logo-loader
viewAllergy Therapeutics PLC

Allergy Therapeutics hails "steady" first half performance; finnCap ups forecasts

The company ended the half-way period in a strong cash position with just under £40mln in the bank

Allergy Therapeutics PLC -

Allergy Therapeutics PLC (LON:AGY) has made a “steady” start to the financial year, according to its chief executive Manuel Llobet with revenue and profit up, respectively, by 9% and 10% backed by a strong operational performance, prompting City broker finncap to raise.forecasts.

Turnover for the six months to December 31, 2019, advanced to £50.5mln from £46.7mln as the firm reported “good growth” across the product portfolio and a small gain in European market share.

Pre-research and development operating profit, meanwhile, advanced £1.6mln to £17.3mln. The operating margin was 34%.

R&D expenditure of just £1.3mln at the halfway stage reflected the receipt of £3.2mln of legal costs following a settlement of litigation with a firm called Inflamax. That compared with the £5mln it spent a year earlier on developing its portfolio of new inoculations.

The firm said the second half should see a ramp-up in R&D activity with the start of a phase III trial of its Grass MATA MPL allergy treatment and further work on its "promising" pre-clinical peanut candidate.

The company exited 2020 in a strong cash position with just under £40mln in the bank.

CEO Llobet said: "The group has made a steady start to the year with good sales growth supporting our strategy. The regulatory environment remains uncertain but we continue to perform well commercially and to progress our high potential pipeline."

Forecasts raised

In a note to clients,analysts at finnCap said: "With this stable growth base arguably underpinning a much higher valuation, we look forward to the start of its two-step Phase III trial for Grass MATA MPL in the US and Europe in the autumn of 2020.

"The market assumes little or no chance of success despite the real-world evidence for its use as well as one positive Phase III trial." 

The analysts said they have upgraded their Allergy Therapeutics' forecasts for full-year 2020 and 2021 by around £2.1mml due to lower R&D costs.

"Given the balance sheet (£39.75m cash), underlying growth and previous clinical trial successes, we believe the risk/reward profile is highly attractive and reiterate our target of 40p,". they added.

In morning trade, shares in Allergy Therapeutics held steady at 10.75p.

 -- Adds analysts comment, share price --  

Quick facts: Allergy Therapeutics PLC

Price: 14.45 GBX

AIM:AGY
Market: AIM
Market Cap: £92.09 m
Follow

NO INVESTMENT ADVICE

The Company is a publisher. You understand and agree that no content published on the Site constitutes a recommendation that any particular security, portfolio of securities, transaction, or investment strategy is...

In exchange for publishing services rendered by the Company on behalf of Allergy Therapeutics PLC named herein, including the promotion by the Company of Allergy Therapeutics PLC in any Content on the Site, the...

FOR OUR FULL DISCLAIMER CLICK HERE

Watch

Allergy Therapeutics on the potential of peanut vaccine

An Allergy Therapeutics (LON:AGY) breakthrough has the potential to protect against severe allergic reactions to peanuts, according to research carried by a leading academic journal.   The single injection helped mice generate “sustained immunity and protection through vaccination”,...

on 3/3/20

2 min read