Exhibit 99.2
Centogene N.V.
Unaudited consolidated statements of comprehensive loss
(in EUR k)
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| For the six months ended June 30 | ||||
2023 | 2022 | |||||
Revenue |
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Cost of sales |
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Gross profit |
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Research and development expenses |
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General administrative expenses |
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Selling expenses |
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Impairment of financial assets |
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Gain on reversal of financial asset impairment | — | | ||||
Other operating income |
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Other operating expenses |
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Operating loss |
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Changes in fair value of warrants | ( | | ||||
Interest and similar income |
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Interest and similar expense |
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Financial costs, net |
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Loss before taxes from continuing operations |
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Income tax expenses |
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Loss for the period from continuing operations |
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Net income from discontinued operations, net of tax | — | | ||||
Loss for the period | ( | ( | ||||
Other comprehensive income/(loss), all attributable to equity holders of the parent |
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Total comprehensive loss |
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Attributable to: |
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Equity holders of the parent |
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Non‑controlling interests from continuing operations |
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Non‑controlling interests from discontinued operations | — | ( | ||||
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Net loss per share - Basic and diluted from (in EUR) | ||||||
Continuing operations | ( | ( | ||||
Loss attributable to parent | ( | ( | ||||
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Centogene N.V.
Unaudited consolidated statements of financial position
(in EUR k)
Assets |
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| June 30, 2023 |
| Dec 31, 2022 |
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Non‑current assets |
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Intangible assets |
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Property, plant and equipment |
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Right-of-use assets | |
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Derivatives assets | | | |||||
Other assets |
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Current assets |
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Inventories |
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Trade receivables and contract assets |
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Other assets |
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Cash and cash equivalents |
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Equity and liabilities |
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| June 30, 2023 |
| Dec 31, 2022 |
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Equity |
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Issued capital |
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Capital reserve |
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Accumulated deficit and other reserves |
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Non‑current liabilities |
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Non‑current loans |
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Lease liabilities |
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Deferred tax liabilities |
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Government grants |
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Derivatives liabilities | | | |||||
Warrant liability | | | |||||
Other liabilities | | | |||||
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Current liabilities |
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Government grants |
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Current loans |
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Lease liabilities |
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Liabilities from income taxes |
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Trade payables | | | |||||
Other liabilities |
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Centogene N.V.
Unaudited consolidated statements of cash flows
(in EUR k)
For the six months ended June 30 | ||||||
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| 2023 |
| 2022 | ||
Operating activities |
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Loss before taxes from continuing operations | ( | ( | ||||
Income before taxes from discontinued operations | — | | ||||
Loss before taxes |
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Adjustments to reconcile loss to cash flow from operating activities |
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Amortization and depreciation |
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Interest income | ( | ( | ||||
Interest expense |
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Expected credit loss allowances on trade receivables and contract assets | | — | ||||
Gain on revaluation of credit loss allowance on trade receivables and contract assets | — | ( | ||||
Gain on disposal of property, plant and equipment | ( | ( | ||||
Share‑based payment (true up)/ expenses |
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Fair value adjustments of warrants | | ( | ||||
Tax expense | — | | ||||
Other non‑cash items |
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Changes in operating assets and liabilities |
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Inventories |
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Trade receivables and contract assets |
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Other assets |
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Trade payables |
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Other liabilities |
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Thereof cash flow (used in) continuing operating activities |
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Thereof cash flow from discontinued operating activities | — | | ||||
Net cash flow (used in) operating activities | ( | ( | ||||
Investing activities |
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Cash paid for investments in intangible assets |
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Cash paid for investments in property, plant and equipment |
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Cash received for disposal of property, plant and equipment | | | ||||
Thereof cash flow (used in) continuing investing activities | ( | ( | ||||
Thereof cash flow from discontinued investing activities | - | | ||||
Cash flow (used in) investing activities |
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Financing activities |
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Cash received from issuance of shares | — | | ||||
Cash received from issuance of warrants | — | | ||||
Cash received from loans |
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Cash repayments of loans |
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Cash repayments of lease liabilities |
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Interest received | | | ||||
Interest paid |
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Thereof net cash flow from/(used in) continuing financing activities | ( | | ||||
Thereof net cash flow (used in) discontinued financing activities | - | ( | ||||
Net cash flow from/ (used in) financing activities |
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Changes in cash and cash equivalents |
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Cash and cash equivalents at the beginning of the period |
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Effect of movements in exchange rates on cash held | | — | ||||
Cash and cash equivalents at the end of the period |
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1 General company information
Centogene N.V. (the “Company” and, together with its subsidiaries, the “Group”) focus on providing data-driven answers to patients, physicians, and pharmaceutical companies for rare and neurodegenerative diseases. By
integrating multiomic technologies with the CENTOGENE Biodatabank, the Group is able to provide dimensional analysis to guide the next generation of precision medicine. The Group´s unique approach enables rapid and reliable diagnosis for patients, supports a more precise physician understanding of disease states, and accelerates and de-risks targeted pharmaceutical drug discovery, development, and commercialization.
Centogene N.V. is a public company with limited liability incorporated in the Netherlands, with registered office located at Am Strande 7 in 18055 Rostock, Germany and Dutch trade register number 72822872.
On January 31, 2022, pursuant to a securities purchase agreement and a warrant agreement, each signed with certain investors, the Company received €
2 Basis of presentation
These unaudited condensed consolidated financial information have been prepared in accordance with the recognition and measurement criteria of IFRS. Certain disclosures required by IAS 34 Interim Financial Statements have been condensed or omitted. Accordingly, these unaudited condensed consolidated financial information should be read in conjunction with the Company’s annual financial statements for the year ended December 31, 2022.
3 Segment information
For the six months ended June 30, 2023 | ||||||||
in EUR k |
| Pharmaceutical |
| Diagnostics |
| Corporate | Total | |
Total Revenues from contracts with external customers | | | — | | ||||
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Adjusted EBITDA |
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Capital Expenditures |
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Additions to property, plant and equipment and right-of-use assets |
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Additions to intangible assets |
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Other segment information |
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Depreciation and amortization | | | | | ||||
Research and development expenses |
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For the six months ended June 30, 2022 | ||||||||
in EUR k |
| Pharmaceutical |
| Diagnostics |
| Corporate |
| Total |
Total Revenues from contracts with external customers | | | — | | ||||
Adjusted EBITDA |
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Capital Expenditures | ||||||||
Additions to property, plant and equipment and right-of-use assets | | | | | ||||
Additions to intangible assets | | — | | | ||||
Other segment information |
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Depreciation and amortization | | | | | ||||
Research and development expenses |
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Adjusted EBITDA
Adjustments to income/ loss include non-cash charges in relation to depreciation, amortization (including impairments), one-off costs (as defined below), share-based payments as well as net financial costs and income taxes. Certain costs, and related income, are not allocated to the reporting segment results and represent the residual
operating activities of the Group reported as ‘Corporate’. These costs include general financing costs and corporate overheads related to centralized functions such as communications, information technology, facilities, legal, finance and accounting, insurance (D&O), human resources, business development and strategic initiatives, certain professional and consulting services, procurement, research and development and other supporting activities.
“One-off costs” are related to the costs incurred for the process of obtaining the equity and debt financing which were not directly attributable to the Oxford Loan or issuance of shares. One-off costs primarily include legal and consulting fees. These costs were disclosed under corporate expenses for the first quarter of 2022.
Reconciliation of segment Adjusted EBITDA to Group net loss from continuing operations
| For the six months ended June 30 | |||
in EUR k | 2023 |
| 2022 | |
Reported segment Adjusted EBITDA |
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Corporate expenses |
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Share-based payment income/(expenses) |
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Depreciation and amortization |
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One-off costs | — | ( | ||
Operating loss from continuing operations |
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Financial costs, net |
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Income tax expenses |
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Loss from continuing operations for the six months ended June 30 |
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4 Going Concern
As an early commercial-stage company, the Group is still in progress towards reaching break-even in its diagnostic and pharma businesses. The Group and the Company are subject to a number of risks similar to those of other development and early commercial stage companies. These risks include, among other things, the failure to enter into and successfully execute further collaborations with pharmaceutical partners, the failure to generate revenue from the Company’s development portfolio and risks associated with research, development, testing and obtaining related regulatory approvals in relation to our product candidates.
The Group´s ongoing success and ultimately the attainment of profitable operations depends on future uncertain events which include, among other things, obtaining adequate financing to promote our commercial and development activities until the Group can generate sufficient revenues to support its operating cash requirements. The Group has incurred operating losses since inception. For the first half year 2023, the Group incurred a net comprehensive loss of EUR
During the year 2022 and continuing in 2023, the Group has embarked upon a company wide transformation that is already reflecting positive progression of revenues in the six months ended June 30, 2023. This is particularly evident in the Pharmaceutical business. In addition, cost savings measures implemented, have resulted in noteworthy reductions in Research and Development costs, improving the overall cash burn rate. Our General and Administration expenses (excluding Share Based Payments) have also reduced significantly, whilst Selling Expenses have increased due to the boosting of the selling resources dedicated to our Pharmaceutical business. Cumulatively, these measures have accentuated a significant decrease in the overall corporate expenses.
On June 26, 2023, the Company entered into a joint venture agreement (the “Joint Venture Agreement”) with Pharmaceutical Investment Company (“PIC” or “Lifera”), a closed joint stock company incorporated pursuant to the laws of Saudi Arabia and a wholly-owned subsidiary of the Public Investment Fund (PIF) based in Riyadh, to form a joint venture under the laws of Saudi Arabia. Pursuant to the Joint Venture Agreement, and subject to the terms and conditions contained therein, the Company and PIC have agreed to establish a limited liability company in Saudi Arabia (the “JV”).
In connection with the Joint Venture Agreement, Lifera and the Company have agreed to enter into a convertible loan agreement (the “Loan Agreement”), pursuant to which Lifera will agree to loan the Company USD
other regulatory clearances, no material adverse change having occurred with respect to the Company and agreement by Lifera and the Company on the terms of the Commercial Agreements. The Company expects to finalize the Commercial Agreements and receive the funding by the second half of September 2023.
Considering cash and cash equivalents as of June 30, 2023 of EUR
Based on management’s assessment, the aforementioned financing activities are necessary for the Company to continue its operational existence for at least twelve months, in addition to the successful continuation of existing development programs and other operating activities.
This requirement for additional financing and improving the cash burn rate represents a material uncertainty that raises significant doubt about our ability to continue as a going concern. Without such funding and improvement of the cash burn rate considered, the current cash and cash equivalents will not be sufficient to fund the Group´s operations and meet all of its obligations as they fall due for at least one year from the date of the issuance of these unaudited condensed consolidated financial information.
In parallel, management is in discussion with several private equity parties aiming to explore a potential transaction with a suitable strategic fit for the company. Management has a reasonable level of confidence that one or more of the mentioned transactions should materialize in the next months, improving the overall cash position and the mid-long-term sustainability of the Company.
Following on the waves of efficiencies first introduced in 2022 and continuing in 2023 the Company is reviewing and refining the cost structure, aiming to improve the overall cash burn rate and reducing mainly the General and Administrative expenses as well as the Research and Development costs. Finally, the Group is seeking strategic collaborations and marketing, distribution or licensing arrangements, business and asset divestitures and grant funding among other things. Despite the Company’s efforts to obtain the necessary funding and improve profitability of its operations, and despite management’s expectation that these efforts will be successful, there can be no assurance of its success in doing so or obtaining necessary funding on acceptable terms.
The accompanying unaudited condensed consolidated financial information for the six months ended June 30, 2023, have been therefore prepared on a going concern basis contingent upon the successful implementation of the plans described above. This contemplates the Group will continue in operation for the foreseeable future and will be able to realize its assets and discharge its liabilities in the normal course of operations. The unaudited interim condensed consolidated financial statements do not reflect any adjustments relating to the recoverability and classification of assets or the amounts and classification of liabilities that would be necessary, should the Group be unable to continue as a going concern.