RNLX Renalytix PLC

 

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549

 

FORM 8-K

 

CURRENT REPORT
Pursuant to Section 13 or 15(d)
of the Securities Exchange Act of 1934

Date of Report (Date of earliest event reported): February 15, 2024

 

Renalytix plc

(Exact name of registrant as specified in its Charter)

 

England and Wales	001-39387	Not Applicable
(State or other jurisdiction of incorporation)	(Commission File Number)	(IRS Employer Identification No.)

 

Finsgate 5-7 Cranwood Street London EC1V 9EE United Kingdom

(Address of principal executive offices) (Zip Code)

 

+44 20 3139 2910
(Registrant’s telephone number, including area code)

Not Applicable
(Former name or former address, if changed since last report)

 

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):

☐ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

☐ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

☐ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

☐ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

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Securities registered pursuant to Section 12(b) of the Act:

Title of each class	Trading Symbol(s)	Name of each exchange on which registered
Ordinary shares, nominal value £0.0025 per ordinary share	n/a	The Nasdaq Stock Market LLC*
American Depositary Shares, each representing two ordinary shares, nominal value £0.0025 per ordinary share	RNLX	The Nasdaq Stock Market LLC

 

* Not for trading, but only in connection with the listing of the American Depositary Shares on The Nasdaq Stock Market LLC.

 

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).

Emerging growth company ☒

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

 

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ITEM 2.02 RESULTS OF OPERATIONS AND FINANCIAL CONDITION

On February 15, 2024, Renalytix plc (the “Company”) issued a press release announcing its financial results for the quarter ended December 31, 2023. The Company’s press release is furnished as Exhibit 99.1 to this Current Report on Form 8-K.

The information included in this Item 2.02 and Exhibit 99.1 attached hereto shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”) or otherwise subject to the liabilities of that section, nor shall it be deemed incorporated by reference in any filing under the Securities Act of 1933, as amended, or the Exchange Act, regardless of any general incorporation language in such filing.

Item 9.01 Financial Statements and Exhibits

(d) Exhibits

 

Exhibit	Exhibit Description
99.1	Press release dated February 15, 2024
104	Cover Page Interactive Data File (embedded within the Inline XBRL document)

 

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, as amended, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

		renalytix plc
Dated: February 14, 2024	By:	/s/ James McCullough
		James McCullough Chief Executive Officer

 

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Renalytix plc

(“Renalytix” or the “Company”)

 

Renalytix Reports Financial Results for Second Quarter of Fiscal Year 2024

 

LONDON and SALT LAKE CITY, February 15, 2024 – Renalytix plc (NASDAQ: RNLX) (LSE: RENX) (the “Company”), an artificial intelligence-enabled in vitro diagnostics company, focused on optimizing clinical management of kidney disease, today reported financial results for the fiscal second quarter ended December 31, 2023. The Company plans to issue another announcement following today’s report of financial results regarding the date and time of its conference call and webcast to discuss second quarter financial results and other key events.

 

The Company made significant progress during the quarter in revenue generation, reimbursement coverage, the publication of real-world evidence and operating cost management, setting the stage for potential future growth. Highlights include:

 

Second Quarter 2024 Financial Results

 

During the three months ended December 31, 2023, we recognized $0.7 million of revenue related to sales of KidneyIntelX. During the three months ended December 31, 2022, we recognized $1.0 million revenue related to sales of KidneyIntelX and $0.2 million of revenue of pharmaceutical services revenue related to services performed for AstraZeneca. The $0.5 million decrease in revenue was primarily driven by a $0.3 million decrease in KidneyIntelX billable testing volumes due to the transition to a commercial billing structure under our arrangement with Mount Sinai and a decrease of $0.2 million of pharmaceutical services revenue.

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Operating expenses for the three months ended December 31, 2023 were $8.9 million, compared to $10.1 million for the three months ended December 31, 2022. We have taken significant actions to lower annual expenditures with a targeted annualized cash burn rate of under $23 million within our fiscal third quarter of 2024 (down from $37 million in the 2023 fiscal year), while preserving revenue generating activity.

 

Within operating expenses, research and development expenses were $3.2 million for the three months ended December 31, 2023, which decreased by $0.1 million from $3.3 million for the three months ended December 31, 2022. The decrease was attributable to a $1.2 million decrease in compensation and related benefits, offset by a $1.1 million increase related to external R&D projects and studies with Mount Sinai, Wake Forest and Joslin.

 

General and administrative expenses were $5.3 million for the three months ended December 31, 2023, decreasing by $1.5 million from $6.8 million for the three months ended December 31, 2022. The decrease was driven by even further cost cutting measures, which resulted in a $1.7 million decrease in compensation and related benefits, including share-based payments, due to decreased headcount, and a $0.5 million decrease in other operating expenses, offset by a $0.5 million increase in legal fees and a $0.2 million increase in consulting and professional fees. We have implemented a plan to further reduce payroll expense and total general and administrative expenses while preserving our sales capacity.

 

Net loss was $8.5 million for the three months ended December 31, 2023, compared to a net loss of $10.4 million for the three months ended December 31, 2022.

 

Cash and cash equivalents totaled $5.6 million as of December 31, 2023.

 

For further information, please contact:

 

Renalytix plc	www.renalytix.com
James McCullough, CEO	Via Walbrook PR
Stifel (Nominated Adviser, Joint Broker)	Tel: 020 7710 7600
Alex Price / Nicholas Moore / Nick Harland / Samira Essebiyea
Investec Bank plc (Joint Broker)	Tel: 020 7597 4000
Gary Clarence / Shalin Bhamra
Walbrook PR Limited	Tel: 020 7933 8780 or renalytix@walbrookpr.com
Paul McManus / Alice Woodings	Mob: 07980 541 893 / 07407 804 654
CapComm Partners
Peter DeNardo	Tel: 415-389-6400 or investors@renalytix.com

 

 

About Renalytix

Renalytix (NASDAQ: RNLX) (LSE: RENX) is an in-vitro diagnostics and laboratory services company that is the global founder and leader in the new field of bioprognosis™ for kidney health. The leadership team, with a combined 200+ years of healthcare and in-vitro diagnostic experience, has designed its KidneyIntelX laboratory developed test to enable risk assessment for rapid progressive decline in kidney function in adult patients with T2D and early CKD (stages 1-3). We believe that by understanding how disease will progress, patients and providers can take action early to improve outcomes and reduce overall health system costs. For more information, visit www.renalytix.com.

 

 

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Forward-Looking Statements

Statements contained in this press release regarding matters that are not historical facts are “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995, as amended. Examples of these forward-looking statements include statements concerning: the commercial prospects of KidneyIntelX, including whether KidneyIntelX will be successfully adopted by physicians and distributed and marketed, the rate of testing with KidneyIntelX in health care systems, expectations and timing of announcement of real-world testing evidence, the potential for KidneyIntelX to be approved for additional indications, the Company’s expectations regarding the timing and outcome of regulatory and reimbursement decisions, the ability of KidneyIntelX to curtail costs of chronic and end-stage kidney disease, optimize care delivery and improve patient outcomes, the Company’s expectations and guidance related to partnerships, testing volumes and revenue for future periods, the Company’s expectations regarding the Company’s ability to obtain and maintain intellectual property protection for its diagnostic products and the Company’s ability to operate its business without infringing on the intellectual property rights of others, and the forecast of the Company’s cash runway and the implementation and potential for additional financing activities and cost-saving initiatives. Words such as “anticipates,” “believes,” “estimates,” “expects,” “intends,” “plans,” “seeks,” and similar expressions are intended to identify forward-looking statements. The Company may not actually achieve the plans and objectives disclosed in the forward-looking statements, and you should not place undue reliance on the Company’s forward-looking statements. Any forward-looking statements are based on management’s current views and assumptions and involve risks and uncertainties that could cause actual results, performance or events to differ materially from those expressed or implied in such statements. These risks and uncertainties include, among others: that KidneyIntelX is based on novel artificial intelligence technologies that are rapidly evolving and potential acceptance, utility and clinical practice remains uncertain; the Company has only recently commercially launched KidneyIntelX; and risks relating to the impact on the Company’s business of the COVID-19 pandemic or similar public health crises. These and other risks are described more fully in the Company’s filings with the Securities and Exchange Commission (SEC), including the “Risk Factors” section of its annual report on Form 10-K filed with the SEC on September 28, 2023, the Company’s Quarterly Report on Form 10-Q for the quarter ended September 30, 2023 filed with the SEC on November 14, 2023 and other filings the Company makes with the SEC from time to time. All information in this press release is as of the date of the release, and the Company undertakes no obligation to publicly update any forward-looking statement, whether as a result of new information, future events, or otherwise, except as required by law.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

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RENALYTIX PLC

Consolidated Statements of Operations and Comprehensive Loss (Unaudited)

 





For the Three Months Ended December 31,





For the Six Months Ended December 31,



(in thousands, except share data)



2023





2022





2023





2022



Revenue



$

709





$

1,192





$

1,168





$

2,161



Cost of revenue





480







711







982







1,407



Gross profit





229







481







186







754



Operating expenses:

























Research and development





3,225







3,326







6,012







7,083



General and administrative





5,339







6,810







11,398







15,060



Impairment loss on property and equipment





306







—







306







—



Performance of contract liability to affiliate





—







(7

)





—







(19

)

Total operating expenses





8,870







10,129







17,716







22,124



Loss from operations





(8,641

)





(9,648

)





(17,530

)





(21,370

)



























Equity in net losses of affiliate





—







—







—







(9

)

Foreign currency (loss) gain, net





(89

)





(108

)





200







699



Fair value adjustment to VericiDx investment





202







(345

)





(245

)





(1,199

)

Fair value adjustment to convertible notes





(114

)





(440

)





(1,321

)





(730

)

Other income, net





161







97







261







211



Net loss before income taxes





(8,481

)





(10,444

)





(18,635

)





(22,398

)

Income tax (expense) benefit





(4

)





—







(4

)





1



Net loss





(8,485

)





(10,444

)





(18,639

)





(22,397

)



























Net loss per ordinary share—basic



$

(0.09

)



$

(0.14

)



$

(0.19

)



$

(0.30

)

Net loss per ordinary share—diluted



$

(0.09

)



$

(0.14

)



$

(0.19

)



$

(0.30

)

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Weighted average ordinary shares—basic





97,268,051







74,891,844







96,017,946







74,848,278



Weighted average ordinary shares—diluted





97,268,051







74,891,844







96,017,946







74,848,278





























Other comprehensive income (loss):

























Changes in the fair value of the convertible notes





—







(920

)





75







(523

)

Foreign exchange translation adjustment





(401

)





588







(359

)





(499

)

Comprehensive loss





(8,886

)





(10,776

)





(18,923

)





(23,419

)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

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RENALYTIX PLC

CONSOLIDATED BALANCE SHEETS (Unaudited)

 

(in thousands, except share and per share data)				December 31, 2023				June 30, 2023		
Assets										
Current assets:										
Cash and cash equivalents				$	5,619			$	24,682	
Accounts receivable					1,370				776	
Prepaid expenses and other current assets					1,261				1,424	
Total current assets					8,250				26,882	
Property and equipment, net					576				1,027	
Right of Use Asset					102				159	
Investment in VericiDx					1,220				1,460	
Other Assets					1,128				1,101	
Total assets				$	11,276			$	30,629	
										
Liabilities and Shareholders’ Equity										
Current liabilities:										
Accounts payable				$	2,109			$	1,485	
Accounts payable – related party					707				1,451	
Accrued expenses and other current liabilities					4,259				6,644	
Accrued expenses – related party					3,673				1,963	
Current lease liability					111				130	
Convertible notes-current					3,063				4,463	
Total current liabilities					13,922				16,136	
Convertible notes-noncurrent					5,310				7,485	
Noncurrent lease liability					—				41	
Total liabilities					19,232				23,662	
										

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Commitments and contingencies (Note 10)										
										
Shareholders’ equity:										
Ordinary shares, £0.0025 par value per share: 107,189,897 shares authorized; 99,930,156 and 93,781,478 shares issued and outstanding at December 31, 2023 and June 30, 2023, respectively					305				286	
Additional paid-in capital					190,437				186,456	
Accumulated other comprehensive loss					(1,734	)			(1,450	)
Accumulated deficit					(196,964	)			(178,325	)
Total shareholders’ (deficit) equity					(7,956	)			6,967	
Total liabilities and shareholders’ (deficit) equity				$	11,276			$	30,629	

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

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RENALYTIX PLC

CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited)

 

		For the Six Months Ended December 31,						
(in thousands)		2023				2022		
Cash flows from operating activities:								
Net loss		$	(18,639	)		$	(22,397	)
Adjustments to reconcile net loss to net cash used in operating activities								
Depreciation and amortization			235				258	
Impairment of property and equipment			306				—	
Stock-based compensation			909				1,584	
Equity in losses of affiliate			—				9	
Reduction of Kantaro liability			—				(55	)
Fair value adjustment to VericiDx investment			245				1,199	
Unrealized foreign exchange gain			—				271	
Realized foreign exchange gain			(163	)			—	
Fair value adjustment to convertible debt, net interest paid			1,059				730	
Non cash lease expense			57				52	
Changes in operating assets and liabilities:								
Accounts receivable			(594	)			81	
Prepaid expenses and other current assets			45				494	
Receivable from affiliates			—				(22	)
Accounts payable			618				2,773	
Accounts payable – related party			(744	)			(1,083	)
Accrued expenses and other current liabilities			(2,465	)			1,367	
Accrued expenses – related party			1,708				(566	)
Deferred revenue			—				(46	)
Net cash used in operating activities			(17,423	)			(15,351	)
								

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Cash flows from investing activities:								
Payment for long term deferred expense			—				(64	)
Net cash used in investing activities			—				(64	)
								
Cash flows from financing activities:								
Payment of convertible notes principal			(1,660	)			(1,648	)
Payment of issuance costs			(5	)			—	
Proceeds from purchase of ordinary shares under employee share purchase plan			93				116	
Net cash used in financing activities			(1,572	)			(1,532	)
Effect of exchange rate changes on cash			(68	)			(570	)
Net decrease in cash and cash equivalents			(19,063	)			(17,517	)
Cash and cash equivalents, beginning of period			24,682				41,333	
Cash and cash equivalents, end of period		$	5,619			$	23,816	
Supplemental noncash investing and financing activities:								
Cash paid for interest on convertible debt		$	249			$	—	

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v3.24.0.1

Document And Entity Information	Feb. 15, 2024
Document Information [Line Items]
Document Type	8-K
Amendment Flag	false
Document Period End Date	Feb. 15, 2024
Entity Registrant Name	Renalytix plc
Entity Central Index Key	0001811115
Entity Emerging Growth Company	true
Entity Ex Transition Period	false
Securities Act File Number	001-39387
Entity Incorporation, State or Country Code	X0
Entity Tax Identification Number	00-0000000
Entity Address, Address Line One	Finsgate
Entity Address, Address Line Two	5-7 Cranwood Street
Entity Address, City or Town	London EC1V 9EE
Entity Address, Country	GB
Entity Address, Postal Zip Code	EC1V 9EE
City Area Code	+44
Local Phone Number	20 3139 2910
Written Communications	false
Soliciting Material	false
Pre-commencement Tender Offer	false
Pre-commencement Issuer Tender Offer	false
Title of 12(b) Security	Ordinary shares, nominal value £0.0025 per ordinary share
No Trading Symbol Flag	true
Security Exchange Name	NASDAQ
American Depositary Shares [Member]
Document Information [Line Items]
Title of 12(b) Security	American Depositary Shares, each representing two ordinary shares, nominal value £0.0025 per ordinary share
Trading Symbol	RNLX
Security Exchange Name	NASDAQ

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