Celyad Oncology announces non-cash impairment
Mont-Saint-Guibert, Belgium - Celyad Oncology (Euronext & Nasdaq: CYAD) (the “Company”), a biotechnology company focused on the discovery and development of innovative technologies for chimeric antigen receptor (CAR) T-cell therapies, today announced a non-cash impairment of its goodwill and intangible oncology assets.
This impairment comes as a result of the Company’s strategic shift in focus away from clinical development and the early stage nature of the implementation of the Celyad 2.0 strategy: shifting from an organization focused on clinical development to one prioritizing R&D discovery and the monetization of its intellectual property (IP) portfolio through partnerships, collaborations and license agreements. As, to date, no effective sublicence contract nor collaboration contract was concluded, some uncertainty exists on the timing and amount of the deal flow and associated short, medium and long term revenues.
Given this uncertainty, and per accounting standards, the Company will recognize a full impairment loss on the remaining value of goodwill, In Process Research and Development, and Horizon Discovery’s shRNA platform, resulting in a non-cash impairment of €20.5 million on a statutory basis and €35.1 million on a consolidated basis for the financial year ended December 31, 2022.
This accounting conclusion, which reflects the Company’s financial situation as of December 31, 2022, does not affect the Management’s commitment to continue the potential monetization of the Company’s IP. The conclusion of the impairment analysis and additional details will be provided with the publication of the Company’s fiscal year 2022 results on or around March 23, 2023.
The net assets of the Company as of December 31, 2022, on a BE-GAAP non-consolidated basis, have fallen below half of the Company’s capital. As a result, in accordance with Article 7:228 of the Belgian Code for Companies and Associations, the Board of Directors plans to submit for a vote, at its May 5, 2023 shareholders’ meeting, its business plan including a proposal to continue the Company’s activities. The Board of Directors will publish a detailed report regarding this proposal on or around April 3, 2023, together with the convocation with proposed resolutions for the shareholders’ meeting.
The audit for fiscal year 2022 has not yet been fully completed.