BBS-Bioactive Bone Substitutes Plc, Half-Year Financial Report, 25 August 2023 at 09.00 (EET)
This is a summary of BBS-Bioactive Bone Substitutes Plc’s Half-Year Financial Report for January – June 2023. The entire report is attached to this Company Announcement as a pdf file. The report is also available on BBS-Bioactive Bone Substitutes Plc’s website at https://www.bbs-artebone.fi/.
BBS-Bioactive Bone Substitutes Plc: Half-Year Financial Report 1 Jan - 30 Jun 2023 (unaudited)
Continued efforts towards obtaining the CE marking for BBS's First Product
JANUARY-JUNE (H1)
- During the first half of the year, BBS-Bioactive Bone Substitutes Plc (BBS) continued to implement the actions required for the registration of the Company's first product (ARTEBONE® Paste), including ramping up production.
- In March, the Notified Body completed the second audit, and delivered its audit report to the Company on 20 March 2023. The Company committed to complete the specified additional measures by 1 September 2023.
- In May, the Company received a positive decision from the Notified Body confirming ARTEBONE® Paste’s product classification as a medical device. The product classification ensures that the CE marking process for the Company's first product may proceed in accordance with the targeted simpler and more cost-effective administrative process.
- In June-July, the Company raised EUR 1.84 million through the Rights issue, and in addition about EUR 165,000 through the warrant (WA2) subscriptions.
- The Company generated no revenue during the review period.
- The financial result in the review period was EUR -1.64 (-1.68) million.
- Cash flow from operations was EUR -1.43 (-1.50) million.
- Cash and cash equivalents on 30 June 2023 were EUR 1.67 (3.39) million.
The figures in the review are rounded, so the sum of the individual figures may differ from the total presented. BBS's accounting period is a calendar year. Figures in parentheses refer to the corresponding period of the previous year, unless otherwise stated. The information in the review is unaudited.
OUTLOOK
Guidance for 2023
No revenue is expected during 2023.
Board of Directors’ outlook for 2023
The Company has submitted the CE marking application for its first product (ARTEBONE® Paste) to the notified body on 9 March 2022. The Company expects authorities’ decision on approving the application during 2023.
Preparations for commercial operations will start towards the end of 2023.
Further measures are required to ensure the sufficiency of the Company's financing in order to implement the Company’s plans following the expected approval of the CE marking. The Company continues discussions to secure additional funding to enable the continuation of the development work as well as initiating commercial activities.
*MedTech Europe Survey -raportti. https://www.medtecheurope.org/wp-content/uploads/2022/07/medtech-europe-survey-report-analysing-the-availability-of-medical-devices-in-2022-in-connection-to-the-medical-device-regulation-mdr-implementation.pdf
KEY FIGURES
| EUR 1000 | 1-6/2023 | 1-6/2022 | Change, % | 1-12/2022 |
| Other operating income | 10 | 55 | -81.9% | 16 |
| Personnel expenses | 621 | 728 | -14.7% | 720 |
| Depreciationa and amortization | 108 | 113 | -4.2% | 119 |
| Other operational expenses | 856 | 689 | -24.2% | 481 |
| Profit/Loss for the period | -1,642 | -1,676 | -2.0% | -1,463 |
| Cash flow for business operations | -1,404 | -1,496 | -6.1% | -1,155 |
| Change in cash resources | 154 | 2,153 | -92.8% | -698 |
| Equity ratio, % 1) | 41 | 43 | 35 | |
| Earnings per share, EUR 2) | -0.17 | -0.24 | -0.22 | |
| Earnings per share, EUR, diluted | -0.16 | -0.23 | -0.22 | |
| Number of shares at the end of period 4) | 10,040,326 | 9,436,936 | 6,737,889 | |
| Average number of shares in the period | 9,738,324 | 6,951,992 | 6,615,855 | |
| Equity per share, EUR 3) 5) | 0.43 | 0.58 | 0.54 | |
| Cash and cash equivalents | 1,671 | 3,390 | -50.7% | 1,236 |
| Equity | 4,360 | 5,475 | -20.4% | 3,634 |
| Balance sheet total | 10,727 | 12,618 | -15.0% | 10,506 |
1) Equity ratio = Equity / (Balance sheet total – Advances received)
2) EPS = Profit (Loss) / Average number of outstanding shares in the period
3) Equity / Total number of outstanding shares at the end of the period
4) The number of shares including the shares registered on 13 July 2023 (Rights issue) is 13,777,382.
5) The equity per share including the shares registered on 13 July 2023 (Rights issue) was 0.32.
CEO ILKKA KANGASNIEMI
During the first half year, BBS took several significant steps towards the CE marking of our first product, ARTEBONE® Paste, in cooperation with the Notified Body.
In May, we received an important and expected decision from the Notified Body regarding product classification: ARTEBONE® Paste can be classified as a medical device according to our proposal. This was a critical decision as it ensured a simpler and more cost-effective administrative process for the CE marking.
Regarding the quality system, we have now gone through the two thorough audits that are part of the process, and according to management no such non-conformities have been reported which would interrupt the approval process. The authorities will conduct the next audit at the end of this month, August 29-31. After we have received the final report from the Notified Body, we will communicate more and update the schedule for the approval of the quality process.
Acknowledging that authorities continue to work through a backlog of applications and that additional measures are still required of BBS, we still expect the CE marking to be received during 2023. This will require that the on-going product approval process, as well as the cooperation required between the Notified Body and the Medicines Agency handling the matter will be realized as planned during the autumn.
In June, we conducted a rights issue to secure the Company's financing. Additionally, the Company raised funds from the subscription of warrants related to the previous year's rights issue in May 2022. Both actions were moderately successful and raised the Company a total of approximately EUR 2 million in gross proceeds. I want to thank the shareholders who participated in the rights issue for the trust they have shown for our joint project.
According to our current estimates, the Company's cash reserves will be sufficient until the end of the year. We have already initiated measures to arrange additional financing in order to ensure the successful launch of our first product on the market after we receive the CE marking. We will patiently and determinedly continue our work towards this goal in the second half of the year.
EVENTS AFTER PERIOD-END
Rights issue 2023
On 3 July 2023, the Company's board of directors decided to approve the entries made in the rights issue. As a result of the rights issue, the number of the Company shares increased by 3,686 393 shares. As a result of the share transfer without consideration related to warrants (WA2), the Company delivered a total of 50,663 of treasury shares which were transferred to shareholders on 11 July 2023 in Sweden and on 12 July 2023 in Finland. Following the June rights issue, the total number of shares in the Company is 14,118,847.
Below is a list of the Company's largest owners after the Rights issue (13 July 2023).
| 13 July 2023 | 31 December 2022 | ||||
| Number of shares | % of outstanding shares | Number of warrants 2) | Number of shares | Number of shares | |
| Finha Capital Oy | 1,857,880 | 13.5 % | 1,408,404 | 38,606 | 14.6 % |
| Reisjärven municipality | 1,846,701 | 13.4 % | 1,051,081 | 43,795 | 10.9 % |
| Panvest Oy | 899,725 | 6.5 % | 476,838 | 19,073 | 4.9 % |
| Jalovaara Pekka (1 | 581,555 | 4.2 % | 568,025 | 1,925 | 5.9 % |
| Paananen Ahti (1 | 520,904 | 3.8 % | 520,904 | 20,836 | 5.4 % |
| Rosenqvist Alexandra | 241,461 | 1.8 % | 230,309 | 961 | 2.4 % |
| Halonen Veronika | 229,349 | 1.7 % | 229,349 | 961 | 2.4 % |
| Halonen Jukka | 247,034 | 1.8 % | 226,481 | 5,618 | 2.3 % |
| Nordnet Bank AB, nominee registered | 176,241 | 1.3 % | 18,629 | 219 | 0.2 % |
| City of Oulu | 130,081 | 0.9 % | 130,081 | 1.3 % | |
| 10 largest total | 6,730,931 | 48.9 % | 4,860,101 | 131,994 | 50.3 % |
| Others | 7,046,451 | 51.1 % | 4,808,250 | 203,487 | 49.7 % |
| Total | 13,777,382 | 100.0 % | 9,668,351 | 335,481 | 100.0 % |
| BBS-Bioactive Bone Substitutes Plc | 341,465 | 509,523 | |||
| Total | 14,118,847 | 10,177,874 | 335,481 | ||
1) Ahti Paananen and Pekka Jalovaara are members of the Company's board.
2) Number of quoted trading options (WA2)
On 13 July 2023, BBS's board of directors held a total of 1,162,260 shares, i.e., 8.4 percent of the total number of outstanding shares.
RiverFort loans partial conversion
On 14 July 2023, the Company announced it had received a request from RiverFort Global Opportunities PCC Ltd to exchange a EUR 50,000 convertible bond portion into Company shares at a subscription price of 0.441 euros per share. In accordance with the terms of the financing arrangement, the subscription price was 90% of the lowest average price for the ten days preceding the conversion. The exchange was carried out by transferring a total of 113,378 of the Company treasury shares to RiverFort.
On 17 August 2023, the Company announced it had received a request from RiverFort Global Opportunities PCC Ltd to exchange a 50,000-euro convertible bond portion into Company shares at a subscription price of 0.39483 euros per share. In accordance with the terms of the financing arrangement, the subscription price was 90% of the lowest average price for the ten days preceding the conversion. The exchange was carried out by transferring a total of 126,636 of the Company treasury shares to RiverFort.
Loan repayment
On 2 August 2023, the Company has repaid to Valtiokonttori approximately EUR 486,000 product development loans due in June.
FINANCIAL CALENDAR FOR 2023
- Financial Statements Release for the year 2023 will be published on 22 February 2024
The Company's previously published reports can be found on the BBS investor website at: https://www.bbs-artebone.fi/investors/financial-reports/.
25 August 2023
BBS-Bioactive Bone Substitutes Plc
Board of Directors
Distribution
Nasdaq Helsinki
https://www.bbs-artebone.fi/
BBS in brief
BBS-Bioactive Bone Substitutes Plc is a Finnish orthobiology Company whose core competence is the development, commercialization and manufacture of easy-to-use bone implants that promote bone formation and healing. Bone substitutes, i.e. implants, are intended for the treatment of various bone damage, bone healing problems and bone diseases instead of autologous and bank bone grafts. BBS aims to become one of the leading players in the field of bioactive implants intended for bone healing problems.
BBS was founded in 2003, and the Company has been listed on Nasdaq First North Growth Market Finland since February 2018. The Company's headquarters are in Oulu.
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