Tiziana Life Sciences Plc – Not earned revenues from the last four years

Tiziana Life Sciences Plc (LON: TILS) is the FTSE AIM All-Share listed biotechnology company, having its focus on innovative therapeutics for oncology, inflammation and infectious diseases.

Investment Highlights - Tiziana Life Sciences Plc – Avoid at GBX 95.00.

• The Company has not reported its revenue from the last four years, which raises uncertainty regarding its earning potential.
• The profitability and return on assets are falling in the negative zone. The Company is consistently making a loss in the range from £5.5 million to £7.5 million from the last four years.
• The stock prices might have absorbed all the positive news regarding its Covid-19 related clinical trials in Brazil.
• The Company is trading lower than its 50-day simple moving average price (GBX 121.94), which raises doubts regarding its upside potential and reflecting a downward trend in the near term.

Key Risks

• The stock has been highly volatile in the last 12 months.
• The second wave of Covid-19 pandemic may cause disruptions in the business environment of the Company.
• The macroeconomic disruptions may affect its clinical trials.

Recent News

On 11 November 2020, the Company announced its association with Parexel Biotech to conduct phase 1b/2 clinical trials in patients regarding Crohn's Disease.

On 02 November 2020, the Company updated regarding the initiation of a collaborative clinical study investigating Covid-19 patients in Brazil regarding nasally administered Foralumab either alone or in combination with orally administered dexamethasone.

On 29 October 2020, the Company updated regarding the demerger of StemPrintER Sciences Limited and mention regarding its allotment of Accustem Sciences Limited shares to shareholders has been sanctioned by the Court on 27 October 2020. The completion date of the demerger is 30 October 2020.

On 27 October 2020, the Company updated regarding the demerger of Accustem Sciences Limited and confirmed the timetable. The completion date of the demerger is 30 October 2020.

Financial Highlights (for six months ended on 30 June 2020 as on 30 September 2020)

(Source: Company result) 

• The Company has not reported any revenue for H1 FY20 ended on 30 June 2020.
• The total loss of the Company went up from £3.57 million in H1 FY19 to £3.91 million in H1 FY20.
• With regards to its financial position, the Company had a cash balance of £7.2 million as of 30 June 2020 in comparison to £153,000 as of 31 December 2019.
• The Company has raised £12.9 million of funds for the six months ended on 30 June 2020.

One Year Share Price Chart

 (Source: Refinitiv, chart created by Kalkine Group) 

Conclusion

The Company has not made any revenue from the last four years. The Company is consistently making a loss in the range from £5.5 million to £7.5 million for the last four years. The stock prices might have recently rallied due to the news of clinical study investigating nasally administered Foralumab in Covid-19 patients in Brazil. On the technical front, the Company is trading lower than its 50-day simple moving average, indicating a short-term correction in the stock price. The stock made a 52-week low and high of GBX 20.74 and GBX 264.83, respectively.

Based on the weak financials and heightened level of uncertainties, we have given the "Avoid" stance on Tiziana Life Sciences Plc at the closing market price of GBX 95.00 (as on 01 December 2020), while we will update when it starts yielding benefits out of Covid-19 trials.

Deepverge Plc - Loss making entity.

Deepverge Plc (LON: DVRG) is the FTSE AIM All-Share listed scientific research and AI-as-a-service company, which is focused on production and analysis of bacteria, virus and toxins utilising artificial intelligent data analytics in regulatory technology.

Investment Highlights - Deepverge Plc – Avoid at GBX 28.00.

• The Company has reported a loss in the same range as that of its revenue (around 92% of its revenue).
• The profitability, return on equity and return on assets are falling in the negative zone.
• From a technical standpoint, 14-day RSI (64.73) is in the overbought zone and hence, a stock price correction is anticipated.

Key Risks

• The Company has reported loss in its recent results and might face liquidity issues in future.
• The ongoing challenges of Covid-19 pandemic and Brexit may cause a delay in various business activities.
• The profitability may get affected due to the increased cost budget with Covid-19 pandemic.

Recent News

On 27 November 2020, the Company announced an update which provides interim analysis from University of Aberdeen Labskin study demonstrating an ability to host
SARS-CoV-2 virus on Labskin cloned human skin microbiome.

On 10 November 2020, the Company provided an update regarding the joining of Dr Nigel Burton as a Non-Executive Director effective from 10 November 2020.

Financial Highlights (for six months ended on 30 June 2020 as on 18 September 2020)

(Source: Company result)

• The Company has reported revenue of £1,004,000 for H1 FY20 while it was £347,000 for H1 FY19.
• The total loss of the Company remained on the same levels as it was on prior-year, i.e. £925,000.
• With regards to its financial position, the Company has reported a cash balance of £255,000 as of 30 June 2020 while it was £1,083,000 as of 30 June 2019.

One Year Share Price Chart

 (Source: Refinitiv, chart created by Kalkine Group)

Conclusion

The Company is on track to report £4.0 million of revenue for FY20 which includes amalgamated revenues of Modern Water Plc, which was acquired on 09 November 2020. The Company has reported a total loss of £925,000, which is approximately 92% of its revenue (£1,004,000) for H1 FY20 ended on 30 June 2020. On the technical front, the Company is trading at a high 14-day RSI of 64.73, which raises doubts regarding its upside movement. The stock made a 52-week low and high of GBX 7.00 and GBX 75.36, respectively.

Based on the weak financial performance and various risk factors mentioned above, we have given the "Avoid" stance on Deepverge Plc at the closing market price of GBX 28.00 (as on 01 December 2020), while we might revisit our stance when the situation becomes advantageous.

*All forecasted figures and Peer information have been taken from Refinitiv, Thomson Reuters.

Disclaimer

PLEASE BE ADVISED THAT YOUR CONTINUED USE OF THIS SITE OR THE INFORMATION PROVIDED HEREIN SHALL INDICATE YOUR CONSENT AND AGREEMENT TO THESE TERMS.

References to ‘Kalkine’, ‘we’, ‘our’ and ‘us’ refer to Kalkine Limited.

This website is a service of Kalkine Limited. Kalkine Limited is a private limited company, incorporated in England and Wales with registration number 07903332.

The article has been prepared for informational purposes only and is not intended to be used as a complete source of information on any particular company. Kalkine is not responsible for material posted on this website and does not guarantee the content, accuracy, or use of the content in this site. No advice or information, whether oral or written, obtained by you from Kalkine or through or from the service shall create any warranty not expressly stated.

Kalkine do not offer financial advice based upon your personal financial situation or goals, and we shall NOT be held liable for any investment or trading losses you may incur by using the opinions expressed in our publications, market updates, news alerts and corporate profiles. Kalkine does not in any way endorse or recommend individuals, products or services that may be discussed on this site. You should discuss your portfolios and the risk tolerance level appropriate for your personal financial situation, with a professional licensed financial planner and adviser.