FY20 unsuprising; waiting for more

  • Crossject released an expected set of FY20 results
  • The industrialisation process of Zeneo is on track
  • The group’s financing for FY21 is secured
  • We will fine-tune our model to account for the latest developments

Crossject released FY20 results. Revenues reached €5,994k vs €5.73m, operating result €-10,672k vs €-8,643k, and the net result €-9,844k vs €-7,174k. Cash at the end of FY20 amounted to €8.2m vs €7.9m a year before.

As usual, we remind that numbers are of little relevance since the story of Crossject is based on the future launch of Zeneo combined with the NTEs the group is targeting. In particular, the group’s top line has so far little meaning, as well as the losses posted by the company.

However, we note that the group’s expenses remain under control taking into account that Crossject is still in the development phase, and this is despite the investment (in human resources in particular, with the workforce having increased by 20% in FY20 to 94 employees for an extra charge of c. €1m). On the commercial front, the company should launch the bioequivalence study for Zeneo Midazolam in the current year (with a potential result by year-end), a prerequisite to ask for a marketing authorisation in both Europe and the US.

In terms of industrialisation of the company, management claims it is now able to produce as many as 500,000 units a year, with a target to reach 6m over the next two years for a total capex of €7.5m.

In FY21, the group intends to produce the quantities of Zeneo necessary to file for marketing authorisations on both sides of the Atlantic, be in a position to answer Barda’s tender offer (with a potential first market launch in H2 22), carry on the bioequivalence study for Zeneo Midazolam and sign new marketing agreements, particularly in the US. In terms of calendar, the group is mainly expecting new commercial agreements and the call for tender from Barda while it remains rather unclear on potential market authorisations, partly disturbed by the pandemic this year, and which will not appear before next year at best.

The gross cash position has remained almost stable (+€0.3m), while management indicates cash needs for the current year to be slightly above last year’s (€14-15m). This should be financed by the bond issued in December (€5.2m see our Latest dated 15 December 2020, paid in April), €3m of public financing part of the €1.5m subsidy granted in February 2021, which could be completed by commercial agreements and/or further public financing. In other words, the gross cash situation enables the group to face its needs for the current year, which is good news.

We will revise our forecasts in the light of these FY20 results. The main change will be that the Zeneo will reach the market at the end of FY22 at the earliest in our new forecasts (vs H2 21 previously), which should moderately reduce our target price, all other things being equal.

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