income and expenses|
|Other interest income and other financing income|
|Other interest and financial expenses|
|To others||-43 938,32||-50 050,03||-102 210,21|
|Financial income and expenses total||-43 937,20||-50 049,85||-102 209,94|
|PROFIT (LOSS) BEFORE APPROPRIATIONS AND TAX||-1 419 709,31||-859 046,12||-1 638 150,11|
|PROFIT (LOSS) OF THE FINANCIAL PERIOD||-1 419 709,31||-859 046,12||-1 638 150,11|
|CONSOLIDATED BALANCE SHEET|
|BBS-Bioactive Bone Substitutes||30.6.2020||30.6.2019||31.12.2019|
|Development expenditure||7 532 827,55||7 532 827,55||7 532 827,55|
|Other Intangible assets||333 593,66||396 271,93||359 254,72|
|Intangible assets total||7 866 421,21||7 929 099,48||7 892 082,27|
|Land and water areas||83 719,00||83 719,00||83 719,00|
|Buildings and structures||497 476,07||534 920,50||515 519,24|
|Machinery and equipment||653 431,00||739 027,62||684 977,83|
|Tangible assets total||1 234 626,07||1 357 667,12||1 284 216,07|
|NON-CURRENT ASSETS TOTAL||9 101 047,28||9 286 766,60||9 176 298,34|
|Other debtors||180 965,20||131 721,88||140 881,37|
|Prepayments and accrued income||0,00||1 693,15||0,00|
|Short term debtors total||180 965,20||133 415,03||140 881,37|
|Debtors total||180 965,20||133 415,03||140 881,37|
|Cash and equivalents||5 019 391,16||877 563,84||515 633,39|
|CURRENT ASSETS TOTAL||5 200 356,36||1 010 978,87||656 514,76|
|ASSETS TOTAL||14 301 403,64||10 297 745,47||9 832 813,10|
|CONSOLIDATED BALANCE SHEET|
|BBS-Bioactive Bone Substitutes||30.6.2020||30.6.2019||31.12.2019|
|CAPITAL AND RESERVES|
|Share capital||80 000,00||80 000,00||80 000,00|
|Share capital total||80 000,00||80 000,00||80 000,00|
|Share premium account||1 394 957,01||1 394 957,01||1 394 957,01|
|Invested unrestricted equity fund||17 377 537,93||11 337 847,26||11 638 453,75|
|Other reserves total||17 377 537,93||11 337 847,26||11 638 453,75|
|Retained earnings (loss)||-10 034 213,06||-8 396 062,95||-8 396 062,95|
|Profit (loss) of the period||-1 419 709,31||-859 046,12||-1 638 150,11|
|CAPITAL AND RESERVES TOTAL||7 398 572,57||3 557 695,20||3 079 197,70|
|Capital Loans||175 825,46||175 825,46||175 825,46|
|Loans from credit institutions||5 585 314,00||5 191 297,00||5 191 297,00|
|Long term loans total||5 761 139,46||5 367 122,46||5 367 122,46|
|Loans from credit institutions||306 728,00||963 793,00||961 473,00|
|Trade creditors||99 483,19||23 123,41||31 879,90|
|Accrual income||365 702,92||11 959,16||27 293,22|
|Referred income||369 777,50||374 052,24||365 846,82|
|Short term creditors total||1 141 691,61||1 372 927,81||1 386 492,94|
|CREDITORS TOTAL||6 902 831,07||6 740 050,27||6 753 615,40|
|EQUITY AND LIABILITIES TOTAL||14 301 403,64||10 297 745,47||9 832 813,10|
|CASH FLOW STATEMENT|
|Cash flow from business operations|
|Profit (loss) before extraordinary items||-1420,00||-859||-1638|
|Scheduled depreciation and amortization||100||112||225|
|Financial income and expenses||44||50||102|
|Other adjustments: Write-downs||0||0||0|
|Cash flow before changes in working capital||-1276||-697||-1311|
|Change in working capital|
|Changes in short-term non-interest-bearing receivables Increase(-)/Decrease(+)||-40||-40||-47|
|Changes in inventory Increase(-)/Decrease(+)||0||0||0|
|Changes in short-term non-interest-bearing loans Increase(+)/Decrease(-)||435||25||18|
|Cash flow from business operations before financial items and taxes||-881||-712||-1340|
|Interest paid and other financial expenses from business operations||69||74||104|
|Interest received and other financial income from business operations||0||0||0|
|Cash flow before extraordinary items||-950||-786||-1444|
|Cash flow from business operations (A)||-950||-786||-1444|
|Cash flow from investments|
|Investments in tangible and intangible goods||-25||-21||-24|
|Investments in shares in subsidiaries||0||0||0|
|Cash flow from investments (B)||-25||-21||-24|
|Cash flow from financing|
|Raised long-term loans||0||0||0|
|Pitkäaikaisten lainojen takaisinmaksut||261||0||2|
|Repayment of long-term loans||0||0||0|
|Repayment of short-term loans||0||0||0|
|Cash flow from financing (C)||5478||0||299|
|Changes in funds (A+B+C) Increase (+)/Decrease (-)||4503||-807||-1169|
|Funds at the beginning of the financial period||516||1685||1685|
|Funds at the end of the financial period||5019||878||516|
|Share capital||Share premium account||Invested unrestricted equity fund||Accu-mulated profits||Equity Total|
|Profit/loss in period||-1419|
|Paid share issue||5739|
|Equity 31.12.2018||80||1 395||11 338||-8 396||4 417|
|Profit/loss in period||-859|
|Paid share issue|
|Equity 30.6.2019||80||1 395||11 338||-9 255||3 558|
|Equity 31.12.2018||80||1 395||11 338||-8 396||4 417|
|Paid share issue||300|
|Equity 31.12.2019||80||1 395||11 638||-10 034||3 079|