After years of struggling to make progress in its late-stage clinical development pipeline, the prospects for Allergy Therapeutics’ (AGY) portfolio of new drugs are finally looking up. In the period under review, the biotech specialist began a final phase trial into its novel birch tree allergy vaccine, tested the Acarovac dust mite drug in humans for the first time and successfully completed pre-clinical trials into its Polyvac Peanut medicine. More importantly, US regulators gave Allergy permission to progress with a dosing trial into its new grass allergy vaccine. Eventual approval could make it the first injectable allergy treatment available in the US.
All this clinical progress is expected to double research and development expenditure in the year to June 2018, from £9.3m in the reported period. Thus, broker finnCap expects pre-tax losses to widen to £7.3m, giving a loss per share of 1.3p (from -£1.3m and -0.3p in FY2017).
But chief financial officer Nick Wykeman is confident that the group has enough cash to fund the progression of these four drugs. The £22m of cash is supplemented by the group’s commercial arm which is making profits selling a range of traditional allergy medicines in Europe. Exclude research and development expenses and operating profit rose by 72 per cent to £4.3m.
| ALLERGY THERAPEUTICS (AGY) | ||||
| ORD PRICE: | 33p | MARKET VALUE: | £193m | |
| TOUCH: | 32-33p | 12-MONTH HIGH: | 34p | LOW: 18p |
| DIVIDEND YIELD: | nil | PE RATIO: | na | |
| NET ASSET VALUE: | 5p* | NET CASH: | £19m | |
| Year to 30 Jun | Turnover (£m) | Pre-tax profit (£m) | Earnings per share (p) | Dividend per share (p) |
| 2013 | 39.3 | 0.5 | 0.1 | nil |
| 2014 | 42.0 | 1.1 | 0.2 | nil |
| 2015 | 43.2 | 0.7 | 0.02 | nil |
| 2016 | 48.5 | -12.1 | -2.3 | nil |
| 2017 | 64.1 | -2.0 | -0.4 | nil |
| % change | +32 | - | - | - |
| Ex-div: | na | |||
| Payment: | na | |||
| *Includes intangible assets of £5.5m, or 0.9p a share | ||||
