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    MDXH   BE0003844611

MDXHEALTH SA

(MDXH)
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2020 Interim Report: English I French

09/30/2020 | 04:25am EDT

2020 INTERIM REPORT

TABLE OF CONTENTS

I. INTERIM MANAGEMENT REPORT ...............................................................................

2

II. INTERIM CONDENSED UNAUDITED CONSOLIDATED FINANCIAL

STATEMENTS MDxHealth SA ............................................................................................

4

1. CONDENSED UNAUDITED CONSOLIDATED STATEMENT OF PROFIT

AND LOSS AND OTHER COMPREHENSIVE INCOME .................................

4

2. CONDENSED UNAUDITED CONSOLIDATED STATEMENT OF

FINANCIAL POSITION ....................................................................................

5

3. CONDENSED UNAUDITED CONSOLIDATED STATEMENT OF

CHANGES IN SHAREHOLDERS' EQUITY .....................................................

6

4. CONDENSED UNAUDITED CONSOLIDATED STATEMENT OF CASH

FLOWS ............................................................................................................

7

5. EXPLANATORY NOTES ............................................................................

8

III. CORPORATE INFORMATION ...........................................................................

16

This Interim Report contains forward-looking statements and estimates with respect to the anticipated future performance of MDxHealth SA and its wholly-owned subsidiaries (hereinafter "MDxHealth" or the "Company") and the market in which it operates. Such statements and estimates are based on assumptions and assessments of known and unknown risks, uncertainties and other factors, which were deemed reasonable but may not prove to be correct. Actual events are difficult to predict, may depend upon factors that are beyond MDxHealth's control, and may turn out to be materially different. MDxHealth expressly disclaims any obligation to update any such forward-looking statements in this Interim Report to reflect any change in its expectations with regard thereto or any change in events, conditions or circumstances on which any such statement is based unless required by law or regulation.

  1. INTERIM MANAGEMENT REPORT

Highlights

Key non-audited financials, as of June 30, 2020

Key unaudited consolidated figures for the six months ended June 30, 2020 (thousands of US dollars, except per share data):

2020

2019

Change

% Change

Product revenue

9,596

10,571

-975

-9%

Royalties and patent income

284

302

-18

-6%

Total Revenue

9,880

10,873

-993

-9%

Gross Profit

4,686

4,964

-278

-6%

Operating expenses

(17,674)

(18,827)

1,153

-6%

Operating loss

(12,988)

(13,863)

875

-6%

Net loss

(13,709)

(14,138)

429

-3%

Basic and diluted loss per share

(0.18)

(0.24)

0.06

-23%

Total revenue for the first half of 2020 was $9.9 million compared to total revenue of $10.9 million for the first half of 2019. Revenue from ConfirmMDx and SelectMDx amounted to $9.6 million, a decrease of 9% as compared to $10.6 million a year earlier. Revenue from ConfirmMDx represented over 90% of product revenue for all periods.

Gross profit on products and services for the first half of 2020 was $4.7 million compared to $5.0 million for the first half of 2019. Gross margins on products and services were 47.4% for the first half of 2020 as compared to 45.7% for the same period in 2019, representing a gross margin improvement of 180 basis points.

Operating expenses in the first half of 2020 were $17.7 million, an improvement of $1.1 million, or 6%, over the same period last year, primarily the result of consistent and continued operating discipline. Excluding non-cash expenses such as depreciation, amortization and stock-based compensation, operating expenses for H1-2020 were $15.3 million, an improvement of $1.5 million, or 9%, over H1- 2019.

Operating loss and net loss for the first half of 2020 were $13.0 million and $13.7 million, respectively, with losses narrowing compared to $13.9 million and $14.1 million, respectively, over the same period in 2019, for the reasons stated above.

Justification to continue using the accounting rules on the basis of going concern

Cash and cash equivalents as of June 30, 2020 were $23.8 million, strengthened by the equity investment of EUR 12.7 million (or approximately $14.2 Million) by MVM. Total cash collections amounted to $11.5 million in H1-2020, a decrease of 3% compared to last year, despite volumes being lower due to the impact of COVID-19. Cash burn for the period was $12.9 million compared to $14.0 million in the prior year period, reflecting strong operating discipline. Cash and cash equivalents as of December 31, 2019 were $22.1 million.

As a result of incurred losses, the Company ended the period with $23.8 million in cash & cash equivalents as of June 30, 2020. The Company is expecting continued losses and negative operating cash flows in the coming twelve months. While these conditions, among others, could raise substantial doubt about the Company's ability to continue as a going concern, the Company and its Board of Directors decided to continue to apply the accounting rules in the assumption of going concern, because it believes that it has sufficient cash to continue its operations at least until the end of June 2021, based on its budget reflecting the Company's current and planned operations as well as expected losses in the coming months.

2

Principal risks related to the business activities

The principal risks related to the MDxHealth's business activities have been outlined in the 2019 Annual Report, which is available on the internet at www.mdxhealth.com/investors/financials

Declaration of responsible persons

The Board of Directors of MDxHealth SA, represented by all its members, declares that, as far as it is aware, the financial statements in this Interim Report, made up according to the applicable standards for financial statements, give a true and fair view of the equity, financial position and the results of the company and its consolidated companies. The Board of Directors of MDxHealth SA, represented by all its members, further declares that this Interim Report gives a true and fair view on the information that has to be contained herein. The condensed consolidated interim financial statements have been prepared in accordance with International Accounting Standard (IAS) 34 (Interim Financial Reporting) as adopted by the European Union.

3

  1. INTERIM CONDENSED UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS MDxHealth SA

For the six months ended June 30, 2020

1. CONDENSED UNAUDITED CONSOLIDATED STATEMENT OF PROFIT AND LOSS AND OTHER COMPREHENSIVE INCOME

In thousands of USD (except per share data)

Condensed unaudited consolidated statement of profit and loss

Note

Jan-June

Jan-June

2020

2019

Services

4

9,596

10,571

Licenses

4

250

200

Royalties

4

34

102

Revenues

9,880

10,873

Cost of goods and services sold

(5,194)

(5,909)

Gross Profit

4,686

4,964

Research and development expenses

(2,130)

(1,970)

General and administrative expenses

(7,268)

(8,034)

Selling and marketing expenses

(8,335)

(8,832)

Other operating income, net

59

9

Operating loss

(12,988)

(13,863)

Financial income

3

6

Financial expenses

(724)

(231)

Loss before income taxes

(13,709)

(14,088)

Income taxes

0

(50)

Loss for the period

(13,709)

(14,138)

Loss for the period attributable to the parent

(13,709)

(14,138)

Loss per share attributable to parent

Basic and diluted earnings per share

(0.18)

(0.24)

Condensed unaudited consolidated statement of other comprehensive income

Loss for the period

(13,709)

(14,138)

Other comprehensive loss

Items that will be reclassified to profit or loss:

Exchange differences arising from translation of

foreign operations

35

379

Total comprehensive loss for the period

(13,674)

(13,759)

(net of tax)

4

2. CONDENSED UNAUDITED CONSOLIDATED STATEMENT OF FINANCIAL POSITION

In thousands of USD

as at

as at

Note

June 30,

December 31,

2020

2019

ASSETS

Intangible assets

6,281

7,269

Property, plant and equipment

919

1,067

Right-of-use assets

1,125

1,385

Non-current assets

8,325

9,721

Inventories

1,735

1,192

Trade receivables

6

5,018

6,645

Prepaid expenses and other current assets

1,000

1,020

Cash and cash equivalents

6

23,781

22,050

Current assets

31,534

30,907

Total assets

39,859

40,628

EQUITY

Share capital

76,844

62,841

Issuance premium

136,349

136,349

Retained earnings

(200,347)

(186,638)

Share-based compensation

8,764

8,090

Translation reserves

(883)

(918)

Total equity

20,727

19,724

LIABILITIES

Loans and borrowings

5

7,630

9,052

Lease liabilities

5

527

735

Other non-current financial liabilities

6

690

690

Non-current liabilities

8,847

10,477

Loans and borrowings

5

2,062

565

Lease liabilities

5

615

650

Trade payables

6

3,446

4,958

Other current liabilities

3,253

3,345

Other current financial liabilities

6/8

909

909

Current liabilities

10,285

10,427

Total liabilities

19,132

20,904

Total equity and liabilities

39,859

40,628

5

3. CONDENSED UNAUDITED CONSOLIDATED STATEMENT OF CHANGES IN SHAREHOLDERS' EQUITY

Attributable to owners of MDxHealth SA

In thousands of USD, except number of shares

Number of

Share

Issuance

Retained

Share-based

Translation

shares

capital

Premium

earnings

compensation

reserves

Total Equity

Note 10

Balance at January 1, 2019

59,939,289

53,877

135,731

(143,538)

7,218

1,171

52,117

Loss for the period

(14,138)

(14.138)

Other comprehensive income

379

379

Total comprehensive income for the period

(14,138)

379

(13,759)

Transactions with owners in their capacity as owners:

Share-based compensation

273

273

Balance at June 30, 2019

59,939,289

53,877

135,731

(157,676)

7,491

(792)

38.631

In thousands of USD, except number of shares

Number of

Share

Issuance

Retained

Share-based

Translation

shares

capital

Premium

earnings

compensation

reserves

Total Equity

Note 10

Balance at January 1, 2020

70,528,525

62,841

136,349

(186,638)

8,090

(918)

19,724

Loss for the period

(13,709)

(13,709)

Other comprehensive income

35

35

Total comprehensive income for the period

(13,709)

35

(13,674)

Transactions with owners in their capacity as owners:

Issuance of shares, net of transaction costs

20,162,924

14,003

14,003

Share-based compensation

674

674

Balance at June 30, 2020

90,691,449

76,844

136,349

(200,347)

8,764

(883)

20,727

4. CONDENSED UNAUDITED CONSOLIDATED STATEMENT OF CASH FLOWS

In thousands of USD

Jan-June

Jan-June

2020

2019

CASH FLOWS FROM OPERATING ACTIVITIES

Operating loss

(12,988)

(13,863)

Depreciation and amortization

1,675

1,702

Share-based compensation

674

273

Other non-cash transactions

(116)

0

Cash generated from operations before working capital

changes

(10,755)

(11,888)

Changes in operating assets and liabilities

(Increase)/decrease in inventories

(543)

634

Decrease in receivables

1,647

986

Decrease in payables

(1,604)

(3,556)

Net cash outflow from operating activities

(11,255)

(13,824)

CASH FLOWS FROM INVESTING ACTIVITIES

Purchase of property, plant and equipment

(167)

(42)

Interests received

3

0

Net cash outflow from investing activities

(164)

(42)

CASH FLOWS FROM FINANCING ACTIVITIES

Proceeds from issuance of shares, net of transaction costs

14,003

0

Payment of long-term debt

0

(136)

Payment of lease liability

(391)

(343)

Payment of interest

(499)

(80)

Net cash inflow/(outflow) from financing activities

13,113

(559)

Net increase/(decrease) in cash and cash equivalents

1,694

(14,425)

Cash and cash equivalents at beginning of the period

22,050

26,203

Effect of exchange rates

37

379

Cash and cash equivalents at end of the period

23,781

12,157

5. EXPLANATORY NOTES

Accounting policies

1. Basis of preparation

MDxHealth SA together with its subsidiaries are herein referred to as "the Company". MDxHealth is a company domiciled in Belgium, with offices in the United States and The Netherlands. The reporting and functional currency of the Company is the U.S. Dollar.

The condensed consolidated interim financial statements have been prepared in accordance with International Accounting Standard (IAS) 34 - Interim Financial Reporting, as adopted by the European Union.

These interim consolidated financial statements do not include all the information required for full annual financial statements and should be read in conjunction with the consolidated financial statements of the Company as at, and for the year ended, December 31, 2019.

As a result of incurred losses, the Company ended the period with $23.8 million in cash & cash equivalents as of June 30, 2020. The Company is expecting continued losses and negative operating cash flows in the coming twelve months. While these conditions, among others, could raise substantial doubt about the Company's ability to continue as a going concern, the Company and its Board of Directors decided to continue to apply the accounting rules in the assumption of going concern, because it believes that it has sufficient cash to continue its operations at least until the end of June 2021, based on its budget reflecting the Company's current and planned operations as well as expected losses in the coming months.

2. Significant accounting policies, use of judgments and estimates

The Company applies the International Financial Reporting Standards (IFRS) as adopted by the European Union. The same accounting policies, presentation and methods of computation have been followed in these condensed financial statements as were applied in the preparation of the Company's financial statements for the year ended December 31, 2019. No amendments to existing standards that became applicable as from January 1, 2020 have a material impact on the consolidated financial statements or accounting policies.

The preparation of the interim condensed financial statements in compliance with IAS 34 requires the use of certain critical accounting estimates. It also requires the Company's management to exercise judgment in applying the Company's accounting policies. The Company has applied the same accounting policies and there have been no material revisions to the nature and amount of estimates and judgments in its interim condensed financial statements.

3. Significant events and transactions

The COVID-19 outbreak has an impact on management's estimates, judgments and assumptions, and could impact the Company's ability to develop business, conduct operations, and obtain components used in its business. The situation is continuously evolving, therefore the extent to which the COVID-19 outbreak will continue to impact business and the economy is highly uncertain and is extremely difficult to predict. Accordingly, the Company cannot accurately predict the extent to which its 2020 financial condition and results of operations will further be affected.

The areas where assumptions and estimation uncertainties in the financial statements related to the COVID-19 outbreak have potentially the most significant effect in 2020 are related to the Company's ability to continue as a going concern, revenue recognition, impairment testing, recognized fair value measurements, and income taxes.

8

In April 2020, the Company's U.S. subsidiary, MDxHealth Inc., qualified for a "Paycheck Protection Program" (PPP) loan with the U.S. Small Business Administration (SBA) in the amount of $2.3 million as part of the U.S Coronavirus Aid, Relief, and Economic Security (CARES) Act. The loan has a term of five years and carries an interest rate of 1.0% per year. Payments on the loan are deferred for the first eighteen months following disbursement of the loan, with principal and interest payments beginning on the nineteenth month. Interest on the loan continues to accrue during the eighteen-month deferment period. Cash proceeds from the loan were received on July 16, 2020.

The Company also received funding from the US department of Health & Human Services (HHS) of approximately $659,000, however, the final amount related to the funding could still differ from the current amount received.

In addition, during April 2020, the Dutch subsidiaries, MDxHealth BV and MDxHealth Research BV, were granted with a preliminary allowance of approximately $114,000 related to the COVID-19 outbreak and its resulting revenue loss.

As part of the requirements of IAS 20, the Company is still assessing its ability to comply with the terms and conditions related to the aforementioned grants and is, therefore, currently unable to recognize these grants in the income statement.

The unprecedented challenges and potential additional tax reliefs caused by the COVID-19 outbreak causes the Company to conclude that it cannot estimate the annual effective tax rate reliably. The actual effective rate, based on a year-to-date actual tax calculation, may represent the best estimate of the annual effective tax rate.

In light of the COVID-19 pandemic, management took every precaution necessary to stay safe and to ensure tests remain accessible to all who need them. These precautions include:

  • Following all CDC (Centres for Disease Control and Prevention) recommendations for maintaining a healthy work environment
  • Directing as many of the office staff as possible to work remotely. Those who must work in the office due to HIPAA and lab needs are following all CDC recommendations to ensure their safety
  • Conducting meetings virtually
  • Restricting staff travel as much as possible

9

4. Segment information

The Company does not distinguish different business segments since most revenues are generated from clinical laboratory service testing, or the out-licensing of the Company's patented DNA methylation platform and biomarkers. However, the Company does distinguish different geographical operating segments based on revenue since the revenues are generated both in United States of America and Europe.

Total product revenue and non-current assets are shown below as a percentage by geography:

External revenue of customers in

Non-current assets per location in

thousands of USD

thousands of USD

$307 3%

United States

Europe

49%

United States

51%

Europe

$9,573

97%

Segment revenues

As of June 30, 2020, the Company earned 100% of its revenue from external customers from its clinical laboratory testing services and out-licensing of intellectual property. As of June 30, 2020, the clinical laboratory testing in the U.S. CLIA laboratory represented 94.0% of the Company's revenue (first six months of 2019: 93.4%), while the out-licensing of intellectual property revenue and grant income in Europe represented 3% (first six months of 2019: 3%).

The Company has one customer responsible for more than 10% of the Company's revenues over the period, represented by Medicare.

The amount of its revenue from external customers broken down by location from the customers is shown in the table below:

THOUSANDS OF $/

Jan-June

Jan-June

2020

2019

United States of America

9,573

10,437

The Netherlands

130

175

Rest of the EU

162

218

Rest of the world

15

43

Total segment revenue

9,880

10,873

The amount of its revenue by category is already presented on the face of the consolidated statement of income.

As of June 30, 2020, 51% of the non-current assets were located in the U.S. (30 June 2019: 44%) and

the remaining 49% were located in Europe (June 30, 2019: 56%).

10

5. Loans, Borrowings and Lease Liabilities

THOUSANDS OF $/

2020

2019

As at January 1

Non-current Loans and borrowings

9,052

0

Non-current Lease liabilities

735

262

Current Loans and borrowings

565

147

Current Lease liabilities

650

117

Total

11,002

526

Issues

Kreos Capital loan facility

0

10,111

IFRS 16 adoption

0

1,733

New leases

114

0

Repayments

Current bank loans

0

(589)

Current lease liabilities

(391)

(815)

Other

Interest accretion

28

88

Effective interest rate adjustment

105

0

Other

(24)

(52)

Total

10,834

11,002

As at June 30 / December 31

Non-current Loans and borrowings

7,630

9,052

Non-current Lease liabilities

527

735

Current Loans and borrowings

2,062

565

Current Lease liabilities

615

650

Total

10,834

11,002

During the fourth quarter of 2019, the Company entered into a loan facility with Kreos Capital in the amount of €9 million, or approximately $10 million. The loan term is four years with the first 12 months of interest-only payments followed by 36 months of principal and interest payments. The financial results largely related to the interest charges for the loan facility with Kreos Capital for a total of $576,000. The amortized cost is calculated using the effective interest method, which allocates interests and expenses at a constant rate over the term of the instrument; the effective interest rate for the loan is 12.86%.

The Company has several lease obligations. The leases have terms of 3 to 5 years and some of them include an option to purchase the equipment.

11

6. Financial instruments and fair value

The carrying value and fair value of the financial instruments for June 30, 2020 and December 31,

2019 can be presented as follows:

THOUSANDS OF $/

June 30,

December 31,

Hierarchy

2020

2019

Financial assets

Trade receivables

5,018

6,645

Level 1

Other current assets

55

51

Level 1

Cash and cash equivalents

23,781

22,050

Level 1

Subtotal financial assets at amortized cost

28,854

28,746

Level 1

Total financial assets

28,854

28,746

Financial liabilities

Other financial liabilities

1,599

1,599

Level 3

Subtotal financial liabilities at fair value

1,599

1,599

through P&L

Financial liabilities at amortized cost:

Loans and borrowings

9,692

9,617

Level 2

Lease liabilities

1,142

1,385

Level 1

Trade payables

3,446

4,958

Level 1

Subtotal financial liabilities at amortized cost

14,280

15,960

Total financial liabilities

15,879

17,559

The fair value of the financial instruments has been determined on the basis of the following methods and assumptions:

  • The carrying value of the cash and cash equivalents, the trade receivables, the trade payables and the other liabilities approximate their fair value due to their short-term character;
  • Loans and borrowings are evaluated based on their interest rates and maturity date. Their fair value approximates their carrying value.
  • Leases are measured at the present value of the remaining lease payments, using a discount rate based on the incremental borrowing rate.
  • The fair value of contingent consideration payable (presented in the lines other non-current financial liabilities and other current financial liabilities) is based on an estimated outcome of the conditional purchase price/contingent payments arising from contractual obligations. This is initially recognized as part of the purchase price and subsequently fair valued with changes recorded through profit and loss. The Company used a discount rate of 9.30%. If expected cash flows were 10% higher or lower, the fair value would remain the same value since it does not impact the milestone payments.
  • Financial instruments are evaluated based on the Mark to Market (MtM) report and the unrealised gains (loss) are recognised through P&L.

Fair value hierarchy

The Company uses the following hierarchy for determining and disclosing the fair value of financial instruments by valuation technique:

  • Level 1: quoted prices in active markets for identical assets and liabilities;
  • Level 2: other techniques for which all inputs which have a significant effect on the recorded fair value are observable, either directly or indirectly; and
  • Level 3: techniques which use inputs that have a significant effect on the recorded fair value that are not based on observable market data.

12

No financial assets or financial liabilities have been reclassified between the valuation categories during the period.

7. Contingent consideration

The Company signed a sale and purchase agreement on September 18, 2015 to acquire all shares and voting interests of NovioGendix, an entity incorporated in The Netherlands.

Under the terms of the agreement, the Company is committed to pay up to $3.3 million subject to meeting certain milestones, be payable in six milestone payments. As of 30 June 2020, the Company paid $1.1 million.

The contingent consideration is valued at every reporting date and the change in fair value only relates to the time value of money, all other assumptions remained unchanged compared to 31 December 2019. This contingent liability has been evaluated to a fair-value of $1.6 million at the end of June 2020 ($1.6 million at 31 December 2019) and $690,000 is included in the other non-current financial liabilities and $909,000 in the other current financial liabilities ($690,000 in the other non-current financial liabilities and $909,000 in the other current financial liabilities at 31 December 2019).

8. Related party transactions

Transactions between MDxHealth SA, MDxHealth BV and MDxHealth Inc., which are related parties, have been eliminated in consolidation and are not disclosed in this note. The intercompany services between all the MDxHealth group entities relate to R&D and administrative services carried out by the subsidiary companies on behalf of the parent company and to administrative services carried out by the parent company for the subsidiaries.

Beside remuneration, warrants and bonus there are no other transactions to key personnel other than those already disclosed in the Company's 2019 consolidated financial statements. For the first half of 2020, the total remuneration for key management and Directors was $1.0 million, and no warrants were granted.

There were no other related party transactions.

9. Warrant plans

During the first half of 2020, the Company granted a total of 18,000 warrants to employees of the Company and its subsidiaries. The warrants have been granted free of charge. Each warrant entitles its holder to subscribe to one common share of the Company at a subscription price determined by the board of directors, within the limits decided upon at the time of their issuance.

The warrants issued have generally a term of ten years as of issuance. Upon expiration of their term, the warrants become null and void. In general, the warrants vest in cumulative tranches of 25% per year, provided that the beneficiary has provided at least one year of service.

The fair value of each warrant is estimated on the date of grant using the Black-Scholes option pricing model with the following assumptions:

  • The dividend return is estimated by reference to the historical dividend payment of the Group; currently, this is estimated to be zero as no dividends have been paid since inception
  • The expected volatility was determined using the average volatility of the stock over the last two years at the date of grant
  • Risk-freeinterest rate is based on the interest rate applicable for the 10Y Belgian government bond at the grant date

13

The model inputs for warrants granted during the period ended 30 June 2020 included:

Grant date

January 01

February 01

March 01

June 01

Exercise price

€1.02

€0.98

€0.89

€0.85

Expiry date

3/31/2027

3/31/2027

3/31/2027

3/31/2027

Share price at grant date

€1.04

€0.93

€0.89

€0.85

Expected price volatility

81.00%

80.26%

80.59%

86.64%

Risk-free interest rate

0.12%

0%

0%

0.01%

The total fair value of the granted warrant is estimated at $8 thousand following the underlying assumptions of the model.

10. Capital

On May 15, 2020, the Company raised EUR 12.7 million (approximately $14.2 million) in gross proceeds by issuance of 20,162,924 new shares at an issue price of EUR 0.632 per share through a private placement. After deduction of the costs directly associated to the transaction, the net proceeds raised amounts to $14.0 million.

11. Subsequent events

On July 16, 2020, the Company received cash proceeds of $2.3 million as part of the previously- communicated "Paycheck Protection Program" (PPP) loan with the U.S. Small Business Administration (SBA). The loan has a term of five years and carries an interest rate of 1.0% per year. Payments on the loan are deferred for the first eighteen months following disbursement of the loan, with principal and interest payments beginning on the nineteenth month. Interest on the loan continues to accrue during the eighteen-month deferment period.

14

12. Statutory auditor's report to the Board of MDxHealth SA on the review of consolidated interim financial information for the six-month period ended 30 June 2020

Introduction

We have reviewed the accompanying interim consolidated statement of financial position of MDxHealth SA as of 30 June 2020 and the related interim consolidated statements of comprehensive income, cash flows and changes in equity for the six-month period then ended, as well as the explanatory notes. The Board of Directors is responsible for the preparation and presentation of this consolidated interim financial information in accordance with IAS 34 "Interim Financial Reporting", as adopted by the European Union. Our responsibility is to express a conclusion on this consolidated interim financial information based on our review.

Scope of review

We conducted our review in accordance with International Standard on Review Engagements 2410, "Review of Interim Financial Information Performed by the Independent Auditor of the Entity". A review of interim financial information consists of making inquiries, primarily of persons responsible for financial and accounting matters, and applying analytical and other review procedures. A review is substantially less in scope than an audit conducted in accordance with International Standards on Auditing and consequently does not enable us to obtain assurance that we would become aware of all significant matters that might be identified in an audit. Accordingly, we do not express an audit opinion.

Conclusion

Based on our review, nothing has come to our attention that causes us to believe that the accompanying consolidated interim financial information is not prepared, in all material respects, in accordance with IAS 34 "Interim Financial Reporting", as adopted by the European Union.

Material uncertainty related to going concern

We draw attention to Note 1 in the accompanying consolidated interim financial information, which indicates that the consolidated entity experienced recurring net losses and negative

cash flows from operations, and is expecting the same for at least the next twelve months. While these conditions, among others, could raise substantial doubt about the Company's ability to continue as a going concern, the Company and its Board of Directors decided to continue to apply the accounting rules in the assumption of going concern, because it believes that it has sufficient cash to continue its operations at least until the end of June 2021, based on its budget reflecting the Company's current and planned operations as well as expected losses in the coming months. Our conclusion is not modified in respect of this matter.

Zaventem, 29 September 2020

BDO Bedrijfsrevisoren / BDO Réviseurs d'Entreprises SCRL

Statutory auditor

Represented by Gert Claes

15

III. CORPORATE INFORMATION

Registered office

MDxHealth SA has the legal form of a public limited liability company (société anonyme - SA / naamloze vennootschap - NV) organized and existing under the laws of Belgium. The company's registered office is located at CAP Business Center, Rue d'Abhooz 31, B-4040 Herstal, Belgium.

The company is registered with the Registry of Legal Persons (registre des personnes morales - RPM / rechtspersonenregister - RPR) under company number RPM/RPR 0479.292.440 (Liège).

Listings

Euronext Brussels : MDXH

Financial calendar

October 21, 2020 - Q3 business update

Financial year

The financial year starts on 1 January and ends on 31 December.

Statutory auditor

BDO Bedrijfsrevisoren / Réviseurs d'entreprises CVBA/SCRL

Da Vincilaan 9

1935 Zaventem

Belgium

Availability of the Interim Report

This document is available to the public free of charge and upon request:

MDxHealth SA - Investor Relations

CAP Business Center - Rue d'Abhooz, 31 - 4040 Herstal - Belgium

Tel: +32 4 257 70 21

E-mail: ir@mdxhealth.com

For informational purposes, an electronic version of the Interim Report 2020 is available on the website of MDxHealth at www.mdxhealth.com/investors/financials

16

Disclaimer

MDxHealth SA published this content on 30 September 2020 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 30 September 2020 08:24:02 UTC


© Publicnow 2020
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