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“Trek, you're putting a lot of effort in!”

And I have a lot of for me money invested!

There is zero benefit in just ramping. There is more benefit in constructive debate.

Anyways i’ve had enough now. I just hope it’s helped some see things through a different lens to help us be better investors.

Good luck with your investments

Trek

Guys,

Sensitive lot!

Firstly. I posted that IMO it is likely that we will raise. I set my points out to that effect.

I don’t think it will be a lot nor am I concerned. Probably around £10m to close what I see as a gap in working capital. It may be more if the manufacturing costs have over run.

Some have a view that after the P3 read out well have loads of money. Of course we will if there is clear statistical differentiation over the placebo group, over 20 countries (different health services) different genders, health profiles and ethnicities. That is not a scare it’s something that some may not have considered. This is hard yards now!

Here’s a link it’s the best I can do to illustrate the bandwidths in health performance. You can get similar across hospitals but you get the gist. Variability.

https://tradingeconomics.com/country-list/hospital-beds

The odds are in our favour based on P2 & home trials but here’s another thought out contrarian view.

For open debate let’s assume they decided to raise £10m.

Would you wait for the read out to raise or would you raise before the readout?

By the sounds of it most say after the read out because they only see one outcome and that is overwhelmingly positive.

My view is I would raise before the readout. Why? Because if the readout is the success that I hope it is then £10m will not matter.

However, if for whatever reason it wasn’t 100% and the SP took a hit that £10m would be more dilutive than a pre read out raise. More shares to buy the same pound!

Something else to contemplate.

By raising before the company then also has working capital cash in the bag should they need to do further statistical analysis without coming to market. Remember the extra data analysis on P2.

And for those who don’t think I am invested. My first buy here was 50k shares in March 2020. I have kept a position here ever since. I mean. Who wouldn’t!

I am really looking forward to the interims. I also think if they raise it would likely be before the interims as the results will show our hand. So if we are clear before then then we could well be all clear and hopefully good news will promptly follow.

Like someone before posted. Indeed we don’t know! But doesn’t this type of debate add more to a BB? Well by the looks of it only for a few.

Thank you Matterhorn for your words.

Good luck with your investments

Trek

From Dec 2020 year end

Cash balance £75m (after placing)

Note from 2021 accounts. R&D 2020 £15.5 million a £12.0 million increase on research and development expenditure attributable to COVID-19 activities. This was manufacturing scale up & R&D....

“This was followed by preparatory activities for the international SG018 Phase III trial in hospitalised patients and finally for participation in the ACTIV-2 study, where we have provided study product for the trial. The clinical trial preparatory and execution activities necessitated a very significant scale up of our clinical trial infrastructure and this resulted in a much greater use of outsourced experts.”

———-

Oct 14 2020 = £80m +£7.1m raised

To.....

(i) support the Phase III clinical trial in COVID-19 patients; £30m. Reduced trial size will save money but I expect increased costs associated with covid and some delays will probable net out £30m

(ii) support SNG001 manufacturing and device scale up activities; £33m for Akron to achieve 100k doses per month.

(iii) generate further SNG001 data to support clinical, manufacturing and regulatory activities; £6m

(iv) strengthen the Company's balance sheet. This would be mostly the RI (£7.1m), £10m needed.

(v) also provide the opportunity for certain Directors to exercise options and for the Company to net settle them on their behalf (details of which are set out below). 530k shares, not significant, £1m

ACTIV-2 assumes nets out as most spent end of last year as per above note.

Rebates c £9m last year. Traded and other receivables rebates at around 26%, should be much higher this year but not until y/e.

Total costs 30+33+6+10+1 = £80m

£75m will include kickstarting some of the above.

My concerns only £10m for working capital. Last year’s run rate was £24m! Expecting admin costs to be significantly higher this year.

I think that it has been harder to do business this year than expected and therefore more expensive particularly the manufacturing upscaling. ‘Pinging’, supply constraints and inflation will add unforeseen costs.

IMO it’s touch and go if they can coast until the rebates kick in.

I wouldn’t be surprised to see a small working capital raise. At this stage we can only speculate based on the data we know but I one thing I am sure of is that I completely disagree with the views that we got ‘loads of cash’ purported by some posters. Those are the opinions to be wary of!

And no I haven’t sold any nor am I buying anymore.

Usual caveats

Trek

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