25. Discontinued operations
On 23 November 2020 we signed a share purchase agreement with Selvita S.A. in relation to the disposal of Fidelta d.o.o. (our fee-for-service segment). As net assets associated with our fee-for-service business will be recovered principally through a sale transaction rather than through continuing use, we have classified these assets and the associated liabilities as held for sale in our financial statements for the year ended 31 December 2020.
The transaction was completed on 4 January 2021 for a total consideration of €37.1 million (including the customary adjustments for cash and working capital). Fidelta will continue performing drug discovery services for us for the next five years for which we have purchase commitments for an aggregate amount of €27.0 million.
Held for sale assets are stated at their carrying amount, which is lower than the fair value less costs to sell.
As we expect to continue to purchase services from Fidelta d.o.o. after the closing of the transaction, we eliminated the intragroup revenue and cost in discontinued operations.
(i) Financial performance
|
Year ended 31 December |
|
(thousands of €, except share and per share data) |
2020 |
2019 |
Revenues |
16,140 |
10,084 |
Other income |
- |
8 |
Total revenues and other income |
16,140 |
10,092 |
|
|
|
Research and development expenditure |
(7,685) |
(7,229) |
General and administrative expenses |
(2,000) |
(1,319) |
Total operating expenses |
(9,685) |
(8,548) |
|
|
|
Operating profit |
6,455 |
1,544 |
|
|
|
Other financial income |
179 |
93 |
Other financial expenses |
(176) |
(102) |
|
|
|
Profit before tax |
6,458 |
1,535 |
|
|
|
Income taxes |
(893) |
(379) |
|
|
|
Net profit |
5,565 |
1,156 |
|
|
|
Basic income per share from discontinued operations |
0.09 |
0.02 |
Diluted income per share from discontinued operations |
0.08 |
0.02 |
Weighted average number of shares (in thousands of shares) |
65,075 |
57,614 |
Weighted average number of shares - Diluted (in thousands of shares) |
67,572 |
60,112 |
(ii) Assets and liabilities
The following assets and liabilities were classified as held for sale in relation to the discontinued operations:
(thousands of €) |
2020 |
Intangible assets |
21 |
Property, plant and equipment |
10,050 |
Other non-current assets |
160 |
Trade and other receivables |
4,428 |
Cash and cash equivalents |
7,884 |
Other current assets |
863 |
Total assets classified as held for sale |
23,406 |
|
|
Non-current lease liabilities |
4,115 |
Other non-current liabilities |
70 |
Trade and other liabilities |
3,649 |
Current lease liabilities |
727 |
Income tax payable |
356 |
Liabilities associated with assets classified as held for sale |
8,917 |
|
|
Net assets |
14,488 |
(iii) Cash flow
(thousands of €) |
2020 |
2019 |
Net cash flows generated in operating activities |
7,173 |
2,911 |
Net cash flows used in investing activities |
(2,284) |
(1,350) |
Net cash flows used in financing activities |
(664) |
(709) |
Net cash flows from discontinued operations |
4,225 |
852 |