Syncona Limited Syncona Limited Quarterly Update
August 09 2018 - 1:00AM
UK Regulatory
TIDMSYNC
Syncona Limited
Quarterly Update
9 August 2018
Syncona Ltd, a leading healthcare company focused on investing in and building
global leaders in life science, today issues its quarterly update covering the
period from 1 April 2018 to 30 June 2018.
Financial and Operational highlights for the three months ending 30 June
* Net assets increased to GBP1,283.2 million, 193.1p per share[1], a total
return of 23.0 per cent[2]
* Life science portfolio, key driver of growth, valued at GBP789.4 million (62
per cent of net assets), a 41.8 per cent return[3] over the quarter
* Capital pool of GBP522.0 million (cash of GBP68.4 million and funds investments
of GBP453.6 million)
* Continued strong performance in portfolio company Blue Earth, with US unit
sales of Axumin of 6,000 in the period; revalued to GBP213.2 million,
valuation increase of GBP26.4 million driven predominantly by positive
foreign exchange movements
* Completion of two significant financing rounds in Syncona's portfolio
companies; an GBP85.0 million commitment to Freeline and a GBP18.1 million
investment in the successful IPO of Autolus. Autolus was valued at GBP275.8
million at 30 June, a GBP172.6 million valuation uplift in the period
* GBP9.8 million commitment to a new Syncona portfolio company, which employs a
novel technology platform to enable drug discovery in small molecule and
antibody areas, bringing the number of life science portfolio companies to
nine
Life science portfolio delivers strong financial and operational progress
Syncona's life science portfolio made continued strong progress during the
quarter. Blue Earth Diagnostics (Blue Earth), our PET imaging agent company,
demonstrated continued momentum in sales of its prostate cancer imaging
diagnostic, Axumin, which sold 6,000 doses during the quarter, up from 5,000 in
the previous quarter. The business, which is profitable, continues to make good
progress rolling the product out across the United States, the key product
market. It was valued at GBP213.2 million at 30 June, with the valuation increase
of GBP26.4 million driven predominantly by positive foreign exchange movements.
Syncona closed two significant financing rounds and a new addition to its
portfolio. Autolus, our T cell immunotherapy company, completed its initial
public offering (IPO) on NASDAQ. Syncona invested GBP18.1 million in the IPO to
retain a stake of 33 per cent in Autolus (previously 38 per cent), which was
valued at GBP275.8 million at 30 June 2018, a significant valuation uplift of GBP
172.6 million to 31 March 2018 valuation. Syncona also announced a commitment
of GBP85.0 million to Freeline, its clinical stage AAV gene therapy company
focused on liver expression for chronic systemic diseases.
In addition, Syncona made a commitment of GBP9.8 million[4] to a new portfolio
company which uses a novel technology platform to enable the discovery of
therapeutics acting at targets in the cell membrane. The technology, which has
been developed by the company's world-leading academic founder, offers the
potential to address previously intractable small molecule and antibody drug
targets. Syncona has a 46 per cent stake in this early stage business and has
been working with the company to define its business plan and strategic
direction. Further information will be provided in due course.
Immediately following the period end, Syncona also sold its entire holding in
NASDAQ-listed Endocyte (ECYT). The exit resulted in Syncona crystallising a
total realised gain of GBP10.2 million on an original investment of GBP4.0 million,
generating value from a therapeutic area in which Syncona has deep domain
expertise.
[1] Fully diluted
[2] Including 2.3p dividend paid in July 2018
[3] Time-weighted rate of return
[4] GBP3.5m of this commitment was paid in July
Fund investments continue to perform well and provide strong capital base
At 30 June 2018, fund investments were valued at GBP453.6 million, (35 per cent
of net assets), having generated a return of 4.0 per cent[5] over the quarter.
These investments continue to provide a liquid pool of capital which is
productively deployed and available to support investment in Syncona's life
science portfolio. The portfolio of fund investments continues to transition
away from more directional long-only funds towards strategies more suited to
our current investment parameters, with a further GBP27.9 million redeemed from
long-only strategies and GBP13.2 million invested into hedged strategies during
the quarter.
Martin Murphy, CEO, Syncona Investment Management Limited, said:
"We have continued to deliver strong performance across the business and have
seen life science increase to 62 per cent of our portfolio. Our continued
progress demonstrates the success of our differentiated model, which combines a
hands-on, partnership approach to building innovative healthcare companies with
a long-term investment perspective and access to a deep pool of capital.
"This is an important period for Syncona as our portfolio companies progress
through clinical trials. There remains much to do as we work to support these
businesses to become global leaders in their fields and deliver
transformational treatments to patients."
Company 31 Mar Net Valuat- 30 Jun % NAV Valuat- Fully Focus area
2018 invest- ion 2018 ion basis diluted
Value ment change value owner-
(GBPm) (GBPm) (GBPm) (GBPm) ship
stake
(%)
Life science portfolio companies
Established
Blue Earth 186.8 - 26.4 213.2 16.6% rDCF 89 Advanced
diagnostics
Maturing
Autolus 85.1 18.1 172.6 275.8 21.5% Quoted 33 Cell therapy
Nightstar 124.5 - 23.4 147.9 11.5% Quoted 42 Gene therapy
Freeline 36.0 27.5 - 63.5 4.9% Cost 80 Gene therapy
Developing
Gyroscope 11.0 - - 11.0 0.9% Cost 78 Gene therapy
Orbit 8.6 - 0.5 9.1 0.7% Cost 80 Surgical
Biomedical devices
Achilles 6.6 - - 6.6 0.5% Cost 69 Cell therapy
SwanBio 4.9 - 0.3 5.2 0.4% Cost 72 Gene therapy
New portfolio - 3.5 - 3.5 0.3% Cost 46 Therapeutics
company
Life science investments
CRT Pioneer 30.8 1.0 - 31.8 2.5% Third-party N/A
Fund
CEGX 9.8 - 0.6 10.4 0.8% PRI 9
Endocyte 9.0 (3.9) 4.9 10.0 0.8% Quoted 1
Syncona 1.4 - - 1.4 0.1% Cost 100
Collaborations
[5]
Time-weighted
rate of return
SUB-TOTAL 514.5 46.2 228.7[6] 789.4 61.5%
Fund 465.1 (27.1)[7] 15.6 453.6 35.4%
investments
Cash 85.2 (19.1) 2.3 68.4 5.3%
Dividend - - (15.2) (15.2) (1.2%)
Other net (9.0) - (4.0) (13.0) (1.0%)
liabilities
TOTAL 1,055.8 - 227.4 1,283.2 100%
Fund Investments -Top 10 funds
Funds Strategy Valuation (GBPm) % NAV
SFP Value Realization Fund Equity Long 43.0 3.1%
Polar UK Absolute Equity Fund Equity Hedge 39.2 3.1%
Maga Smaller Companies UCITS Equity Hedge 33.4 2.6%
AKO Global UCITS Fund Equity Hedge 31.8 2.4%
Sinfonietta Non-Equity Hedge 26.4 2.0%
Polygon European Equity Equity Hedge 24.7 2.6%
Opportunity
Portland Hill Equity Hedge 23.0 1.8%
Polar Capital Japan Alpha Equity Long 20.4 1.6%
Polygon Convertible Equity Hedge 20.0 1.5%
Opportunity
Permira V Private Equity 19.6 1.7%
[ENDS]
Enquiries
Syncona Limited Tel: +44 (0) 20 7611 2010
Annabel Clay
Tulchan Communications Tel: +44 (0) 207 353 4200
Martin Robinson/Lisa Jarrett-Kerr
About Syncona:
Syncona is a leading FTSE250 healthcare company focused on investing in and
building global leaders in life science. Our vision is to deliver
transformational treatments to patients in truly innovative areas of healthcare
while generating superior returns for shareholders.
We seek to partner with the best, brightest and most ambitious minds in science
to build globally competitive businesses.
We take a long-term view, underpinned by a deep pool of capital, and are
established leaders in gene and cell therapy. We focus on delivering dramatic
efficacy for patients in areas of high unmet need.
Copies of this press release and other corporate information can be found on
the company website at: www.synconaltd.com
[6] Includes: update of rDCF model, change in quoted share prices and foreign
currency exchange rates; impact of change in foreign currency exchange rates c.
GBP36m increase
[7] Includes: GBP27.9m redemption from long-only strategy, GBP3.5m net subscription
into equity hedge and GBP2.7m capital return
END
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