Tiziana Life Sciences Plc – Developing Innovative Technology to Optimise Health Outcome

Tiziana Life Sciences Plc (LON: TILS) is a Pharmaceuticals & Biotechnology company that specialises in the development of transformative therapies to fight against cancer and inflammatory diseases related to the liver.

Recent News
On 18^th June 2020, Tiziana Life Sciences announced that its director, Gregor MacRae, will be resigning from his position effective immediately.

Financial Highlights – Declined Performance for FY2019 (31^st December 2019, GBP, thousand)

(Source: Annual Report, Company Website)
 
For the financial year ending 31^st December 2019, the Group is in the development stage and do not generate any revenue for the period. Due to an increase in the operating expenses for the period, the Group reported an operating loss of GBP 7,774 thousand in the financial year 2019 versus an operating loss of GBP 7,400 thousand in the financial year 2018. Due to an increase in the financial expenses, the LBT (loss before tax) stood at GBP 7,846 thousand in FY2019 versus an LBT (loss before tax) of GBP 7,409 thousand in the financial year 2018. The LAT (loss after tax) attributable to shareholders stood at GBP 7,306 thousand in the financial year 2019 versus a LAT (loss after tax) attributable to shareholders of GBP 5,950 thousand in FY2018. The basic and diluted loss per share stood at 5.4 pence in FY2019 versus a basic and diluted loss per share of 4.7 pence in the financial year 2018.

Share Price Performance

Daily Chart as of June 19^th, 2020, after the market closed (Source: Refinitiv,Thomson Reuters)

Tiziana Life Sciences Plc shares were closed at GBX 114.00 on 19^th June 2020. Stock's 52 weeks High is GBX 162.50 and Low is GBX 23.50.

From the technical standpoint, 14-day RSI is currently hovering in an overbought zone, and stock price can decline further.

Key Risks and Growth Catalysts
A global economic slowdown may further accentuate pressure from governments and regulators on prices, leading to a decline in some markets, which may result in a reduction of revenue, profits and cash flow. The Company faces significant pressure from regulatory changes with the threat of price controls increasing across all markets. The Group, through its wide-ranging scope, had accelerated growth organically and through acquisitions.

Conclusion
Tiziana Life Sciences Plc is in the development phase; hence, it does not generate any revenue. The Group relied on its cash balances and fundraised from the stock market for all the operational tasks. The profitability margins have remained stagnant or declined. The Company operates in a challenging environment, which requires continuous investment, sometimes at the cost of profitability, to stay ahead of competitors. The Company is confident towards its long term outlook with unchanged investment plans.

Based on the above rationale, we have given a “Watch” recommendation at the closing price of GBX 114.00 (as on 19^th June 2020), while we look for any upcoming catalysts in the near term.

Synairgen Plc – Specialist in Scientific Research Related to Respiratory Diseases

Synairgen Plc (LON: SNG) is an FTSE AIM All-Share listed Company, which is involved in drug discovery and development of therapies for respiratory diseases.

Recent News
On 18^th June 2020, Synairgen announced the expansion of clinical trial of its SNG001 beyond the Southampton and will include covid-19 patients from across the UK.

Financial Highlights –Declined Performance for FY2019 (31^st December 2019, GBP, thousand)

(Source: Annual Report, Company Website)
 
For the financial year ending 31^st December 2019, the Group do not generate any revenue. Due to an increase in the operating expenses for the period, the Group reported an operating loss of GBP 4,817 thousand in the financial year 2019 versus an operating loss of GBP 4,132 thousand in the financial year 2018. The LBT (loss before tax) stood at GBP 4,793 thousand in FY2019 versus an LBT (loss before tax) of GBP 4,096 thousand in the financial year 2018. The LAT (loss after tax) attributable to shareholders stood at GBP 3,885 thousand in the financial year 2019 versus a LAT (loss after tax) attributable to shareholders of GBP 3,301 thousand in FY2018. The basic and diluted loss per share stood at 3.55 pence in FY2019 versus a basic and diluted loss per share of 3.47 pence in the financial year 2018. The Company had raised GBP 14 million through equity issuance to strengthen its position for COVID-19 related activities.

Share Price Performance

Daily Chart as of June 19^th, 2020, after the market closed (Source: Refinitiv,Thomson Reuters)

Synairgen Plc shares were closed at GBX 40.00 on 19^th June 2020. Stock's 52 weeks High is GBX 78.00 and Low is GBX 5.50.

From the technical standpoint, its shares were trading below its short-term support level of 20-day simple moving average prices, which reflects a downtrend in the stock and carrying the risk to move down further.

Key Risks and Growth Catalysts
The Company is still reporting a loss from operations; moreover, the loss from operations has been increased in FY2019 compared to FY2018. The emergence of Coronavirus had halted the COPD trial and diverted their attention towards pressing concerns of the pandemic. The group has a wide range of tools and applications to support research related to the Coronavirus, which can prove to be a gamechanger in the growth of the operations and market value.

Conclusion
During the financial year 2019, the Group reported a decline in both top-line and bottom-line items of the income statement. The profitability remained in the negative zone for the period. Moreover, the company’s Price/Earnings, EV/EBITDA and Price/Cash Flow multiples are in negative zone as compared to the industry multiples. However, the Group has received approval for three major clinical trials, which are expected to undertake in the coming months. Moreover, the Company is involved on many fronts from creating the trials to supply chain for prospective demand.

Based on the above rationale, we have given a “Watch” recommendation at the closing price of GBX 40.00 (as on 19^th June 2020), while we look for positive clinical trials development in the near term.

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