EX-99.1 2 d606011dex991.htm EX-99.1 EX-99.1


Unaudited Condensed Consolidated Interim Statements of Profit or Loss

and Other Comprehensive Income / (Loss) for the Three and Six Months Ended June 30

 

            Three Months Ended June 30    

Six Months Ended June 30

 
     Notes      2018     2017     2018     2017  
            (EUR’000)     (EUR’000)  

Revenue

     4        18       444       46       816  

Research and development costs

        (40,235     (21,880     (70,775     (42,488

General and administrative expenses

        (5,226     (3,231     (9,888     (6,556
     

 

 

   

 

 

   

 

 

   

 

 

 

Operating profit / (loss)

        (45,443     (24,667     (80,617     (48,228

Finance income

        22,573       158       16,270       288  

Finance expenses

        (6     (6,234     (11     (7,956
     

 

 

   

 

 

   

 

 

   

 

 

 

Profit / (loss) before tax

        (22,876     (30,743     (64,358     (55,896

Tax on profit / (loss) for the period

        99       37       206       51  
     

 

 

   

 

 

   

 

 

   

 

 

 

Net profit / (loss) for the period

        (22,777     (30,706     (64,152     (55,845
     

 

 

   

 

 

   

 

 

   

 

 

 

Other comprehensive income / (loss)

           

Items that may be reclassified subsequently to profit or loss:

           

Exchange differences on translating foreign operations

        2       42       (7     46  
     

 

 

   

 

 

   

 

 

   

 

 

 

Other comprehensive income / (loss) for the period, net of tax

        2       42       (7     46  
     

 

 

   

 

 

   

 

 

   

 

 

 

Total comprehensive income / (loss) for the period, net of tax

        (22,775     (30,664     (64,159     (55,799

Profit / (loss) for the period attributable to owners of the Company

        (22,777     (30,706     (64,152     (55,845

Total comprehensive income / (loss) for the period attributable to owners of the Company

        (22,775     (30,664     (64,159     (55,799
     

 

 

   

 

 

   

 

 

   

 

 

 
            EUR     EUR     EUR     EUR  

Basic earnings / (loss) per share

        (0.55     (0.94     (1.60     (1.72

Diluted earnings / (loss) per share

        (0.55     (0.94     (1.60     (1.72

Number of shares used for calculation (basic)

        41,650,907       32,502,555       40,182,701       32,465,935  

Number of shares used for calculation (diluted) (1)

        41,650,907       32,502,555       40,182,701       32,465,935  
     

 

 

   

 

 

   

 

 

   

 

 

 

 

(1)

A total of 4,479,691 warrants outstanding as of June 30, 2018 can potentially dilute earnings per share in the future, but have not been included in the calculation of diluted earnings per share because they are antidilutive for the periods presented. Similarly, a total of 3,689,506 warrants outstanding as of June 30, 2017 are also considered antidilutive for the periods presented and have not been included in the calculation.

 

F-2


Unaudited Condensed Consolidated Interim Statements of Financial Position

 

     Notes      June 30, 2018      December 31, 2017  
            (EUR’000)  

Assets

     

Non-current assets

        

Intangible assets

        3,495        3,495  

Property, plant and equipment

        2,597        2,557  

Deposits

        1,115        293  
     

 

 

    

 

 

 
        7,207        6,345  

Current assets

        

Trade receivables

        17        188  

Other receivables

        1,826        1,410  

Prepayments

        5,934        6,907  

Income taxes receivable

        1,279        778  

Cash and cash equivalents

        352,601        195,351  
     

 

 

    

 

 

 
        361,657        204,634  
     

 

 

    

 

 

 

Total assets

        368,864        210,979  
     

 

 

    

 

 

 

Equity and liabilities

        

Equity

        

Share capital

     7        5,619        4,967  

Distributable equity

        326,606        182,244  
     

 

 

    

 

 

 

Total equity

        332,225        187,211  
     

 

 

    

 

 

 

Current liabilities

        

Trade payables and other payables

        36,614        23,768  

Income taxes payable

        25        —    
     

 

 

    

 

 

 
        36,639        23,768  
     

 

 

    

 

 

 

Total liabilities

        36,639        23,768  
     

 

 

    

 

 

 

Total equity and liabilities

        368,864        210,979  
     

 

 

    

 

 

 

 

F-3


Unaudited Condensed Consolidated Interim Statements of Changes in Equity

 

            Distributable Equity        
     Share
Capital
     Share
Premium
    Foreign
Currency
Translation
Reserve
    Share-based
Payment
Reserve
     Accumulated
Deficit
    Total  
     (EUR’000)  

Equity at December 31, 2017

     4,967        422,675       (14     22,793        (263,210     187,211  

Loss for the period

     —          —         —         —          (64,152     (64,152

Other comprehensive income / (loss), net of tax

     —          —         (7     —          —         (7
  

 

 

    

 

 

   

 

 

   

 

 

    

 

 

   

 

 

 

Total comprehensive income / (loss)

     —          —         (7     —          (64,152     (64,159
  

 

 

    

 

 

   

 

 

   

 

 

    

 

 

   

 

 

 

Share-based payment (Note 6)

     —          —         —         8,901        —         8,901  

Capital increase

     652        212,738       —         —          —         213,390  

Cost of capital increase

     —          (13,118     —         —          —         (13,118
  

 

 

    

 

 

   

 

 

   

 

 

    

 

 

   

 

 

 

Equity at June 30, 2018

     5,619        622,295       (21     31,694        (327,362     332,225  
  

 

 

    

 

 

   

 

 

   

 

 

    

 

 

   

 

 

 

 

            Distributable Equity        
     Share
Capital
     Share
Premium
     Foreign
Currency
Translation
Reserve
    Share-based
Payment
Reserve
     Accumulated
Deficit
    Total  
     (EUR’000)  

Equity at December 31, 2016

     4,354        298,567        (79     13,084        (139,313     176,613  

Loss for the period

     —             —         —          (55,845     (55,845

Other comprehensive income / (loss), net of tax

     —             46       —          —         46  
  

 

 

    

 

 

    

 

 

   

 

 

    

 

 

   

 

 

 

Total comprehensive income / (loss)

     —             46       —          (55,845     (55,799

Share-based payment (Note 6)

     —             —         5,010        —         5,010  

Capital increase

     11        633        —         —          —         644  
  

 

 

    

 

 

    

 

 

   

 

 

    

 

 

   

 

 

 

Equity at June 30, 2017

     4,365        299,200        (33     18,094        (195,158     126,468  
  

 

 

    

 

 

    

 

 

   

 

 

    

 

 

   

 

 

 

 

F-4


Unaudited Condensed Consolidated Interim Cash Flow Statements for the

Six Months Ended June 30

 

     Notes      2018     2017  
            (EUR’000)  

Operating activities

       

Net profit / (loss) for the period

        (64,152     (55,845

Reversal of finance income

        (16,270     (288

Reversal of finance expenses

        11       7,956  

Reversal of tax charge

        (206     (51

Adjustments for:

       

Share-based payment

        8,901       5,010  

Depreciation and amortization

        397       349  

Changes in working capital:

       

Deposits

        (822     (11

Trade receivables

        171       (163

Other receivables

        (416     (549

Prepayments

        973       (4,116

Trade payables and other payables

        12,839       2,504  
     

 

 

   

 

 

 

Cash flows generated from / (used in) operations

        (58,574     (45,204

Finance income received

        2,004       288  

Finance expenses paid

        (11     (55

Income taxes received / (paid)

        (270     (196
     

 

 

   

 

 

 

Cash flows from / (used in) operating activities

        (56,851     (45,167
     

 

 

   

 

 

 

Investing activities

       

Acquisition of property, plant and equipment

        (437     (585
     

 

 

   

 

 

 

Cash flows from / (used in) investing activities

        (437     (585
     

 

 

   

 

 

 

Financing activities

       

Capital increase

        213,390       644  

Cost of capital increase

        (13,118     —    
     

 

 

   

 

 

 

Cash flows from / (used in) financing activities

        200,272       644  
     

 

 

   

 

 

 

Increase / (decrease) in cash and cash equivalents

        142,984       (45,108
     

 

 

   

 

 

 

Cash and cash equivalents at January 1

        195,351       180,329  

Effect of exchange rate changes on balances held in foreign currencies

        14,266       (7,901
     

 

 

   

 

 

 

Cash and cash equivalents at June 30

        352,601       127,320  
     

 

 

   

 

 

 

Restricted cash included in cash and cash equivalents

        5,468       —    

 

F-5


Notes to the Unaudited Condensed Consolidated Interim Financial Statements

Note 1—General Information

Ascendis Pharma A/S, together with its subsidiaries, is a biopharmaceutical company applying its innovative TransCon technology to build a leading, fully integrated biopharma company. Ascendis Pharma A/S was incorporated in 2006 and is headquartered in Hellerup, Denmark. Unless the context otherwise requires, references to the “Company,” “we,” “us” and “our” refer to Ascendis Pharma A/S and its subsidiaries.

The address of the Company’s registered office is Tuborg Boulevard 12, DK-2900, Hellerup, Denmark.

On February 2, 2015, the Company completed an initial public offering, or IPO, which resulted in the listing of American Depositary Shares, or ADSs, representing the Company’s ordinary shares, under the symbol “ASND” in the United States on The Nasdaq Global Select Market.

The Company’s Board of Directors approved these unaudited condensed consolidated interim financial statements on August 29, 2018.

Note 2—Summary of Significant Accounting Policies

Basis of Preparation

The unaudited condensed consolidated interim financial statements of the Company are prepared in accordance with International Accounting Standard 34, “Interim Financial Reporting”. Certain information and disclosures normally included in the consolidated financial statements prepared in accordance with International Financial Reporting Standards (“IFRS”) have been condensed or omitted. Accordingly, these condensed consolidated interim financial statements should be read in conjunction with the Company’s annual consolidated financial statements for the year ended December 31, 2017 and accompanying notes, which have been prepared in accordance with IFRS as issued by the International Accounting Standards Board, and as adopted by the European Union.

The preparation of financial statements in conformity with IFRS requires the use of certain critical accounting estimates and requires management to exercise its judgment in the process of applying the Company’s accounting policies. The areas involving a higher degree of judgment or complexity, or areas where assumptions and estimates are significant to the condensed consolidated interim financial statements are disclosed in Note 3.

Changes in Accounting Policies

As of January 1, 2018, the Company has adopted IFRS 9, “Financial Instruments”, which introduces a new impairment model for financial assets measured at amortized cost based on an expected credit loss model, which currently applies to the Company’s bank deposits and trade receivables. The adoption of IFRS 9 had no material impact on the Company’s financial reporting. Further, the Company has adopted IFRS 15, “Revenue from Contracts with Customers”, which establishes a single, comprehensive framework for revenue recognition, based on a five-step model, which applies to the Company’s licensing agreements with multiple activities. IFRS 15 was adopted using the ‘retrospective method with the cumulative effect of initially applying this standard recognized at the date of the initial application’. The adoption of IFRS 15 had no impact on the Company’s financial reporting.

Except for the adoption of these two new standards, the accounting policies applied when preparing these condensed consolidated interim financial statements have been applied consistently to all the periods presented, unless otherwise stated and are consistent with those of the Company’s most recent annual consolidated financial statements. A description of our accounting policies is provided in the Accounting Policies section of the audited consolidated financial statements as of and for the year ended December 31, 2017.

Changes in Presentation

The Company has changed its accounting policy for the presentation of exchange rate gains and losses in the Unaudited Condensed Consolidated Interim Statements of Profit or Loss and Other Comprehensive Income / (Loss). On the basis that the foreign exchange rate movements primarily impact the Company’s balance of cash and cash equivalents, exchange rate gains and losses are now reported net for the accumulated period and not as an aggregation of the quarterly reported exchange rate gains and losses. The Company believes that the revised presentation more appropriately presents the overall impact of changes in foreign exchange rates. The change has had no effect on the reported comparative figures for profit or loss, assets, liabilities, cash flows or earnings per share.

Note 3—Critical Accounting Judgments and Key Sources of Estimation Uncertainty

In the application of our accounting policies, we are required to make judgments, estimates and assumptions about the carrying amounts of assets and liabilities that are not readily apparent from other sources. The estimates and associated assumptions are based on historical experience and other factors that are considered to be relevant. Actual results may differ from these estimates.

The estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognized in the period in which the estimate is revised if the revision affects only that period, or in the period of the revision and future periods if the revision affects both current and future periods.

Critical judgments made in the process of applying our accounting policies and that have the most significant effect on the amounts recognized in our unaudited condensed consolidated financial statements relate to revenue recognition, share-based payment, internally generated intangible assets, and joint arrangements / collaboration agreements.

The key sources of estimation uncertainty that have a significant risk of causing a material adjustment to the carrying amount of assets and liabilities within the next financial year relate to impairment of goodwill and to recognition of accruals for manufacturing and clinical trial activities. There have been no changes to the application of significant accounting estimates, and no impairment losses have been recognized during the first six months of 2018 or 2017.

The unaudited condensed consolidated interim financial statements do not include all disclosures for critical accounting estimates and judgments that are required in the annual consolidated financial statements, and should be read in conjunction with the Company’s annual consolidated financial statements for the year ended December 31, 2017.

Note 4—Revenue

 

     Three Months Ended
June 30,
     Six Months Ended
June 30,
 
     2018      2017      2018      2017  
     (EUR’000)      (EUR’000)  

Revenue from the rendering of services

     18        444        46        816  
  

 

 

    

 

 

    

 

 

    

 

 

 

Total revenue

     18        444        46        816  
  

 

 

    

 

 

    

 

 

    

 

 

 

Revenue from external customers (geographical)

           

USA

     18        444        46        816  
  

 

 

    

 

 

    

 

 

    

 

 

 

Total revenue

     18        444        46        816  
  

 

 

    

 

 

    

 

 

    

 

 

 

Note 5—Segment Information

We are managed and operated as one business unit. No separate business areas or separate business units have been identified in relation to product candidates or geographical markets. Accordingly, we do not disclose information on business segments or geographical markets, except for the geographical information on revenue included in Note 4.

 

F-6


Notes to the Unaudited Condensed Consolidated Interim Financial Statements

Note 6—Warrants and Share-based Payment

Share-based payment

Ascendis Pharma A/S has established warrant programs, equity-settled share-based payment transactions, as an incentive for all of our employees, members of our Board of Directors and select external consultants.

Warrants are granted by the Board of Directors in accordance with authorizations given to it by the shareholders of Ascendis Pharma A/S. As of June 30, 2018, 6,630,437 warrants had been granted, of which 19,580 warrants have been cancelled, 1,918,670 warrants have been exercised, 2,168 warrants have expired without being exercised, and 210,328 warrants have been forfeited. As of June 30, 2018, our Board of Directors was authorized to grant up to 3,985,875 additional warrants to our employees, board members and select consultants without pre-emptive subscription rights for the shareholders of Ascendis Pharma A/S. Each warrant carries the right to subscribe for one ordinary share of a nominal value of DKK 1. The exercise price is fixed at the fair market value of our ordinary shares at the time of grant as determined by our Board of Directors. The exercise prices of outstanding warrants under our warrant programs range from €6.48 to €60.23 depending on the grant dates. Vested warrants may be exercised in two or four annual exercise periods. Apart from exercise prices and exercise periods, the programs are similar.

Warrant Activity

The following table specifies the warrant activity during the six months ended June 30, 2018:

 

     Total
Warrants
     Weighted
Average
Exercise
Price
EUR
 

Outstanding at December 31, 2017

     4,621,154        17.62  
  

 

 

    

 

 

 

Granted during the period

     189,625        49.34  

Exercised during the period

     (317,825      11.16  

Forfeited during the period

     (13,263      24.24  

Expired during the period

     —          —    
  

 

 

    

 

 

 

Outstanding at June 30, 2018

     4,479,691        19.40  
  

 

 

    

 

 

 

Vested at the balance sheet date

     2,248,000        13.48  
  

 

 

    

 

 

 

Warrant Compensation Costs

Warrant compensation costs are determined with basis in the grant date fair value of the warrants granted and recognized over the vesting period.

 

     Three Months Ended
June 30,
     Six Months Ended
June 30,
 
     2018      2017      2018      2017  
     (EUR’000)      (EUR’000)  

Research and development costs

     1,964        1,122        4,349        2,411  

General and administrative expenses

     2,258        1,183        4,552        2,599  
  

 

 

    

 

 

    

 

 

    

 

 

 

Total warrant compensation costs

     4,222        2,305        8,901        5,010  
  

 

 

    

 

 

    

 

 

    

 

 

 

Note 7—Share Capital

The share capital of Ascendis Pharma A/S consists of 41,841,590 shares at a nominal value of DKK 1, all in the same share class.

On February 26, 2018, the Company completed the sale and issuance of 4,539,473 ADSs in a public offering, increasing the Company’s share capital from 36,984,292 shares to 41,523,765 shares.

In April and June 2018, an aggregate of 317,825 warrants were exercised, increasing the Company’s share capital from 41,523,765 shares to 41,841,590 shares.

Note 8—Subsequent Events

No events have occurred after the balance sheet date that would have a significant impact on the results or financial position of the Company.

 

F-7