Northland Capital Partners View on the City - Edenville Energy and Evgen Pharma


Evgen Pharma plc (LON:EVG) – BUY*: Interim results in line
Market Cap: £17m; Current Price: 23.5p; Target Price: 97p

Results in line with expectations: good cost controls and strong balance sheet

Evgen issued interim results for the six months ended 30 September 2016. The group continues to manage strict cost controls with a Total comprehensive loss for the period of £1.7m (30 September 2015: total comprehensive loss £1.2m), which was in line with our expectations. 

With a reported cash position at 30 September 2016 of £5.5m (30 September 2015: £1.8m), the group’s balance sheet is strong.

The Company is fully funded to complete its two ongoing Phase II studies and to conduct further preclinical work.

Principle achievements in the year-to-date included:

The first patient being dosed (April 2016) in the Company's first Phase II clinical trial (SAS) testing SFX-01 in subarachnoid haemorrhage. (Moreover, patient recruitment rates for this trial are reported to be in-line with expectations.)

The US Food & Drug Administration (FDA) granting the Company orphan drug designation (August 2016) for the use of stabilised sulforaphane in subarachnoid haemorrhage (SAH).

The first clinical site opening for patient recruitment for the Company's second Phase II clinical trial STEM (SFX-01 in the Treatment and Evaluation of Metastatic Breast Cancer), with further sites due to open across Europe in H1-2017 (calendar year).

The reporting of positive data from preclinical studies of SFX-01 in various models of the relapsing remitting form of multiple sclerosis (MS) presented (September 2016) at a leading MS conference.

NORTHLAND CAPITAL PARTNERS VIEW: Evgen’s results were in line with our expectations. The group remains a good custodian of investor capital, managing a lean but productive operation. With £5.5m of cash on account (Sept. 30/2016), the Company has a strong balance sheet and is funded to complete its current clinical programmes. The group’s two Phase II clinical trials are progressing to plan, with both studies expected to report in H1-2018 (calendar year). Of note, over the period the group secured orphan designation for its lead product in the treatment of subarachnoid haemorrhage, representing a major milestone for the business. Also, the group recently presented very encouraging preclinical MS data.

Edenville Energy (LON:EDL) – CORP: Rukwa update
Market Cap: £3.4m; Current Price: 0.45p

Positive bulk sample result from MK1

Edenville Energy has now received the second set of sampling results from its bulk sampling programme at the Mkomolo and Namwele deposits, located in Tanzania.

These results come from the MK1 coal seam, whereas the previous results come from the MK2 coal seam. The results demonstrate that only moderate to no washing will be required for the MK1 seam for it to be used in coal fired thermal power plants. Where washing is required, high-yields of c. 60% are achievable to produce a high-quality power plant feed.

Applying an increased wash to seam MK1 results in a product above 20MJ/kg that opens the potential for supply into the local and regional markets.

Edenville is now working with potential customers to assess the options for establishing mining operations in 2017.

NORTHLAND CAPITAL PARTNERS VIEW: Another positive bulk sample result for Edenville Energy with both the M1 and M2 coal seams demonstrating the potential for the production of coal that with moderate to no washing can be used in coal fired power plants. The Company has received interest in its product from a number of power plants that are planned in East Africa and is in discussions regarding pricing and supply. The Company is also in advanced discussion with local and regional parties with regards to the sale of higher energy value coal, contained within the seams for use in industrial applications. These results now open up the northern area of Mkomolo for initial production and Edenville is seeking to commence production in 2017.


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