6-K

 

 

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

 

 

FORM 6-K

 

 

REPORT OF FOREIGN ISSUER

PURSUANT TO RULE 13a-16 OR 15d-16

OF THE SECURITIES EXCHANGE ACT OF 1934

For the month of August 2018

(Commission File No. 001-38215)

 

 

NUCANA PLC

(Translation of registrant’s name into English)

 

 

3 Lochside Way

Edinburgh EH12 9DT

United Kingdom

(Address of registrant’s principal executive office)

 

 

Indicate by check mark whether the registrant files or will file annual reports under cover Form 20-F or Form 40-F.

Form 20-F  ☒            Form 40-F  ☐

Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101 (b) (1):  ☐

Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101 (b) (7):  ☐

 

 

 


Other Events

On August 28, 2018, NuCana plc (the “Company”) issued a press release announcing its second quarter 2018 financial results. The press release is attached as Exhibit 99.1 hereto and is incorporated by reference herein. The Company’s unaudited condensed consolidated financial statements as of June 30, 2018 are attached as Exhibit 99.2 and are incorporated by reference herein.

The information in the attached Exhibits 99.1 and 99.2 is being furnished and shall not be deemed “filed” for the purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or otherwise subject to the liabilities of that Section, nor shall it be deemed incorporated by reference in any filing made by the Company under the Securities Act of 1933, as amended, or the Exchange Act, except as otherwise set forth herein or as shall be expressly set forth by specific reference in such a filing.

The information in the attached Exhibit 99.2 shall be deemed to be incorporated by reference into the registration statement on Form S-8 (Registration Number 333-223476), and related Prospectuses, as such Registration Statement and Prospectuses may be amended from time to time, and to be a part thereof from the date on which this report is filed, to the extent not superseded by documents or reports subsequently filed or furnished.

Exhibits

 

99.1    Press Release dated August 28, 2018
99.2    Unaudited Condensed Consolidated Financial Statements as of June 30, 2018


SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

 

NuCana plc
By:  

/s/ Donald Munoz

Name:   Donald Munoz
Title:   Chief Financial Officer

Date: August 28, 2018

EX-99.1

Exhibit 99.1

NuCana Reports Second Quarter 2018 Financial Results and Provides Business Update

Additional Acelarin and NUC-3373 Data to be Presented at ESMO in October

Edinburgh, United Kingdom, August 28, 2018 (GLOBE NEWSWIRE) – NuCana plc (NASDAQ: NCNA) announced financial results for the second quarter ended June 30, 2018 and provided an update on its extensive clinical program with its transformative ProTide therapeutics.

As of June 30, 2018, NuCana had cash and cash equivalents of £81.5 million compared to £81.3 million as of March 31, 2018 and £86.7 million as of December 31, 2017. This increase in cash and cash equivalents during the second quarter of 2018 reflects the weakening of the UK pound sterling relative to the US dollar and the fact that NuCana holds a portion of its cash in US dollars. NuCana reported a loss of £1.3 million for the quarter ended June 30, 2018, compared to £2.7 million for the quarter ended June 30, 2017 as the Company continued to advance its various clinical programs. Basic and diluted loss per share was £0.04 for the quarter ended June 30, 2018, compared to £0.11 per share for the comparable quarter in 2017.

“We have made excellent progress with our development programs during the first half of 2018 and look forward to providing additional clinical updates later in the year,” said Hugh Griffith, NuCana’s Founder and Chief Executive Officer. “The high response rates achieved in the first cohort of eight patients with biliary tract cancers, which were reported earlier this year at ASCO GI, has led us to prioritize this indication for rapid development. We are also excited about opening our combination Phase 1b study with NUC-3373 for patients with colorectal cancers and taking our third ProTide, NUC-7738, into the clinic later this year.”

Mr. Griffith continued: “We are also pleased to announce that we have had three posters accepted for presentation at the European Society for Medical Oncology (ESMO) Congress being held in Munich, Germany on October 19 to 23, 2018. These posters include additional data from the ongoing Phase 1b study of Acelarin® plus cisplatin in front-line advanced biliary tract cancer (the ABC-08 study), additional data from the ongoing Phase 1 study of NUC-3373 in advanced solid tumors (the NuTide:301 study) and a study status update from the ongoing Phase 3 study of Acelarin® compared to gemcitabine in front-line pancreatic cancer patients (the Acelarate study).”

Anticipated Second Half 2018 Milestones

 

   

Acelarin® is NuCana’s ProTide transformation of gemcitabine. Over the remainder of 2018, NuCana anticipates a number of data read-outs and milestones including:

 

   

Reporting additional Phase 1b data of Acelarin combined with cisplatin as a first-line treatment for patients with advanced biliary tract cancer at ESMO on October 21, 2018 (the ABC-08 study). This will include additional data on the eight patients reported at ASCO-GI in January 2018, data from the six patients in the 725mg/m2 dose cohort, and interim data from the additional six patients in an expansion cohort at the selected 625mg/m2 dose.

 

   

Initiating a Phase 3 study of Acelarin combined with cisplatin as a first-line treatment for patients with advanced biliary tract cancer.


   

Continuing to enroll and follow-up with patients in the Phase 2 platinum-resistant ovarian study (the PRO-105 study).

 

   

Reporting current study status of the ongoing Phase 3 study of Acelarin compared to gemcitabine as a first-line treatment of patients with metastatic pancreatic cancer at ESMO on October 21, 2018 (the Acelarate study).

 

   

NUC-3373 is NuCana’s second ProTide in clinical development, a transformation of 5-fluorouracil (5-FU). In 2018, NuCana expects to:

 

   

Report additional Phase 1 data in advanced solid tumors at ESMO on October 22, 2018 (the NuTide:301 study).

 

   

Initiate a Phase 1b study in patients with advanced colorectal cancer in combination with other approved agents with which 5-FU is typically combined, including leucovorin, oxaliplatin and irinotecan (the NuTide:302 study).

 

   

NUC-7738 is NuCana’s ProTide transformation of cordycepin, a novel nucleoside analog that has shown potent anti-cancer activity in preclinical studies across a range of different human cancer cell lines. NuCana expects to initiate a First-In-Human Phase 1 clinical study of NUC-7738 in patients with solid tumors later in 2018 (the NuTide:701 study).

About NuCana plc

NuCana® is a clinical-stage biopharmaceutical company focused on significantly improving treatment outcomes for cancer patients by applying our ProTide™ technology to transform some of the most widely prescribed chemotherapy agents, nucleoside analogs, into more effective and safer medicines. While these conventional agents remain part of the standard of care for the treatment of many solid tumors, their efficacy is limited by cancer cell resistance mechanisms and they are often poorly tolerated. Utilizing our proprietary technology, we are developing new medicines, ProTides, designed to overcome key cancer resistance mechanisms and generate much higher concentrations of anti-cancer metabolites in cancer cells.

Our most advanced ProTide candidates, Acelarin® and NUC-3373, are new chemical entities derived from the nucleoside analogs gemcitabine and 5-fluorouracil, respectively, two widely used chemotherapy agents. Acelarin is currently being evaluated in three clinical studies, including a Phase 1b study for patients with biliary tract cancer, a Phase 2 study for patients with ovarian cancer and a Phase 3 study for patients with pancreatic cancer. NUC-3373 is currently in a Phase 1 study for the potential treatment of a wide range of advanced solid tumors.

For more information, please visit: www.nucana.com.

Forward-Looking Statements

This press release may contain “forward-looking” statements within the meaning of the Private Securities Litigation Reform Act of 1995 that are based on the beliefs and assumptions and on information currently available to management of NuCana plc (the “Company”). All statements other than statements of historical fact contained in this press release are forward-looking statements,


including statements concerning our results of operations for the second quarter of 2018; our planned and ongoing clinical studies for the Company’s product candidates, including Acelarin, NUC-3373 and NUC-7738; the initiation, enrollment, timing, progress, release of data from and results of those planned and ongoing clinical studies; and the utility of prior preclinical and clinical data in determining future clinical results. In some cases, you can identify forward-looking statements by terminology such as “may,” “will,” “should,” “expects,” “plans,” “anticipates,” “believes,” “estimates,” “predicts,” “potential” or “continue” or the negative of these terms or other comparable terminology. Forward-looking statements involve known and unknown risks, uncertainties and other factors that may cause the Company’s actual results, performance or achievements to be materially different from any future results, performance or achievements expressed or implied by the forward-looking statements. These risks and uncertainties include, but are not limited to, the risks and uncertainties set forth in the “Risk Factors” section of our Annual Report on Form 20-F for the year ended December 31, 2017 filed with the Securities and Exchange Commission (“SEC”) on March 22, 2018, and subsequent reports that we file with the SEC. Forward-looking statements represent the Company’s beliefs and assumptions only as of the date of this press release. Although the Company believes that the expectations reflected in the forward-looking statements are reasonable, it cannot guarantee future results, levels of activity, performance or achievements. Except as required by law, the Company assumes no obligation to publicly update any forward-looking statements for any reason after the date of this press release to conform any of the forward-looking statements to actual results or to changes in its expectations.


Unaudited Condensed Consolidated Statements of Operations

 

    

For the three months ended

June 30,

   

For the six months ended

June 30,

 
     2018     2017     2018     2017  
     (in thousands, except per share data)  
     £     £     £     £  

Research and development expenses

     (5,158     (2,077     (8,863     (3,689

Administrative expenses

     (1,402     (313     (2,642     (637

Initial public offering related expenses

     —         (1,034     —         (1,066

Net foreign exchange gains (losses)

     3,607       (113     1,059       (161
  

 

 

   

 

 

   

 

 

   

 

 

 

Operating loss

     (2,953     (3,537     (10,446     (5,553

Finance income

     252       44       442       91  
  

 

 

   

 

 

   

 

 

   

 

 

 

Loss before tax

     (2,701     (3,493     (10,004     (5,462

Income tax credit

     1,383       745       2,292       1,077  
  

 

 

   

 

 

   

 

 

   

 

 

 

Loss for the period

     (1,318     (2,748     (7,712     (4,385
  

 

 

   

 

 

   

 

 

   

 

 

 
        

Basic and diluted loss per share

     (0.04     (0.11     (0.24     (0.18


Unaudited Condensed Consolidated Statements of Financial Position

 

         June 30,    
2018
    December 31,
2017
 
     (in thousands)  
     £     £  

Assets

    

Non-current assets

    

Intangible assets

     2,485       1,938  

Property, plant and equipment

     495       358  

Deferred tax asset

     32       81  
  

 

 

   

 

 

 
     3,012       2,377  
  

 

 

   

 

 

 

Current assets

    

Prepayments, accrued income and other receivables

     1,737       3,050  

Current income tax receivable

     4,660       4,225  

Cash and cash equivalents

     81,469       86,703  
  

 

 

   

 

 

 
     87,866       93,978  
  

 

 

   

 

 

 
    
  

 

 

   

 

 

 

Total assets

     90,878       96,355  
  

 

 

   

 

 

 
    

Equity and liabilities

    

Capital and reserves

    

Share capital and share premium

     80,508       80,508  

Other reserves

     59,072       58,071  

Accumulated deficit

     (52,871     (45,159
  

 

 

   

 

 

 

Total equity attributable to equity holders of the Company

     86,709       93,420  
  

 

 

   

 

 

 
    

Non-current liabilities

    

Provisions

     26       18  
    

Current liabilities

    

Trade payables

     2,123       1,120  

Payroll taxes and social security

     103       157  

Accrued expenditure

     1,917       1,640  
  

 

 

   

 

 

 
     4,143       2,917  
  

 

 

   

 

 

 
    
Total liabilities      4,169       2,935  
  

 

 

   

 

 

 
    

Total equity and liabilities

     90,878       96,355  
  

 

 

   

 

 

 


Unaudited Condensed Consolidated Statements of Cash Flows

 

     For the six months ended June 30,  
     2018     2017  
     (in thousands)  
     £     £  

Cash flows from operating activities

    

Loss for the period

     (7,712     (4,385

Adjustments for:

    

Income tax credit

     (2,292     (1,077

Amortization and depreciation

     164       84  

Finance income

     (442     (91

Share-based payments

     997       532  

Initial public offering (IPO) related expenses

     —         1,066  

Net foreign exchange (gains) losses

     (1,112     142  
  

 

 

   

 

 

 
     (10,397     (3,729

Movements in working capital:

    

Decrease in prepayments, accrued income and other receivables

     1,358       609  

Increase (decrease) in trade payables

     1,003       (477

Increase (decrease) in payroll taxes, social security and accrued expenditure

     231       (230
  

 

 

   

 

 

 

Movements in working capital

     2,592       (98
  

 

 

   

 

 

 

Cash used in operations

     (7,805     (3,827
  

 

 

   

 

 

 

Net income tax credit received

     1,906       235  
  

 

 

   

 

 

 

Net cash used in operating activities

     (5,899     (3,592
  

 

 

   

 

 

 

Cash flows from investing activities

    

Interest received

     429       98  

Payments for property, plant and equipment

     (200     (5

Payments for intangible assets

     (648     (492
  

 

 

   

 

 

 

Net cash used in investing activities

     (419     (399
  

 

 

   

 

 

 

Cash flows from financing activities

    

IPO related expenses included in statement of operations

     —         (73
  

 

 

   

 

 

 

Net cash used in financing activities

     —         (73
  

 

 

   

 

 

 

Net decrease in cash and cash equivalents

     (6,318     (4,064
  

 

 

   

 

 

 

Cash and cash equivalents at beginning of period

     86,703       19,990  
  

 

 

   

 

 

 

Foreign currency translation differences

     1,084       (8
  

 

 

   

 

 

 

Cash and cash equivalents at end of period

     81,469       15,918  
  

 

 

   

 

 

 


For more information, please contact:

NuCana plc

Hugh S. Griffith

Chief Executive Officer

+44 131 357 1111

info@nucana.com

Westwicke Partners

Chris Brinzey

+1 339-970-2843

Chris.brinzey@westwicke.com

RooneyPartners

Marion Janic

+1 212-223-4017

mjanic@rooneyco.com

EX-99.2

Exhibit 99.2

NUCANA PLC

UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

 

            For the three months ended
June 30,
    For the six months ended
June 30,
 
     Notes      2018     2017     2018     2017  
            (in thousands, except per share data)  
            £     £     £     £  

Research and development expenses

        (5,158     (2,077     (8,863     (3,689

Administrative expenses

        (1,402     (313     (2,642     (637

Initial public offering related expenses

     3        —         (1,034     —         (1,066

Net foreign exchange gains (losses)

        3,607       (113     1,059       (161
     

 

 

   

 

 

   

 

 

   

 

 

 

Operating loss

        (2,953     (3,537     (10,446     (5,553

Finance income

        252       44       442       91  
     

 

 

   

 

 

   

 

 

   

 

 

 

Loss before tax

        (2,701     (3,493     (10,004     (5,462

Income tax credit

     4        1,383       745       2,292       1,077  
     

 

 

   

 

 

   

 

 

   

 

 

 

Loss for the period

        (1,318     (2,748     (7,712     (4,385 ) 
     

 

 

   

 

 

   

 

 

   

 

 

 
           

Basic and diluted loss per share

     5        (0.04     (0.11     (0.24     (0.18

The accompanying notes form an integral part of these unaudited condensed consolidated financial statements.

 

1


NUCANA PLC

UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE LOSS

 

     For the three months ended
June 30,
    For the six months ended
June 30,
 
     2018     2017     2018     2017  
     (in thousands)  
     £     £     £     £  

Loss for the period

     (1,318     (2,748     (7,712     (4,385

Other comprehensive expense:

        

Items that may be reclassified subsequently to profit or loss:

        

Exchange differences on translation of foreign operations

     9       —         4       (1
  

 

 

   

 

 

   

 

 

   

 

 

 

Other comprehensive income (expense) for the period

     9       —         4       (1
  

 

 

   

 

 

   

 

 

   

 

 

 

Total comprehensive loss for the period

     (1,309     (2,748     (7,708     (4,386
  

 

 

   

 

 

   

 

 

   

 

 

 

Attributable to:

        

Equity holders of the Company

     (1,309     (2,748     (7,708     (4,386
  

 

 

   

 

 

   

 

 

   

 

 

 

The accompanying notes form an integral part of these unaudited condensed consolidated financial statements.

 

2


NUCANA PLC

UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF FINANCIAL POSITION

AS AT

 

            June 30,
2018
    December 31,
2017
 
            (in thousands)  
     Notes      £     £  

Assets

       

Non-current assets

       

Intangible assets

     6        2,485       1,938  

Property, plant and equipment

        495       358  

Deferred tax asset

     4        32       81  
     

 

 

   

 

 

 
        3,012       2,377  
     

 

 

   

 

 

 

Current assets

       

Prepayments, accrued income and other receivables

        1,737       3,050  

Current income tax receivable

     4        4,660       4,225  

Cash and cash equivalents

     7        81,469       86,703  
     

 

 

   

 

 

 
        87,866       93,978  
     

 

 

   

 

 

 
       

Total assets

        90,878       96,355  
     

 

 

   

 

 

 
       

Equity and liabilities

       

Capital and reserves

       

Share capital and share premium

     9        80,508       80,508  

Other reserves

        59,072       58,071  

Accumulated deficit

        (52,871     (45,159
     

 

 

   

 

 

 

Total equity attributable to equity holders of the Company

        86,709       93,420  
     

 

 

   

 

 

 
       

Non-current liabilities

       

Provisions

        26       18  
       

Current liabilities

       

Trade payables

        2,123       1,120  

Payroll taxes and social security

        103       157  

Accrued expenditure

        1,917       1,640  
     

 

 

   

 

 

 
        4,143       2,917  
       

Total liabilities

        4,169       2,935  
     

 

 

   

 

 

 
       

Total equity and liabilities

        90,878       96,355  
     

 

 

   

 

 

 

The accompanying notes form an integral part of these unaudited condensed consolidated financial statements.

 

3


NUCANA PLC

UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY

 

 

     For the Six Months Ended June 30,  
     Share
capital
     Share
premium
    Own
share
reserve
    Share
option
reserve
     Foreign
currency
translation
reserve
    Capital
reserve
     Accumulated
deficit
    Total
equity
attributable
to equity
holders
 
     (in thousands)  
     £      £     £     £      £     £      £     £  

Balance at December 31, 2016

     663        42,770       (339     4,406        (3     —          (22,256     25,241  

Loss for the period

     —          —         —         —          —         —          (4,385     (4,385

Other comprehensive expense for the period

     —          —         —         —          (1     —          —         (1
  

 

 

    

 

 

   

 

 

   

 

 

    

 

 

   

 

 

    

 

 

   

 

 

 

Total comprehensive loss for the period

     —          —         —         —          (1     —          (4,385     (4,386

Share-based payments

     —          —         —         532        —         —          —         532  

Reduction in share premium

     —          (42,466     —         —          —         42,466        —         —    
  

 

 

    

 

 

   

 

 

   

 

 

    

 

 

   

 

 

    

 

 

   

 

 

 

Balance at June 30, 2017

     663        304       (339     4,938        (4     42,466        (26,641     21,387  
  

 

 

    

 

 

   

 

 

   

 

 

    

 

 

   

 

 

    

 

 

   

 

 

 
                   

Balance at December 31, 2017

     1,272        79,236       (339     15,955        (11     42,466        (45,159     93,420  

Loss for the period

     —          —         —         —          —         —          (7,712     (7,712

Other comprehensive income for the period

     —          —         —         —          4       —          —         4  
  

 

 

    

 

 

   

 

 

   

 

 

    

 

 

   

 

 

    

 

 

   

 

 

 

Total comprehensive loss for the period

     —          —         —         —          4       —          (7,712     (7,708

Share-based payments

     —          —               —         997                —         —          —         997  
  

 

 

    

 

 

   

 

 

   

 

 

    

 

 

   

 

 

    

 

 

   

 

 

 

Balance at June 30, 2018

         1,272        79,236       (339     16,952        (7     42,466        (52,871     86,709  
  

 

 

    

 

 

   

 

 

   

 

 

    

 

 

   

 

 

    

 

 

   

 

 

 

The accompanying notes form an integral part of these unaudited condensed consolidated financial statements.

 

4


NUCANA PLC

UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

 

     For the six months ended
June 30,
 
     2018     2017  
     (in thousands)  
     £     £  

Cash flows from operating activities

    

Loss for the period

     (7,712     (4,385

Adjustments for:

    

Income tax credit

     (2,292     (1,077

Amortization and depreciation

     164       84  

Finance income

     (442     (91

Share-based payments

     997       532  

Initial public offering (IPO) related expenses

     —         1,066  

Net foreign exchange (gains) losses

     (1,112     142  
  

 

 

   

 

 

 
     (10,397     (3,729

Movements in working capital:

    

Decrease in prepayments, accrued income and other receivables

     1,358       609  

Increase (decrease) in trade payables

     1,003       (477

Increase (decrease) in payroll taxes, social security and accrued expenditure

     231       (230
  

 

 

   

 

 

 

Movements in working capital

     2,592       (98
  

 

 

   

 

 

 

Cash used in operations

     (7,805     (3,827
  

 

 

   

 

 

 

Net income tax credit received

     1,906       235  
  

 

 

   

 

 

 

Net cash used in operating activities

     (5,899     (3,592
  

 

 

   

 

 

 

Cash flows from investing activities

    

Interest received

     429       98  

Payments for property, plant and equipment

     (200     (5

Payments for intangible assets

     (648     (492
  

 

 

   

 

 

 

Net cash used in investing activities

     (419     (399
  

 

 

   

 

 

 

Cash flows from financing activities

    

IPO related expenses included in statement of operations

     —         (73
  

 

 

   

 

 

 

Net cash used in financing activities

     —         (73
  

 

 

   

 

 

 

Net decrease in cash and cash equivalents

     (6,318     (4,064

Cash and cash equivalents at beginning of period

     86,703       19,990  
  

 

 

   

 

 

 

Foreign currency translation differences

     1,084       (8
  

 

 

   

 

 

 

Cash and cash equivalents at end of period

     81,469        15,918  
  

 

 

   

 

 

 

The accompanying notes form an integral part of these unaudited condensed consolidated financial statements.

 

5


NUCANA PLC

NOTES TO THE UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

1. General information

NuCana plc (“NuCana” or the “Company”) is a clinical-stage biopharmaceutical company developing a portfolio of new medicines to treat cancer. We are harnessing the power of phosphoramidate chemistry to generate new medicines called ProTides. These compounds have the potential to improve cancer treatment by enhancing the efficacy and safety of several current standards of care.

On August 29, 2017 the Company re-registered as a public limited company and changed its name from NuCana BioMed Limited to NuCana plc.

The Company has had American Depository Receipts (“ADRs”) registered with the US Securities and Exchange Commission (“SEC”) and is listed on Nasdaq since October 2, 2017. The Company is incorporated in England and Wales and domiciled in the United Kingdom.

The Company has two wholly owned subsidiaries, NuCana, Inc. and NuCana BioMed Trustee Company Limited (together referred to as the “Group”).

The comparative figures for the year ended December 31, 2017 are not the Group’s statutory accounts for that financial year within the meaning of section 434 of the Companies Act 2006. Those accounts have been reported on by the Company’s auditor and delivered to the Registrar of Companies. The report of the auditor was (i) unqualified, (ii) did not include a reference to any matters to which the auditors drew attention by way of emphasis without qualifying their report, and (iii) did not contain a statement under section 498 (2) or (3) of the Companies Act 2006.

2. Significant accounting policies

Basis of preparation

The unaudited condensed consolidated financial statements (the “financial statements”) for the three and six months ended June 30, 2018 have been prepared in accordance with International Accounting Standard 34 “Interim Financial Reporting” (IAS 34). The significant accounting policies and methods of computation applied in the preparation of the financial statements are consistent with those applied in the Company’s annual financial statements for the year ended December 31, 2017. No new standards, amendments or interpretations have had an impact on the financial statements for the six months ended June 30, 2018.

The financial statements comprise the financial statements of the Company and its subsidiaries at June 30, 2018. The financial statements are presented in pounds sterling, which is also the Company’s functional currency. All values are rounded to the nearest thousand, except where otherwise indicated.

The financial statements do not include all the information and disclosures required in the annual financial statements, and should be read in conjunction with the Company’s annual financial statements as at December 31, 2017.

The unaudited condensed consolidated statement of cash flows for the six months ended June 30, 2017 has been restated to be consistent with the presentation of foreign exchange differences and IPO related expenses in the annual financial statements for the year ended December 31, 2017.

Going concern

In common with many companies in the biopharmaceutical sector, the Company incurs significant expenditure in its early years as it researches and develops its potential products for market.

The board of directors, having reviewed the operating budgets and development plans, considers that the Company has adequate resources to continue in operation for the foreseeable future. The board of directors is therefore satisfied that it is appropriate to adopt the going concern basis of accounting in preparing the financial statements. The Company believes that its cash and cash equivalents of £81.5 million at June 30, 2018, will be sufficient to fund its current operating plan for at least the next 12 months. As the Company continues to incur losses, the transition to profitability is dependent upon the successful development, approval and commercialization of its product candidates and achieving a level of revenues adequate to support its cost structure. The Company may never achieve profitability, and unless and until it does, it will continue to need to raise additional capital. There can be no assurances, however, that additional funding will be available on acceptable terms.

Judgements and estimates

The accounting estimates and judgements made by management in applying the Group’s accounting policies that have the most significant effect on the amounts included within these financial statements, were the same as those that applied to the annual financial statements for the year ended December 31, 2017.

 

6


NUCANA PLC

NOTES TO THE UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

 

3. IPO related expenses

 

     For the three months ended
June 30,
     For the six months ended
June 30,
 
     2018      2017      2018      2017  
     (in thousands)      (in thousands)  
     £      £      £      £  
  

 

 

    

 

 

    

 

 

    

 

 

 

IPO related expenses

         —          1,034            —          1,066  
  

 

 

    

 

 

    

 

 

    

 

 

 

IPO related expenses primarily relate to legal, accounting and other advisors’ fees in relation to the Company’s listing on Nasdaq which completed on October 2, 2017.

4. Income tax

 

     For the three months ended
June 30,
     For the six months ended
June 30,
 
     2018      2017      2018      2017  
     (in thousands)      (in thousands)  
     £      £      £      £  

Current tax

     1,393        745        2,341        1,077  

Deferred tax

     (10      —          (49      —    
  

 

 

    

 

 

    

 

 

    

 

 

 

Income tax credit

     1,383           745        2,292        1,077  
  

 

 

    

 

 

    

 

 

    

 

 

 

The income tax credit recognized primarily represents the U.K. research and development tax credit. In the U.K. the Company is able to surrender some of its losses for a cash rebate of up to 33.35% of expenditure related to eligible research and development projects.

 

     June 30,
2018
     December 31,
2017
 
     (in thousands)  
     £      £  

Current income tax receivable

     

U.K. tax

     4,641        4,207  

U.S. tax

     19        18  
  

 

 

    

 

 

 
             4,660        4,225  
  

 

 

    

 

 

 

Deferred tax asset

     

U.S. deferred tax asset

     32        81  
  

 

 

    

 

 

 

 

7


NUCANA PLC

NOTES TO THE UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

 

5. Basic and diluted loss per share

 

     For the three months ended
June 30,
     For the six months ended
June 30,
 
     2018      2017      2018      2017  
     (in thousands, except per share data)  
     £      £      £      £  

Loss for the period

     (1,318      (2,748      (7,712      (4,385
  

 

 

    

 

 

    

 

 

    

 

 

 

Basic and diluted weighted average number of shares

     31,811        24,185        31,811        24,185  
           
     £      £      £      £  

Basic and diluted loss per share

     (0.04      (0.11      (0.24      (0.18
  

 

 

    

 

 

    

 

 

    

 

 

 

Basic loss per share is calculated by dividing the loss for the period attributable to the equity holders of the Company by the weighted average number of shares outstanding during the period.

The potential shares issued through equity settled transactions were considered to be anti-dilutive as they would have decreased the loss per share and were therefore excluded from the calculation of diluted loss per share.

 

8


NUCANA PLC

NOTES TO THE UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

 

6. Intangible assets

Intangible assets comprise patents with a carrying value of £2.4 million as of June 30, 2018 (as of December 31, 2017: £1.8 million) and computer software with a carrying value of £0.1 million as of June 30, 2018 (as of December 31, 2017: £0.1 million).

During the six months ended June 30, 2018, the Company acquired intangible assets with a cost of £0.6 million in relation to patents (six months ended June 30, 2017: £0.4 million in relation to patents and £0.1 million in relation to computer software).

There were no disposals of intangible assets in the six months ended June 30, 2018 (six months ended June 30, 2017: £nil).

7. Cash and cash equivalents

 

     June 30,
2018
     December 31,
2017
 
     (in thousands)  
     £      £  

Cash and cash equivalents

             81,469        86,703  
  

 

 

    

 

 

 

Cash and cash equivalents comprise cash at bank with maturities of three months or less and earn interest at fixed or variable rates based on the terms agreed for each account.

 

9


NUCANA PLC

NOTES TO THE UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

 

8. Share-based payments

The Company has three share-based payment plans for employees, directors and consultants. The share options granted will be settled in equity.

On April 11, 2018 and May 8, 2018, 79,000 and 62,000 share options respectively were granted under the U.K. share-based payment plans. Options granted under these plans will vest if the option holder remains under respective contract of employment or contract of service for the agreed vesting period. The share options granted under these plans will vest equally over a period of four years, with the exception of options granted to a consultant, which vested immediately.

The fair values of options granted were determined using the Black-Scholes model that takes into account factors specific to the share incentive plan. As NuCana plc listed on October 2, 2017, it is not possible to derive historical volatility from the Company’s own share price. The underlying expected volatility was therefore determined by using the historical volatility of similar listed entities as a proxy. The volatility percentage applied to each tranche is the average of the historical volatility of comparable companies to NuCana plc.

The following weighted average principal assumptions were used in calculating the fair values of options granted:

 

     Options granted on  
     Apr 11, 2018     Apr 11, 2018     May 8, 2018  

Vesting dates

     Apr 11, 2019       Apr 11, 2018       May 8, 2019  
     Apr 11, 2020         May 8, 2020  
     Apr 11, 2021         May 8, 2021  
     Apr 11, 2022         May 8, 2022  

Volatility

     64.48     60.06     65.80

Dividend yield

     0     0     0

Risk-free investment rate

     1.04     0.83     1.02

Fair value of option at grant date

   £ 8.97     £ 17.35     £ 8.63  

Fair value of share at grant date

   £ 17.51     £ 17.51     £ 16.57  

Exercise price at date of grant

   £ 17.51     £ 0.16     £ 16.57  

Lapse date

     Apr 11, 2028       Apr 11, 2028       May 8, 2028  

Expected option life (years)

     4.50       2.00       4.50  

Number of options granted

     71,500       7,500       62,000  

For the six months ended June 30, 2018, the Company has recognized £1.0 million of share-based payment expense in the statement of operations (six months ended June 30, 2017: £0.5 million). For the three months ended June 30, 2018, the Company has recognized £0.6 million of share-based payment expense in the statement of operations (three months ended June 30, 2017: £0.3 million).

 

10


NUCANA PLC

NOTES TO THE UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

 

9. Share capital and share premium

 

     June 30,
2018
     December 31,
2017
 
     (in thousands)  
     £      £  

Share capital

     1,272        1,272  

Share premium

     79,236        79,236  
  

 

 

    

 

 

 
     80,508        80,508  
  

 

 

    

 

 

 
     June 30,
2018
     December 31,
2017
 
    

Number

(in thousands)

 

Issued share capital comprises:

     

Ordinary shares of £0.04 each

     31,811        31,811  
  

 

 

    

 

 

 

 

     Number of
shares
     Share
capital
     Share
premium
 
     (in thousands)  
Fully paid shares:           £      £  

Balance at December 31, 2017

     31,811        1,272        79,236  

Balance at June 30, 2018

     31,811        1,272        79,236  
  

 

 

    

 

 

    

 

 

 

10. Contingent liabilities

Under the U.K. share-based payment plan, the Company granted unapproved share options that have fully vested. If and when these share options are exercised, the Company will be liable for the Employer Class 1 National Insurance payable to HMRC in the U.K. This contingent liability will be determined based on the market value of the shares on exercise less the exercise price paid by the option holders, at the prevailing rate of Employer National Insurance (currently 13.8%). Based on the closing share price of ADSs on the Nasdaq Global Select Market on June 29, 2018, the last trading day of the period to which these financial statements relate, and assuming full exercise of all outstanding and vested unapproved share options on that date, the Employer National Insurance contingent liability would have been £4.1 million (December 31, 2017: £2.1 million).

 

11