XCSE:BAVA ESEF Annual Report
BAVARIAN NORDIC A/S (XCSE:BAVA)
ESEF Annual Report
2023-11-15
For: 2021-09-30
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Added on
September 23, 2026
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Bavarian Nordic A/S
DK-2900 Hellerup www.bavarian-nordic.com LEI Code: 2138006JCDVYIN6INP51
Company Announcement
Bavarian Nordic Announces Interim Results for the First Nine Months of 2021
COPENHAGEN, Denmark , November 12, 2021 – Bavarian Nordic A/S (OMX: BAVA) announced today its interim financial results for the first
nine months of 2021 and business progress for the third quarter of 2021.
Paul Chaplin, President & Chief Executive Officer of Bavarian Nordic said: “We continued to experience a challenging market environment
for our travelers vaccine business during the third quarter, due to COVID-19. Despite these headwinds, we remain on track to meet our guidance
as both our smallpox and Ebola vaccine sales remain unaffected. This truly highlights the importance of a broader and more diversified product
portfolio. We are very pleased with the strong pipeline progress seen during the quarter, where highly promising results for our COVID-19
booster vaccine candidate were reported and funding for the remaining phases was secured. Likewise, we have presented strong results for
our RSV vaccine candidate, which showed remarkable efficacy in reducing symptomatic RSV infections in a challenge study. These assets
provide an encouraging outlook for Bavarian Nordic, and we look forward to providing more updates as the work progresses.”
Financial highlights
• Total revenue in the first nine months was DKK 1,354 million comprised of DKK 1,323 million from combined product sales and DKK
31 million from contract work.
• Revenue in the third quarter totaled DKK 449 million comprised of DKK 214 million from sales of MVA-BN smallpox vaccine, DKK 160
million from sales of Rabipur/RabAvert, DKK 72 million from sales of Encepur and DKK 3 million from contract work.
• EBITDA in the first nine months was DKK 44 million.
• Strong cash position of DKK 2,182 million** at the end of the period.
• Full-year guidance maintained with expected revenue of approximately DKK 1,900 million, EBITDA of approximately DKK 100
million and securities, cash and cash equivalents at year-end of approximately DKK 1,400 million.
DKK million
Q3 2021
Q3 2020
9m 2021
9m 2020
2021 Guidance
Revenue
449
558
1,354
1,623
~1,900
EBITDA
52
163
44
1,001*
~100
Securities, cash and cash equivalents
2,182**
2,569
2,182**
2,569
~1,400
* EBITDA in the first nine months of 2020 was positively impacted by the sale of the Priority Review Voucher (DKK 628 million).
** Unutilized credit facilities of DKK 243 million not included. Repo pledged securities deducted.
Other highlights
• In August, initial results from the first-in-human trial of the COVID-19 vaccine candidate, ABNCoV2 were reported, which
demonstrated that the vaccine candidate was well tolerated and induced a strong antibody response, higher than currently
approved vaccines. Results from the high dose groups are now available and suggest a plateau in the responses as similar high
antibody titers were shown for these groups. Importantly, a strong neutralization response was demonstrated against SARS-CoV-2
variants, including the Delta variant.
• In August, Bavarian Nordic initiated a phase 2 clinical trial of ABNCoV2 to investigate the vaccine’s potential as a universal booster
vaccine for individuals with existing immunity from prior COVID-19 disease or vaccination. Initial results from the study are
expected in December 2021.
• In August, Bavarian Nordic entered a funding agreement with the Danish Ministry of Health, under which the Company will be
eligible to receive up to DKK 800 million to further advance the development of ABNCoV2 as a booster vaccine for COVID-19. The
agreement was finally executed in September upon approval from the Finance Committee of the Danish Parliament.
• In September, Bavarian Nordic reported positive results from the human challenge trial of MVA-BN RSV. The trial achieved the
primary endpoint of the pivotal study by demonstrating a statistically significant reduction in viral load in vaccinated versus
control (placebo) treated volunteers. The vaccine demonstrated a 79% efficacy in reducing symptomatic RSV infections.
Preparations for a phase 3 trial in 2022 continue, pending a final decision driven by regulatory discussions and feedback on the trial
design and funding/partnering considerations.
Events after the reporting date
• In accordance with the shareholder authorization for the board of directors and the Company’s remuneration policy, the board of
directors has today decided to issue warrants to executive management and certain employees in the Bavarian Nordic Group. In
accordance with the Company’s remuneration policy, President and CEO, Paul Chaplin will receive an extraordinary grant as
Bavarian Nordic Announces Interim Results for the First Nine Months of 2021 Page 2 of 20
Company Announcement no. 35 / 2021
further explained on page 6 in the interim report. A total of 716,256 warrants have been issued, which entitle the warrant holders
to subscribe for up to 716,256 shares in total, with a nominal value of DKK 10 each at an exercise price of DKK 353.06 per share.
Conference call and webcast
The management of Bavarian Nordic will host a conference call today at 2 pm CET (8 am EST) to present the interim results followed by a
Q&A session. A listen-only version of the call can be accessed via https://www.bavarian-nordic.com/investor/events.aspx?event=6097. To
join the Q&A session, use one of the following dial-in numbers: De nmark : +45 32 72 80 42, UK: +44 (0) 844 571 8892, USA: +1 631-510-7495.
Participant code is 2839609.
Contacts
Europe: Rolf Sass Sørensen, Vice President Investor Relations, Tel: +45 61 77 47 43
US: Graham Morrell, Paddock Circle Advisors, graham@paddockcircle.com, Tel: +1 781 686 9600
Company Announcement no. 35 / 2021
About Bavarian Nordic
Bavarian Nordic is a fully integrated vaccines company focused on the development, manu facturing and commercialization of life -saving
smallpox vaccine, which has been approved by the FDA, also for the protection against monkeypox. The vaccine is approved as a smallpox
vaccine in Europe and Canada. Our commercial product portfolio furthermore contains market-leading vaccines against rabies and tick-borne
encephalitis. Using our live virus vaccine platform technology, MVA-BN®, we have created a diverse portfolio of proprietary and partnered
product candidates designed to save and improve lives by unlocking the power of the immune system, including an Ebola vaccine, which is
licensed to the Janssen Pharmaceutical Companies of Johnson & Johnson. We are also committed to the development of a next generation
COVID-19 vaccine. For more information visit www.bavarian-nordic.com.
Forward-looking statements
This announcement includes forward-looking statements that involve risks, uncertainties and other factors, many of which are outside of our
control, that could cause actual results to differ materially from the results discussed in the forward-looking statements. Forward-looking
statements include statements concerning our plans, objectives, goals, future events, performance and/or other information that is not
historical information. All such forward-looking statements are expressly qualified by these cautionary statements and any other cautionary
statements which may accompany the forward-looking statements. We undertake no obligation to publicly update or revise forward-looking
statements to reflect subsequent events or circumstances after the date made, except as required by law.
Bavarian Nordic Announces Interim Results for the First Nine Months of 2021 Page 3 of 20
Company Announcement no. 35 / 2021
Consolidated Key Figures (unaudited)
DKK thousand
1/7 - 30/9 2021
1/7 - 30/9 2020
1/1 - 30/9 2021
1/1 - 30/9 2020
1/1-31/12 2020
Income statements
Revenue
448,656
558,488
1,353,908
1,623,468
1,852,383
Production costs
313,913
245,597
940,555
868,167
1,195,094
Sales and distribution costs
37,575
72,575
135,671
222,439
285,783
Research and development costs
74,511
102,300
293,728
226,359
341,420
Administrative costs
69,641
74,075
225,571
200,408
278,145
Other operating income
-
-
-
627,647
627,647
Income before interest and taxes (EBIT)
(46,984)
63,941
(241,617)
733,742
379,588
Financial items, net
(31,834)
(37,060)
(115,065)
(79,284)
(97,612)
Income before company tax
(78,818)
26,881
(356,682)
654,458
281,976
Net profit for the period
(81,440)
26,349
(362,543)
652,202
277,521
Balance sheet
Total non-current assets
6,523,564
6,359,911
6,378,017
Securities, cash and cash equivalents
2,638,064
2,569,107
1,669,607
Other current assets
955,896
522,117
711,440
Total assets
10,117,524
9,451,135
8,759,064
Equity
5,770,699
5,264,117
4,894,353
Non-current liabilities
2,034,090
2,408,367
2,912,401
Current liabilities
2,312,735
1,778,651
952,310
Cash flow statements
Cash flow from operating activities
(247,117)
987,639
571,911
Cash flow from investment activities
(1,355,880)
(2,051,270)
(1,911,532)
- Investment in intangible assets
(86,010)
(113,408)
(501,877)
- Investment in property, plant and equipment
(307,166)
(108,359)
(204,833)
- Net investment in securities
(947,362)
(1,826,820)
(1,202,145)
Cash flow from financing activities
1,655,265
1,331,154
1,334,874
Financial Ratios
1)
EBITDA after Other operating income
51,581
162,658
43,596
1,001,276
739,736
EBITDA before Other operating income
51,581
162,658
43,596
373,629
112,089
Earnings (basic) per share of DKK 10
(5.8)
12.4
5.1
Net asset value per share
90.1
90.1
83.7
Share price at period-end
326
198
187
Share price/Net asset value per share
3.6
2.2
2.2
Number of outstanding shares at period-end
(thousand)
2)
64,065
58,450
58,450
Equity share
57%
56%
56%
Number of employees, converted to full-time, at
period-end
750
649
690
1)
Earnings per share (EPS) is calculated in accordance with IAS 33 "Earning per share". Other financial ratios have been calculated in accordance with
the guidelines from the Danish Society of Financial Analysts.
2)
Number of shares increased by 5,150,000 at completion of private placement March 2021.
Reconciliation of EBITDA
Income before interest and tax (EBIT)
(46,984)
63,941
(241,617)
733,742
379,588
Depreciation and amortization
98,565
98,717
285,213
267,534
360,148
EBITDA after Other operating income
51,581
162,658
43,596
1,001,276
739,736
Bavarian Nordic Announces Interim Results for the First Nine Months of 2021 Page 4 of 20
Company Announcement no. 35 / 2021
Management’s Review
Sales and other income
Comparative figures for 2020 are shown in brackets. Where
market shares are mentioned, these are measured by value.
Q3 sales 9M sales
Rabipur/RabAvert
Rabipur/RabAvert revenue amounted to DKK 160 million (DKK 188
million) for the third quarter. The 15% decrease versus the prior
year was primarily caused by an expected market share loss as
the competitor returned into the market from a stock out
situation last year.
The Q3 US market grew by approximately 4% compared with last
year, but the market is still significantly below the pre-COVID-19
level. The US market share end of September was approximately
69%, 5 percentage point below same period prior year, but still
approximately 7-8 percentage points higher than the level prior
to the competitor out-of-stock situation.
European revenue remains very low due to COVID-19 and the
impact on travelling to endemic rabies countries. However, the
German market did show 71% growth versus prior year but
coming from a very low base. Rabipur market share ended at
approximately 95% in Germany, 4 percentage points down
compared with prior year.
For the first nine months, Rabipur/RabAvert revenue amounted
to DKK 368 million (DKK 548 million), i.e. a decrease of 33%.
Encepur
Encepur revenue amounted to DKK 72 million (DKK 110 million)
for the third quarter, i.e. a decrease of 35% versus prior year
primarily caused by continued negative market development in
Germany and inventory movements at wholesaler and partner
level.
The Q3 2021 German market declined by 13%, continuing the
negative trend started in Q2 and caused by lack of resources for
TBE vaccinations as general practitioners were focused on COVID-
19 vaccinations. This decline followed a promising first quarter
with an 8% market growth. The German market share was 31% by
end of September, which is in line with prior year.
For the first nine months, Encepur revenue amounted to DKK 316
million (DKK 406 million), i.e. a decrease of 22%.
JYNNEOS
Revenue from the sale of JYNNEOS/IMVANEX/IMVAMUNE in the
third quarter was DKK 214 million (DKK 160 million) comprising of
both bulk batches and liquid frozen finished products to BARDA.
For the first nine months, JYNNEOS/IMVANEX/IMVAMUNE revenue
was DKK 550 million (DKK 480 million), of which DKK 460 million
was related to orders from the US government and DKK 90 million
was related to rest of World orders.
Mvabea (Ebola)
For the first nine months, revenue from Mvabea was DKK 89 million
(DKK 0 million), which is related to the order announced in June
2020.
Contract work
Revenue from contract work in the third quarter was DKK 3
million (DKK 33 million). For the first nine months, revenue from
contract work amounted to DKK 31 million (DKK 123 million),
mainly stemming from qualification and validation activities
relating to the fill-and-finish plant and the phase 3 trial of the
freeze-dried version of the smallpox vaccine, both under
contracts with the US government.
Our marketed products
PRODUCT
INDICATION
Rabipur
®
/RabAvert
®
Rabies
Encepur
®
Tick-borne encephalitis (TBE)
JYNNEOS
®
/IMVAMUNE
®
/IMVANEX
®
(liquid-frozen)
Smallpox (and Monkeypox in the US)
Mvabea
®
(licensed to Janssen)
Ebola
mDKK
Q3 2021
Q3 2020
Growth
Rabipur/RabAvert
160
188
-15%
Encepur
72
110
-35%
JYNNEOS
214
160
+33%
Mvabea (Ebola)
-
-
-
Milestone payments
-
67
-
Contract work
3
33
-90%
Total
449
558
mDKK
9m 2021
9m 2020
Growth
Rabipur/RabAvert
368
547
-33%
Encepur
316
406
-22%
JYNNEOS
550
480
14%
Mvabea (Ebola)
89
-
-
Milestone payments
-
67
-
Contract work
31
123
-84%
Total
1,354
1,623
Bavarian Nordic Announces Interim Results for the First Nine Months of 2021 Page 5 of 20
Company Announcement no. 35 / 2021
Update on strategic priorities
Bavarian Nordic’s mission is to save and improve lives by
unlocking the power of the immune system and in the medium
term, we have established a bold vision and aspiration to become
one of the largest pure play vaccine companies by developing
innovative life-saving vaccines, excelling in commercialization
and being a best-in-class vaccine manufacturer.
Commercial
The establishment of the commercial infrastructure and transfer
of marketing and distribution for Rabipur/RabAvert and Encepur
from GSK has been completed for all markets, except Japan, in
accordance with plans and in record time. In addition, market
shares have either been maintained or increased during the
transition and the awareness of Bavarian Nordic among health
care practitioners has increased in key markets.
Preparations are ongoing to expand the commercial portfolio in
2022 with the addition of HEPLISAV-B
®
hepatitis B vaccine from
Dynavax, which Bavarian Nordic will market and distribute in
Germany, as well as the DUKORAL
®
cholera vaccine and IXIARO
®
Japanese encephalitis vaccine from Valneva which Bavarian
Nordic will market and distribute in Germany and Switzerland
according to the agreements entered with both companies during
2020 and 2021.
R&D innovation
Several key pipeline projects have advanced during 2021,
supporting the Company’s strategy to develop innovative life-
saving vaccines.
COVID-19 vaccine
Initial data from the first-in-human study of ABNCoV2, the capsid
virus like particle (cVLP) COVID-19 vaccine candidate licensed
from AdaptVac, were reported in August, and the remaining data
for the high dose groups have now become available. The phase
1/2 dose-escalation trial enrolled 45 healthy SARS-CoV-2-naïve
adult volunteers, who received two doses (dose ranges from 6-70
μg) of ABNCoV2, formulated with and without adjuvant. The high
doses (50 μg and 70 μg) were however all administered without
adjuvant. The results demonstrate that the vaccine was well
tolerated across all dose groups with no observed difference in
the adverse event profile following the first and second
vaccinations. No serious adverse events were reported, and the
safety profile was comparable to other vaccines based on
recombinant protein-technology.
In all dose groups, antibody titers were boosted after the second
vaccination to levels significantly higher than those reported for
current approved COVID-19 vaccines. Titers were up to 12-fold
higher than those measured in convalescent human samples with
similar strong responses seen across the groups receiving 25, 50
and 70 μg, indicating a plateau within this range. This could
potentially provide rationale for reducing the dose of the
vaccine, while maintaining optimal effect, and thus could lead to
an optimization of manufacturing costs, however more data is
needed to facilitate a meaningful conclusion.
Importantly, ABNCoV2 demonstrated high neutralization titers
against all SARS-CoV-2 variants of concern, including the
dominant Delta variant.
A phase 2 clinical trial was initiated in August to investigate the
potential of ABNCoV2 as a booster vaccine for individuals with
previous COVID-19 disease or vaccination. Upon assessment of
the phase 1 results, the phase 2 trial has been amended and will
expand the group of healthy volunteers with existing immunity to
a total of 180 (previously 150 subjects), of which 90 subjects will
receive a single dose of 100 μg ABNCoV2 and 90 subjects will
receive 50 μg of ABNCoV2, thus seeking to confirm the optimal
dose for boosting the existing levels of SARS-CoV-2 neutralizing
antibodies. Enrollment has been completed in the first group
with initial results expected in December 2021 according to plan.
The second group is expected to initiate enrollment later in
November.
In August a funding agreement, valued at up to DKK 800 million,
was entered with the Danish Ministry of Health to support the
completion of the development of ABNCoV2 towards licensure.
The agreement includes an upfront payment of DKK 80 million, in
addition to payments of up to DKK 720 million, which are
contingent upon reaching a number of predefined milestones
including among others completion of the ongoing phase 2 trial,
phase 3 development milestones and milestones related to
upscaling of manufacturing for clinical and commercial
production of the vaccine.
All payments are potentially subject to repayment, however only
upon successful marketing authorization of the vaccine by the
European Commission. Repayment may occur via supply of
vaccines and royalty payments from the sale of the vaccine to
other customers. Royalty payments are only triggered upon
reaching a certain volume in sales. The Danish Ministry of Health
could be entitled to an additional, capped royalty payment if the
sales reach a certain threshold.
The phase 3 trial of ABNCoV2 is anticipated in 2022, pending
results from the ongoing phase 2 trial and further discussions and
feedback from the regulatory authorities.
The manufacturing of vaccines for the phase 3 trial has been
agreed with a contract manufacturer and is planned for
December 2021, with filling at Bavarian Nordic’s own facility
anticipated during first quarter of 2022.
RSV
In September, positive results from the human challenge trial of
MVA-BN
®
RSV were reported. The phase 2 double-blinded,
placebo-controlled trial enrolled healthy adult volunteers,
between 18-50 years of age who were randomized to receive
either a single vaccination of MVA-BN RSV or placebo. Volunteers
were challenged intranasally with an RSV type A strain 28 days
after vaccination. A total of 61 subjects were evaluable.
The study demonstrated a significant reduction in viral load in
vaccinated subjects (n=30) versus placebo (n=31), thus meeting
the primary endpoint of this critical study. At the same time, the
vaccinated subjects showed a significant reduction in clinical
symptoms typically associated with RSV infections. The MVA-BN
RSV vaccine demonstrated a vaccine efficacy of up to 79% in
preventing symptomatic RSV infections.
No vaccine-related serious adverse events were observed, and
the vaccine was well tolerated, consistent with the safety profile
previously reported in phase 1 and phase 2 clinical studies.
Pending further analysis of the current RSV infection rates,
discussions with regulatory authorities about the phase 3 design,
and funding/partnering considerations, the Company will
determine the immediate next steps and expects to communicate
these during fourth quarter of 2021. In the meantime,
preparations are ongoing to enable a trial start in 2022 should
this be decided upon.
MVA-BN smallpox, freeze-dried
The tech transfer of the freeze-dried version of the MVA-BN
smallpox vaccine to Bavarian Nordic’s fill and finish line has been
initiated, which, together with the completed phase 3 trial (lot
consistency trial) will form basis for submission of a supplement
Bavarian Nordic Announces Interim Results for the First Nine Months of 2021 Page 6 of 20
Company Announcement no. 35 / 2021
to the Biologics License Application (BLA) to extend the approval
for both formulations of MVA-BN, anticipated in 2022.
Immuno-oncology
A phase 1/2 open label trial of intravenous administration of
TAEK-VAC, a tumor antibody enhanced therapeutic vaccine
targeting HER2 and brachyury, which has been generated from
the MVA-BN platform, was initiated earlier in 2021. The first
stage of the trial is investigating the safety and tolerability of
escalating doses of the vaccine before advancing into stage 2,
expected in 2022.
Manufacturing
The ongoing activities to expand Bavarian Nordic’s manufacturing
footprint are progressing as planned, while also running the
planned production in parallel, including among others
production of bulk vaccine for the US government, as well as
production of Mvabea (Ebola) bulk vaccine for Janssen.
In June, the Kvistgaard manufacturing facility was inspected by
the Danish Medicines Agency (DMA). In addition to the primary
inspection of the new fill and finish facility, the existing bulk
manufacturing facility was reinspected in accordance with the
GMP requirements. Both inspections were successful and Bavarian
Nordic received the formal approval of the entire facility from
the DMA during the third quarter of 2021.
The transfer and validation of the final drug production of the
liquid-frozen JYNNEOS smallpox vaccine has been completed and
commercial production of the vaccine has been initiated at the
new fill and finish facility.
Additionally, the expansion of the bulk facility to support
technology transfer of Rabipur/RabAvert and Encepur have
progressed timely. In accordance with the expansion plans the
bulk facility is now shut down and will not reopen until third
quarter of 2022 which means there will be a significant reduction
of the bulk manufacturing capacity in 2022.
Other matters
Incentive programs for employees and executive management in
Bavarian Nordic
The board of directors has today decided to issue warrants to
executive management and certain employees in the Bavarian
Nordic Group. The decision is made in accordance with the
shareholder authorization for the board of directors adopted as
Article 5b of the Articles of Association and the Company’s
remuneration policy.
The warrant program entails the issuance of 716,256 warrants in
total which entitle the warrant holders to subscribe for up to
716,256 shares in total with a nominal value of DKK 10 each at an
exercise price of DKK 353.06 per share. The warrants may be
exercised wholly or partly during eight fixed subscription periods
during 2025 and 2026.
The value of each warrant equals DKK 76.05 and is calculated on
the Black-Scholes model with a risk-free interest rate of -0.53%
per cent and on the historical volatility of the shares in relevant
peers. The calculation is based on a share price of DKK 307.20.
Retention scheme introduced for CEO Paul Chaplin
In order to secure Paul Chaplin's continued service as CEO for
Bavarian Nordic A/S in the light of increasing demand driven by
the COVID-19 pandemic for leaders with strong vaccine
experience, the board of directors has today decided, in
accordance with the remuneration policy, to grant Mr. Chaplin an
extraordinary retention cash bonus in 2024 equivalent to one
year's base wage (2021 level) as well as an extraordinary Long
Term Incentive (LTI) grant equal to one year's base wage (2021
level) out of which 50% will be granted as warrants in 2021 and
the remaining 50% will in Q2 2022 be granted either as warrants
or RSUs (the latter would be subject to approval at the annual
general meeting in 2022).
Our clinical pipeline
VACCINE
INDICATION
PHASE 1
PHASE 2
PHASE 3
STATUS / MILESTONE
MVA-BN freeze-dried
Smallpox
Phase 3 completed. Submission of BLA supplement anticipated in 2022
MVA-BN RSV
RSV
Phase 2 completed. Decision on phase 3 pending.
ABNCoV2
COVID-19
Phase 2 ongoing with expected data read-out in Q4 2021.
TAEK-VAC
Cancer
Phase 1/2 study ongoing.
MVA-BN WEV
Equine encephalitis
Phase 1 dose finding study completed. Further development is pending
external funding.
Bavarian Nordic Announces Interim Results for the First Nine Months of 2021 Page 7 of 20
Company Announcement no. 35 / 2021
Financial review
Financial statements for the period January 1 – September 30,
2021 are un-audited. Comparison figures for the same period
2020 are stated in brackets.
Revenue
Revenue for the period was DKK 1,354 million (DKK 1,623
million). Revenue was composed of DKK 684 million (DKK 954
million) from sales of the two new products Rabipur/RabAvert
and Encepur, DKK 460 million (DKK 480 million) from sales of
MVA-BN smallpox vaccine to US government, DKK 90 million (DKK
0 million) from sales of smallpox vaccines to three European
countries, DKK 89 million (DKK 0 million) sales of Mvabea to
Janssen, DKK 0 million milestone payments (DKK 67 million) and
DKK 31 million (DKK 123 million) from contract work. Revenue
reported for the three months ended September 30, 2021 was
DKK 449 million (DKK 558 million).
Production costs
Production costs totaled DKK 941 million (DKK 868 million). Costs
related directly to revenue amounted to DKK 453 million (DKK
606 million), of which cost of goods sold totaled DKK 432 million
(DKK 523 million). Contract costs totaled DKK 20 million (DKK 83
million). Amortization of product rights related to
Rabipur/RabAvert and Encepur has also been recognized as part
of the production costs with a total of DKK 205 million (DKK 205
million). Other production costs totaled DKK 283 million (DKK 57
million) and included write-down of inventories by DKK 77 million
to cover likely expiry of products following the lower sale, offset
by partial reversal of accrual made year-end 2020 to capture
obsolete products related to distribution switch from GSK (DKK
34 million). In Q1 the production plant was utilized for
production of RSV Phase 3 clinical trial material, which gave a
much lower utilization of the commercial manufacturing capacity
leading to low absorption of indirect production costs causing
higher other production costs. Since August 2021, the current
bulk manufacturing facility has been shut down due to the
ongoing expansion of the drug substance facility for future
production of Rabipur/RabAvert and Encepur, therefore no
absorption of indirect production costs for this part of the
production facility leading to increased other production costs.
In the third quarter of 2021, production costs were DKK 314
million (DKK 246 million).
Sales and distribution costs
Sales and distribution costs totaled DKK 136 million (DKK 222
million) split between costs for distribution of products of DKK 13
million (DKK 109 million) and costs for running the commercial
organization and activities of DKK 123 million (DKK 113 million).
In 2020 GSK handled the sale and distribution of
Rabipur/RabAvert and Encepur for which the Group paid a
distribution fee based on the revenue incurred, leading to much
higher distribution costs in 2020 compared to 2021.
Research and development costs
Research and development costs totaled DKK 294 million (DKK
226 million). The increase compared to 2020 was driven by
manufacturing of RSV Phase 3 material. The amount excludes
R&D costs of DKK 20 million (DKK 83 million) recognized as
production costs, see note 5.
Administrative costs
Administrative costs totaled DKK 226 million (DKK 200 million).
The increase primarily relates to the ongoing transfer project for
1
The deferred consideration for product rights is measured at net present
value and the difference between the net present value and the amounts
Rabipur/RabAvert and Encepur and the impact from the
extension of the executive management during 2020.
Other operating income
Other operating income for 2020 related to the sale of the
Priority Review Voucher, DKK 628 million.
EBIT/EBITDA
Income before interest and tax (EBIT) was a loss of DKK 242
million, compared to a gain of DKK 734 million in first nine
months of 2020.
EBITDA was a gain of DKK 44 million (gain of DKK 1,001 million).
Amortization of product rights related to Rabipur/RabAvert and
Encepur amounted to DKK 205 million (DKK 205 million) whereas
depreciation on other fixed assets amounted to DKK 81 million
(DKK 63 million).
Financial items
Financial items totaled a net expense of DKK 115 million (net
expense of DKK 79 million) and consisted of interest expense on
debt of DKK 13 million (DKK 27 million), net value adjustment of
deferred consideration of DKK 88 million (DKK 54 million) and a
net expense from securities of DKK 28 million (income of DKK 12
million), partly offset by net foreign exchange rate gains of DKK
12 million (loss DKK 3 million), a net gain on derivative financial
instruments of DKK 1 million (loss DKK 7 million) and interest
income DKK 1 million (DKK 0 million).
The net value adjustment of deferred consideration consists of
three components; Adjustment of deferred consideration due to
change in estimated timing of payments DKK 7 million income
(income of DKK 26 million), currency adjustments of DKK 2
million income (income of DKK 10 million) and unwinding
1
of the
discounting effect related to deferred consideration DKK 97
million (DKK 90 million), see note 6 and 7.
Income before company tax was a loss of DKK 357 million (gain of
DKK 654 million).
Tax
Tax on income was DKK 6 million (DKK 2 million). The parent
company’s taxable income for the full year of 2021 is expected to
be zero due to utilization of tax deductable amortization on the
acquired product rights related to Rabipur/RabAvert and
Encepur, leading to an effective tax rate close to 0% for the
Group. We do not expect to use any tax loss carry forwards,
hence the deferred tax asset on the balance sheet remains at
DKK 0 million. The Company retains the right to use the tax
losses carried forward that was written down in prior year, see
note 14 in the Annual Report for 2020.
Net profit
For the first nine months of 2021, Bavarian Nordic reported a net
loss of DKK 363 million (net gain of DKK 652 million).
Product rights
Product rights recognized in the balance sheet totaled DKK 4,981
million (DKK 5,186 million as of December 31, 2020) and relates
to Rabipur/RabAvert and Encepur.
Acquired rights and development in progress
Acquired rights and development in progress relates to the
development of ABNCoV2, the Company’s COVID-19 vaccine
candidate. The asset includes the upfront payment to AdaptVac
of DKK 30 million paid last summer when the license and
due is recognized in the income statement as a financial expense over the
period until expected payment date using the effective interest method.
Bavarian Nordic Announces Interim Results for the First Nine Months of 2021 Page 8 of 20
Company Announcement no. 35 / 2021
collaboration agreement was signed and capitalization of
development costs for running the ongoing phase 2 study (DKK 19
million). Under the Group’s accounting policies and in
accordance with common industry practice, development costs
are generally expensed in the year they occur. During the
development of ABNCoV2, the Group has, however, started
capitalization of directly related development cost at
commencement of the phase 2 studies as – unlike most other
development candidates - the feasibility of developing a final
vaccine and obtain regulatory approval is considered highly
likely, because the development of other COVID-19 vaccine
candidates based on the same antigen has been successful.
Furthermore, the Group has ensured significant finance of the
development through the funding obtained from Danish Ministry
of Health and a minimum demand agreed in the agreement with
the Danish Ministry of Health.
Under the agreement, the Company is entitled to an upfront
payment of DKK 80 million, in addition to payments of up to DKK
720 million, which are contingent upon reaching a number of
predefined milestones under the development project. All
payments are potentially subject to repayment, however only
upon successful obtainment of marketing authorization and upon
reaching certain annual levels of doses sold.
The upfront payment of DKK 80 million was received mid-
October.
Securities, cash and cash equivalents
Securities, cash and cash equivalents were DKK 2,638 million as of
September 30, 2021, including repo pledged securities of DKK 456
million (DKK 1,670 million as of December 31, 2020, no repo pledged
securities). The increase is primarily due to the capital increase in
March 2021 which generated net proceeds of DKK 1.1 billion.
In addition to the current cash position, the Company has an
undrawn loan with the European Investment Bank of EUR 30
million.
Cash flow
Cash flow generated by operating activities was negative by DKK
247 million (positive by DKK 988 million), primarily following an
increase in trade receivables compared to year-end 2020. Cash
flow from investment activities was negative by DKK 1,356
million (negative by DKK 2,051 million) following net investments
in securities of DKK 947 million (net investment of DKK 1,827
million). Cash flow from investment activities also include DKK
307 million (DKK 108 million) of investments in property, plant
and equipment related to the ongoing expansion of the drug
substance facility for future production of Rabipur/RabAvert and
Encepur. Investment in other intangible assets amounted to DKK
86 million (DKK 92 million) and includes the ongoing
Rabipur/RabAvert and Encepur technology transfer project, the
development project for the COVID-19 vaccine and IT system
investments. Cash flow from financing activities was a
contribution of DKK 1,655 million (DKK 1,331 million), following
the proceeds from capital increase through private placement,
proceeds from warrant exercise and conclusion of repo
transactions. The net change in cash and cash equivalents was
positive by DKK 52 million (positive by DKK 268 million).
Equity
The Group’s equity as of September 30, 2021 stood at DKK 5,771
million (DKK 4,894 million as of December 31, 2020). The capital
increase through private placement increased the equity by DKK
1,148 million before costs.
Deferred consideration
Deferred consideration for product rights amounted to DKK 2,911
million, an increase of DKK 88 million compared to December 31,
2020, due to the adjustment of net present value following the
unwinding of the discounting effect.
Debt to credit institutions
The Company has concluded repo transactions (further described
in note 15), hence debt to credit institutions increased by DKK
455 million compared to December 31, 2020. The European
Investment Bank loan obtained in August 2017 (DKK 372 million)
shall be repaid in August 2022 and therefore presented as current
liabilities.
Significant risks and uncertainties
Bavarian Nordic faces a number of risks and uncertainties,
common for the biotech/pharma industry. These relate to
operations, research and development, manufacturing,
commercial and financial activities. For further information
about risks and uncertainties which Bavarian Nordic faces, refer
to page 48-51 “Risk Management” in the 2020 Annual Report.
In addition to the risk factors stated in the annual report, the
COVID-19 situation could impact Bavarian Nordic’s business
adversely by delaying projects, development or manufacturing or
by negatively impacting demand for products or availability of
critical raw materials.
Outlook for 2021
Bavarian Nordic maintains the financial guidance for 2021,
expecting to meet to the lower end of the previously guided
ranges due to continued COVID-19 impact on the TBE and rabies
markets. Thus, revenue of approximately DKK 1,900 million and
an EBITDA of approximately DKK 100 million are expected. Cash
and cash equivalents at year-end are expected to be
approximately DKK 1,400 million.
The smallpox and Ebola business are not expected to be
impacted by COVID-19.
Other key assumptions for the guidance remain largely
unchanged.
Financial calendar 2021 and 2022
2021 Annual Report March 4, 2022
Annual General Meeting* April 5, 2022
Three-month report (Q1) May 9, 2022
Half-year report (Q2) August 24, 2022
Nine-month report (Q3) November 9, 2022
* Pursuant to Article 12 of the Articles of Association,
shareholders who wish to submit a request for proposals for
consideration at the annual general meeting must lodge this with
the Company no later than Monday, February 21, 2022.
Bavarian Nordic Announces Interim Results for the First Nine Months of 2021 Page 9 of 20
Company Announcement no. 35 / 2021
Financial statements
Unaudited Condensed Consolidated Income Statements for the Periods Ended September 30, 2021 and
2020 and December 31, 2020
DKK thousand
Note
1/7 - 30/9 2021
1/7 - 30/9 2020
1/1 - 30/9 2021
1/1 - 30/9 2020
1/1-31/12 2020
Revenue
3
Production costs
4
Gross profit
Sales and distribution costs
Research and development costs
5
Administrative costs
Total operating costs
Other operating income
Income before interest and tax (EBIT)
(46,984 )
(241,617 )
Financial income
6
Financial expenses
7
Income before company tax
(78,818 )
(356,682 )
Tax on income for the period
Net profit for the period
(81,440 )
(362,543 )
Earnings per share (EPS) - DKK
Basic earnings per share of DKK 10
(1.3 )
(5.8 )
Diluted earnings per share of DKK 10
(1.3 )
(5.8 )
Unaudited Condensed Consolidated Statements of Comprehensive Income for the Periods Ended September
30, 2021 and 2020 and December 31, 2020
DKK thousand
1/7 - 30/9 2021
1/7 - 30/9 2020
1/1 - 30/9 2021
1/1 - 30/9 2020
1/1-31/12 2020
Net profit for the period
(81,440 )
(362,543 )
Items that might be reclassified to the
income statement:
Exchange rate adjustments on translating
foreign operations
(50 )
(311 )
(3,082 )
Change in fair value of financial instruments
entered into to hedge future cash flows
(3,053 )
(3,467 )
(13,839 )
(1,433 )
(3,096 )
Other comprehensive income after tax
(3,517 )
(6,014 )
(1,744 )
(6,178 )
Total comprehensive income
(80,659 )
(368,557 )
Bavarian Nordic Announces Interim Results for the First Nine Months of 2021 Page 10 of 20
Company Announcement no. 35 / 2021
Unaudited Condensed Consolidated Statements of Cash Flow for the Periods Ended September 30, 2021
and 2020 and December 31, 2020
DKK thousand
1/1 - 30/9 2021
1/1 - 30/9 2020
1/1-31/12 2020
Net profit for the period
(362,543 )
Adjustment for non-cash items:
Financial income
(30,994 )
(47,775 )
(97,922 )
Financial expenses
Tax on income for the period
Depreciation, amortization and impairment losses
Share-based payment
Changes in inventories
(32,196 )
(256,703 )
(420,320 )
Changes in receivables
(213,885 )
(58,437 )
(88,094 )
Changes in current liabilities
(97,908 )
Cash flow from operations (operating activities)
(245,014 )
Received financial income
Paid financial expenses
(7,630 )
(25,339 )
(40,034 )
Paid company taxes
(1,796 )
(2,959 )
(3,944 )
Cash flow from operating activities
(247,117 )
Investments in products rights
(21,673 )
(393,992 )
Investments in other intangible assets
(86,010 )
(91,735 )
(107,885 )
Investments in property, plant and equipment
(307,166 )
(108,359 )
(204,833 )
Investments in/disposal of financial assets
(15,342 )
(2,683 )
(2,677 )
Investments in securities
(1,138,549 )
(2,172,512 )
(2,343,828 )
Disposal of securities
Cash flow from investment activities
(1,355,880 )
(2,051,270 )
(1,911,532 )
Payment on loans
(1,630 )
(1,383,998 )
(1,375,598 )
Proceeds from loans
Repayment of lease liabilities
(14,608 )
(13,119 )
(17,799 )
Proceeds from warrant programs exercised
Proceeds from rights issue
Proceeds from capital increase through private placement
Cost related to issue of new shares
(25,588 )
(103,184 )
(103,184 )
Sale of preemptive rights - treasury shares
Purchase of treasury shares
(8,581 )
(11,099 )
(11,099 )
Cash flow from financing activities
Cash flow of the period
(4,747 )
Cash as of 1 January
Currency adjustments 1 January
(3,623 )
(7,311 )
Cash end of period
Bavarian Nordic Announces Interim Results for the First Nine Months of 2021 Page 11 of 20
Company Announcement no. 35 / 2021
Unaudited Condensed Consolidated Statements of Financial Position - Assets as of September 30, 2021 and
2020 and December 31, 2020
DKK thousand
Note
30/9 2021
30/9 2020
31/12 2020
Assets
Product rights
Acquired rights and development in progress
Software
Intangible assets in progress
Intangible assets
Land and buildings
Leasehold improvements
Plant and machinery
Fixtures and fittings, other plant and equipment
Assets under construction
Property, plant and equipment
Right-of-use assets
14
Other receivables
Prepayments
Financial assets
Total non-current assets
Inventories
8
Trade receivables
9
Tax receivables
Other receivables
10
Prepayments
Receivables
Securities
15, 16
Cash and cash equivalents
Securities, cash and cash equivalents
Total current assets
Total assets
Bavarian Nordic Announces Interim Results for the First Nine Months of 2021 Page 12 of 20
Company Announcement no. 35 / 2021
Unaudited Condensed Consolidated Statements of Financial Position - Equity and Liabilities as of September
30, 2021 and 2020 and December 31, 2020
DKK thousand
Note
30/9 2021
30/9 2020
31/12 2020
Equity and liabilities
Share capital
Treasury shares
(1,176 )
(1,077 )
(1,077 )
Retained earnings
Other reserves
Equity
Deferred consideration for product rights
Debt to credit institutions
11
Lease liabilities
14
Non-current liabilities
Deferred consideration for product rights
Debt to credit institutions
11, 15
Lease liabilities
14
Prepayment from customers
12
Trade payables
Company tax
Other liabilities
13
Current liabilities
Total liabilities
Total equity and liabilities
Bavarian Nordic Announces Interim Results for the First Nine Months of 2021 Page 13 of 20
Company Announcement no. 35 / 2021
Unaudited Condensed Consolidated Statements of Changes in Equity for the Periods September 30, 2021
and 2020
DKK thousand
Share capital
Treasury
shares
Retained
earnings
Reserves for
currency
adjustment
Reserves for
fair value of
financial
instruments
Share-based
payment
Equity
Equity as of January 1, 2021
(1,077 )
(40,640 )
(809 )
Comprehensive income for the period
Net profit
(362,543 )
(362,543 )
Other comprehensive income
Exchange rate adjustments on translating foreign
operations
Change in fair value of financial instruments entered
into to hedge future cash flows
(13,839 )
(13,839 )
Total comprehensive income for the period
(362,543 )
(13,839 )
(368,557 )
Transactions with owners
Share-based payment
Warrant program exercised
(23,047 )
Capital increase through private placement
Cost related to issue of new shares
(25,588 )
(25,588 )
Purchase of treasury shares
(317 )
(8,264 )
(8,581 )
Transfer regarding restricted stock units
(3,734 )
Total transactions with owners
(99 )
Equity as of September 30, 2021
(1,176 )
(32,815 )
(14,648 )
DKK thousand
Share capital
Treasury
shares
Retained
earnings
Reserves for
currency
adjustment
Reserves for
fair value of
financial
instruments
Share-based
payment
Equity
Equity as of January 1, 2020
(684 )
(37,558 )
Comprehensive income for the period
Net profit
Other comprehensive income
Exchange rate adjustments on translating foreign
operations
(311 )
(311 )
Change in fair value of financial instruments entered
into to hedge future cash flows
(1,433 )
(1,433 )
Total comprehensive income for the period
(311 )
(1,433 )
Transactions with owners
Share-based payment
Warrant program exercised
(3,448 )
Capital increase through rights issue
Cost related to issue of new shares
(103,184 )
(103,184 )
Purchase of treasury shares
(524 )
(10,575 )
(11,099 )
Transfer regarding restricted stock units
(3,766 )
Sale of preemptive rights - treasury shares
Total transactions with owners
(393 )
Equity as of September 30, 2020
(1,077 )
(37,869 )
Bavarian Nordic Announces Interim Results for the First Nine Months of 2021 Page 14 of 20
Company Announcement no. 35 / 2021
Notes
1. Significant accounting policies
2. Significant accounting estimates, assumptions and
uncertainties
3. Revenue
4. Production costs
5. Research and development costs
6. Financial income
7. Financial expenses
8. Inventories
9. Trade receivables
10. Other receivables
11. Debt to credit institutions
12. Prepayment from customers
13. Other liabilities
14. Right-of-use assets and lease liabilities
15. Transferred financial assets that are not derecognized
16. Financial instruments
17. Warrants
18. Significant changes in contingent liabilities and other
contractual obligations
19. Significant events after the balance sheet date
20. Approval of the unaudited condensed consolidated interim
financial statements
1. Significant accounting policies
The interim financial statements are prepared in accordance with IAS 34, Interim Financial Reporting, as adopted by EU and the additional
Danish requirements for submission of interim reports for companies listed on Nasdaq Copenhagen. The interim report has not been audited
or reviewed by the Company’s auditors.
The interim financial statements are presented in Danish Kroner (DKK), which is considered the primary currency of the Group’s activities
and the functional currency of the parent company.
The accounting policies used in the interim financial statements are consistent with those used in the consolidated financial statements for
2020 and in accordance with the recognition and measurement policies in the International Financial Reporting Standards (IFRS) as adopted
by EU.
As of September 30, 2021, the Company has implemented all new or amended accounting standards and interpretations as adopted by the
EU and applicable for the 2021 financial year. None of the new or amended standards or interpretations are assessed to have significant
impact on the consolidated financial statements.
2. Significant accounting estimates, assumptions and uncertainties
In the preparation of the interim financial statements according to IAS 34, Interim Financial Reporting, as adopted by the EU, Management is
required to make certain estimates as many financial statement items cannot be reliably measured but must be estimated. Such estimates
comprise judgments made on the basis of the most recent information available at the reporting date. It may be necessary to change
previous estimates as a result of changes to the assumptions on which the estimates were based or due to supplementary information,
additional experience or subsequent events.
Similarly, the value of assets and liabilities often depends on future events that are somewhat uncertain. In that connection, it is necessary
to set out e.g. a course of events that reflects Management’s assessment of the most probable course of events.
Further to the significant accounting estimates, assumptions and uncertainties, which are stated in the Annual Report 2020, Management has
made a significant accounting judgment in relation to capitalization of the development costs related to ABNCoV2. Under the Group’s
accounting policies and in accordance with common industry practice, development costs are generally expensed in the year they occur.
During the development of ABNCoV2, the Group has, however, started capitalization of directly related development cost at commencement
of the phase 2 studies as – unlike most other development candidates - the feasibility of developing a final vaccine and obtain regulatory
approval is considered highly likely, because the development of other COVID-19 vaccine candidates based on the same antigen has been
successful. Furthermore, the Group has ensured significant finance of the development through the funding obtained from Danish Ministry of
Health and a minimum demand agreed in the agreement with the Danish Ministry of Health.
Management has not changed significant estimates and judgments regarding recognition and measurement.
Bavarian Nordic Announces Interim Results for the First Nine Months of 2021 Page 15 of 20
Company Announcement no. 35 / 2021
DKK thousand
1/7 - 30/9
2021
1/7 - 30/9
2020
1/1 - 30/9
2021
1/1 - 30/9
2020
1/1-31/12
2020
3. Revenue
MVA-BN smallpox vaccine sale
213,667
160,168
550,045
480,477
540,769
Rabipur/RabAvert
160,347
187,987
367,537
547,678
627,699
Encepur
71,365
110,491
316,025
405,890
455,012
Other product sale
-
-
89,079
-
-
Sale of goods
445,379
458,646
1,322,686
1,434,045
1,623,480
Milestone payments
-
66,553
-
66,553
66,553
Contract work
3,277
33,289
31,222
122,870
162,350
Sale of services
3,277
99,842
31,222
189,423
228,903
Revenue
448,656
558,488
1,353,908
1,623,468
1,852,383
Total revenue includes:
Fair value adjustment concerning financial instruments
entered into to hedge revenue
(5,274)
11,283
(5,005)
13,146
13,146
4. Production costs
Cost of goods sold
108,595
140,080
432,255
523,776
584,574
Contract costs
1,076
23,298
20,305
82,837
104,409
Amortization product rights
68,234
68,234
204,701
204,701
272,935
Other production costs
136,008
13,985
283,294
56,853
233,176
Production costs
313,913
245,597
940,555
868,167
1,195,094
5. Research and development costs
Research and development costs occurred in the period
75,587
125,598
314,033
309,196
445,829
Of which:
Contract costs recognized as production costs
(1,076)
(23,298)
(20,305)
(82,837)
(104,409)
Research and development costs
74,511
102,300
293,728
226,359
341,420
6. Financial income
Financial income from bank and deposit contracts
1,243
-
1,340
193
193
Interest income from financial assets measured at
amortized cost
1,243
-
1,340
193
193
Financial income from securities
2,238
2,644
7,703
6,337
8,756
Fair value adjustments on securities
-
2,034
-
5,837
6,783
Adjustment of deferred consideration due to change in
estimated timing of payments
446
(1,593)
6,789
25,499
67,719
Currency adjustment deferred consideration
78
2,711
1,865
9,909
11,900
Net gains on derivative financial instruments at fair value
through the income statement
940
-
940
-
2,571
Net foreign exchange gains
7,424
-
12,357
-
-
Financial income
12,369
5,796
30,994
47,775
97,922
7. Financial expenses
Interest expenses on debt
4,589
4,333
13,473
27,479
31,853
Interest expenses on financial liabilities measured at
amortized cost
4,589
4,333
13,473
27,479
31,853
Fair value adjustments on securities
12,834
-
35,830
-
-
Unwinding of the discounting effect related to deferred
consideration
28,867
27,678
96,756
89,565
145,149
Net loss on derivative financial instruments at fair value
through the income statement
(2,087)
5,710
-
7,203
-
Net foreign exchange losses
-
5,135
-
2,812
18,532
Financial expenses
44,203
42,856
146,059
127,059
195,534
Bavarian Nordic Announces Interim Results for the First Nine Months of 2021 Page 16 of 20
Company Announcement no. 35 / 2021
DKK thousand
30/9 2021
30/9 2020
31/12 2020
8. Inventories
Raw materials and supply materials
70,490
55,101
73,919
Work in progress
101,774
205,566
201,601
Manufactured goods and commodities
460,344
196,723
309,099
Write-down on inventory
(79,330)
(99,925)
(63,537)
Inventories
553,278
357,465
521,082
Write-down on inventory 1 January
(63,537)
(104,056)
(104,056)
Write-down during the period
(76,889)
(21,181)
(25,692)
Use of write-down
61,096
24,773
65,672
Reversal of write-down
-
539
539
Write-down end of period
(79,330)
(99,925)
(63,537)
9. Trade receivables
Trade receivables from smallpox vaccine sale
-
-
-
Trade receivables from Encepur and Rabipur/RabAvert
264,621
113,753
121,355
Trade receivables from other product sale
-
-
-
Trade receivables from contract work
38,352
16,909
17,937
Trade receivables
302,973
130,662
139,292
10. Other receivables
Receivable VAT and duties
37,970
18,354
31,486
Derivative financial instruments at fair value
-
2,348
606
Interest receivables
5,245
4,256
3,767
Other receivables
-
-
1,475
Other receivables
43,215
24,958
37,334
11. Debt to credit institutions
Mortgage
21,617
23,789
23,247
European Investment Bank (loan in DKK)
372,195
372,195
372,195
Security lending (repo transactions)
456,418
-
-
Debt to credit institutions
850,230
395,984
395,442
12. Prepayment from customers
Prepayments from customers as of January 1
74,347
6,631
6,631
Prepayments received during the period
-
77,185
77,185
Recognized as revenue during the period
(23,592)
(2,595)
(9,469)
Prepayments from customers end of period
50,755
81,221
74,347
13. Other liabilities
Financial instruments at fair value
14,762
1,494
1,414
Liability relating to phantom shares
30,413
5,463
4,849
Payable salaries, holiday accrual etc.
85,152
93,226
101,229
Gross to net deduction accrual
74,404
23,205
26,355
Other accrued costs
23,294
25,417
17,967
Other liabilities
228,025
148,805
151,814
Bavarian Nordic Announces Interim Results for the First Nine Months of 2021 Page 17 of 20
Company Announcement no. 35 / 2021
14. Right-of-use assets and lease liabilities
Right-of-use assets
DKK thousand
Rent facility
Car leasing
Equipment
Total
Right-of-use assets as of January 1, 2021
68.931
2.312
744
71.987
Additions
-
753
768
1.521
Modifications
20.502
111
38
20.651
Depreciations
(13.486)
(1.142)
(350)
(14.978)
Exchange rate adjustments
43
41
-
84
Right-of-use assets as of September 30, 2021
75.990
2.075
1.200
79.265
Lease liabilities
DKK thousand
30/9 2021
Non-current
61.128
Current
21.059
Lease liabilities
82.187
Amounts included in the income statement
DKK thousand
1/1 - 30/9 2021
Interest expense leases
1,504
Depreciation recognized on right-of-use assets
14,978
Cost recognized for short term leases (less than 12 months)
386
In the first nine months of 2021 the total cash outflow relating to lease was DKKt 16,112 split between interests of DKKt 1,504 and
repayment of DKKt 14,608.
15. Transferred financial assets that are not derecognized
The Company has entered into transactions that transferred ownership of securities to a counterparty, while the Company retains the risks
associated with the holding of the securities (repo transactions). As the Company retains all risks, the securities remain in the balance sheet,
and the transactions are accounted for as loans received against collateral (securities lending). The transactions involve selling the securities
to be repurchased at a fixed price at a later date. Counterparties are entitled to sell the securities or deposit them as collateral for loans.
DKK thousand
30/9 2021
30/9 2020
31/12 2020
Carrying amount of transferred securities
455,048
-
-
Carrying amount of associated liabilities (repo transactions)
(456,418)
-
-
Net position
(1,370)
-
-
Bavarian Nordic Announces Interim Results for the First Nine Months of 2021 Page 18 of 20
Company Announcement no. 35 / 2021
16. Financial instruments
Method and assumption to determine fair value
The Group has financial instruments measured at fair value at level 1 and level 2.
Securities (level 1)
The portfolio of publicly traded government bonds and publicly traded mortgage bonds is valued at listed prices and price quotas.
Derivative financial instruments (level 2)
Currency forward contracts, currency option contracts and currency swap contracts are valued according to generally accepted valuation
methods based on relevant observable swap curves and exchange rates.
Fair value hierarchy for financial instruments measured at fair value
As of September 30, 2021
DKK thousand
Level 1
Level 2
Total
Securities
1,841,194
-
1,841,194
Transferred securities that are not derecognized
455,048
-
455,048
Financial assets measured at fair value through the income statement
2,296,242
-
2,296,242
Derivative financial instruments to hedge future cash flow (currency)
-
(13,799)
(13,799)
Derivative financial instruments to hedge future cash flow (interest)
-
(848)
(848)
Financial assets/liabilities used as hedging instruments
-
(14,647)
(14,647)
Derivative financial instruments at fair value through the income statement
(currency)
-
(115)
(115)
Security lending (repo transactions)
(456,418)
-
(456,418)
Liability relating to phantom shares
-
(30,413)
(30,413)
Financial liabilities measured at fair value through the income statement
(456,418)
(30,528)
(486,946)
As of December 31, 2020
DKK thousand
Level 1
Level 2
Total
Securities
1,384,120
-
1,384,120
Financial assets measured at fair value through the income statement
1,384,120
-
1,384,120
Derivative financial instruments to hedge future cash flow (currency)
-
606
606
Derivative financial instruments to hedge future cash flow (interest)
-
(1,414)
(1,414)
Financial assets/liabilities used as hedging instruments
-
(808)
(808)
Liability relating to phantom shares
-
(4,849)
(4,849)
Financial liabilities measured at fair value through the income statement
-
(4,849)
(4,849)
Bavarian Nordic Announces Interim Results for the First Nine Months of 2021 Page 19 of 20
Company Announcement no. 35 / 2021
17. Warrants
Outstanding warrants as of September 30, 2021
Outstanding
as of
January 1
Addition
during the
period
Warrants
exercised
Annulled
Terminated
Trans-
ferred
Outstanding
as of
September
30
Corporate Management
439,402
-
-
-
-
-
439,402
Other Executive Management
723,326
-
(31,709)
-
-
(215,328)
476,289
Other employees
2,062,360
-
(307,240)
(176,183)
-
(44,479)
1,534,458
Resigned employees
167,901
-
(126,056)
-
-
259,807
301,652
Total
3,392,989
-
(465,005)
(176,183)
-
-
2,751,801
Weighted average exercise price
188
217
192
184
Weighted average share price at exercise
329
Numbers of warrants which can be exercised as of September 30, 2021
347,140
at a weighted average exercise price of DKK
238
The total recognized cost of the warrant programs was DKK 22.8 million in the first nine months of 2021 (DKK 15.9 million).
Specification of parameters for Black-Scholes model
DKK
Dec
2016
Jul
2017
Nov
2017
Nov
2018
Nov
2019
Jan
2020
Nov
2020
Average share price
222.50
383.50
259.50
159.00
154.05
171.20
179.84
Average exercise price at grant
260.20
430.40
303.00
179.60
185.40
197.00
206.82
Average exercise price determined at date
of rights issue March 30, 2020 (DKK)
205.80
340.40
239.60
142.00
146.60
155.80
-
Applied volatility rate
44.6%
44.1%
52.4%
53.3%
52.2%
53.0%
39.8%
Expected life (years)
3.0
3.0
3.0
3.0
3.0
3.0
3.0
Expected dividend per share
-
-
-
-
-
-
-
Risk-free interest rate p.a.
-0.48%
-0.46%
-0.55%
-0.43%
-0.69%
-0.65%
-0.66%
Fair value at grant
1)
54
98
80
52
45
53
41
The applied volatility is based on the historical volatility of the Bavarian Nordic share, except for November 2020 program where the
volatility is based on the volatility for a peer group.
1)
Fair value of each warrant applying the Black-Scholes model
18. Significant changes in contingent liabilities and other contractual obligations
No significant changes in contingent liabilities and other contractual obligations have occurred since December 31, 2020.
19. Significant events after the balance sheet date
20. Approval of the unaudited condensed consolidated interim financial statements
The unaudited condensed consolidated interim financial statements were approved by the board of directors and corporate management and
authorized for issue on November 12, 2021.
Bavarian Nordic Announces Interim Results for the First Nine Months of 2021 Page 20 of 20
Company Announcement no. 35 / 2021
Statement from the Board of Directors and Corporate Management
Corporate Management:
Board of Directors:
Employee-elected Employee-elected Employee-elected Employee-elected