Alzecure Q1 2024: Strengthening the cash position
Research Update
2024-04-26
11:40
Analyst Q&A
Closed
Fredrik Thor answered 2 questions.
Redeye returns with a research update on Alzecure following its Q1 report and recent events in the company. We further discuss the company's ongoing rights issue and the strategy ahead.
Fredrik Thor
About a month ago, Alzecure announced a rights issue of up to SEK53m, plus an over-allotment option of an additional SEK15m, thus with the potential to raise SEK68m in total. The subscription price is SEK1.7 per share, and the issue is covered by subscription commitments (SEK18.8m) and guarantees (SEK14.7m) of 63%.
Alzecure’s Q1 report aligned well with expectations, with operating expenses amounting to SEK-10m and a cash position at SEK19m. We had already assumed a rights issue of SEK60m at SEK1.65 per share, which is close to what we assume is the net proceeds of the full rights issue and overallotment option. The company further participated in the AD/PD conference and moved forward with its TrkA-NAM platform.
Following the announcement of the rights issue, we have tweaked our dilution assumptions and adjusted our FX assumption and deal estimates related to ACD440. This leads to a new base case of SEK13 (13.5) per share.
| SEKm | 2022 | 2023 | 2024e | 2025e |
| Revenues | 0.0 | 0.0 | 0.0 | 58.3 |
| Revenue Growth | nm. | nm. | nm. | nm. |
| EBITDA | -56.4 | -44.3 | -46.5 | -7.0 |
| EBIT | -56.4 | -44.3 | -46.5 | -7.0 |
| EBIT Margin | nm. | nm. | nm. | nm. |
| Net Income | -56.2 | -43.2 | -46.5 | -7.0 |
| EV/Sales | nm. | nm. | nm. | nm. |
| EV/EBIT | -4.5 | -5.8 | -5.5 | -36.5 |
Announced a rights issue
About a month ago, Alzecure announced a rights issue of up to SEK53m, plus an over-allotment option of an additional SEK15m, thus with the potential to raise SEK68m in total. The subscription price is SEK1.7 per share, and the issue is covered by subscription commitments (SEK18.8m) and guarantees (SEK14.7m) of 63%. In relation to the rights issue, Alzecure has secured a guarantee without a fee from Jan Lundberg of SEK1m, and he will, in return, be prioritized if the over-allotment option is exercised. Mr. Lundberg has a notable background in major pharmaceutical companies like AstraZeneca and Eli Lilly, where he served as the global head of R&D and was recently proposed as a new board member in Alzecure, which we argue is a solid addition to the board. Yesterday, the rights issue was also approved by an extraordinary board meeting.
Disclosures and disclaimers