zk1414859.htm


SECURITIES AND EXCHANGE COMMISSION
 
Washington, D.C.  20549
______________________
 
FORM 6-K
 
REPORT OF FOREIGN PRIVATE ISSUER
 
Pursuant to Rule 13a-16 or 15d-16 of the
Securities Exchange Act of 1934
 
For the month of May 2014
 
Commission File Number: 001-35464
 
                  MediWound Ltd.                  
(Translation of registrant’s name into English)
 
42 Hayarkon Street
Yavne, 8122745 Israel
 (Address of principal executive offices)

Indicate by check mark whether the registrant files or will file annual reports under cover Form 20-F or Form 40-F.
 
Form 20-F x   Form 40-F o
 
Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(1):   __
 
Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(7):   __
 
Indicate by check mark whether by furnishing the information contained in this Form, the registrant is also thereby furnishing the information to the Commission pursuant to Rule 12g3-2(b) under the Securities Exchange Act of 1934.
 
Yes o   No x
 
If “Yes” is marked, indicate below the file number assigned to the registrant in connection with Rule 12g3-2(b):  82-________
 
 
 

 
 
EXPLANATORY NOTE
 
On May 2, 2014, MediWound Ltd. issued a press release entitled “MediWound Reports First Quarter 2014 Financial Results”. A copy of this press release is attached to this Form 6-K as Exhibit 99.1.

 
2

 
 
SIGNATURE
 
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.
 
 
MEDIWOUND LTD.
 
       
Date: May 2, 2014 
By:
/s/ Sharon Malka  
   
Name:  Sharon Malka
 
   
Title:    Chief Financial Officer
 
 
 
3

 
 
EXHIBIT INDEX

The following exhibits are filed as part of this Form 6-K:

Exhibit                    Description

99.1
Press release dated May 2, 2014 titled “MediWound Reports First Quarter 2014 Financial Results”.

99.2
Unaudited Interim Financial Statements as of March 31, 2014.
 
 
4


exhibit_99-1.htm


Exhibit 99.1
 
 
News Release
 
MediWound Reports First Quarter 2014 Financial Results
 
YAVNE, Israel (May 2, 2014) MediWound Ltd. (Nasdaq: MDWD), a fully integrated biopharmaceutical company bringing innovative therapies to address unmet needs in severe burn and wound management, reports today its financial results for the three months ended March 31, 2014.

Highlights of the first quarter of 2014 and recent weeks include:

 
·
Raised approximately $80 million in a U.S. initial public offering (IPO) of 5.75 million ordinary shares at $14.00 per share, which included the full exercise of the underwriters’ option to purchase additional shares.
 
·
Generated initial revenues from sales of NexoBrid following its launch in Germany to burn specialists who treat patients in burn centers and hospital burn units.
 
·
Executed a distribution agreement in Latin America for the marketing and distribution of NexoBrid in Argentina, pending market authorization, as disclosed in the prospectus.
 
“The first quarter of 2014 was a transformative time for MediWound during which we positioned our Company to continue the marketing of NexoBrid in Europe and the regulatory approval process in the United States,” stated Gal Cohen, President and Chief Executive Officer of MediWound.  “We are very excited to have completed our U.S. IPO and listing on the NASDAQ Global Market, as it provides us with growth capital to expand our marketing infrastructure in Europe, execute our planned clinical studies including the Phase III trial for NexoBrid in the United States and our pediatric trial in the European Union and to scale-up the Company's manufacturing capabilities.
 
“We launched NexoBrid in Germany in December 2013, and our efforts there have commenced well.  Our strategy is to initiate direct sales to burn centers by utilizing tools that illustrate both the clinical and the economic benefits of NexoBrid for the treatment of severe burn wounds.  The reception from physicians has been positive and highly encouraging.  We look forward to expanding the use of NexoBrid into other European countries in the coming quarters and plan to expand the access of NexoBrid to other international markets through agreements with local distributors.  In parallel, we will work to obtain reimbursement coverage.  Central to that effort is data demonstrating that NexoBrid has the ability to promptly and effectively remove the eschar from a wound, thereby allowing clinicians to visually assess burn severity, which results in significantly reduced surgical burden on patients and overall favorable long-term outcomes, while reducing the burden on health systems.
 
“We expect to achieve a number of value-creating milestones throughout the balance of the year,” concluded Mr. Cohen.
 
 
 

 
 
First Quarter Financial Results
 
The Company generated initial insignificant revenues from sales of NexoBrid in the first quarter of 2014, after launching NexoBrid in December 2013 in Germany, which included preliminary onsite training and hands-on demonstrations in burn centers throughout Germany.

Operating expenses for the first quarter of 2014 were $4.3 million compared with $1.4 million in the first quarter of 2013.  The increase was primarily due to $1.1 million of commercial activities associated with building the European marketing infrastructure and $1.2 million increase in non-cash share based compensation expenses.
 
For the first quarter of 2014, the Company posted a net loss of $0.7 million, or $0.05 per share.

Adjusted EBITDA, as defined below, for the first quarter of 2014 was $3.1 million compared with $1.3 million for the same quarter last year.
 
Balance Sheet Highlights
 
As of March 31, 2014, the Company had $80.6 million in cash and cash equivalents and working capital of $78.5 million.  The Company used $3.2 million during the quarter to fund operating activities.
 
On March 25, 2014, the Company closed its U.S. IPO and listed 5,750,000 of its ordinary shares on the NASDAQ Global Market. The public offering price was $14.00 per share. After deducting the underwriting discount and the offering expenses, the net proceeds from the offering amounted to $72 million.
 
During 2014, the Company plans to continue to build our marketing infrastructure in Europe, fund further clinical development of NexoBrid, support efforts to obtain regulatory approvals worldwide and initiate our plans to scale up manufacturing capabilities.
 
Non-IFRS Financial Measures

To supplement our consolidated financial statements, which are prepared and presented in accordance with IFRS, the Company has provided a supplementary non-IFRS measure to consider in evaluating the Company’s performance. Management uses Adjusted EBITDA. Adjusted EBITDA is defined as earnings before interest, taxes, depreciation and amortization, impairment, restructuring and further eliminates the effect of share based compensation expenses.

Although Adjusted EBITDA is not a measure of performance or liquidity calculated in accordance with IFRS, we believe that the non-IFRS financial measures we present provide meaningful supplemental information regarding our operating results primarily because they exclude certain non-cash charges or items that we do not  believe are reflective of our ongoing operating results when budgeting, planning and forecasting, determining  compensation, and when assessing the performance of our business with our  senior management.

 
 

 
 
However, investors should not consider these measures in isolation or as substitutes for operating income, cash flows from operating activities or any other measure for determining the Company’s operating performance or liquidity that is calculated in accordance with IFRS. In addition, because Adjusted EBITDA is not calculated in accordance with IFRS, it may not necessarily be comparable to similarly titled measures employed by other companies. The non-IFRS measures included in this press release have been reconciled to the IFRS results in the tables below.
 
About MediWound Ltd.
MediWound is a fully integrated biopharmaceutical company focused on developing, manufacturing and commercializing novel therapeutics based on its patented proteolytic enzyme technology to address unmet needs in the fields of severe burns, as well as chronic and other hard-to-heal wounds. MediWound’s first innovative biopharmaceutical product, NexoBrid, received marketing authorization from the European Medicines Agency for removal of dead or damaged tissue, known as eschar, in adults with deep partial- and full-thickness thermal burns and has been launched in Europe. NexoBrid represents a new paradigm in burn care management, and clinical trials have demonstrated, with statistical significance, its ability to non-surgically and rapidly remove the eschar earlier and, without harming viable tissues. For more information, please visit www.mediwound.com.

Cautionary Note Regarding Forward-Looking Statements
This release includes forward-looking statements within the meaning of Section 27A of the U.S. Securities Act of 1933, as amended, Section 21E of the US Securities Exchange Act of 1934, as amended, and the safe harbor provisions of the U.S. Private Securities Litigation Reform Act of 1995. Forward-looking statements are statements that are not historical facts, such as statements regarding assumptions and results related to financial results forecast, commercial results, clinical trials and the regulatory authorizations. Forward-looking statements are based on MediWound’s current knowledge and its present beliefs and expectations regarding possible future events and are subject to risks, uncertainties and assumptions. Actual results and the timing of events could differ materially from those anticipated in these forward-looking statements as a result of several factors including, but not limited to, unexpected results of clinical trials, delays or denial in the FDA or the EMA regulatory approval process or additional competition in the market. The forward-looking statements made herein speak only as of the date of this announcement and MediWound undertakes no obligation to update publicly such forward-looking statements to reflect subsequent events or circumstances, except as otherwise required by law.
 
Contacts:
 
Sharon Malka
Anne Marie Fields
Chief Financial & Operation Officer
Senior Vice President
MediWound Ltd.
LHA
ir@mediwound.co.il
212-838-3777
 
afields@lhai.com
 
 - Financial Tables to Follow -
 
 
 

 
 
CONDENSED CONSOLIDATED UNAUDITED BALANCE SHEETS

U.S. dollars in thousands
 
   
March 31,
   
December 31,
 
   
2014
   
2013
 
CURRENT ASSETS:
           
Cash, cash equivalents and short term deposits
    80,570       9,553  
Accounts receivable
    2,455       2,512  
Inventories
    809       -  
      83,834       12,065  
LONG-TERM ASSETS:
               
Long term deposits and deferred costs
    140       204  
Property, plant and equipment, net
    1,110       1,136  
Intangible assets, net
    987       1,004  
Other assets
    417       417  
      86,488       14,826  
CURRENT LIABILITIES:
               
Current maturities of Financials Liabilities
    314       -  
Accounts payables and accruals
    5,032       2,023  
      5,346       2,023  
LONG-TERM LIABILITIES:
               
Liabilities in respect of Chief Scientist government grants, net of current maturities
    6,714       6,604  
Contingent consideration for the purchase of treasury shares, net of current maturities
    17,115       16,800  
Warrants to shareholders
    -       9,200  
Severance pay liability, net
    3       3  
     
23,832
     
32,607
 
SHAREHOLDERS' EQUITY (DEFICIT)
    57,310      
(19,804
)
      86,488       14,826  

 
 

 
 
CONDENSED CONSOLIDATED UNAUDITED STATEMENTS OF COMPREHENSIVE INCOME

U.S. dollars in thousands (except share and per share data)
 
   
Three months ended
March 31,
 
   
2014
   
2013
 
Revenues
    50       -  
Cost of revenues
    170       -  
Gross loss
    (120 )     -  
Operating expenses:
               
Research and development, net of participations
    1,465       757  
Selling and marketing
    1,615       240  
General and administrative
    1,267       411  
Total operating expenses
    (4,347 )     (1,408 )
Operating loss
    (4,467 )     (1,408 )
Financial income
    4,523       -  
Financial expense
    (791 )     (885 )
Loss from continuing operations
    (735 )     (2,293 )
Loss from discontinued operation
    (14 )     (845 )
Loss for the period
    (749 )     (3,138 )
Foreign currency translation adjustments
    (10 )     -  
Total other comprehensive loss
    (10 )     -  
Total comprehensive loss
    (759 )     (3,138 )
                 
Basic and diluted loss per share:
               
Loss from continuing operations
    (0.05 )     (0.15 )
Loss from discontinued operation
    (* )     (0.05 )
Net loss per share
    (0.05 )     (0.20 )
Weighted average number of ordinary shares used in the computation of basic and diluted loss per share:
    15,749       15,707  
 
(*)           Represents less than $ 0.01
 
 
 

 
 
CONDENSED CONSOLIDATED UNAUDITED STATEMENTS OF CASH FLOWS

U.S. dollars in thousands
 
   
Three months ended
March 31,
 
   
2014
   
2013
 
Cash Flows from Operating Activities:
           
Net loss
    (749 )     (3,138 )
Adjustments to reconcile net loss to net cash used in continuing operating activities:
               
Adjustments to profit and loss items:
               
Loss from discontinued operation
    14       845  
Depreciation and amortization
    117       65  
Revaluation of warrants to shareholders
    (4,491 )     -  
Share-based compensation
    1,261       59  
Revaluation of liabilities in respect of Chief Scientist government grants
    141       222  
Revaluation of contingent consideration for the purchase of treasury shares
    586       500  
Accrued interest in respect of financial loans
    -       168  
Other Financing expenses, net
    (14 )     (6 )
      (2,386 )     1,853  
Changes in asset and liability items:
               
Increase in trade receivables
    (16 )     -  
Decrease in other receivables
    8       44  
Increase in inventories
    (809 )     (17 )
Decrease in trade payables
    (359 )     (198 )
Increase in other payables
    1,092       219  
      (84 )     48  
Net cash used in continuing operating activities
    (3,219 )     (1,237 )
                 
Net cash used in discontinued operating activities
    (14 )     (424 )
                 
Net cash flows used in operating activities
    (3,233 )     (1,661 )
             
Cash Flows from Investing Activities:
           
Purchase of property and equipment
    (74 )     (25 )
Interest received
    3       -  
Proceeds from (investment in) short term bank deposits, net of investments
    2,500       -  
                 
Net cash provided by (used in) investing activities
    2,429       (25 )
                 
Cash Flows from Financing Activities:
               
Proceeds from exercise of options
    208       279  
Proceeds from issuance of shares and warrants, net
    74,082       -  
Proceeds from shareholders' loans
    -       1,445  
Proceeds from the Chief Scientist government grants
    12       -  
                 
Net cash provided by financing activities
    74,302       1,724  
Exchange rate differences on cash and cash equivalent balances
    19       6  
Increase in cash and cash equivalents from continuing activities
    73,531       468  
Decrease in cash and cash equivalents from discontinued activities
    (14 )     (424 )
Balance of cash and cash equivalents at the beginning of the period
    7,053       337  
Balance of cash and cash equivalents at the end of the period
    80,570       381  
Significant non-cash activities:
               
Exercise of cashless warrants into shares
    4,709       -  
Unpaid issuance expenses
    2,258          
 
 
 

 
 
ADJUSTED EBITDA

U.S. dollars in thousands

   
Three months ended
 
   
March 31,
 
   
2014
   
2013
 
Loss for the period
    (749 )     (3,138 )
Adjustments:
               
Financial (expenses) income, net
    3,732       (885 )
Other expenses *
    (14 )     (845 )
Depreciation and amortization
    (117 )     (65 )
Share-based compensation expenses **
    (1,261 )     (59 )
Total adjustments
    2,340       (1,854 )
Adjusted EBITDA from continuing operation
    (3,089 )     (1,284 )
                 
* Loss from discontinued operation
               
                 
** Share-based compensation expenses:
               
Cost of revenues
    132          
Research and development
    346       20  
Selling and marketing
    302          
General and administrative
    481       39  
Share-based compensation expenses
    1,261       59  
 
###
 


exhibit_99-2.htm


Exhibit 99.2
 
MEDIWOUND LTD. AND ITS SUBSIDIARIES
 
INTERIM FINANCIAL STATEMENTS
 
AS OF MARCH 31, 2014
 
IN U.S. DOLLARS IN THOUSANDS
 
UNAUDITED
 
INDEX
 
 
Page
   
2
   
3
   
4 - 5
   
6 - 7
   
8 - 9

 
 

 
 
MEDIWOUND LTD. AND ITS SUBSIDIARIES
 
BALANCE SHEETS

U.S. dollars in thousands (except share and per share data)

   
March 31,
   
December 31,
 
   
2014
   
2013
   
2013
 
   
Unaudited
   
Audited
 
CURRENT ASSETS:
                 
Cash and cash equivalents
    80,570       381       7,053  
Short-term bank deposits
    -       -       2,500  
Trade receivables
    16       -       -  
Other receivables
    2,439       2,029       2,512  
Inventories
    809       685       -  
                         
      83,834       3,095       12,065  
LONG-TERM ASSETS:
                       
Long term deposits and deferred costs
    140       2       204  
Derivative instruments
    -       14,900       -  
Property, plant and equipment, net
    1,110       1,196       1,136  
Intangible assets, net
    987       4,919       1,004  
Other assets
    417       417       417  
                         
      2,654       21,434       2,761  
                         
      86,488       24,529       14,826  
CURRENT LIABILITIES:
                       
Current maturities of Financials Liabilities
    314       -       -  
Trade payables
    823       577       1,180  
Derivative in respect of convertible loan
    -       1,616       -  
Convertible loan
    -       1,552       -  
Accrued expenses and other payables
    4,209       1,254       843  
                         
      5,346       4,999       2,023  
LONG-TERM LIABILITIES:
                       
Liabilities in respect of Chief Scientist government grants net of current maturities
    6,714       6,656       6,604  
Contingent consideration for the purchase of treasury shares net of current maturities
    17,115       -       16,800  
Warrants to shareholders
    -       -       9,200  
Severance pay liability, net
    3       6       3  
                         
      23,832       6,662       32,607  
SHAREHOLDERS' EQUITY (DEFICIT):
                       
Ordinary shares of NIS 0.01 par value:
                       
 Authorized: 33,000,000 shares as of March 31, 2013 December 31, 2013 and March 31, 2014; Issued: 15,751,441, 15,769,487 and 22,053,336 shares respectively; Outstanding: 15,751,441, 15,013,995 and 21,297,844 shares respectively
    61       9       11  
Share premium
    140,052       48,058       62,229  
Treasury shares
    (34,600 )     -       (34,600 )
Foreign currency translation adjustments
    (42 )     -       (32 )
Accumulated deficit
    (48,161 )     (35,199 )     (47,412 )
                         
      57,310       12,868       (19,804 )
                         
      86,488       24,529       14,826  
 
The accompanying notes are an integral part of the interim financial statements.
 
 
2

 
 
MEDIWOUND LTD. AND ITS SUBSIDIARIES
 
STATEMENTS OF COMPREHENSIVE INCOME

U.S. dollars in thousands

   
Three months ended
March 31,
   
Year ended
December 31,
 
   
2014
   
2013
   
2013
 
   
Unaudited
   
Audited
 
Revenues
    50       -       -  
Cost of revenues
    170       -       -  
                         
Gross loss
    (120 )     -       -  
                         
Operating expenses:
                       
Research and development, net of participations
    1,465       757       3,635  
Selling and marketing
    1,615       240       2,259  
General and administrative
    1,267       411       1,687  
                         
Total operating expenses
    (4,347 )     (1,408 )     (7,581 )
                         
Operating loss
    (4,467 )     (1,408 )     (7,581 )
                         
Financial income
    4,523       -       2,401  
Financial expense
    (791 )     (885 )     (3,321 )
                         
Loss from continuing operations
    (735 )     (2,293 )     (8,501 )
                         
Loss from discontinued operation
    (14 )     (845 )     (6,850 )
                         
Loss for the period
    (749 )     (3,138 )     (15,351 )
                         
Other comprehensive loss:
                       
Items to be reclassified to profit or loss in subsequent periods:
                       
Foreign currency translation adjustments
    (10 )     -       (32 )
                         
Total other comprehensive loss
    (10 )     -       (32 )
                         
Total comprehensive loss
    (759 )     (3,138 )     (15,383 )
                         
Basic and diluted loss per share:
                       
Loss from continuing operations
    (0.05 )     (0.15 )     (0.54 )
Loss from discontinued operation
    (* )     (0.05 )     (0.44 )
Net loss per share
    (0.05 )     (0.20 )     (0.98 )
                         
Weighted average number of ordinary shares used in the computation of basic and diluted loss per share: (**)
    15,749       15,707       15,671  
 
(*)           Represents less than $ 0.01.
(**)         all ordinary shares, options, warrants and earnings (losses) per share amounts have been adjusted retroactively, see note 1(c).
 
The accompanying notes are an integral part of the interim financial statements.

 
3

 
 
MEDIWOUND LTD. AND ITS SUBSIDIARIES
 
STATEMENTS OF CHANGES IN SHAREHOLDERS' EQUITY

U.S. dollars in thousands (except share data)

   
Share capital
   
Share premium
   
Treasury
shares
   
Foreign currency translation reserve
   
Accumulateddeficit
   
Total
equity
 
   
Unaudited
 
                                     
Balance as of January 1, 2014 (audited)
    11       62,229       (34,600 )     (32 )     (47,412 )     (19,804 )
Loss for the period
    -       -       -       -       (749 )     (749 )
Other comprehensive loss
    -       -       -       (10 )     -       (10 )
                                                 
Total comprehensive loss
    -       -       -       (10 )     (749 )     (759 )
                                                 
Exercise of options
    (* )     208       -       -       -       208  
Exercise of warrants
    1       4,711       -       -       -       4,712  
Issuance of shares, net
    17       71,675       -       -       -       71,692  
Share-based compensation
    -       1,261       -       -       -       1,261  
Effect of share split
    32       (32 )     -       -       -       -  
                                                 
Balance as of March 31, 2014
    61       140,052       (34,600 )     (42 )     (48,161 )     57,310  
 
   
Share capital
   
Share premium
   
Treasury
shares
   
Foreign currency translation reserve
   
Accumulated
deficit
   
Total
equity
 
   
Unaudited
 
                                     
Balance as of January 1, 2013 (audited)
    9       47,686       -       -       (32,061 )     15,634  
                                                 
Total comprehensive loss
    -       -       -       -       (3,138 )     (3,138 )
                                                 
Exercise of options
    (* )     279       -       -       -       279  
Share-based compensation
    -       93       -       -       -       93  
                                                 
Balance as of March 31, 2013
    9       48,058       -       -       (35,199 )     12,868  

 
4

 

MEDIWOUND LTD. AND ITS SUBSIDIARIES
 
STATEMENTS OF CHANGES IN SHAREHOLDERS' EQUITY

U.S. dollars in thousands (except share data)

   
Share capital
   
Share premium
   
Treasury
shares
   
Foreign currency translation reserve
   
Accumulated
deficit
   
Total
equity
 
                                     
Balance as of January 1, 2013
    9       47,686       -       -       (32,061 )     15,634  
Loss for the period
    -       -       -       -       (15,351 )     (15,351 )
Other comprehensive loss
    -       -       -       (32 )     -       (32 )
                                                 
Total comprehensive loss
    -       -       -       (32 )     (15,351 )     (15,383 )
                                                 
Exercise of options
    (* )     279       -       -       -       279  
Purchase of treasury shares
    -       -       (34,600 )     -       -       (34,600 )
Share-based compensation
    -       607       -       -       -       607  
Issuance of shares, net
    2       13,657       -       -       -       13,659  
                                                 
Balance as of December 31, 2013
    11       62,229       (34,600 )     (32 )     (47,412 )     (19,804 )

(*)           Represents less than $ 1.

The accompanying notes are an integral part of the interim financial statements.

 
5

 
 
MEDIWOUND LTD. AND ITS SUBSIDIARIES
 
STATEMENTS OF CASH FLOWS

U.S. dollars in thousands

   
Three months ended
March 31,
   
Year ended
December 31,
 
   
2014
   
2013
   
2013
 
   
Unaudited
   
Audited
 
Cash Flows from Operating Activities:
                 
Net loss
    (749 )     (3,138 )     (15,351 )
                         
Adjustments to reconcile net loss to net cash used in continuing operating activities:
                       
                         
Adjustments to profit and loss items:
                       
Loss from discontinued operation
    14       845       6,850  
Depreciation and amortization
    117       65       336  
Revaluation of warrants to shareholders
    (4,491 )     -       820  
Share-based compensation
    1,261       59       531  
Revaluation of liabilities in respect of Chief Scientist government grants
    141       222       (106 )
Revaluation of contingent consideration for the purchase of treasury shares
    586       500       (2,400 )
Accrued interest in respect of financial loans
    -       168       1,669  
Other Financing expenses, net
    (14 )     (6 )     (35 )
                         
      (2,386 )     1,853       7,665  
Changes in asset and liability items:
                       
Increase in trade receivables
    (16 )     -       -  
Decrease (increase) in other receivables
    8       44       (532 )
Increase in inventories
    (809 )     (17 )     -  
Increase (decrease) in trade payables
    (359 )     (198 )     405  
Increase (decrease) in other payables
    1,092       219       (262 )
                         
      (84 )     48       (389 )
                         
Net cash used in continuing operating activities
    (3,219 )     (1,237 )     (8,075 )
                         
Net cash used in discontinued operating activities
    (14 )     (424 )     (1,665 )
                         
Net cash flows used in operating activities
    (3,233 )     (1,661 )     (9,740 )

The accompanying notes are an integral part of the financial statements.

 
6

 
 
MEDIWOUND LTD. AND ITS SUBSIDIARIES
 
STATEMENTS OF CASH FLOWS

U.S. dollars in thousands
 
   
Three months ended
March 31,
   
Year ended
December 31,
 
   
2014
   
2013
   
2013
 
   
Unaudited
   
Audited
 
Cash Flows from Investing Activities:
                 
                   
Purchase of property and equipment
    (74 )     (25 )     (268 )
Purchase of intangible assets
    -       -       (90 )
Interest received
    3       -       3  
Proceeds from (investment in) short term bank deposits, net of investments
    2,500       -       (2,500 )
                         
Net cash provided by (used in) investing activities
    2,429       (25 )     (2,855 )
                         
Cash Flows from Financing Activities:
                       
                         
Proceeds from exercise of options
    208       279       279  
Proceeds from issuance of shares and warrants, net
    74,082       -       15,800  
Proceeds from shareholders' loans
    -       1,445       3,930  
Repayment of shareholders' loans
    -       -       (915 )
Deferred issuance costs
    -       -       (129 )
Proceeds from the Chief Scientist government grants
    12       -       276  
                         
Net cash provided by financing activities
    74,302       1,724       19,241  
                         
Exchange rate differences on cash and cash equivalent balances
    19       6       70  
Increase in cash and cash equivalents from continuing activities
    73,531       468       8,381  
                         
Decrease in cash and cash equivalents from discontinued activities
    (14 )     (424 )     (1,665 )
                         
Balance of cash and cash equivalents at the beginning of the period
    7,053       337       337  
                         
Balance of cash and cash equivalents at the end of the period
    80,570       381       7,053  
                         
Non-cash activities:
                       
Exercise of cashless warrants into shares
    4,709       -       -  
Unpaid issuance expenses
    2,258       -       -  
Contingent consideration for the purchase of treasury shares
    -       -       19,200  
Exercise of derivative instrument into treasury shares
    -       -       15,400  
Conversion of loans and realization of derivatives into shares and warrants
    -       -       6,239  

The accompanying notes are an integral part of the financial statements.

 
7

 
 
MEDIWOUND LTD. AND ITS SUBSIDIARIES
 
NOTES TO FINANCIAL STATEMENTS

U.S. dollars in thousands (except share and per share data)
 
NOTE 1:
GENERAL

 
a.
General description of the company and its operations:
 
 
 
MediWound Ltd. (the "Company" or "MediWound"), is a fully integrated biopharmaceutical company focused on developing, manufacturing and commercializing novel products to address unmet needs in the fields of severe burns, chronic and other hard to heal wounds. The Company's first innovative biopharmaceutical product, NexoBrid, received marketing authorization from the European Medicines Agency for removal of dead or damaged tissue, known as eschar, in adults with deep partial and full-thickness thermal burns and was launched in Europe in December 2013.
 
 
b.
The Company has two wholly-owned subsidiaries: MediWound Germany GmbH, acting as EU marketing authorization holder and EU sales and marketing arm and MediWound UK Limited, an inactive company. In addition, the Company owns 7.5% of PolyHeal Ltd., a private life sciences company ("PolyHeal").

 
c.
On March 3, 2014, the Company effected a bonus share distribution under which: (i) two and eight tenths (2.8) bonus shares were issued for each ordinary share outstanding prior to such distribution; and (ii) the conversion rate for each preferred share, option and warrant was adjusted to reflect such bonus share distribution. For accounting purposes, this transaction was recorded as a stock split and accordingly (unless otherwise noted), all ordinary shares, options, warrants and earnings (losses) per share amounts have been adjusted retroactively for all periods presented in these financial statements.

 
d.
On March 25, 2014, the Company closed its initial public offering (IPO) in the United States and listing on the NASDAQ Global Select Market of 5,750,000 new ordinary shares. The public offering price was $14.00 per share. After deducting the underwriting discount and the offering expenses, the net proceeds from the offering amounted to $71,700. The number of shares offered included the underwriters' option to purchase an additional 750,000 shares at the offering price that was exercised prior to closing.

 
e.
Upon the closing of this IPO the Company issued 336,591 ordinary shares pursuant to the exercise of 1,066,735 warrants held by certain of our shareholders, including (1) the exercise of 433 warrants into 433 ordinary shares at an exercise price of $6.72 per share and the receipt of proceeds by us related to such exercise and (2) the cashless exercise of 1,066,302 warrants into 336,158 ordinary shares at a weighted average exercise price of $9.58 per share.
 
 
8

 
 
MEDIWOUND LTD. AND ITS SUBSIDIARIES
 
NOTES TO FINANCIAL STATEMENTS

U.S. dollars in thousands (except share and per share data)
 
NOTE 2:
SIGNIFICANT ACCOUNTING POLICIES

 The following accounting policies have been applied consistently in the financial statements for all periods presented unless otherwise stated.

 
a.
Basis of presentation of financial statements:
 
 
These financial statements have been prepared in accordance with International Financial Reporting Standards ("IFRS") as issued by the International Accounting Standards Board ("IASB").
 
 
b.
Basis of preparation of the interim consolidated financial statements:
 
 The interim condensed financial statements for the three months ended March 31, 2014 have been prepared in accordance with IAS 34 "Interim Financial Reporting".
 
 The interim condensed financial statements do not include all the information and disclosures required in the annual financial statements, and should be read in conjunction with 
 the Company's annual financial statements as of December 31, 2013 that were included in the Registration Statement on Form F-1 filed on March 20, 2014.
 
9