Cellectis: 2012 first-half earnings

Paris, September 20th, 2012 (7 am) – Cellectis (Alternext: ALCLS), the genome engineering specialist, is releasing its condensed consolidated accounts for the first half of 2012.

Paris, September 20th, 2012 (7 am) – Cellectis (Alternext: ALCLS), the genome engineering specialist, is releasing its condensed consolidated accounts for the first half of 2012.

Marc Le Bozec, Cellectis' Chief Financial Officer, stated: “The first half of 2012 has laid the foundations for Cellectis' future growth. The progress made is illustrated by the strong development of our Products and Services activities, following the commercial success of the TALEN™ offer, as well as a significant increase in commercial opportunities. These developments are being accompanied by major technological advances, enabling us to accelerate the rollout of our therapeutics programs. In line with our development plans, these advances mean that we are able to maintain our target for 20 to 30% growth in operating income for the current year, excluding exceptional agreements”.

Half-year highlights

• Organizational developments

Cellectis has launched an active policy to structure its organization following the acquisition of Cellartis, which has been consolidated since November 1st, 2011. This is reflected in a rationalization of internal procedures and resources aimed at improving projects. It is being accompanied by the development of resources to help drive growth (optimization of support functions and increase in marketing investments), opening up more commercial opportunities.

To support its development, Cellectis has continued to further strengthen its development teams across all its activities. At June 30th, 2012, the Group had 230 staff, compared with 155 at June 30th, 2011.

• Increasingly dynamic commercial development

During the first half of 2012, Cellectis confirmed the commercial success of TALEN™ offer, the first range of services making it possible to specifically modify a gene in all cell types. This is reflected in the clear acceleration in growth for TALEN™ sales over the last 12 months.

During the first six months of the year, several new licensing, research and development collaboration agreements were also signed with:

1. Total, for the development of microalgae-based substitutes for oil products.
2. Medicago, for improvements to therapeutic proteins expressed from tobacco leaves. • SES VanderHave, for the development of marketable sugar beet varieties.
3. Bayer CropScience, for the development of commercial products for the agricultural seeds market.

• Major advances with the development of the therapeutics portfolio

Cellectis has stepped up the development of its therapeutics business. Major progress has been made, including a tenfold increase in the effectiveness of the DNA modification techniques, paving the way for new therapeutic approaches. Cellectis is now focusing on a selection of high-potential programs, including cancer and diabetes (working with Novo Nordisk). The Cellectis Group's therapeutics strategy will be presented in detail in January 2013.

Financial results for the first half of 2012

• Revenues totaled €7.5 million for the first half of 2012, virtually stable in relation to last year. These revenues, marked by the activity's traditional seasonal patterns, do not include high levels of income relating to licensing agreements, unlike the first half of 2011 (€3 million).

• Operating expenses rose to €19.2 million, up 9% compared with the first half of 2011, in line with the development plan. This increase factors in a ramping up of R&D (€10.2 million, versus €7.4 million one year earlier). Sales and administrative costs have been kept tightly under control, coming in at €8.2 million, compared with €8.9 million for the same period in 2011.

• Income for the period came to -€11.5 million, similar to the figure for the first half of 2011 (-€10.3 million). It includes €1.2 million in tax income linked to the capitalization of losses carried forward.

• Cash represented €27.8 million at June 30th, 2012. Cash consumption came to €14.6 million for the first half of 2012, compared with €3.6 million for the same period in 2011. This change primarily reflects a €6 million difference relating to the research tax credit (received during the first half of the year in 2011 and expected in the second half of 2012) and a differential of almost €5 million concerning certain technology suppliers paid during the first half of 2012.

• At June 30th, 2012, shareholders’ equity was €71.7 million, an increase of €42.9 million compared with December 31st, 2011. This change primarily reflects the redemption of the reimbursable bonds subscribed for by the French sovereign fund (FSI) and Pierre Bastid at the end of 2011 for a total of €50 million into shares.

Outlook

Cellectis is moving forward with the industrialization of its technologies in order to develop its commercial offering for therapeutics and biopharmaceutical products and services, while adopting stringent cost control measures.

For 2012, Cellectis is targeting 20 to 30% growth in its revenues compared with 2011 (excluding exceptional agreements). Like-for-like, Cellectis expects to break even by 2014, owing to its effective management of current costs over the coming half-year periods.

Next dates:

• Presentation of the therapeutics strategy in January 2013

• 2012 full-year earnings in April 2013