Pacific Edge raises $5 million from shareholder plan

DUNEDIN cancer diagnostic company Pacific Edge’s shareholder placement plan raised the $5 million sought.

The shareholder plan, which was not underwritten, was the second tranche of Pacific Edge’s latest capitalraising programme, the company having already secured $7 million from issuing new shares in late November.

Pacific Edge is yet to turn a profit from its target United States market, where it has contracts with several significant health and insurer organisations, but has had to overcome numerous trials and regulatory hurdles to have its bladder cancer test fully accepted.

Pacific Edge chairman Chris Gallaher said in an NZX update yesterday the issue, which closed on Friday, was successful and the price was confirmed at 34.27c per share.

Pacific Edge shares were yes terday trading at 33.5c, down 14% on a year ago.

Mr Gallaher said several new local and international investors had joined Pacific Edge’s register and that reflected growing interest from institutional and fund manager investors.

‘‘The [$12 million] funds raised provide extra capital resources to assist the company to progress its commercial objectives and become cash flow positive as soon as possible,’’ Mr Gallaher said.

While revenue grew 43% for its half year trading to September to more than $2 million, its monthly cash burn to keep operations afloat has been estimated at at least $1 million.

Between 2013 and 2018 Pacific Edge has been back to shareholders for cash injections at least seven times, and has now raised more than $99 million.

Combined with the $10.06 million cash in hand Pacific Edge had last September, the additional $12 million injection is estimated to keep it in cash for the next eight to 17 months.

For its half year to September, Pacific Edge’s loss declined from $10.03 million for the corresponding period the previous year to $8.71 million.