Syncona has published results for the 12 months ended 31 March 2024. The NAV edged up from 186.5p to 188.7p, giving a NAV return for the period of 1.2%, but as it turns out all of that came from the effect of buying back shares at a discount. £20.2m worth of shares were repurchased at an average discount of 35.1%, adding 1.61p to the NAV. The share buyback is ongoing, with a further £10.0m of shares bought back since end March. However, the discount widened to 34.8% over the period (and has widened further since to 39.6%) to leave the share price down by 17.0%. As usual there is no dividend.
The company’s excessive cash reserves have fallen from £650.1m to £452.8m. [On that basis, there could still be scope for a more aggressive buyback. However, for many investors Syncona is more about the results that it achieves for patients and so our main gripe in the past was how slow it was to invest in new life sciences businesses. That has definitely stepped up a gear.] £172.2m was invested into the portfolio over the period, and Syncona has announced two new deals today with €30m for iOnctura and $16.5m of backing for Yellowstone (see separate story). Syncona anticipates that deployment into the portfolio and pipeline in the financial year to 31 March 2025 will be £150-200m.
Syncona also committed £20m to a Series A financing of a company it had previously seed financed in 2021, Forcefield Therapeutics aims to revolutionise the treatment of heart attacks. Roche Venture Fund committed a further £10.0m to the financing, valuing Syncona’s holding in Forcefield at £8.9m, a 38% uplift to the 31 March 2024 valuation.
The performance of the life science portfolio was driven by a £122.4m valuation gain from Autolus, offset by partial write-downs of Anaveon and Clade and the write-off of Gyroscope milestone payments. The share price appreciation at Autolus was driven by continued strong progress in the development of its obe-cel therapy. The company has submitted the key regulatory filing for approval of the drug, its Biologics License Application (BLA), with the US Food and Drug Administration (FDA) and expects to receive feedback regarding potential approval in November 2024. Autolus also completed a strategic collaboration with BioNTech worth $250m in upfront proceeds and a public offering of $350m.
£42.8m was written off the value of Anaveon (to £35.7m) as that company decided to focus on its next generation, pre-clinical ANV600 programme. After the period end, Clade was sold to Century, triggering a £14.4m write-down in its valuation to £9.4m. The biggest impact though came from Novartis’ decision to discontinue the development of Gyroscope’s GT005. This resulted in a write-off of the £56.4m risk-adjusted valuation of potential milestone payments.
71.1% of Syncona’s value is now in clinical-stage companies. The announcement gives detailed information on the portfolio which we won’t replicate here but is available here.
SYNC : Syncona NAV flat following Gyroscope disappointment