OncoSil Medical Limited

Hurdles in CE mark certification for OncoSil: Medical device company, OncoSil Medical Limited (ASX: OSL) focuses on the development of localized treatments for pancreatic and liver cancer in Australia. Today (i.e., 25 March 2019), its share price tumbled over 69% owing to the announcement that, the British Standards Institute “BSI” Clinical Oversight Committee after reviewing the OncoSil™ CE Mark file, advised that at this time insufficient clinical benefit has been demonstrated to recommend approval.The Clinical Oversight Committee will send this recommendation to BSI’s Medical Device Group for final determination. However, OncoSil will look forward to clarify the issues with BSI and going forth will update the market about any course of action.

In its H1FY19 result, it reported an increase in its revenues from ordinary activities by 6.3% pcp to ~$1.9 Mn. Its loss attributable to the owners of OncoSil Medical Ltd increased by 13.6% pcp to $5.15 Mn.

H1FY19 P&L Statement (Source: Company Reports)

What to expect from the company: OncoSil can proceed to a full US pivotal study without further US patient data as US FDA has confirmed that the PanCO (ex-US) clinical study safety data meets IDE requirement. It’s US OncoPaC-1 clinical study has now closed for recruitment with 9 patients successfully implanted. The clinical results from the Interim Analysis conducted on the PanCO study were encouraging. Such developments are expected to encourage the company’s Board in their endeavour to achieve sustainable growth for the company.

Stock Recommendation: OncoSil’s share generated negative YTD return of 8.57%. Given the performance in terms of top line in 1HFY19 and mixed outlook ahead, we recommend a “Hold” rating on the stock at the current market price of $0.049 per share(down 69.375% on March 25, 2019).
 

Dacian Gold Limited

Equipment unavailability reduced productivity for DCN: Gold exploration & development company Dacian Gold Limited (ASX: DCN) has primary focus on its 100% owned Mount Morgans Gold project in Western Australia. Today DCN’s share tumbled over 7% with the announcement about its March quarter production update and revised FY2019 guidance.

Reduced underground equipment availability has contributed to lower-than-expected productivity for the March quarter, with gold production for the three months now expected to be between 36,000-38,000oz. All-in sustaining costs (AISC) for the March quarter expected to be A$1,400 -$1,500/oz.

The company stated that itsJune quarter production is expected to be in the range of 50,000-55,000oz at an AISC of A$1,050-$1,150/oz. The company expects production guidance for FY2019 to be in the range of 150,000-160,000oz, down from the previous target of 180,000oz.


H1FY19 P&L Metrics (Source: Company Reports)

Dacian Gold reported decrease in its net loss after income tax by 20.6% pcp to $7,003,629 in H1FY19. It included loss of $5,681,422 relating to exploration and evaluation costs immediately expensed. At the end of half-year, the company had cash of $67,622,263.

Stock Recommendation: Dacian Gold’s share generated negative YTD return of 3.54%. In the span of previous three months, the company’s stock posted return of 12.90% which can be considered decent. However, the stock is presently trading slightly towards its 52-week lower level.  Hence, considering the aforesaid facts and decent return over the past three months, we recommend a “Hold” rating on stock at the current market price of $2.270 per share (down 7.347% on March 25, 2019).  
 

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