EX-99.1

EX-99.1 2 d422694dex991.htm EX-99.1 EX-99.1

Exhibit 99.1

ASCENDIS PHARMA A/S

INDEX TO UNAUDITED CONDENSED CONSOLIDATED INTERIM FINANCIAL STATEMENTS


	Page
Unaudited Condensed Consolidated Interim Statements of Profit or Loss and Other Comprehensive Income / (Loss) for the Three and Six Months Ended June 30, 2017 and 2016		2
Unaudited Condensed Consolidated Interim Statements of Financial Position as of June 30, 2017 and December 31, 2016		3
Unaudited Condensed Consolidated Interim Statements of Changes in Equity at June 30, 2017 and 2016		4
Unaudited Condensed Consolidated Interim Cash Flow Statements for the Six Months Ended June 30, 2017 and 2016		5
Notes to the Unaudited Condensed Consolidated Interim Financial Statements		6

Unaudited Condensed Consolidated Interim Statements of Profit or Loss

and Other Comprehensive Income / (Loss) for the Three and Six Months Ended June 30


			Three Months Ended June 30						Six Months Ended June 30
	Notes		2017			2016			2017			2016
			(EUR’000)						(EUR’000)
Revenue		4		444			1,136			816			2,394
Research and development costs				(21,880	)		(13,279	)		(42,488	)		(29,521	)
General and administrative expenses				(3,231	)		(2,669	)		(6,556	)		(5,577	)

Operating profit / (loss)				(24,667	)		(14,812	)		(48,228	)		(32,704	)
Finance income				158			1,453			288			1,473
Finance expenses				(6,234	)		—			(7,956	)		(2,764	)

Profit / (loss) before tax				(30,743	)		(13,359	)		(55,896	)		(33,995	)
Tax on profit / (loss) for the period				37			74			51			192

Net profit / (loss) for the period				(30,706	)		(13,285	)		(55,845	)		(33,803	)

Other comprehensive income / (loss)
Items that may be reclassified subsequently to profit or loss:
Exchange differences on translating foreign operations				42			(14	)		46			7

Other comprehensive income / (loss) for the period, net of tax				42			(14	)		46			7

Total comprehensive income / (loss) for the period, net of tax				(30,664	)		(13,299	)		(55,799	)		(33,796	)
Profit / (loss) for the period attributable to owners of the Company				(30,706	)		(13,285	)		(55,845	)		(33,803	)
Total comprehensive income / (loss) for the period attributable to owners of the Company				(30,664	)		(13,299	)		(55,799	)		(33,796	)


			EUR			EUR			EUR			EUR
Basic earnings / (loss) per share				(0.94	)		(0.53	)		(1.72	)		(1.34	)
Diluted earnings / (loss) per share				(0.94	)		(0.53	)		(1.72	)		(1.34	)
Number of shares used for calculation (basic)				32,502,555			25,172,984			32,465,935			25,150,613
Number of shares used for calculation (diluted) ⁽¹⁾				32,502,555			25,172,984			32,465,935			25,150,613

⁽¹⁾

A total of 3,689,506 warrants outstanding as of June 30, 2017 can potentially dilute earnings per share in the future, but have not been included in the calculation of diluted earnings per share because they are antidilutive for the periods presented. Similarly, a total of 2,819,779 warrants outstanding as of June 30, 2016 are also considered antidilutive for the periods presented and have not included in the calculation.

Unaudited Condensed Consolidated Interim Statements of Financial Position


	Notes		June 30, 2017		December 31, 2016
Assets				(EUR’000)
Non-current assets
Intangible assets				3,495		3,495
Property, plant and equipment				2,587		2,350
Deposits				278		268

				6,360		6,113

Current assets
Trade receivables				450		287
Other receivables				1,190		640
Prepayments				6,077		1,962
Income taxes receivable				1,006		740
Cash and cash equivalents				127,320		180,329

				136,043		183,958


Total assets				142,403		190,071


Equity and liabilities
Equity
Share capital		7		4,365		4,354
Other reserves				18,061		13,005
Retained earnings				104,042		159,254

Total equity				126,468		176,613


Current liabilities
Trade payables and other payables				15,536		13,078
Deferred income				94		94
Income taxes payable				305		286

				15,935		13,458


Total liabilities				15,935		13,458

Total equity and liabilities				142,403		190,071

Unaudited Condensed Consolidated Interim Statements of Changes in Equity


	Share Capital		Foreign Currency Translation Reserve			Share- based Payment Reserve		Retained Earnings			Total
			(EUR’000)
Equity at December 31, 2016		4,354		(79	)		13,084		159,254			176,613

Profit / (loss) for the period		—		—			—		(55,845	)		(55,845	)
Other comprehensive income / (loss), net of tax		—		46			—		—			46

Total comprehensive income / (loss)		—		46			—		(55,845	)		(55,799	)
Share-based payment (Note 6)		—		—			5,010		—			5,010
Capital increase		11		—			—		633			644

Equity at June 30, 2017		4,365		(33	)		18,094		104,042			126,468


	Share Capital		Foreign Currency Translation Reserve			Share- based Payment Reserve		Retained Earnings			Total
			(EUR’000)
Equity at December 31, 2015		3,374		(85	)		5,763		111,277			120,329

Profit / (loss) for the period		—		—			—		(33,803	)		(33,803	)
Other comprehensive income / (loss), net of tax		—		7			—		—			7

Total comprehensive income / (loss)		—		7			—		(33,803	)		(33,796	)
Share-based payment (Note 6)		—		—			3,865		—			3,865
Capital increase		8		—			—		503			511

Equity at June 30, 2016		3,382		(78	)		9,628		77,977			90,909

Unaudited Condensed Consolidated Interim Cash Flow Statements for the

Six Months Ended June 30


	Notes	2017			2016
		(EUR’000)
Operating activities
Net profit / (loss) for the period			(55,845	)		(33,803	)
Reversal of finance income			(288	)		(1,473	)
Reversal of finance expenses			7,956			2,764
Reversal of tax charge			(51	)		(192	)

Adjustments for:
Share-based payment			5,010			3,865
Depreciation and amortization			349			335

Changes in working capital:
Deposits			(11	)		7
Trade receivables			(163	)		672
Other receivables			(549	)		(262	)
Prepayments			(4,116	)		162
Trade payables and other payables			2,504			1,735
Deferred income			—			(1,489	)


Cash flows generated from / (used in) operations			(45,204	)		(27,679	)
Finance income received			288			41
Finance expenses paid			(55	)		(3	)
Income taxes received / (paid)			(196	)		(27	)


Cash flows from / (used in) operating activities			(45,167	)		(27,668	)


Investing activities
Acquisition of property, plant and equipment			(585	)		(410	)

Cash flows from / (used in) investing activities			(585	)		(410	)


Financing activities
Capital increase			644			511
Cost of capital increase			—			—


Cash flows from / (used in) financing activities			644			511


Increase / (decrease) in cash and cash equivalents			(45,108	)		(27,567	)


Cash and cash equivalents at January 1			180,329			119,649
Effect of exchange rate changes on balances held in foreign currencies			(7,901	)		(1,329	)


Cash and cash equivalents at June 30			127,320			90,753

Notes to the Unaudited Condensed Consolidated Interim Financial Statements

Note 1—General Information

Ascendis Pharma A/S, together with its subsidiaries, is a biopharmaceutical company that utilizes our innovative TransCon technology to address significant unmet medical needs in rare diseases. We have created a portfolio of potential best-in-class rare disease endocrinology product candidates to address unmet medical needs by applying TransCon technology to parent drugs with clinical proof-of-concept. Ascendis Pharma A/S was incorporated in 2006 and is headquartered in Hellerup, Denmark. Unless the context otherwise requires, references to the “Company,” “we,” “us” and “our” refer to Ascendis Pharma A/S and its subsidiaries.

The address of the Company’s registered office is Tuborg Boulevard 5, DK-2900, Hellerup, Denmark.

On February 2, 2015, the Company completed an initial public offering, or IPO, which resulted in the listing of American Depositary Shares, or ADSs, representing the Company’s ordinary shares, under the symbol “ASND” in the United States on The NASDAQ Global Select Market.

The Company’s Board of Directors approved these unaudited condensed consolidated interim financial statements on August 17, 2017.

Note 2—Summary of Significant Accounting Policies

Basis of Preparation

The unaudited condensed consolidated interim financial statements of the Company are prepared in accordance with International Accounting Standard 34, “Interim Financial Reporting”. Certain information and disclosures normally included in the consolidated financial statements prepared in accordance with International Financial Reporting Standards as issued by the International Accounting Standards Board, and as approved by the European Union (“IFRS”) have been condensed or omitted. Accordingly, these condensed consolidated interim financial statements should be read in conjunction with the Company’s annual consolidated financial statements for the year ended December 31, 2016 and accompanying notes, which have been prepared in accordance with IFRS.

The preparation of financial statements in conformity with IFRS requires the use of certain critical accounting estimates and requires management to exercise its judgment in the process of applying the Company’s accounting policies. The areas involving a higher degree of judgment or complexity, or areas where assumptions and estimates are significant to the condensed consolidated interim financial statements are disclosed in Note 3.

Changes in Accounting Policies

The accounting policies applied when preparing these condensed consolidated interim financial statements have been applied consistently to all the periods presented, unless otherwise stated and are consistent with those of the Company’s most recent annual consolidated financial statements. A description of our accounting policies is provided in the Accounting Policies section of the audited consolidated financial statements as of and for the year ended December 31, 2016.

Note 3—Critical Accounting Judgments and Key Sources of Estimation Uncertainty

In the application of our accounting policies, we are required to make judgments, estimates and assumptions about the carrying amounts of assets and liabilities that are not readily apparent from other sources. The estimates and associated assumptions are based on historical experience and other factors that are considered to be relevant. Actual results may differ from these estimates.

The estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognized in the period in which the estimate is revised if the revision affects only that period, or in the period of the revision and future periods if the revision affects both current and future periods.

Notes to the Unaudited Condensed Consolidated Interim Financial Statements

Critical judgments made in the process of applying our accounting policies and that have the most significant effect on the amounts recognized in our condensed consolidated financial statements relate to revenue recognition, share-based payment, internally generated intangible assets, and joint arrangements / collaboration agreements.

The key sources of estimation uncertainty that have a significant risk of causing a material adjustment to the carrying amount of assets and liabilities within the next financial year relate to impairment of goodwill and to recognition of accruals for manufacturing and clinical trial activities. There have been no changes to the application of significant accounting estimates, and no impairment losses have been recognized during the first six months of 2017 or 2016.

The condensed consolidated interim financial statements do not include all disclosures for critical accounting estimates and judgments that are required in the annual consolidated financial statements, and should be read in conjunction with the Company’s annual consolidated financial statements for the year ended December 31, 2016.

Note 4—Revenue

Three Months Ended
June 30,

Six Months Ended
June 30,

2017

2016

2017

2016

(EUR’000)

Revenue from the rendering of services

444

391

816

905

License income

—

745

—

1,489

Total revenue

444

1,136

816

2,394

Revenue from external customers (geographical)

USA

444

1,136

816

2,394

Total revenue

444

1,136

816

2,394

Note 5—Segment Information

We are managed and operated as one business unit. No separate business areas or separate business units have been identified in relation to product candidates or geographical markets. Accordingly, we do not disclose information on business segments or geographical markets, except for the geographical information on revenue included in Note 4.

Note 6—Warrants and Share-based Payment

Share-based payment

Ascendis Pharma A/S has established warrant programs, equity-settled share-based payment transactions, as an incentive for all of our employees, members of our Board of Directors and select external consultants.

Warrants are granted by the Board of Directors in accordance with authorizations given to it by the shareholders of Ascendis Pharma A/S. As of June 30, 2017, 5,372,312 warrants had been granted, of which 19,580 warrants have been cancelled, 1,489,108 warrants have been exercised, 2,168 warrants have expired without being exercised, and 171,950 warrants have been forfeited. As of June 30, 2017, our Board of Directors was authorized to grant up to 2,647,092 additional warrants to our employees, board members and select consultants without pre-emptive subscription rights for the shareholders of Ascendis Pharma A/S. Each warrant carries the right to subscribe for one ordinary share of a nominal value of DKK 1. The exercise price is fixed at the fair market value of our ordinary shares at the time of grant as determined by our Board of Directors. The exercise prices of outstanding warrants under our warrant programs range from €6.48 to €26.85 depending on the grant dates. Vested warrants may be exercised in two or four annual exercise periods. Apart from exercise prices and exercise periods, the programs are similar.

Notes to the Unaudited Condensed Consolidated Interim Financial Statements

Warrant Activity

The following table specifies the warrant activity during the six months ended June 30, 2017:


	Total Warrants			Weighted Average Exercise Price EUR
Outstanding at December 31, 2016		3,691,765			13.05


Granted during the period		127,500			23.46
Exercised during the period		(81,434	)		7.91
Forfeited during the period		(48,325	)		16.27
Expired during the period		—			—


Outstanding at June 30, 2017		3,689,506			13.49


Vested at the balance sheet date		1,754,732			10.55

Warrant Compensation Costs

Warrant compensation costs are determined with basis in the grant date fair value of the warrants granted and recognized over the vesting period.

Three Months Ended
June 30,

Six Months Ended
June 30,

2017

2016

2017

2016

(EUR’000)

Research and development costs

1,122

1,001

2,411

2,008

General and administrative expenses

1,183

784

2,599

1,857

Total warrant compensation costs

2,305

1,785

5,010

3,865

Note 7—Share Capital

The share capital of Ascendis Pharma A/S consists of 32,502,555 shares at a nominal value of DKK 1, all in the same share class.

On March 23 and March 30, 2017, an aggregate of 81,434 warrants were exercised, increasing the Company’s share capital from 32,421,121 shares to 32,502,555 shares.

Note 8—Subsequent Events

No events have occurred after the balance sheet date that would have a significant impact on the results or financial position of the Company.

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