Prenetics Global Limited (NASDAQ: PRE) (“Prenetics” or the
“Company”), a leading health sciences company, today announced
unaudited financial results for the first quarter ended March 31,
2024, along with recent business updates.
First Quarter 2024 Financial
Highlights
- Revenue from continuing operations
of US$6.4 million in the first quarter 2024, an increase of 30.2%
as compared to the first quarter 2023.
- Gross profit from continuing
operations of US$3.8 million in the first quarter 2024, an increase
of 159.8% as compared to the first quarter 2023.
- Adjusted EBITDA from continuing
operations of US$(4.1) million in the first quarter 2024, an
improvement of 55.9% as compared to the first quarter 2023.
- Cash and other short-term assets1
of US$86.6 million as of March 31, 2024. Additionally, Insighta2,
our 50/50 joint venture in early cancer detection with Professor
Dennis Lo, had a cash balance of US$79.8 million in its balance
sheet as of March 31, 2024.
Danny Yeung, Chief Executive Officer and
Co-Founder of Prenetics remarked: “The first quarter of
2024 marked a good start for our company, showcasing solid growth
in revenue and gross profit. These results demonstrate firm
governance of our financial position with no debt supported by a
resilient and talented team.
As we enter the second half of 2024, we are making significant
strides in our strategic realignment with a keen focus on the
consumer healthcare market in the USA. Our purpose remains
dedicated to our science first approach in our pivot to consumer
healthcare to broaden accessibility to science based health and
wellness. To support this growth, we have established dual
headquarters with a presence in the US which will position us to
seize new opportunities both domestically and globally. We look
forward to sharing more details on the new direction of Prenetics
in the near future,” concluded Mr. Yeung.
Recent Business Updates
- Continued improvement on financial
performance, achieving 30.2% increase in revenue from continuing
operations, a 55.9% reduction in adjusted EBITDA loss, and ended
the quarter with strong financial position of cash and short-term
assets position of US$86.6 million as of March 31, 2024.
- Initiate a strategic realignment
with an accelerated focus on the consumer healthcare sector,
presenting vast global opportunities, beginning with the USA.
- Insighta, the Company’s early
cancer detection venture continues to show significant progress as
initial pre-clinical data on Prostate cancer shows very promising
results.
- Insighta has received all approvals
necessary to move forward with a 1,500 person clinical trial with
patient recruitment to begin in July 2024.
______________________________
1 Represents current assets, including cash and
cash equivalents and short-term deposits totaling US$54.5 million,
financial assets at fair value through profit or loss of US$11.0
million, and trade receivables of US$4.1 million, amongst other
accounting line items under current assets.2 As of March 31, 2024,
we owned 50% shareholding in Insighta, which was accounted for
under equity-accounted investee. Equity-accounted investees,
totaling US$98.2 million as of March 31, 2024, were classified as
non-current assets on our balance sheet.
About PreneticsPrenetics
(NASDAQ:PRE), a leading genomics-driven health sciences company, is
revolutionizing prevention, early detection, and treatment. Our
prevention arm, CircleDNA, uses whole exome sequencing to offer the
world’s most comprehensive consumer DNA test. Insighta, our $200
million joint venture with renowned scientist Prof. Dennis Lo,
underscores our unwavering commitment to saving lives through
pioneering multi-cancer early detection technologies. Lastly, ACT
Genomics, our treatment unit, is the first Asia-based company to
achieve FDA clearance for comprehensive genomic profiling of solid
tumors via ACTOnco. Each of Prenetics’ units synergistically
enhances our global impact on health, truly embodying our
commitment to ‘enhancing life through science’. To learn more about
Prenetics, please visit www.prenetics.com.
Investor Relations
Contact:investors@prenetics.comPRE@mzgroup.us
Forward-Looking Statements This
press release contains forward-looking statements. These statements
are made under the “safe harbor” provisions of the U.S. Private
Securities Litigation Reform Act of 1995. Statements that are not
historical facts, including statements about the Company’s goals,
targets, projections, outlooks, beliefs, expectations, strategy,
plans, objectives of management for future operations of the
Company, and growth opportunities are forward-looking statements.
In some cases, forward-looking statements can be identified by
words or phrases such as “may,” “will,” “expect,” “anticipate,”
“target,” “aim,” “estimate,” “intend,” “plan,” “believe,”
“potential,” “continue,” “is/are likely to” or other similar
expressions. Forward-looking statements are based upon estimates
and forecasts and reflect the views, assumptions, expectations, and
opinions of the Company, which involve inherent risks and
uncertainties, therefore they should not be relied upon as being
necessarily indicative of future results. A number of factors could
cause actual results to differ materially from those contained in
any forward-looking statement, including but not limited to: the
Company’s ability to further develop and grow its business,
including new products and services; its ability to execute on its
new business strategy in genomics, precision oncology, and
specifically, early detection for cancer; the results of case
control studies and/or clinical trials; and its ability to identify
and execute on M&A opportunities, especially in precision
oncology. In addition to the foregoing factors, you should also
carefully consider the other risks and uncertainties described in
the “Risk Factors” section of the Company’s most recent
registration statement and the prospectus therein, and the other
documents filed by the Company from time to time with the U.S.
Securities and Exchange Commission. All information provided in
this press release is as of the date of this press release, and the
Company does not undertake any duty to update such information,
except as required under applicable law.
Basis of PresentationUnaudited
Non-IFRS Financial Measures has been provided in the financial
statements tables included at the end of this press release. An
explanation of these measures is also included below under the
heading “Unaudited Non-IFRS Financial Measures”.
Unaudited Non-IFRS Financial
MeasuresTo supplement Prenetics’ consolidated financial
statements prepared in accordance with International Financial
Reporting Standards (“IFRS”), the Company is providing non-IFRS
measures, adjusted EBITDA from continuing operations, adjusted
gross profit from continuing operations and adjusted loss
attributable to equity shareholders of Prenetics. These non-IFRS
financial measures are not based on any standardized methodology
prescribed by IFRS and are not necessarily comparable to
similarly-titled measures presented by other companies. Management
believes these non-IFRS financial measures are useful to investors
in evaluating the Company’s ongoing operating results and
trends.
Management is excluding from some or all of its
non-IFRS results (1) Employee equity-settled share-based payment
expenses, (2) depreciation and amortization, (3) finance income and
exchange gain or loss, net, and (4) certain items that may not be
indicative of our business, results of operations, or outlook,
including but not limited to non-cash and/ or non-recurring items.
These non-IFRS financial measures are limited in value because they
exclude certain items that may have a material impact on the
reported financial results. Management accounts for this limitation
by analyzing results on an IFRS basis as well as a non-IFRS basis
and also by providing IFRS measures in the Company’s public
disclosures.
In addition, other companies, including
companies in the same industry, may not use the same non-IFRS
measures or may calculate these metrics in a different manner than
management or may use other financial measures to evaluate their
performance, all of which could reduce the usefulness of these
non-IFRS measures as comparative measures. Because of these
limitations, the Company’s non-IFRS financial measures should not
be considered in isolation from, or as a substitute for, financial
information prepared in accordance with IFRS. Investors are
encouraged to review the non-IFRS reconciliations provided in the
tables captioned “Reconciliation of loss from operations from
continuing operations under IFRS and adjusted EBITDA from
continuing operations (Non-IFRS)”, “Reconciliation of gross profit
from continuing operations under IFRS and adjusted gross profit
from continuing operations (Non-IFRS)” and “Reconciliation of loss
attributable to equity shareholders of Prenetics under IFRS and
adjusted loss attributable to equity shareholders of Prenetics
(Non-IFRS)” set forth at the end of this document.
PRENETICS GLOBAL LIMITEDUnaudited
consolidated statements of financial position(Expressed in
United States dollars unless otherwise indicated)
|
March 31, |
|
December 31, |
|
|
2024 |
|
|
2023 |
Assets |
|
|
|
Property, plant and
equipment |
$ |
4,585,957 |
|
$ |
5,777,794 |
Intangible assets |
|
13,169,672 |
|
|
13,424,648 |
Goodwill |
|
29,170,123 |
|
|
29,170,123 |
Interests in equity-accounted
investees |
|
98,244,733 |
|
|
98,464,875 |
Financial assets at fair value
through profit or loss |
|
9,371,064 |
|
|
9,371,064 |
Deferred tax assets |
|
27,630 |
|
|
27,680 |
Deferred expenses |
|
1,483,348 |
|
|
3,530,756 |
Other non-current assets |
|
948,811 |
|
|
743,173 |
Non-current
assets |
|
157,001,338 |
|
|
160,510,113 |
Deferred expenses |
|
8,272,025 |
|
|
8,312,890 |
Inventories |
|
2,815,607 |
|
|
3,126,776 |
Trade receivables |
|
4,106,052 |
|
|
4,058,007 |
Deposits, prepayments and
other receivables |
|
5,708,610 |
|
|
5,284,848 |
Amount due from a related
company |
|
2,556 |
|
|
5,123 |
Amount due from an
equity-accounted investee |
|
126,177 |
|
|
132,114 |
Financial assets at fair value
through profit or loss |
|
11,034,200 |
|
|
11,034,200 |
Short-term deposits |
|
— |
|
|
16,000,000 |
Cash and cash equivalents |
|
54,518,588 |
|
|
45,706,448 |
Current
assets |
|
86,583,815 |
|
|
93,660,406 |
Total
assets |
$ |
243,585,153 |
|
$ |
254,170,519 |
Liabilities |
|
|
|
Deferred tax liabilities |
$ |
2,327,331 |
|
$ |
2,614,823 |
Warrant liabilities |
|
143,264 |
|
|
223,850 |
Lease liabilities |
|
669,373 |
|
|
867,215 |
Other non-current
liabilities |
|
464,215 |
|
|
823,345 |
Non-current
liabilities |
|
3,604,183 |
|
|
4,529,233 |
Trade payables |
|
1,637,568 |
|
|
1,671,019 |
Accrued expenses and other
current liabilities |
|
7,100,324 |
|
|
8,174,815 |
Contract liabilities |
|
5,542,678 |
|
|
6,111,017 |
Lease liabilities |
|
1,079,449 |
|
|
1,502,173 |
Liabilities for puttable
financial instrument3 |
|
14,472,666 |
|
|
14,622,529 |
Tax payable |
|
7,385,897 |
|
|
7,402,461 |
Current
liabilities |
|
37,218,582 |
|
|
39,484,014 |
Total
liabilities |
|
40,822,765 |
|
|
44,013,247 |
Equity |
|
|
|
Share
capital4 |
|
18,326 |
|
|
18,308 |
Reserves |
|
199,425,243 |
|
|
206,339,490 |
Total equity
attributable to equity shareholders of the Company |
|
199,443,569 |
|
|
206,357,798 |
Non-controlling interests |
|
3,318,819 |
|
|
3,799,474 |
Total equity |
|
202,762,388 |
|
|
210,157,272 |
Total equity and
liabilities |
$ |
243,585,153 |
|
$ |
254,170,519 |
|
|
|
|
|
|
PRENETICS GLOBAL LIMITEDUnaudited
consolidated statements of profit or loss and other comprehensive
income(Expressed in United States dollars unless otherwise
indicated)
|
Three Months Ended |
|
|
March 31, |
|
|
|
December 31, |
|
|
|
March 31, |
|
|
|
2024 |
|
|
|
2023 |
|
|
|
2023 |
|
|
|
|
|
|
|
(Restated) |
|
Continuing
operations |
|
|
|
|
|
Revenue |
$ |
6,413,397 |
|
|
$ |
5,428,460 |
|
|
$ |
4,924,035 |
|
Direct costs |
|
(2,630,751 |
) |
|
|
(2,758,288 |
) |
|
|
(3,467,939 |
) |
Gross profit |
|
3,782,646 |
|
|
|
2,670,172 |
|
|
|
1,456,096 |
|
Other income and other net
gain |
|
747,891 |
|
|
|
715,562 |
|
|
|
1,077,091 |
|
Selling and distribution
expenses5 |
|
(1,898,473 |
) |
|
|
(1,908,415 |
) |
|
|
(2,501,274 |
) |
Research and development
expenses5 |
|
(2,731,050 |
) |
|
|
(2,586,477 |
) |
|
|
(3,233,538 |
) |
Impairment loss of
goodwill |
|
— |
|
|
|
(3,900,268 |
) |
|
|
— |
|
Administrative and other
operating expenses5 |
|
(9,059,929 |
) |
|
|
(10,362,374 |
) |
|
|
(11,689,809 |
) |
Loss from operations |
|
(9,158,915 |
) |
|
|
(15,371,800 |
) |
|
|
(14,891,434 |
) |
Fair value loss on financial
assets at fair value through profit or loss |
|
— |
|
|
|
(3,190,379 |
) |
|
|
— |
|
Fair value gain on warrant
liabilities |
|
80,586 |
|
|
|
671,550 |
|
|
|
1,260,276 |
|
Share of loss of
equity-accounted investees |
|
(216,245 |
) |
|
|
(688,183 |
) |
|
|
(112,751 |
) |
Other finance
(costs)/income |
|
(16,339 |
) |
|
|
1,073 |
|
|
|
(43,844 |
) |
Loss before taxation |
|
(9,310,913 |
) |
|
|
(18,577,739 |
) |
|
|
(13,787,753 |
) |
Income tax
credit/(expense) |
|
285,938 |
|
|
|
(10,678 |
) |
|
|
80,655 |
|
Loss from continuing
operations |
|
(9,024,975 |
) |
|
|
(18,588,417 |
) |
|
|
(13,707,098 |
) |
Discontinued
operation |
|
|
|
|
|
(Loss)/profit from
discontinued operation, net of tax6 |
|
(26,615 |
) |
|
|
(1,026,983 |
) |
|
|
2,733,358 |
|
Loss for the
period |
|
(9,051,590 |
) |
|
|
(19,615,400 |
) |
|
|
(10,973,740 |
) |
Other comprehensive
income for the period |
|
|
|
|
|
Item that may be reclassified
subsequently to profit or loss: |
|
|
|
|
|
Exchange difference on translation of foreign operations |
|
(430,444 |
) |
|
|
1,118,149 |
|
|
|
(636,502 |
) |
Total comprehensive
income for the period |
$ |
(9,482,034 |
) |
|
$ |
(18,497,251 |
) |
|
$ |
(11,610,242 |
) |
Loss attributable
to: |
|
|
|
|
|
Equity shareholders of
Prenetics |
$ |
(8,568,095 |
) |
|
$ |
(19,047,124 |
) |
|
$ |
(10,398,430 |
) |
Non-controlling interests |
|
(483,495 |
) |
|
|
(568,276 |
) |
|
|
(575,310 |
) |
|
$ |
(9,051,590 |
) |
|
$ |
(19,615,400 |
) |
|
$ |
(10,973,740 |
) |
Total comprehensive
income attributable to: |
|
|
|
|
|
Equity shareholders of
Prenetics |
$ |
(9,001,379 |
) |
|
$ |
(18,677,610 |
) |
|
$ |
(10,495,918 |
) |
Non-controlling interests |
|
(480,655 |
) |
|
|
180,359 |
|
|
|
(1,114,324 |
) |
|
$ |
(9,482,034 |
) |
|
$ |
(18,497,251 |
) |
|
$ |
(11,610,242 |
) |
Loss per
share: |
|
|
|
|
|
Basic |
$ |
(0.70 |
) |
|
$ |
(1.57 |
) |
|
|
(0.99 |
) |
Diluted |
|
(0.70 |
) |
|
|
(1.57 |
) |
|
|
(0.99 |
) |
Loss per share -
Continuing operations: |
|
|
|
|
|
Basic |
|
(0.70 |
) |
|
|
(1.49 |
) |
|
|
(1.25 |
) |
Diluted |
|
(0.70 |
) |
|
|
(1.49 |
) |
|
|
(1.25 |
) |
Weighted average
number of common shares: |
|
|
|
|
|
Basic |
|
12,215,904 |
|
|
|
12,114,922 |
|
|
|
10,522,621 |
|
Diluted |
|
12,215,904 |
|
|
|
12,114,922 |
|
|
|
10,522,621 |
|
|
|
|
|
|
|
|
|
|
|
|
|
PRENETICS GLOBAL LIMITEDUnaudited
Non-IFRS Financial Measures(Expressed in United States
dollars unless otherwise indicated)
Reconciliation of loss from operations
from continuing operations under IFRS and adjusted EBITDA
from continuing operations (Non-IFRS)
|
Three Months Ended |
|
|
March 31, |
|
|
|
December 31, |
|
|
|
March 31, |
|
|
|
2024 |
|
|
|
2023 |
|
|
|
2023 |
|
|
|
|
|
|
|
(Restated) |
|
Loss from operations
from continuing operations under IFRS |
$ |
(9,158,915 |
) |
|
$ |
(15,371,800 |
) |
|
$ |
(14,891,434 |
) |
Employee equity-settled
share-based payment expenses |
|
1,937,268 |
|
|
|
2,055,858 |
|
|
|
2,940,984 |
|
Depreciation and
amortization |
|
1,719,555 |
|
|
|
1,564,816 |
|
|
|
1,796,990 |
|
Other strategic financing,
transactional expense and non-recurring expenses |
|
2,096,563 |
|
|
|
6,263,188 |
|
|
|
1,847,131 |
|
Finance income, exchange gain
or loss, net |
|
(700,589 |
) |
|
|
(673,740 |
) |
|
|
(1,000,131 |
) |
Adjusted EBITDA from
continuing operations (Non-IFRS) |
$ |
(4,106,118 |
) |
|
$ |
(6,161,678 |
) |
|
$ |
(9,306,460 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
Reconciliation of gross profit from continuing
operations under IFRS and adjusted gross profit from continuing
operations (Non-IFRS)
|
Three Months Ended |
|
March 31, |
|
December 31, |
|
March 31, |
|
|
2024 |
|
|
2023 |
|
|
2023 |
|
|
|
|
|
(Restated) |
Gross profit from
continuing operations under IFRS |
$ |
3,782,646 |
|
$ |
2,670,172 |
|
$ |
1,456,096 |
Employee equity-settled
share-based payment expenses |
|
581 |
|
|
11,522 |
|
|
— |
Depreciation and
amortization |
|
279,561 |
|
|
309,812 |
|
|
384,326 |
Adjusted gross profit
from continuing operations (Non-IFRS) |
$ |
4,062,788 |
|
$ |
2,991,506 |
|
$ |
1,840,422 |
|
|
|
|
|
|
|
|
|
Reconciliation of loss attributable to equity
shareholders of Prenetics under IFRS and adjusted loss attributable
to equity shareholders of Prenetics (Non-IFRS)
|
Three Months Ended |
|
|
March 31, |
|
|
|
December 31, |
|
|
|
March 31, |
|
|
|
2024 |
|
|
|
2023 |
|
|
|
2023 |
|
|
|
|
|
|
|
(Restated) |
|
Loss attributable to
equity shareholders of Prenetics under IFRS |
$ |
(8,568,095 |
) |
|
$ |
(19,047,124 |
) |
|
$ |
(10,398,430 |
) |
Employee equity-settled
share-based payment expenses |
|
1,937,268 |
|
|
|
2,055,858 |
|
|
|
3,124,189 |
|
Other strategic financing,
transactional expense and non-recurring expenses |
|
2,096,563 |
|
|
|
8,248,151 |
|
|
|
3,161,638 |
|
Fair value gain on warrant
liabilities |
|
(80,586 |
) |
|
|
(671,550 |
) |
|
|
(1,260,276 |
) |
Fair value loss on financial
assets at fair value through profit or loss |
|
— |
|
|
|
3,190,379 |
|
|
|
— |
|
Adjusted loss
attributable to equity shareholders of Prenetics
(Non-IFRS) |
$ |
(4,614,850 |
) |
|
$ |
(6,224,286 |
) |
|
$ |
(5,372,879 |
) |
______________________________
3 In connection with the
acquisition of ACT Genomics, the remaining shareholders of ACT
Genomics - representing 25.61% of the fully diluted shareholding of
ACT Genomics that Prenetics does not own - were granted put options
which allow these remaining shareholders to put their remaining
shares to Prenetics under certain conditions. The liabilities
arising from such put option are recorded as liabilities for
puttable financial instrument, and are valued at the present value
of the exercise price of the put option.
4 Represents number of authorized and issued
shares as follows:
|
March 31, |
|
December 31, |
|
2024 |
|
2023 |
Number of authorized shares of
$0.0015 each |
33,333,333 |
|
33,333,333 |
Number of issued shares |
12,217,226 |
|
12,205,200 |
5 Includes equity-settled share-based payment
expenses from continuing operations as follows:
|
Three Months Ended |
|
March 31, |
|
|
December 31, |
|
|
March 31, |
|
|
2024 |
|
|
2023 |
|
|
|
2023 |
|
|
|
|
|
(Restated) |
Direct costs |
$ |
581 |
|
$ |
11,522 |
|
|
$ |
— |
Selling and distribution
expenses |
|
1,053 |
|
|
(632 |
) |
|
|
45,255 |
Research and development
expenses |
|
758,394 |
|
|
675,928 |
|
|
|
486,507 |
Administrative and other
operating expenses |
|
1,155,752 |
|
|
1,339,419 |
|
|
|
2,391,044 |
Total equity-settled
share-based payment expenses |
$ |
1,915,780 |
|
$ |
2,026,237 |
|
|
$ |
2,922,806 |
6 We ceased our COVID-19
testing business entirely in 2023 Q2, and other DNA testing
operations in the EMEA regions in 2023 Q4. As a result, COVID-19
testing business and the operations in the EMEA regions are
reported as a discontinued operation under IFRS 5 Non-current
Assets Held for Sale and Discontinued Operations. In accordance
with IFRS 5, the results of the discontinued operation have been
presented separately from the continuing operations in the
consolidated statements of profit or loss and other comprehensive
income. The comparative information in the consolidated statements
of profit or loss and other comprehensive income has also been
re-presented to show the results of discontinued operation
separately.
Prenetics Global (NASDAQ:PRE)
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Prenetics Global (NASDAQ:PRE)
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