LONDON (Alliance News) - Amphion Innovations PLC Thursday said its net asset value was over five times higher at the end of 2015, boosted by its investment in fellow London-listed Motif Bio PLC, as the company also revealed it managed to turn a profit during the year.
The investment firm and developer of medical and technology businesses said its net asset value per share at the end of 2015 stood at 3.8 pence, a huge lift from the NAV of only 0.7 pence at the end of 2014.
Amphion also got back into the black during the year after reporting a pretax profit of USD5.9 million compared to the USD12.6 million loss in 2014. That was primarily driven by a rise in the value of its investment portfolio, generating a USD5.7 million gain, compared to 2014 when the revaluation of the portfolio led to a loss of USD10.0 million being booked.
The company also booked a USD1.6 million gain from disposing some of its investments in the year, when in 2014 that amounted to nil.
"The rise in our net asset value per ordinary share was mainly due to the increase in the value of our holdings in Motif Bio," said Richard Morgan, chief executive of Amphion. "We believe Motif has a very bright future and is now on its way to becoming a significant player in the antibiotic market, which has a growing need for novel therapies."
Motif Bio, a clinical stage biopharmaceutical company with the aim of developing antibiotics to combat bacteria resistant to existing drugs, launched its initial public offering in April 2015 but then raised a further GBP22.0 million via a placing with several investors at a price that was significantly higher than the IPO price.
Specifically, Motif Bio's IPO raised a total of GBP2.8 million and the shares were priced at 20.0 pence each but the subsequent financing only two to three months later raised a much larger amount of GBP22.0 million as the shares were priced at 50.0 pence - 1.5 times higher.
Motif Bio's share price has hit a high of 71.0 pence a share since April 2015 and on Thursday morning was trading flat at 47.50 pence per share, over 11% higher since the start of 2016.
That financing post-IPO by Motif Bio resulted in a huge rise in Amphion's holding in the company to USD27.0 million at the end of 2015 from only USD13.2 million at the end of 2014.
"We are committed to working closely with Motif to help it achieve its goals. In addition, we now have the opportunity to move forward one or two other partner companies and, for the first time in many years, to begin to explore the possibility of adding to Amphion's portfolio," said Morgan.
Amphion is the largest shareholder of Motif Bio with a 29.21% stake at the end of 2015, but the company holds significant interests in other companies.
The two other partner companies that Amphion hopes to work with in order to increase their value is Kromek Group PLC, in which it holds a 5.27% stake, and m2m Imaging Corp in which Amphion holds a 15.62% stake.
"The outlook for Amphion depends increasingly on the value we can capture from our holdings in Motif, Kromek and, if we can move it forward successfully, m2m. We are very actively supporting the development of both Motif and m2m and view the future of all three companies with optimism," said Amphion.
The majority of Amphion's other investments are in US-based companies, namely Axcess International Inc, FireStar Software Inc, PrivateMarkets Inc and WellGen Inc, alongside one investment in French firm Novacyt SA.
Looking at Amphion's balance sheet, the company managed to reduce its liabilities and also raised its first cash from equity markets for seven years. A USD1.4 million reduction in liabilities led them to total USD29.0 million at the end of 2015, compared to total assets of USD40.0 million.
Amphion had a cash balance of USD936,981 at the end of the year, rising from GBP212,816 at the end of the previous year after Amphion raised GBP2.1 million from a placing conducted in June and through warrant conversions in the year.
"The board and management have supported Amphion through several lean years but the fact that we have been able to raise fresh equity capital is an encouraging development. While our stated goal is to reduce the level of gearing or leverage on our balance sheet, we are committed to doing so in ways that preserve the shareholder value we have managed to create through this support," said Amphion.
Amphion shares were up 3.7% to 3.50 pence per share on Thursday morning.
By Joshua Warner; joshuawarner@alliancenews.com; @JoshAlliance
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