CARLSBAD, Calif. - Lineage Cell Therapeutics (NYSE:LCTX), Inc. (NYSE American and TASE: LCTX), a clinical-stage biotechnology company, announced today the completion of a registered direct offering, raising $14 million in gross proceeds. The transaction involved the sale of 13,461,540 common shares at $1.04 each, matching the closing price on February 5, 2024.
Notably, significant investments were made by insiders, including 6,730,770 shares purchased by Broadwood Partners, L.P., affiliated with board member Neal Bradsher, and roughly 100,000 shares bought by board member Don M. Bailey. The offering was conducted without an investment bank and did not include discounts or dilutive elements such as warrants.
According to Brian M. Culley, CEO of Lineage, the capital infusion is intended to strengthen the company's balance sheet, supporting the advancement of its product candidates. The proceeds are earmarked for general corporate purposes, which may encompass clinical trials, research and development, and other operational costs.
The securities were sold pursuant to a shelf registration statement on Form S-3, filed and declared effective by the SEC in March 2021. A final prospectus supplement relating to the offering has been filed with the SEC.
Lineage Cell Therapeutics focuses on developing allogeneic cell therapies to address unmet medical needs. The company's pipeline includes a variety of product candidates targeting degenerative diseases, traumatic injury, and cancer.
This article is based on a press release statement from Lineage Cell Therapeutics, Inc.
InvestingPro Insights
Amidst Lineage Cell Therapeutics' recent capital raise, the company's financial health and market performance remain critical factors for investors. According to InvestingPro, Lineage holds more cash than debt on its balance sheet, which could be a reassuring sign for investors concerned about the company's liquidity following the direct offering. This aligns with the company's strategy to strengthen its balance sheet as mentioned by CEO Brian M. Culley.
Furthermore, the company's gross profit margins are impressive, standing at 94.11% for the last twelve months as of Q1 2023, underscoring the efficiency of Lineage's operations despite the challenges in revenue growth, which has seen a decline of 37.15% in the same period. The recent influx of funds may help in mitigating the sales decline anticipated by analysts for the current year.
InvestingPro Tips reveal that two analysts have revised their earnings upwards for the upcoming period, suggesting a potential positive outlook on the company's future financial performance. For investors looking for more detailed analysis, there are additional InvestingPro Tips available, which can be accessed through the platform's dedicated page for Lineage Cell Therapeutics at https://www.investing.com/pro/LCTX.
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InvestingPro Data also highlights a significant return over the last week with a 10.2% price total return, reflecting a recent uptick in investor confidence which may be linked to the direct offering and insider investments. However, the company's P/E Ratio stands at -8.00, indicating that it is not profitable as of the last twelve months, a concern that investors may weigh against the potential for future growth.
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