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Name | Symbol | Market | Type |
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SPDR S&P Telecom ETF | AMEX:XTL | AMEX | Exchange Traded Fund |
Price Change | % Change | Price | High Price | Low Price | Open Price | Traded | Last Trade | |
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-0.0573 | -0.05% | 112.0838 | 112.61 | 111.62 | 112.61 | 4,652 | 21:15:00 |
XTL Biopharmaceuticals Ltd Interim Results for the Six Months Ended 30 June 2003 XTL Biopharmaceuticals Ltd (XTLbio) today announces interim financial results for the six months ended 30 June 2003. Summary: * Completed strategic review of the business which resulted in increasing the focus on the most advanced clinical development programs for liver transplant in hepatitis; * HepeX-C enrolment for the phase 2 study is progressing well with interim results expected towards the year end - as previously reported Hepex-C showed encouraging safety and biological activity in a phase 1 study; * HepeX-B showed encouraging pharmacokinetic results in a dose-ranging study - phase 2 trials are expected to start later this year; * HepeX-B was granted Orphan Drug Designation by the US Food and Drug Administration - an application is being submitted for similar status in Europe; * Exercised an option to develop and commercialise compounds developed by Korea-based B&C Biopharm aimed at inhibiting Hepatitis C virus replication - lead compounds are being selected and toxicology studies are proceeding; and * Cash balance of $28 million as of 30 June 2003 (31 December 2002: $36 million). Commenting on the results, Dr Martin Becker, Chief Executive Officer, said: "In the first six months of 2003, we took significant steps to realign our business to concentrate on those areas offering greatest potential value. We have focused our resources on niche, hepatitis-related products with near-term commercial opportunities and we have implemented a Company-wide cost-reduction programme. With these changes in place and a strong cash position, we believe that XTLbio is well-placed for future growth and success." Contacts: XTLbio Tel: +972-8-930-4440 Dr. Martin Becker, President and CEO Jonathan Burgin, Chief Financial Officer Financial Dynamics Tel: +44 (0) 20 7831 3113 David Yates, Sarah MacLeod Chief Executive Officer's Review The past six months have presented a number of challenges for XTLbio, resulting in a strategic review of the business to conserve cash and focus on products offering near-term commercial potential. Since the Annual General Meeting in June, we implemented a number of changes at the Company across all aspects of the business, to further focus and extend the Company's cash resources until 2006. The most significant change we made was to put on hold all early stage research activities, which involved a reduction in headcount from 74 to 54. We decided further to focus the Company's efforts on the development of our most advanced clinical products in order to optimize the use of cash resources. With product partnering our priority, we also set up a licensing committee of experienced Non-Executive Directors to help management progress discussions on the most advanced programs. With the renewed focus now in place, we can concentrate on our core objective of bringing to market revolutionary new treatments for viral hepatitis. OPERATIONAL REVIEW Considerable progress has been made in both the HepeX-C and HepeX-B clinical programs for prevention of reinfection following liver transplant. HepeX-C Patient recruitment is proceeding well for the phase 2 HepeX-C trial in liver transplant patients, with over half the patients (12 out of 19 patients) having completed enrolment in the original study. Based on our initial observations, we requested and received permission from the FDA to explore a variety of different dosing regimens and further extend the study to 24 patients. We expect to unveil interim results from this trial towards the end of the year. We anticipate that Hepex C will ultimately be marketed as a combination of two antibodies. Therefore we intend to add a second antibody to the current antibody and commence an additional Phase I trial with the combined therapy next year. Following that, we currently estimate that a Phase II/III trial for the combined product for HCV LT will be required prior to regulatory approval and commercialisation. As there are currently no FDA-approved products for the prevention of recurrent infection in these patients, we believe that if HepeX-C is capable of preventing or delaying re-infection in patients undergoing liver transplant, it could become a standard therapy. HepeX-B HepeX-B continues to demonstrate excellent safety data and strong anti-viral activity in clinical studies. To accelerate the program with liver transplant patients, we completed a clinical study in healthy volunteers to determine optimum dosing. Confirming the pre-clinical activity seen in XTLbio's proprietary Trimera model, it was determined from these studies that as little as one thousandth of the dose of HepeX-B may be required compared to the current standard of care. This could mean fewer side effects and simpler modes of administration. Phase 2 trials with HepeX-B are planned to start later this year. Lending credence to this development program, HepeX-B was granted Orphan Drug Designation from the US Food and Drug Administration (FDA) in July for liver transplant patients. The grant of Orphan Drug Designation entitles the product to exclusive marketing rights in the United States for seven years following marketing approval. Other benefits include the Company being eligible to apply for certain grants from the FDA to provide funding for development. There is also a fee waiver when XTLbio submits its Biological License Application (BLA) to the FDA for approval to market the product. The Company is submitting documentation for Orphan Drug Designation in Europe through the European Medicines Evaluation Agency (EMEA). Pre-clinical Hepatitis C Program In February, we exercised an option to develop and commercialize a series of compounds developed by Korea-based B&C Biopharm for treating chronic hepatitis C patients. Several clinical candidates have been designated and pre-clinical toxicology studies are proceeding. Assuming continuing success in pre-clinical development, XTLbio plans to submit an Investigational New Drug (IND) for clinical testing with one candidate in the second half of 2004. Partnering Strategy With our programs with liver transplant patients now well-defined and clinical trials underway, we are increasing our efforts to seek alliance partners for our products. With regard to HepeX-B, where proof-of-principle data is now becoming available, XTLbio is in active licensing discussions with a number of parties. In addition, XTLbio expects to have data on HepeX-C by the end of the year, which will be helpful to promote alliances. FINANCIAL REVIEW As of 30 June 2003 the Company's cash, short- and long-term investments were $28 million (31 December 2002: $36 million). R&D expenses remained stable at $6.6 million compared to $6.5 million for the equivalent period last year. G&A costs for the period ending 30 June 2003 decreased to $2.2 million from $2.7 million for the first half of 2002. Going forward, in order to ensure that XTLbio has the cash reserves to accomplish critical goals, the Company has further reduced its net cash outflow. This further reduction in cash outflow, which is substantial, is not reflected in these financial statements and the full impact of all these cash conservation measures taken will be reflected in the annual report for 2003. SUMMARY It is our belief that with our current strategy and strong cash balance, XTLbio has all the building blocks in place to provide the best chances of success for our products and to offer considerable upside for shareholders. I would like to take this opportunity to thank our shareholders for their continued support, and look forward to updating you on our progress in the coming months. Martin Becker, PhD President and Chief Executive Officer Products in development - update Product Indication Active ingredient Status HepeX-B Liver transplant 2 antibodies Start H2 2003 phase II HepeX-C Liver transplant 1 antibody Phase II ongoing HepeX-C Liver transplant 2 antibodies Phase I to commence H1 (existing & new) 2004 HepeX-C SM Chronic hepatitis Small molecule Phase I to commence H2 C 2004 About XTLbio XTL Biopharmaceuticals Ltd. (XTLbio) is a biopharmaceutical company developing drugs against hepatitis. XTLbio's HepeX(tm) product line - now in clinical trials - has the potential to introduce revolutionary therapies for viral hepatitis, including prevention of re-infection in transplanted livers, the Company's primary focus, and a longer-term cocktail approach in treating chronic illness. XTLbio believes its primary competitive advantage lies in its patented Trimera(tm) technology, which enables the development of fully human monoclonal antibodies and models of human disease for pre-clinical drug validation. Established in 1993, XTLbio became a public company in 2000 with shares traded on the London Stock Exchange under the symbol XTL.Auditor's Report The Board of Directors of XTL Biopharmaceuticals Ltd. Re: Review of condensed consolidated unaudited interim financial statements for the period ended 30 June 2003 At your request, we have reviewed the condensed consolidated balance sheet of XTL Biopharmaceuticals Ltd. (hereafter - the Company) and its subsidiary at 30 June 2003 and the condensed consolidated statements of operations, changes in shareholders' equity and cash flows for the six months period then ended. We have also reviewed the consolidated statements of operations and cash flows for the period from 9 March 1993 (incorporation date) to 30 June 2003 (the amounts included therein, which relate to the period through 31 December 2000, are based on the financial statements for 2000, which were audited by another accounting firm). Our review was performed in accordance with auditing standards generally accepted in Israel and in the United States including those prescribed by the Institute of Certified Public Accountants in Israel. Inter alia, these procedures include: reading of the financial statements referred to above, reading of minutes of meetings of shareholders, the board of directors and its committees, and making inquiries of Company officers responsible for financial and accounting matters. Since our review was limited in scope and did not constitute an audit in accordance with auditing standards generally accepted in Israel, we do not express an opinion on the condensed consolidated interim financial statements. During our review, nothing came to our attention that indicated that significant adjustments should be made in the said interim condensed consolidated financial statements in order for them to be considered as having been prepared in accordance with the accounting principles generally accepted in the United States. Sincerely yours, Kesselman & Kesselman Certified Public Accountants (Israel) A member of PriceWaterhouseCoopers International Tel Aviv, Israel 3 September 2003 XTL BIOPHARMACEUTICALS LTD. (A Development Stage Company) BALANCE SHEET AT 30 JUNE 2003 EXPRESSED IN US DOLLARS 30 June 30 June 31 December 2003 2002 2002 ______ ______ ______ (Unaudited) (Unaudited) (Audited) $000 $000 $000 ______ ______ ______ A s s e t s CURRENT ASSETS: Cash and cash equivalents 9,854 23,715 2,016 Short-term deposits 17,187 19,071 32,053 Marketable securities 836 1,089 1,637 Accounts receivable 2,167 684 266 ______ ______ ______ T o t a l current assets 30,044 44,559 35,972 ______ ______ ______ ASSET HELD FOR SALE 354 LONG-TERM DEPOSITS 157 134 139 PROPERTY AND EQUIPMENT, net 1,226 1,495 1,770 ______ ______ ______ 31,781 46,188 37,881 ====== ====== ====== Liabilities and shareholders' equity CURRENT LIABILITIES - accounts payable and accruals: Trade 805 1,429 799 Other 2,028 1,672 1,777 ______ ______ ______ T o t a l current liabilities 2,833 3,101 2,576 ______ ______ ______ LIABILITY FOR EMPLOYEE RIGHTS UPON 579 303 475 RETIREMENT ______ ______ ______ T o t a l liabilities 3,412 3,404 3,051 ______ ______ ______ SHAREHOLDERS' EQUITY: Share capital 594 590 590 Additional paid in capital 88,966 88,966 88,966 Other capital surplus 337 337 337 Accumulated other comprehensive 29 (130) (48) income (loss) Deficit accumulated during the (61,557) (46,979) (55,015) development stage ______ ______ ______ T o t a l shareholders' equity 28,369 42,784 34,830 ______ ______ ______ 31,781 46,188 37,881 ====== ====== ====== Date of approval of the interim financial statements: 3 September 2003 Geoffrey Vernon - Chairman Martin Becker - CEO of the Board of Directors and President The accompanying notes are an integral part of these condensed financial statements. XTL BIOPHARMACEUTICALS LTD. (A Development Stage Company) STATEMENTS OF OPERATIONS FOR THE PERIODS ENDED 30 JUNE 2003 EXPRESSED IN US DOLLARS Six months Six months Year ended Period from ended ended 31 December 9 March 30 June 30 June 2002 1993* to 2003 2002 ______ 30 June 2003 ______ ______ ______ (Unaudited) (Unaudited) (Audited) (Unaudited) $000 $000 $000 $000 ______ ______ ______ ______ RESEARCH AND DEVELOPMENT 6,451 **6,572 **13,096 **56,290 COSTS LESS - PARTICIPATIONS 1,886 ______ 75 9,607 ______ ______ ______ 4,565 6,572 13,021 46,683 GENERAL AND ADMINISTRATIVE 2,169 **2,669 **4,716 **21,064 EXPENSES ______ ______ ______ ______ OPERATING LOSS 6,734 9,241 17,737 67,747 FINANCIAL INCOME , net 192 137 597 6,190 ______ ______ ______ ______ NET LOSS FOR THE PERIOD 6,542 9,104 17,140 61,557 ====== ====== ====== ====== $ $ $ ______ ______ ______ BASIC AND DILUTED PER SHARE DATA: Loss per ordinary share 0.06 0.08 0.15 ====== ====== ====== Weighted average number of 111,212,003 111,132,987 111,149,292 ordinary shares used to compute loss per ordinary ====== ====== ====== share * Incorporation date see note 1(a) ** Reclassified The accompanying notes are an integral part of these condensed financial statements. XTL BIOPHARMACEUTICALS LTD. (A Development Stage Company) STATEMENT OF CHANGES IN SHAREHOLDERS' EQUITY FOR THE SIX MONTH PERIOD ENDED 30 JUNE 2003 EXPRESSED IN US DOLLARS Number Share Additional of shares Capital paid-in capital _____ _____ _____ $000 $000 ______ ______ BALANCE AT 1 JANUARY 2003 (audited) 111,165,364 590 88,966 CHANGES DURING THE SIX MONTHS ENDED 30 JUNE 2003 (unaudited): Loss Net unrealized gain Comprehensive loss Exercise of employee stock options 849,550 4 ______ ______ ______ BALANCE AT 30 JUNE 2003 (unaudited) 112,014,914 594 88,966 ====== ====== ====== BALANCE AT 1 JANUARY 2002 (audited) 111,127,038 590 88,946 CHANGES DURING THE SIX MONTHS ENDED 30 JUNE 2002 (unaudited): Loss Net unrealized loss Comprehensive loss Exercise of employee stock options 38,326 * 20 ______ ______ ______ BALANCE AT 30 JUNE 2002 (unaudited) 111,165,364 590 88,966 ====== ====== ====== BALANCE AT 1 JANUARY 2002 (audited) 111,127,038 590 88,946 CHANGES DURING THE YEAR ENDED 31 DECEMBER 2002 (audited): Loss Net unrealized loss Comprehensive loss Exercise of employee stock options 38,326 * 20 ______ ______ ______ BALANCE AT 31 DECEMBER 2002 (audited) 111,165,364 590 88,966 ====== ====== ====== * Represents an amount less than $1,000 XTL BIOPHARMACEUTICALS LTD. (A Development Stage Company) STATEMENT OF CHANGES IN SHAREHOLDERS' EQUITY FOR THE SIX MONTH PERIOD ENDED 30 JUNE 2003 EXPRESSED IN US DOLLARS (Continued) Other Accumulated Deficit Total Capital other accumulated ______ Surplus comprehensive during the ______ income development ______ stage ______ $000 $000 $000 $000 ______ ______ ______ ______ BALANCE AT 1 JANUARY 2003 (audited) 337 (48) (55,015) 34,830 CHANGES DURING THE SIX MONTHS ENDED 30 JUNE 2003 (unaudited): Loss (6,542) (6,542) Net unrealized gain 77 77 ______ Comprehensive loss (6,465) Exercise of employee stock options ______ ______ ______ 4 ______ BALANCE AT 30 JUNE 2003 (unaudited) 337 29 (61,557) 28,369 ====== ====== ====== ===== BALANCE AT 1 JANUARY 2002 (audited) 337 (45) (37,875) 51,953 CHANGES DURING THE SIX MONTHS ENDED 30 JUNE 2002 (unaudited): Loss (9,104) (9,104) Net unrealized loss (85) (85) ______ Comprehensive loss (9,189) Exercise of employee stock options ______ ______ ______ 20 ______ BALANCE AT 30 JUNE 2002 (unaudited) 337 (130) (46,979) 42,784 ====== ====== ====== ===== BALANCE AT 1 JANUARY 2002 (audited) 337 (45) (37,875) 51,953 CHANGES DURING THE YEAR ENDED 31 DECEMBER 2002 (audited): Loss (17,140) (17,140) Net unrealized loss (3) (3) ______ Comprehensive loss (17,143) ______ Exercise of employee stock options ______ ______ ______ 20 ______ BALANCE AT 31 DECEMBER 2002 337 (48) (55,015) 34,830 (audited) ====== ====== ====== ===== * Represents an amount less than $1,000 The accompanying notes are an integral part of these condensed financial statements. XTL BIOPHARMACEUTICALS LTD. (A Development Stage Company) CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS FOR THE SIX MONTH PERIOD ENDED 30 JUNE 2003 EXPRESSED IN US DOLLARS Six months Six months Year Period from ended ended ended 9 March 31 30 June 30 June December 1993* to 2003 2002 2002 30 June 2003 ______ ______ ______ ______ (Unaudited) (Unaudited) (Audited) (Unaudited) $000 $000 $000 $000 ______ ______ ______ ______ CASH FLOWS FROM OPERATING ACTIVITIES: Loss for the period (6,542) (9,104) (17,140) (61,557) Adjustments to reconcile loss to net cash used in operating activities: Depreciation 243 221 470 2,071 Capital (gain) loss on property and (1) (1) 9 equipment Liability for employee rights upon 177 219 323 1,310 retirement Loss (gain) on marketable securities (7) 23 41 (403) Stock based compensation expenses 478 Changes in operating asset and liability items: Decrease (increase) in accounts (1,901) 188 606 (2,120) receivable Increase (decrease) in accounts 331 388 (20) 2,786 payable and accruals _______ _______ _______ _______ Net cash used in operating (7,699) (8,066) (15,721) (57,426) activities (*) _______ _______ _______ _______ CASH FLOWS FROM INVESTING ACTIVITIES: Short-term deposits, net 14,866 14,040 1,058 (17,187) Long-term deposits (18) 7 2 (157) Investment in available for sale (11) (337) (1,219) (3,303) securities Proceeds from sales of available for 896 318 716 2,899 sale securities Severance pay funded (147) (39) (88) (731) Purchase of property and equipment (53) (135) (659) (3,775) Proceeds from sale of property and _______ 8 8 115 equipment _______ _______ _______ Net cash provided by (used in) 15,533 13,862 (182) (22,139) investing activities _______ _______ _______ _______ CASH FLOWS FROM FINANCING ACTIVITIES: Issuance of share capital, net of 4 20 20 89,419 share issue expenses Proceeds from long-term debt 399 Proceeds from short-term debt 50 Payments relating to long-term debt (399) Payments relating to short-term debt _______ _______ _______ (50) _______ Net cash provided by financing 4 20 20 89,419 activities _______ _______ _______ _______ XTL BIOPHARMACEUTICALS LTD. (A Development Stage Company) CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS FOR THE SIX MONTH PERIOD ENDED 30 JUNE 2003 EXPRESSED IN US DOLLARS (Continued) Six months Six months Year Period from ended ended ended 9 March 31 30 June 30 June December 1993* to 2003 2002 2002 30 June 2003 ______ ______ ______ ______ (Unaudited) (Unaudited) (Audited) (Unaudited) $000 $000 $000 $000 ______ ______ ______ ______ NET INCREASE IN CASH AND CASH 7,838 5,816 (15,883) 9,854 EQUIVALENTS BALANCE OF CASH AND CASH EQUIVALENTS 2,016 17,899 17,899 _______ AT BEGINNING OF PERIOD _______ _______ _______ BALANCE OF CASH AND CASH EQUIVALENTS 9,854 23,715 2,016 9,854 AT END OF PERIOD ====== ====== ====== ====== Supplementary information on 1,700 financing activities not ====== involving cash flows - conversion of convertible subordinated debenture into shares Supplemental disclosures: Income taxes paid 109 85 79 57 ====== ====== ====== ====== Interest paid 350 ====== (*) Including effect of changes in (749) (709) 1,811 the exchange rate on cash _______ _______ _______ (**) Incorporation date see note 1(a). The accompanying notes are an integral part of these condensed financial statements. XTL BIOPHARMACEUTICALS LTD. (A Development Stage Company) NOTES TO INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS FOR THE SIX MONTH PERIOD ENDED 30 JUNE 2003 1. General: a. XTL Biopharmaceutical Ltd. ("the Company") was incorporated under the Israel Companies Ordinance on March 9, 1993. The Company is a development stage company in accordance with Financial Accounting Standard 7 ("FAS") "Accounting and Reporting by Development Stage Enterprises". The principal activity of the Company is the development of therapeutic pipeline for the treatment of infectious diseases. The Company has a wholly-owned subsidiary in the United States - XTL biopharmaceuticals Inc. ("Subsidiary"), which was incorporated in 1999 under the law of the state of Delaware. The subsidiary is primarily engaged in business development and clinical activities. b. Through June 30, 2003, the Company has incurred losses in an aggregate amount of US$ 62,260,000. Such losses have resulted primarily from the Company's activities as a development stage company. The Company does not foresee any cash limitations to finance its operations for the coming year. c. The interim financial statements at June 30, 2003 ("the interim statements") were drawn up in condensed form, in accordance with accounting principles generally accepted applicable to interim statements. Thus, the accounting principles applied in preparation of the interim statements are consistent with those applied in the preparation of annual financial statements. Nevertheless, the interim statements do not include all the information and explanations required for annual financial statements. 2. Functional currency The currency of the primary economic environment in which the operations of the Company are conducted is the U.S. dollar ("$" or "dollar"). Most of the Company's research and development expenses are incurred in dollars. Significant part of the Company's capital expenditures and substantially all of its financing is in dollars. Thus, the functional currency of the Company is dollar. Transactions and balances originally denominated in dollars are presented at their original amounts. Balances in non-dollar currencies are translated into dollars using historical and current exchange rates for non-monetary and monetary balances, respectively. For non-dollar transactions and other items reflected in the statements of operations, the following exchange rates are used: (i) for transactions - exchange rates at transaction dates or average rates and (ii) for other items (derived from non-monetary balance sheet items) - historical exchange rates. The resulting currency transaction gains or losses are carried to financial income or expenses, as appropriate. XTL BIOPHARMACEUTICALS LTD. (A Development Stage Company) NOTES TO INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS FOR THE SIX MONTH PERIOD ENDED 30 JUNE 2003 2. Functional currency (continued): Following are the changes in the exchange rate of the dollar and in the Israeli Consumer Price Index ("CPI"): Six months Six months Year ended ended ended 31 December 30 June 30 June 2002 2003 2002 ___________ ___________ _________ % % % Rate of change of the Israeli currency against the dollar (8.9) 8.0 7.3 Changes in the Israeli CPI (0.5) 6.3 6.5 Exchange rate of one dollar (at end of NIS 4.312 NIS 4.769 NIS 4.737 period) 3. Employee Stock Based Compensation The Company accounts for employee stock based compensation in accordance with Accounting Principles Board Opinion No. 25 "Accounting for Stock Issued to Employees" ("APB 25") and related interpretations. In accordance with FAS 123 - "Accounting for Stock-Based Compensation" the Company discloses pro-forma data assuming the Company had accounted for employee stock options grants using the fair value-based method defined in FAS 123. XTL BIOPHARMACEUTICALS LTD. (A Development Stage Company) NOTES TO INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS FOR THE SIX MONTH PERIOD ENDED 30 JUNE 2003 3. Employee Stock Based Compensation (continued): The following table illustrates the effect on net income and earning per share assuming the Company had applied the fair value recognition provisions of FAS 123 to its stock-based employee compensation: Six months Six months Year ended Period from ended ended 31 December 9 March 30 June 30 June 2002 1993* 2003 2002 ____________ to 30 June 2003 __________ (Unaudited) (Unaudited) (Audited) (Unaudited) $000 $000 $000 $000 Loss for the period, as 6,542 9,104 17,140 61,557 reported Deduct: stock based employee compensation expense, included in reported statement of operations, net of related tax effect (482) Add: stock based employee compensation expense determined under fair value method for all awards 514 817 1,297 5,809 ________ ________ ________ ________ Pro forma- loss 7,056 9,921 18,437 66,884 ======= ======= ======= ======= Basic and diluted loss per share: As reported $ 0.06 $ 0.08 $0.15 ======= ======= ======= Pro-forma $ 0.06 $ 0.09 $0.17 ======= ======= ======= (*) Incorporation date see note 1(a). 14 END
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