19th Feb 2020 09:40
(Alliance News) - Cambridge Cognition Holdings PLC said Wednesday it expects to report a widened annual loss on lower revenue, as a result of declining sales from its core business.
Cambridge - which develops digital products for assessing brain health - also announced a plan to raise GBP1.4 million to finalise the commercialisation of recently developed products.
Through a placing and subscription, the company will issue 7.0 million shares at a price of 20 pence each, which represents a 33% discount to Cambridge's closing price on Tuesday of 30p.
Shares in Cambridge Cognition - which is based in Cambridge, Massachusetts - were 20% lower at 24.00 pence on Wednesday in London.
finnCap Ltd will act as nominated adviser and joint broker, while Dowgate Capital Ltd acts as joint broker for the fundraising. The company will hold a general meeting on March 9 to gain shareholder approval for the fundraising.
Cambridge Cognition said for 2019, it expects to report an after-tax loss of GBP2.9 million, widened from GBP1.4 million the year before, on revenue that declined by 18% to GBP5.0 million from GBP6.1 million.
The company attributed the weaker performance to lower sales from its core business due to short-term market factors, and a merger of two of its large customers leading to delays in finalising contracts and a dip in trial initiations for Alzheimer's drugs.
Cambridge Cognition said its weakness continued into the third quarter of the year, but it reported a return to significant growth in the fourth quarter and early 2020.
Looking ahead, Cambridge Cognition said even though its sales & marketing spend is rising, research & development and overall administrative costs are being significantly reduced, leading to the company expecting to achieve profitability in the fourth quarter of 2020.
Cambridge Cognition will publish its 2019 results on March 24.
By Dayo Laniyan; [email protected]
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