11th Jun 2019 10:31
LONDON (Alliance News) - Venn Life Sciences Holdings PLC on Tuesday said it has conditionally raised GBP4.5 million before expenses through a share placing as its loss widened in 2018.
The AIM-listed company said it issued 80.4 million shares at a price of 5.6 pence each, representing about 32% of its enlarged share capital upon admission, at which time it will have about 253 million shares.
The stock was trading 89% higher on Tuesday morning at 5.00p a share.
Turning to annual results, the drug development company reported a pretax loss of EUR5.0 million for 2018, compared to EUR1.8 million a year earlier, as revenue fell to EUR13.9 million from EUR17.4 million.
Looking ahead, Venn said it has experienced a continuation of prior year trends in its recently commenced financial year, with low utilisation resulting in revenue and earnings before interest, taxes, depreciation and amortization being behind management forecasts for the year-to-date.
"2018 has been challenging for the company with a need to closely monitor cash resources; a trend that continued into 2019, notwithstanding the cash realised from the recent disposals of investment assets," explained Chief Executive Cathal Friel.
In 2018, the company reported write down of EUR2.2 million on the impairment of intangible assets.
"The placing will position the company to take full advantage of the platform created from the combination of Venn and Open Orphan DAC," continued Friel. "We are excited by the growth potential as we seek to build a leading full-service, Europe-wide, high-margin consultancy offering services to the fast-growing orphan drug market."
Venn agreed to buy Open Orphan in May for GBP5.7 million in shares. It will issue 101.7 million new shares at the same price as placing price of 5.6p.
Prior to the two new share issues, the company had 71 million shares outstanding.