Creo Medical Group plc (AIM: CREO), a medical device company focused on the emerging field of surgical endoscopy, announces its audited results for the 12 months ended 31 December 2019.
The 12 months to the end of December 2019 was a period of considerable progress in the development and path to commercial launch for the Company’s suite of devices to complement the Company’s CROMA Advanced Energy Platform (“CROMA”) and Speedboat device for use in Gastrointestinal (“GI”) therapeutic endoscopy.
Operational Highlights, including post period end:
· Post period end 510(k) clearance from the US Food and Drug Administration (‘FDA’) for Creo’s HS1 Haemostasis device (‘HS1’) and on track to gain clearance with additional devices from the suite of products in the USA
· Increased commercial momentum with Creo’s first products, Speedboat and the CROMA Advanced Energy
Platform:
– Successful roll out of Creo’s Clinical Education Programme (“CEP”) in the United States (“US”) and completion of the first Speedboat training course delivered by a US clinician trained as part of Creo’s CEP
– Procedures successfully carried out on patients by a number of US clinicians using Speedboat
– First commercial orders for Speedboat and first revenue from US hospitals
– Additional European Framework Distribution secured across France, Germany and Italy with first physicians trained and delivering procedures
– Additional Asian Framework Distribution Agreement secured covering India with first physicians trained and publication of cases
– Suite of devices launched at the United European Gastroenterology Week Congress in October 2019
· Advanced progress made in gaining regulatory approvals in the EU for a further four devices optimised for the core tissue effects of dissection, resection, haemostasis and ablation all four products will be CE marked in Europe simultaneously on receipt of Creo’s new EC certificate, which is expected in the near term
· Strengthened IP portfolio, with 188 granted patents and 599 pending applications (as at 31 December 2019)
· Post period end, key appointments made with the addition of Ivonne Cantu as an independent non-executive director
· Cogent plan to manage the business despite the global impact that COVID-19 and ensure the readiness of an expanded range of game-changing products for launch into key markets in due course.
Financial Highlights (for 12 months ended 31 December 2019):
· Strengthened balance sheet following the successful raise of an additional £51.9m (before expenses) through a placing and open offer
· Cash and cash equivalents of £81.0m at 31 December 2019 (31 December 2018: £44.6m)
· R&D expenditure for 2019 was £8.1m (18 months to 31 December 2018: £7.8m) to expand the portfolio of products
· Operating loss of £18.9m (18 months to 31 December 2018: £17.7m) including £1.6m share based payments, in line with management expectations
· Underlying operating loss of £14.0m (18 months to 31 December 2018: £12.6m) is in line with the anticipated spend profile and reflects increased commercial activities
· Net assets of £82.7m (31 December 2018: £47.4m)
· Total sales in the period was £151k (18 months to 31 December 2018: £30k) of which £13k was recognised as revenue in relation to direct sales and £138k was recognised from products supplied in relation to Framework Distribution Agreements
· Net cash outflow from operating activities of £11.9m (18 months to 31 December 2018: £14.3m)
Craig Gulliford, Chief Executive Officer, commented:
“Despite the challenges and uncertainties that COVID-19 has created for businesses world-wide, we remain confident of our medium and long-term prospects having developed an unrivalled suite of game-changing devices that will change the way endoscopists and surgical users operate and bring positive benefits to patients globally. Supported by the security of our long-term funding and following the huge efforts of the Creo team we now have an exciting suite of advanced energy surgery products that are nearing regulatory clearance and which are poised for commercial rollout as lockdown restrictions are eased. I am proud of the progress we have made to date; we have advanced engineering projects into commercial products, we are ready to move from local production into volume manufacturing, and we have progressed our first trainees into trainers within their home markets. Whilst the global outlook for 2020 may be uncertain, I believe we have created a solid platform to deliver on our longer-term commercial goals.“
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