Artgen Biotech (ex Human Stem Cell Institute, MOEX: ABIO) published its consolidated performance statement for 6 months of 2023 according to international financial reporting standards (IFRS).
Key events affecting the valuation of Artgen Biotech:
1. Consolidated revenue for 6 months increased by 19.47% compared to 2022, amounting to RUB 621,115 thousand.
2. As of the end of 2022, the company paid dividends in the amount of RUB 1 per ordinary share. The company’s new dividend policy was approved. It is planned to allocate 40% to 60% of the net profits to pay dividends.
3. On July 18, 2023, the Human Stem Cell Institute (HSCI) changed its name to Artgen Biotech due to rebranding aimed at making the company’s activities, strategy, and values clearer to the public and a wider range of investors. A new website has been launched: artgen.ru. The Moscow Exchange changed the company’s ticker to ABIO.
4. The Moscow Exchange listed Artgen Biotech’s shares under the “second level” section of the securities listing.
5. Genetico (MOEX: GECO) held an IPO on the Moscow Exchange and raised RUB 178.8 million. The order book was oversubscribed by 2.5 times.
6. Vaccine-developing biotech company RBT (BioTechnology Developments) raised RUB 155 million during its private offering on the Rounds investment platform.
7. The Analytical Credit Rating Agency (ACRA) confirmed the credit rating of Artgen Biotech at the BB+ level on the Russian national rating scale with a stable outlook.
8. Trading in deliverable futures and cash-settled incentive options on ordinary shares of Artgen Biotech has begun on the Moscow Exchange.
9. The Moscow Exchange included Artgen Biotech shares in two indices at the same time: the broad market share index and the consumer sector index.
Review of Artgen Biotech’s consolidated performance for 6 months of 2023 according to IFRS
In 6 months of 2023, Artgen Biotech Group (hereinafter also referred to as the “Group”) demonstrated the following consolidated performance:
|
In thousands of RUB |
6 months 2023 |
6 months 2022 |
% change |
|
Revenue |
621 115 |
519 888 |
19% |
|
Operating expenses, incl. |
-516 334 |
-456 351 |
13% |
|
Depreciation of fixed assets, intangible assets, and right-of-use assets |
-44 123 |
-34 474 |
28% |
|
Operating profit |
104 781 |
63 537 |
65% |
|
Operating margin, % |
16,87% |
12,22% |
|
|
EBITDA1 |
127 465 |
93 402 |
36% |
|
EBITDA margin |
20,52% |
17,97% |
|
|
Net profit |
36 068 |
29 925 |
21% |
|
Net margin, % |
5,81% |
5,76% |
|
|
EBITDA R&D2 |
133 289 |
99 087 |
35% |
|
EBITDA R&D margin, % |
21,46% |
19,06% |
|
1 EBITDA, earnings before interest, taxes, depreciation, and amortization, excluding interest received. This indicator reflects the cash flow from the Company’s operating activities which remains at the disposal of creditors, investors, and founders.
2 EBITDA R&D, earnings before interest, taxes, depreciation, and amortization, excluding interest received and research expenses. This indicator reflects the cash flow from the Company’s operating activities which remains at the disposal of creditors, investors, and founders, before investing in scientific research.
Consolidated revenue and income of the main Artgen Biotech Group companies
The Group’s consolidated revenue for 6 months of 2023 amounted to RUB 621,115 thousand, which is 19.47% more than in 2022.
|
|
For 6 months that ended on June 30, 2023 |
For 6 months that ended on June 30, 2022 |
% change |
|
Genetic research |
154 555 |
139 870 |
10,5% |
|
Gemabank biomaterial storage services |
140 900 |
126 529 |
11,4% |
|
Covid-19 testing services and assays |
886 |
21 907 |
-96,0% |
|
Neovasculgen |
202 837 |
110 115 |
84,2% |
|
Reproductive materials bank services |
90 765 |
84 288 |
7,7% |
|
SPRS therapy services |
27 580 |
26 925 |
2,4% |
|
Other revenue |
3 592 |
10 254 |
-65,0% |
|
|
|
|
|
|
Total |
621 115 |
519 888 |
19,47% |
Operating expenses, operating profit/(loss), EBITDA, EBITDAR&D
Consolidated operating expenses in the first 6 months of 2023 increased by 13.1% compared to the previous period, meaning that the growth rate is less than that of the revenue, resulting in an increase in operating profits.
The Group’s operating profits amounted to RUB 104,781 thousand, the operating margin amounted to 16.87%.
EBITDA increased by 36% to RUB 127,465 thousand compared to the same period of 2022.
EBITDA R&D shown in the 2022 annual statement which, in our opinion, gives a more objective understanding of the Group’s operating profitability and margins, increased to RUB 133,289 thousand by the end of the first 6 months of 2023, which is 35% higher than in the same period of 2022. This indicator excludes research and development expenses (RUB 5,824 thousand), which, although reflected in the Profit and Loss Statement according to the accounting rules, actually represent investments in the development and creation of new drugs and medical devices.
Other profits and losses, profit/(loss) before tax
In 2023, the Company’s Other Losses amounted to RUB 61,344 thousand (resulting from participation in associated companies, net interest, net other non-operating expenses, and net negative exchange differences), which 79.8% more than in the same period of 2022.
Profit/(loss) during the reporting period (net profit/(loss))
The Company’s consolidated net profit amounted to RUB 36,068 thousand (+21%).
Consolidation
Consolidated financial statements for 6 months of 2023 include the results of PJSC Artgen Biotech and its subsidiaries: International Medical Center for Biomaterials PJSC,GENETICO JSC, Reprolab LLC, Nextgen JSC, HSCI Pharma LLC, Vitacel LLC, Skincel LLC, LKT LLC (acquired by HSCI Ventures on January 20, 2023), Angiogenesis LLC (acquired by HSCI Ventures LLC on June 1, 23), HSCI Ventures LLC , Betuvax LLC, Histograft LLC, as well as associated companies: Biotechnology Developments JSC, Genotarget LLC, HSCI Consulting LLC, Genes & Cells LLC (Artgen Biotech PJSC ceased its membership on April 21, 2023), and INMT JSC.
ATTACHMENTS:
1. Consolidated profit/loss and other comprehensive income statement for 6 months of 2023 and 2022 (RUB thous., aggregate, with a breakdown).
2. Consolidated financial position statement as of June 30, 2023 and June 30, 2022, RUB thous.
For the IFRS consolidated financial statements of Artgen Biotech PJSC and its subsidiaries, see the Company’s corporate website under the “Investors” section (Financial Statements/IFRS Reports): https://artgen.ru/investors/raskrytie-informaczii/msfo/