SEC Filing | Centogene N.V.

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UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 6-K

REPORT OF FOREIGN PRIVATE ISSUER

PURSUANT TO RULE 13a-16 OR 15d-16

UNDER THE SECURITIES EXCHANGE ACT OF 1934

For the date of September 7, 2021

Commission File Number 001-39124

Centogene N.V.

(Translation of registrant’s name into English)

Am Strande 7

18055 Rostock

Germany

(Address of principal executive offices)

Indicate by check mark whether the registrant files or will file annual reports under cover of Form 20-F or Form 40-F.

Form 20-F..⌧.. Form 40-F.◻

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): ◻

Centogene N.V.

On September 7, 2021, Centogene N.V. (the “Company”) issued a press release reporting its financial results for the six months ended June 30, 2021. A copy of the press release is attached hereto as Exhibit 99.1.

Attached hereto as Exhibits 99.2 and 99.3 are also the financial statements of the Company for the three and six months ended June 30, 2021 and the Management’s Discussion and Analysis of Financial Condition and Results of Operations for the three and six months ended June 30, 2021, respectively. All exhibits attached hereto are incorporated by reference herein.

Exhibit 99.1 to this Report on Form 6-K shall not be deemed “filed” for purposes of Section 18 of the U.S. Securities Exchange Act of 1934, as amended (the “Exchange Act”), or otherwise subject to the liabilities of that section, nor shall it be deemed incorporated by reference in any filing under the U.S. Securities Act of 1933, as amended, or the Exchange Act.

Exhibits 99.2 and 99.3 to this Report on Form 6-K shall be deemed to be incorporated by reference into the registration statement on Form S-8 (Registration Number 333-234551) of the Company and to be a part thereof from the date on which this report is filed, to the extent not superseded by documents or reports subsequently filed or furnished.

Signatures

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.


	CENTOGENE N.V.


Date: September 7, 2021


	By:	/s/ Rene Just
		Name:	Rene Just
		Title:	Chief Financial Officer

Exhibit Index

Exhibit		Description of Exhibit

99.1		Press Release dated September 7, 2021
99.2		Unaudited Condensed Consolidated Interim Financial Statements as of and for the Three and Six Months ended June 30, 2021
99.3		Management’s Discussion and Analysis of Financial Condition and Results of Operations for the Three and Six Months ended June 30, 2021

Exhibit 99.1

CENTOGENE Reports Second Quarter 2021 Financial Results

Strong Revenues and Steady Return to Core Business Growth; Surpasses Milestone of 200 Scientific Publications, Highlighting Value of Bio/Databank

CAMBRIDGE, Mass. and ROSTOCK, Germany, and BERLIN, September 7, 2021 (GLOBE NEWSWIRE) – Centogene N.V. (Nasdaq: CNTG), a commercial-stage company focused on generating data-driven insights to diagnose, understand, and treat rare diseases, today announced financial results for the second quarter ended June 30, 2021, and provided an update on recent business progress.

Executive Commentary

“We delivered a strong quarter and made meaningful progress on our strategic priorities, which we outlined at our Investor Event in June this year. This includes the appointment and onboarding of an expanded new management team, with the most recent addition of Patrice P. Denèfle as Chief Scientific Officer to help lead our data-driven approach to reinvent rare disease drug discovery and development,” stated Andrin Oswald, M.D., Chief Executive Officer at CENTOGENE. “By leveraging the compounding value of our leading and continuously growing Bio/Databank within our diagnostic, research, and pharma initiatives, we have built a strong foundation and are set to enable the cure of 100 rare diseases in 10 years.”

Q2 Financial Highlights

●

Revenues of €51.9 million in Q2 2021, a 434% increase compared to €9.7 million in Q2 2020; Revenues from the Company’s Pharma and Diagnostics segments (“Core Business”) increased 25%

●

Clinical Diagnostics revenues (excl. COVID) of €6.7 million, an increase of 82% compared to €3.6 million in Q2 2020

●

Pharma revenues of €2.8 million in Q2 2021, down from €3.9 million in Q2 2020, with further revenues weighted towards the end of 2021

●

Commercial COVID-19 testing revenues of €42.3 million in Q2 2021, up from €2.1 million in Q2 2020

●

Positive total segment adjusted EBITDA of €7.5 million compared to €1.0 million in Q2 2020 from our Pharma, Diagnostics, and COVID-19 testing segments

●

Cash and cash equivalents of €34.8 million as of June 30, 2021, compared to €45.2 million for the period ending March 31, 2021

“We are very encouraged by the accelerating momentum and the performance we delivered in Q2 2021, particularly in achieving strong segment adjusted EBITDA now multiple quarters in a row,” said René Just, Chief Financial Officer of CENTOGENE. “We will continue to efficiently deploy our capabilities and resources to drive further growth and value creation for our patients and shareholders.”

Corporate Highlights

●

Set mission to enable the cure of 100 rare diseases in 10 years and outlined high value creating strategy and milestones for the next few years at first corporate Investor Event on June 22, 2021

●

Published 200^th scientific publication – accelerating scientific discoveries through leveraging CENTOGENE's vast Bio/Databank and studying over 115,000 patient cases to diagnose, understand, and treat rare disease patients around the world

●

Added approximately 24,000 patients with high quality data sets to CENTOGENE’s Bio/Databank, the world´s most geographically diverse source of rare disease-centric insights

●

Announced key additions to executive management team, including most recently Patrice P. Denèfle as Chief Scientific Officer, who is responsible for overseeing scientific activities to deliver on the Company’s vision and strategy, while driving value creation

Pharma Highlights

●

Initiated new collaboration with immuno-neurology pioneer Alector to accelerate the diagnosis of patients with frontotemporal dementia, a genetic neurogenerative disease

●

Extended partnership with Takeda to enable access to genetic testing and diagnosis of patients with certain genetic disorders

●

Extended global Parkinson’s disease study (Rostock International Parkinson's Disease (ROPAD) Study) – aiming to recruit and genetically test an additional 2,500 patients for Parkinson’s, one of CENTOGENE’s key prioritized diseases. In 2018, CENTOGENE entered into a strategic collaboration with Denali Therapeutics for the targeted global identification and recruitment of Parkinson’s disease patients with mutations in the LRRK2 gene

●

Currently leads 12 ongoing observational and longitudinal observational clinical studies to validate/monitor biomarkers, covering several disease categories, such as Parkinson’s disease, transthyretin amyloidosis, and inborn errors of metabolism

Diagnostic Highlights

●

Launched enhanced Whole Exome Sequencing (WES) service NEW CentoXome®, coupling insights from the Company’s unique rare disease-centric Bio/Databank with superior omics technology to increase diagnostic yield by up to 20% compared to conventional WES

●

Reported testing volume/order intake/test requests of 29,100 which represents a 54 % increase compared to 18,850 in the same period in 2020

●

Published latest research which led to the discovery of six new rare diseases, which are now incorporated into the Company’s diagnostic offering, and diagnosis of over 90 patients by leveraging the Company’s Bio/Databank

●

Authored 18 peer-reviewed scientific publications in Q2 2021, focused on generating critical insights into diseases, including Parkinson’s disease, as well as advancements in genetic sequencing technology

COVID-19 Testing

●

Leveraged CENTOGENE’s diagnostic expertise and resources with continued COVID-19 testing, including the processing of 679,900 test requests for SARS-CoV-2 testing in Q2 2021

2021 Financial Guidance

The Company continues to see Diagnostics recovery, alongside momentum in newly signed Pharma partnership deals. This trajectory indicates a return to solid core business growth for 2021. Despite anticipating COVID-19 revenues to decline in the second half of the year, overall revenue for FY 2021 is expected to surpass FY 2020.

Webcast and Conference Call Information

Management will host a conference call and webcast today at 2 p.m. CEST/ 8 a.m. EDT to discuss financial results and recent developments. To access the conference call and webcast, please register at: http://emea.directeventreg.com/registration/6090847. Upon registering, each participant will be provided with Participant Dial In Numbers, a Direct Event Passcode, and a unique Registrant ID. Registrants can then join up to 10 minutes prior to the start of the call.

The webcast of the conference call and the slide deck will also be available on the Investor Relations page of the Company’s website at http://investors.centogene.com.

These results reflect another step forward for CENTOGENE’s mission to enable the cure of 100 rare diseases within the next 10 years. To learn more, visit: https://www.centogene.com/virtual-investor-event

About CENTOGENE

CENTOGENE engages in diagnosis and research around rare diseases transforming real-world clinical, genetic, and multiomic data to diagnose, understand, and treat rare diseases. Our goal is to bring rationality to treatment decisions and to accelerate the development of new orphan drugs by using our extensive rare disease knowledge and data. CENTOGENE has developed a global proprietary rare disease platform based on our real-world data repository with over 3.9 billion weighted data points from approximately 600,000 patients representing over 120 different countries as of December 31, 2020.

The Company’s platform includes epidemiologic, phenotypic, and genetic data that reflects a global population, as well as a biobank of patients’ blood samples and cell cultures. CENTOGENE believes this represents the only platform focused on comprehensive analysis of multi-level data to improve the understanding of rare hereditary diseases. It allows for better identification and stratification of patients and their underlying diseases to enable and accelerate discovery, development, and access to orphan drugs. As of December 31, 2020, the Company collaborated with over 30 pharmaceutical partners.

Forward-Looking Statements

This press release contains “forward-looking statements” within the meaning of the U.S. federal securities laws. Statements contained herein that are not clearly historical in nature are forward-looking, and the words “anticipate,” “believe,” “continues,” “expect,” “estimate,” “intend,” “project,” and similar expressions and future or conditional verbs such as “will,” “would,” “should,” “could,” “might,” “can,” and “may,” are generally intended to identify forward-looking statements. Such forward-looking statements involve known and unknown risks, uncertainties, and other important factors that may cause CENTOGENE’s actual results, performance, or achievements to be materially different from any future results, performance, or achievements expressed or implied by the forward-looking statements. Such risks and uncertainties include, among others, negative worldwide economic conditions and ongoing instability and volatility in the worldwide financial markets, the effects of the COVID-19 pandemic on our business and results of operations, possible changes in current and proposed legislation, regulations and governmental policies, pressures from increasing competition and consolidation in our industry, the expense and uncertainty of regulatory approval, including from the U.S. Food and Drug Administration, our reliance on third parties and collaboration partners, including our ability to manage growth and enter into new client relationships, our dependency on the rare disease industry, our ability to manage international expansion, our reliance on key personnel, our reliance on intellectual property protection, fluctuations of our operating results due to the effect of exchange rates, or other factors. For further information on the risks and uncertainties that could cause actual results to differ from those expressed in these forward-looking statements, as well as risks relating to CENTOGENE’s business in general, see CENTOGENE’s risk factors set forth in CENTOGENE’s Form 20-F filed on April 15, 2021, with the Securities and Exchange Commission (the “SEC”) and subsequent filings with the SEC. Any forward-looking statements contained in this press release speak only as of the date hereof, and CENTOGENE’s specifically disclaims any obligation to update any forward-looking statement, whether as a result of new information, future events, or otherwise.

Media Contact:

CENTOGENE

Lennart Streibel

Investor Relations

investor.relations@centogene.com

FTI Consulting

Robert Stanislaro

robert.stanislaro@fticonsulting.com

Rachel Kleiman

rachel.kleiman@fticonsulting.com

Exhibit 99.2

Centogene N.V.

Unaudited interim condensed consolidated statements of comprehensive loss

for the three and six months ended June 30, 2021 and 2020

(in EUR k)


		For the three months ended June 30		For the six months ended June 30
	Note	2020	2021	2020	2021
Revenue	4, 5	9,719	51,871	21,824	116,831
Cost of sales		6,815	43,760	13,833	95,707
Gross profit		2,904	8,111	7,991	21,124
Research and development expenses		3,119	4,053	5,810	8,388
General administrative expenses		7,767	10,494	15,665	22,090
Selling expenses		2,386	1,942	4,712	3,891
Impairment of financial assets	7	500	580	1,674	675
Other operating income	6.1	801	1,276	1,746	1,642
Other operating expenses	6.2	37	2	138	36
Operating loss		(10,104)	(7,684)	(18,262)	(12,314)
Interest and similar income		13	—	13	—
Interest and similar expense		269	212	718	471
Financial costs, net		(256)	(212)	(705)	(471)
Loss before taxes		(10,360)	(7,896)	(18,967)	(12,785)
Income tax expenses		—	124	129	124
Loss for the period		(10,360)	(8,020)	(19,096)	(12,909)
Other comprehensive income/ (loss), all attributable to equity holders of the parent		(6)	(191)	70	(70)
Total comprehensive loss		(10,366)	(8,211)	(19,026)	(12,979)
Attributable to:
Equity holders of the parent		(10,364)	(8,222)	(18,963)	(13,025)
Non‑controlling interests		(2)	11	(63)	46
		(10,366)	(8,211)	(19,026)	(12,979)
Loss per share - Basic and diluted (in EUR)		(0.52)	(0.37)	(0.95)	(0.58)

The accompanying notes form an integral part of these unaudited interim condensed consolidated financial statements

Centogene N.V.

Unaudited interim condensed consolidated statements of financial position

as at December 31, 2020 and June 30, 2021

(in EUR k)


Assets	Note	Dec 31, 2020	June 30, 2021
Non‑current assets
Intangible assets		12,407	12,179
Property, plant and equipment		16,590	16,411
Right-of-use assets		22,120	20,558
Other assets	7	1,967	3,023
		53,084	52,171
Current assets
Inventories		11,405	9,281
Trade receivables and contract assets	7	29,199	18,490
Other assets	7	8,286	6,064
Cash and cash equivalents	8	48,156	34,780
		97,046	68,615
		150,130	120,786


Equity and liabilities	Note	Dec 31, 2020	June 30, 2021
Equity
Issued capital	9	2,654	2,693
Capital reserve	9	125,916	130,153
Retained earnings and other reserves		(62,888)	(75,913)
Non‑controlling interests		95	141
		65,777	57,074
Non‑current liabilities
Non‑current loans	10.1	401	200
Lease liabilities	10.1	17,677	16,209
Deferred tax liabilities		207	246
Government grants	10.2	8,950	8,640
		27,235	25,295
Current liabilities
Government grants	10.2	1,342	1,352
Current loans	10.1	2,492	3,883
Lease liabilities	10.1	3,528	3,299
Trade payables	10.2	31,736	14,014
Liabilities from income taxes	10.2	58	143
Other liabilities	10.2	17,962	15,726
		57,118	38,417
		150,130	120,786

The accompanying notes form an integral part of these unaudited interim condensed consolidated financial statements

Centogene N.V.

Unaudited interim condensed consolidated statements of cash flows

for the six months ended June 30, 2020 and 2021

(in EUR k)


		For the six months ended June 30
	Note	2020	2021
Operating activities

Loss before taxes		(18,967)	(12,785)

Adjustments to reconcile loss to cash flow from operating activities

Amortization and depreciation	5	4,432	6,670
Interest income		(13)	—
Interest expense		718	471
Expected credit loss allowances on trade receivables and contract assets	7	1,674	675
Share‑based payment expenses	11	1,393	4,276
Tax expense		129	124
Other non‑cash items		(686)	126

Changes in operating assets and liabilities
Inventories		(6,252)	2,124
Trade receivables and contract assets	7	(64)	10,034
Other assets	7	269	328
Trade payables	10.2	274	(17,722)
Other liabilities	10.2	2,457	(2,151)

Cash flow used in operating activities		(14,636)	(7,830)

Investing activities

Cash paid for investments in intangible assets	5	(3,965)	(2,089)
Cash paid for investments in property, plant and equipment		(3,072)	(2,696)
Grants received for investment in property, plant and equipment	10.2	390	—
Interest received		13	—

Cash flow used in investing activities		(6,634)	(4,785)

Financing activities
Cash paid for acquisition of non-wholly owned subsidiary		(75)	—
Cash received from loans	10.1	928	1,769
Cash repayments of loans	10.1	(1,260)	(185)
Cash repayments of lease liabilities	10.1	(1,619)	(2,263)
Interest paid		(399)	(82)

Cash flow from used in financing activities		(2,425)	(761)


Changes in cash and cash equivalents		(23,695)	(13,376)
Cash and cash equivalents at the beginning of the period		41,095	48,156
Cash and cash equivalents at the end of the period		17,400	34,780

The accompanying notes form an integral part of these unaudited interim condensed consolidated financial statements

Centogene N.V.

Unaudited interim condensed consolidated statements of changes in equity

for the six months ended June 30, 2020 and 2021


		Attributable to the owners of the parent
				Currency			Non-
		Issued	Capital	translation	Retained		controlling	Total
in EUR k	Note	capital	reserve	reserve	earnings	Total	interests	equity

As of January 1, 2020		2,383	98,099	—	(40,622)	59,860	(938)	58,922
Loss for the period		—	—	—	(19,033)	(19,033)	(63)	(19,096)
Other comprehensive loss		—	—	70	—	70	—	70
Total comprehensive loss		—	—	70	(19,033)	(18,963)	(63)	(19,026)
Share-based payments	11	—	1,393	—	—	1,393	—	1,393
Disposal of non-wholly owned subsidiary	6.2	—	—	—	—	—	268	268
Acquisition of non-wholly owned subsidiary		—	—	—	(755)	(755)	680	(75)
As of June 30, 2020		2,383	99,492	70	(60,410)	41,535	(53)	41,482


		Attributable to the owners of the parent
				Currency			Non-
		Issued	Capital	translation	Retained		controlling	Total
in EUR k	Note	capital	reserve	reserve	earnings	Total	interests	equity

As of January 1, 2021		2,654	125,916	(48)	(62,840)	65,682	95	65,777
Loss for the period		—	—	—	(12,955)	(12,955)	46	(12,909)
Other comprehensive loss		—	—	(70)	—	(70)	—	(70)
Total comprehensive loss		—	—	(70)	(12,955)	(13,025)	46	(12,979)
Share-based payments	11	—	4,276	—	—	4,276	—	4,276
Exercise of options		39	(39)	—	—	—	—	—
As of June 30, 2021		2,693	130,153	(118)	(75,795)	56,933	141	57,074

The accompanying notes form an integral part of these unaudited interim condensed consolidated financial statements

Notes to the unaudited interim condensed consolidated financial statements as of December 31, 2020 and June 30, 2021 and for the three months and six months ended June 30, 2020 and 2021

1General company information

Centogene N.V. (“the Company”) and its subsidiaries (“the Group”) focus on rare diseases and seek to transform real-world clinical and genetic or other data into actionable information for patients, physicians and pharmaceutical companies. The mission of the Company is to bring rationality to treatment decisions and to accelerate the development of new orphan drugs by using our knowledge of the global rare disease market, including epidemiological and clinical data and innovative biomarkers.

On November 7, 2019, the Company completed an initial public offering (“IPO”) and has since been listed on Nasdaq Global Market under stock code “CNTG”. Centogene N.V. is a public company with limited liability incorporated in the Netherlands, with registered office located at Am Strande 7 in 18055 Rostock, Germany and Dutch trade register number 72822872.

In July 2020, the Company completed a follow-on offering of 3,500,000 common shares of the Company (the “Follow-on Equity Offering”), consisting of 2,000,000 common shares offered by the Company and 1,500,000 common shares offered by selling shareholders at a price to the public of USD 14.00 per common share (i.e. EUR 12.71 per share). Aggregate offering proceeds, net of underwriting discounts, commissions and transaction costs, were EUR 22 million to the Company.

2Basis of preparation

The interim condensed consolidated financial statements for the three and six months ended June 30, 2020 and 2021 have been prepared in accordance with IAS 34 Interim Financial Reporting.

The interim condensed consolidated financial statements do not include all the information and disclosures required in the annual financial statements, and should be read in conjunction with the Group’s annual consolidated financial statements as of December 31, 2019 and 2020 and for the three years ended December 31, 2020. Unless otherwise specified, "the Company" refers to Centogene N.V. and Centogene GmbH throughout the remainder of these notes, while "the Group" refers to Centogene N.V., Centogene GmbH and its subsidiaries.

The accounting policies adopted in the preparation of the interim condensed consolidated financial statements are consistent with those followed in the preparation of the Group’s annual consolidated financial statements for the year ended December 31, 2020. The Group has not early adopted any standard, interpretation or amendment that has been issued but is not yet effective, and there are no new or amended standards or interpretations that are issued and became effective for the 2021 annual reporting period, that have a material impact on the Group.

These interim condensed consolidated financial statements are presented in euro, which is the Group's functional currency. Unless otherwise specified, all financial information presented in euro is rounded to the nearest thousand (EUR k) in line with customary commercial practice.

3Effect of COVID-19 Pandemic

The COVID-19 pandemic has spread worldwide and continues to cause many governments to maintain measures to slow the spread of the outbreak through quarantines, travel restrictions, closures of borders and requiring maintenance of physical distance between individuals.

Since the second quarter of 2020, the COVID-19 pandemic has resulted in a slowdown in our Diagnostics and Pharmaceutical businesses. As part of the Company’s initiative to assist local, national and international authorities as well as other partners in their efforts to facilitate the earliest possible diagnosis of COVID-19 and thereby contribute to allowing society to return to a “new” normal, the Company commenced testing for COVID-19 in March 2020.

Notes to the unaudited interim condensed consolidated financial statements as of December 31, 2020 and June 30, 2021 and for the three months and six months ended June 30, 2020 and 2021

During the six months ended June 30, 2021, the Group continued the COVID-19 testing activities started in 2020 with a leading role in providing testing services at airports in Germany. Furthermore, new variants of the virus have emerged since mid-December 2020. How these mutations develop and their impact on the effectiveness of vaccines is not yet fully clear. Furthermore, vaccination campaigns in several countries started during the six months ended June 30, 2021, and due to the expected increase in the availability of vaccines until the end of the year, the expectation is that governments will reduce restrictions during 2021. How and when this would affect the potential prolongation of the need for testing on a broader scale is not clear yet.

Although the Group is taking a number of measures aimed at minimizing disruptions to the business and operations, and while the provision of testing for the COVID-19 virus is anticipated to generate additional revenues for us, the full extent to which the global COVID-19 pandemic may impact the business will depend on future developments, which are highly uncertain and cannot be predicted, such as the duration of the pandemic, the availability of vaccines, the probability of the occurrence of further outbreaks and the ultimate impact on the financial markets and the global economy, and could result in an unforeseen negative impact on the business and future results of operations.

4Revenues from contracts with customers


in EUR k	Three Months Ended June 30, 2020⁽¹⁾
	Pharmaceutical	Diagnostics	COVID-19	Total
Rendering of services	3,606	3,684	2,053	9,343
Sales of goods	334	—	42	376
Total Revenues from contracts with external customers	3,940	3,684	2,095	9,719

Recognized over time	3,606	3,684	522	7,812
Recognized at a point in time	334	—	1,573	1,907
Total Revenues from contracts with external customers	3,940	3,684	2,095	9,719

Geographical information
Europe	23	1,109	2,095	3,227
—Germany#*	19	1	2,095	2,115
—Netherlands**	—	—	—	—
Middle East	45	1,789	—	1,834
—Saudi Arabia#	—	1,106	—	1,106
North America	3,872	501	—	4,373
—United States#	3,872	493	—	4,365
Latin America	—	219	—	219
Asia Pacific	—	66	—	66
Total Revenues from contracts with external customers	3,940	3,684	2,095	9,719

(1)	Since the COVID-19 business has been reported as a separate segment as from the third quarter of 2020, the comparative figures for the three and six months ended June 30, 2020 were adjusted retrospectively for both the COVID-19 and diagnostics segments.

Notes to the unaudited interim condensed consolidated financial statements as of December 31, 2020 and June 30, 2021 and for the three months and six months ended June 30, 2020 and 2021


in EUR k	Three Months Ended June 30, 2021
	Pharmaceutical	Diagnostics	COVID-19	Total
Rendering of services	2,653	6,715	42,325	51,693
Sales of goods	178	—	—	178
Total Revenues from contracts with external customers	2,831	6,715	42,325	51,871

Recognized over time	2,653	6,715	7,128	16,496
Recognized at a point in time	178	—	35,197	35,375
Total Revenues from contracts with external customers	2,831	6,715	42,325	51,871

Geographical information
Europe	49	1,320	42,161	43,530
—Germany#*	—	57	40,323	40,380
—Netherlands**	—	3	1,771	1,774
Middle East	26	3,950	—	3,976
North America	2,731	690	164	3,585
Latin America	25	608	—	633
Asia Pacific	—	147	—	147
Total Revenues from contracts with external customers	2,831	6,715	42,325	51,871

*country of the incorporation of Centogene GmbH

**country of the incorporation of Centogene N.V.

#	countries contributing more than 10% of the Group’s total consolidated revenues for the three months ended June 30, 2020 and 2021, respectively.

Notes to the unaudited interim condensed consolidated financial statements as of December 31, 2020 and June 30, 2021 and for the three months and six months ended June 30, 2020 and 2021


in EUR k	Six months ended June 30, 2020⁽¹⁾
	Pharmaceutical	Diagnostics	COVID-19	Total
Rendering of services	7,880	11,226	2,066	21,172
Sales of goods	610	—	42	652
Total Revenues from contracts with external customers	8,490	11,226	2,108	21,824

Recognized over time	7,880	11,226	535	19,641
Recognized at a point in time	610	—	1,573	2,183
Total Revenues from contracts with external customers	8,490	11,226	2,108	21,824

Geographical information
Europe	67	2,713	2,108	4,888
—Germany#*	38	61	2,108	2,207
—Netherlands**	—	3	—	3
Middle East	48	6,204	—	6,252
—Saudi Arabia#	—	4,139	—	4,139
North America	8,375	1,121	—	9,496
—United States#	8,375	964	—	9,339
Latin America	—	965	—	965
Asia Pacific	—	223	—	223
Total Revenues from contracts with external customers	8,490	11,226	2,108	21,824

(1)	Since the COVID-19 business has been reported as a separate segment as from the third quarter of 2020, the comparative figures for the six months ended June 30, 2020 were adjusted retrospectively for both the COVID-19 and diagnostics segments.


in EUR k	Six months ended June 30, 2021
	Pharmaceutical	Diagnostics	COVID-19	Total
Rendering of services	6,046	13,098	97,302	116,446
Sales of goods	383	—	2	385
Total Revenues from contracts with external customers	6,429	13,098	97,304	116,831

Recognized over time	6,046	13,098	18,972	38,116
Recognized at a point in time	383	—	78,332	78,715
Total Revenues from contracts with external customers	6,429	13,098	97,304	116,831

Geographical information
Europe	198	2,534	96,282	99,014
—Germany#*	—	110	92,668	92,778
—Netherlands**	—	5	3,539	3,544
Middle East	55	8,085	—	8,140
North America	6,136	1,154	944	8,234
—United States	6,136	1,045	944	8,125
Latin America	40	1,018	—	1,058
Asia Pacific	—	307	78	385
Total Revenues from contracts with external customers	6,429	13,098	97,304	116,831

*country of the incorporation of Centogene GmbH

**country of the incorporation of Centogene N.V.

#	countries contributing more than 10% of the Group’s total consolidated revenues for the six months ended June 30, 2020 and 2021, respectively.

The Group collaborated with a range of pharmaceutical partners on a worldwide basis in 2020 and 2021. In addition, in cases where pharmaceutical partners are developing a new rare disease treatment, it is generally anticipated that

Notes to the unaudited interim condensed consolidated financial statements as of December 31, 2020 and June 30, 2021 and for the three months and six months ended June 30, 2020 and 2021

the final approved treatment will be made available in several countries or globally. As a result, the Group allocates the revenues of the pharmaceutical segment by geographical region by reference to the location where each pharmaceutical partner mainly operates, which is based on the region from which most of their revenues are generated. The allocation of revenues in the diagnostics segment and COVID-19 segments is based on the location of each customer.

Pharmaceutical segment

During the three and six months ended June 30, 2021, revenues from one pharmaceutical partner represented 4.1% and 4.4%, respectively, of the Group's total revenues (the three and six months ended June 30, 2020: 26.2% and 26.4%, respectively).

COVID-19 segment

During the three months ended June 30, 2021, revenues from two COVID-19 partners represented 5.2% and 12.9%, respectively, of the Group’s total revenues (the three months ended June 30, 2020: nil). In the six months ended June 30, 2021, revenues from two COVID-19 partners represented 4.7% and 15.2%, respectively, of the Group’s total revenues (the six months ended June 30, 2020: nil).

To support the COVID-19 test offerings, the Company acquired laboratory facilities and equipment, developed CENTOGENE’s Corona Test Portal and leased laboratory space at several locations in Germany. Additionally, COVID-19 testing capacity is provided through custom-built CentoTrucks, mobile laboratories in a container setup to carry out the COVID-19 analysis. Total investments in COVID-19 testing for the three and six months ended June 30, 2021 amounted to EUR 618k and EUR 2,034k, respectively, in property, plant and equipment (the three and six months ended June 30, 2020: EUR 1,873k and EUR 1,903k, respectively). An amount of EUR 354k is included in intangible assets and relates to the development of CENTOGENE’s Corona Test Portal for the six months ended June 30, 2021, no investments in intangibles were made in the three months ended June 30, 2021 (the three and six months ended June 30, 2020: EUR 527k and EUR 527k, respectively).

Notes to the unaudited interim condensed consolidated financial statements as of December 31, 2020 and June 30, 2021 and for the three months and six months ended June 30, 2020 and 2021

5Segment information


in EUR k	Three months ended June 30, 2020
	Pharmaceutical	Diagnostics	COVID-19	Corporate	Total
Total Revenues from contracts with external customers	3,940	3,684	2,095	—	9,719

Adjusted EBITDA	1,799	(1,636)	812	(8,395)	(7,420)

Capital Expenditures
Additions to property, plant and equipment and right-of-use assets	301	200	1,873	1,249	3,623
Additions to intangible assets	1,852	—	527	395	2,774

Other segment information
Depreciation and amortization	389	563	54	1,342	2,348
Research and development expenses	—	—	—	3,119	3,119


in EUR k	Three Months Ended June 30, 2021
	Pharmaceutical	Diagnostics	COVID-19	Corporate	Total
Total Revenues from contracts with external customers	2,831	6,715	42,325	—	51,871

Adjusted EBITDA	647	580	6,251	(9,544)	(2,066)

Capital Expenditures
Additions to property, plant and equipment and right-of-use assets	3	—	618	105	726
Additions to intangible assets	241	—	—	522	763

Other segment information
Depreciation and amortization	410	412	1,069	1,493	3,384
Research and development expenses	—	—	—	4,053	4,053


	Six Months Ended June 30, 2020
in EUR k	Pharmaceutical	Diagnostics	COVID-19	Corporate	Total
Total Revenues from contracts with external customers	8,490	11,226	2,108	—	21,824

Adjusted EBITDA	4,407	(1,358)	621	(16,107)	(12,437)

Capital Expenditures
Additions to property, plant and equipment and right-of-use assets	301	987	1,903	1,836	5,027
Additions to intangible assets	2,854	—	527	584	3,965

Other segment information
Depreciation and amortization	1,071	1,107	54	2,200	4,432
Research and development expenses	—	—	—	5,810	5,810

Notes to the unaudited interim condensed consolidated financial statements as of December 31, 2020 and June 30, 2021 and for the three months and six months ended June 30, 2020 and 2021


	Six Months Ended June 30, 2021
in EUR k	Pharmaceutical	Diagnostics	COVID-19	Corporate	Total
Total Revenues from contracts with external customers	6,429	13,098	97,304	—	116,831

Adjusted EBITDA	2,144	1,633	16,418	(21,563)	(1,368)

Capital Expenditures
Additions to property, plant and equipment and right-of-use assets	9	234	2,034	419	2,696
Additions to intangible assets	563	—	354	1,172	2,089

Other segment information
Depreciation and amortization	824	818	1,996	3,032	6,670
Research and development expenses	—	—	—	8,388	8,388

Adjustments to EBITDA

Adjustments to EBITDA include non-cash charges in relation to depreciation, amortization (including impairments), and share-based payments as well as net financial costs, and income taxes. Certain costs, and related income, are not allocated to the reporting segment results and represent the residual operating activities of the Group reported as ‘Corporate’. These include corporate overheads, which are responsible for centralized functions such as communications, information technology, facilities, legal, finance and accounting, insurance (D&O), human resources, business development and strategic initiatives, certain professional and consulting services, procurement, research and development and other supporting activities.

Increases in corporate expenses for the three and six months ended June 30, 2021 are mainly due to increased personnel costs and administrative costs and additional investments in IT support and data center costs.

Notes to the unaudited interim condensed consolidated financial statements as of December 31, 2020 and June 30, 2021 and for the three months and six months ended June 30, 2020 and 2021

Reconciliation of segment Adjusted EBITDA to Group loss for the period


For the three months ended June 30	2020	2021
Reported segment Adjusted EBITDA	975	7,477
Corporate expenses	(8,395)	(9,543)
	(7,420)	(2,066)
Share-based payment expenses (Note 11)	(336)	(2,234)
Depreciation and amortization	(2,348)	(3,384)
Operating loss	(10,104)	(7,684)
Financial costs, net	(256)	(212)
Income tax expenses	—	(124)
Loss for the three months ended June 30	(10,360)	(8,020)


For the six months ended June 30	2020	2021
Reported segment Adjusted EBITDA	3,670	20,195
Corporate expenses	(16,107)	(21,563)
	(12,437)	(1,368)
Share-based payment expenses (Note 11)	(1,393)	(4,276)
Depreciation and amortization	(4,432)	(6,670)
Operating loss	(18,262)	(12,314)
Financial costs, net	(705)	(471)
Income tax expenses	(129)	(124)
Loss for the six months ended June 30	(19,096)	(12,909)

Non-current asset locations

Non-current assets of the Group consist of right-of-use assets (under IFRS 16), property, plant and equipment, as well as intangible assets. All of such assets are located in Germany, which is the country of the business address of Centogene GmbH, except for property, plant and equipment of EUR 460k (December 31, 2020: EUR 516k) and right-of-use assets of EUR 449k (December 31, 2020: EUR 709k), which are located in the United States.

6Other income and expenses

6.1Other operating income


	For the Three months ended June 30		For the Six months ended June 30
in EUR k	2020	2021	2020	2021
Government grants	703	837	1,405	1,177
Others	98	439	341	465
Total other operating income	801	1,276	1,746	1,642

Government grants include performance-based grants to subsidize research, development and innovation in the state of Mecklenburg-Western Pomerania from funds granted by the European Regional Development Fund. Furthermore, government grants contain the release of deferred income from investment related grants. Other operating income includes the bank loan granted under the Coronavirus Aid, Relief, and Economic Security Act (CARES Act) which was forgiven during the three months ended June 30, 2021 (see note 10).

Notes to the unaudited interim condensed consolidated financial statements as of December 31, 2020 and June 30, 2021 and for the three months and six months ended June 30, 2020 and 2021

6.2Other operating expenses


	For the Three months ended June 30		For the Six months ended June 30
in EUR k	2020	2021	2020	2021
Currency losses	37	(8)	37	26
Others	—	10	101	10
Total other operating expenses	37	2	138	36

During the six months ended June 30, 2020, the Group disposed of its entire 51% interest in LPC GmbH (“LPC”) to the minority shareholders for a consideration of EUR 213k, of which EUR 200k is to be paid over a period of four years (and included in other assets, see note 7). The related non-controlling interest of EUR 268k (accumulated share of loss) was debited to profit or loss, and the sale resulted in a loss of EUR 101k.

7Trade receivables and other assets


in EUR k	Dec 31, 2020	June 30, 2021
Non‑current
Other assets - Rental deposits	1,867	2,923
Other assets – Others	100	100
	1,967	3,023
Current
Trade receivables, net	25,656	15,630
Contract assets, net	3,543	2,860
Other assets	8,286	6,064
	37,485	24,554
Total non-current and current trade receivables and other assets	39,452	27,577

Other non-current assets

The non-current portion of other assets mainly include cash deposits of EUR 2,250k used to secure a bank guarantee of EUR 3,000k relating to the leases of the Rostock headquarters building, cash deposits of EUR 192k, used to secure a bank guarantee of EUR 257k, relating to the leases of the Berlin office and EUR 285k for the leases of certain plant and machineries. It also includes the non-current part of the consideration receivable for the sale of LPC for EUR 100k. (see note 6.2).

Trade receivables and contract assets

Trade receivables are non-interest bearing and are generally due in 30 to 90 days. In general, portfolio-based expected credit loss allowances are recognized on trade receivables and contract assets.

Notes to the unaudited interim condensed consolidated financial statements as of December 31, 2020 and June 30, 2021 and for the three months and six months ended June 30, 2020 and 2021


in EUR k	Dec, 2020		June 30, 2021
Not past due	24,185		11,826
Past due 1-30 days	2,228		3,293
Past due 31-90 days	797		2,474
Past due more than 90 days	6,757		6,275
Total gross amount of trade receivables and contract assets	33,967		23,868

Expected credit loss rate
Not past due	1.6	%	1.2	%
Past due 1-30 days	3.1	%	3.6	%
Past due 31-90 days	7.7	%	11.8	%
Past due more than 90 days	63.0	%	77.0	%
Expected credit loss rate on total gross trade receivables and contract assets	14.0	%	22.7	%

Expected credit loss	4,768		5,378

The addition to the allowance for expected credit losses amounts to EUR 580k and EUR 675k for the three and six months ended June 30, 2021, respectively, which was included in the impairment of financial assets in the profit and loss account (the three and six months ended June 30, 2020: EUR 500k and EUR 1,674k).

Other current assets

The current assets include no VAT receivables (December 31, 2020: EUR 226k), prepaid expenses of EUR 2,873k (December 31, 2020: EUR 4,431k), receivables related to exercised share-based payment grants of EUR 283k (December 31, 2020: EUR 1,253k receivables), receivables related to COVID-19 bank or credit card transactions of EUR 435k (December 31, 2020: EUR 1,076k), as well as receivables from grants of EUR 1,280k (December 31, 2020: EUR 442k).

8Cash and short-term deposits

As of June 30, 2021, the Group has pledged its short-term deposits with carrying amount of EUR 1,500k (December 31, 2020: EUR 1,500k) and EUR 2,500k (December 31, 2020: EUR 2,500k) respectively, to fulfil collateral requirements in respect of existing secured bank loan and overdraft facility up to EUR 2,500k. In addition, the Group has pledged its short-term deposits of EUR 1,000k (December 31, 2020: EUR 1,000k) related to two other overdraft facilities worth EUR 500k each.

The restriction applying to the collateral may be terminated at any time subject to the full amount of the relevant bank loans and the overdrafts being repaid.

Notes to the unaudited interim condensed consolidated financial statements as of December 31, 2020 and June 30, 2021 and for the three months and six months ended June 30, 2020 and 2021

9Equity

Common Shares

As of June 30, 2021, 22,445,242 common shares of Centogene N.V. with a nominal value of EUR 0.12 were issued and fully paid up (December 31, 2020: 22,117,643). As of June 30, 2021, the authorized but unissued common share capital amounted to EUR 6,787k (December 31, 2020: EUR 6,826k).

The holders of common shares are entitled to the Company's approved dividends and other distributions as may be declared from time to time by the Company, and are entitled to vote per share on all matters to be voted at the Company's annual general meetings.

Capital reserve

As of June 30, 2021, capital reserve included a share premium of EUR 107,459k (December 31, 2020: EUR 107,498k), being amounts paid in by shareholders at the issuance of shares in excess of the par value of the shares issued, net of any transaction costs incurred for the share issuance.

In addition, it also included amounts recorded on the basis of share-based payments. For additional information on the share-based payments, see note 11.

10Financial liabilities

10.1Interest-bearing liabilities


in EUR k	Dec 31, 2020	June 30, 2021
Non‑current liabilities
Non‑current portion of secured bank loans	401	200
Total non‑current loans	401	200
Lease liabilities	17,677	16,209
Total non‑current liabilities	18,078	16,409

Current liabilities
Current portion of secured bank loans	567	567
Other bank loans	387	—
Bank overdrafts	1,538	3,316
Total current loans	2,492	3,883
Current portion of lease liabilities	3,528	3,299
Total current liabilities	6,020	7,182

Total non‑current and current liabilities	24,098	23,591

As of June 30, 2021, short-term cash deposits of EUR 1,500k (December 31, 2020: EUR 1,500k were used to secure the secured bank loan outstanding (see note 8).

Other bank loans outstanding as of December 31, 2020 represented bank loans granted under the Coronavirus Aid, Relief, and Economic Security Act (CARES Act) which were forgiven during the three months ended June 30, 2021. The amount forgiven has been included in other operating income (see note 6).

The following table is based on the original terms and conditions:

Notes to the unaudited interim condensed consolidated financial statements as of December 31, 2020 and June 30, 2021 and for the three months and six months ended June 30, 2020 and 2021

Conditions and statement of liabilities

The outstanding interest-bearing liabilities as of June 30, 2021 and December 31, 2020 have the following conditions:


				Dec 31, 2020		June 30, 2021
				Nominal	Carrying	Nominal	Carrying
in EUR k	Currency	Nominal interest rate	Maturity	amount	amount	amount	amount
Secured bank loan	EUR	2.95%	2017‑22	968	968	767	767
Other bank loan	USD	1%	2020-22	387	387	—	—
Bank overdrafts	EUR	4.75%	Rollover	498	498	496	496
Bank overdrafts	EUR	3.75%	Rollover	628	628	2,324	2,324
Bank overdrafts	EUR	4.50%	Rollover	412	412	496	496
Lease liabilities	EUR	2.1%-3.5%*, 5.4%-9.1%	2017-31	21,205	21,205	19,508	19,508
Total interest‑bearing financial liabilities				24,098	24,098	23,591	23,591

*	represents the incremental borrowing rate of the Group at the commencement of the leases

The bank overdrafts of EUR 2,324k as of June 30, 2021 (December 31, 2020: EUR 628k) were secured by short-term deposits with a carrying amount of EUR 2,500k (December 31, 2020: EUR 2,500k) (see note 8). The other bank overdrafts of EUR 992k (December 31, 2020: EUR 910k) were secured over two short-term deposits with a carrying amount of EUR 500k each (see note 8).

10.2Trade payables and other liabilities


in EUR k	Dec 31, 2020	June 30, 2021
Trade payables	31,736	14,014
Government grants (deferred income)	10,292	9,992
Contract liabilities	4,479	4,913
Others	13,483	10,813
Trade payables and other liabilities	59,990	39,732
Non‑current	8,950	8,640
Current	51,040	31,092

Government grants mainly include investment-related government grants. These were received for the purchase of certain items of property, plant and equipment for the research and development facilities in Mecklenburg-Western Pomerania, including the Rostock facility. The grants were issued in the form of investment subsidies as part of the joint federal and state program, "Verbesserung der regionalen Wirtschaftsstruktur" (improvement of the regional economic structure) in connection with funds from the European Regional Development Fund. No additional grants were received during the six months ended June 30, 2021 related to the purchase of certain items of property, plant and equipment (the six months ended June 30, 2020: EUR 390k).

In addition, other liabilities include a provision for outstanding invoices of EUR 4,931k (December 31, 2020: EUR 1,245k), personnel-related liabilities for vacation and bonuses totaling EUR 3,245k (December 31, 2020: EUR 4,032k), VAT payable of EUR 119k (December 31, 2020: EUR 4,578k payable), as well as liabilities for wage and church tax of EUR 920k (December 31, 2020: EUR 1,988k).

11Share-based payments

Expenses from share-based payment arrangements

During the three and six months ended June 30, 2021, the Company incurred share-based payment expenses of EUR 2,234k and EUR 4,276k, respectively (the three and six months ended June 30, 2020: EUR 336k and EUR 1,393k, respectively). These expenses were included in general administrative expenses for services received during the respective periods.

Notes to the unaudited interim condensed consolidated financial statements as of December 31, 2020 and June 30, 2021 and for the three months and six months ended June 30, 2020 and 2021

Share-based award activity

A detailed description of the Company’s share-based payment arrangements is included in Note 20 of the Group’s annual consolidated financial statements for the year ended December 31, 2020. During the six months ended June 30, 2021 there were no changes to the terms and conditions of the Company’s share-based payment arrangements.

The following table presents a summary of the Company’s share-based payment arrangement activity for the six months ended June 30, 2021.


	ESOP 2017		2019-2021 awards ⁽¹⁾
number of awards (options and RSUs)	Number	WAEP	Number of options	WAEP (USD)	Number of RSUs	WAEP
Outstanding as of January 1	549,005	0.12	154,925	11.60	1,885,100	—
Granted during the year(1)	—	0.12	30,152	12.57	150,804	—
Exercised during the year	(140,169)	0.12	—	—	(187,430)	—
Outstanding as of June 30	408,836	0.12	185,077	11.76	1,848,474	—
Vested as of June 30	408,836		111,591		230,992
Exercisable as of June 30	408,836		111,591		230,992

(1)

The granted and outstanding options and RSUs do not include the number of awards for which the service period has commenced in advance of grant date. The number of these options and RSUs to be granted is not fixed until the relevant grant date as the number is dependent on the achieved value of the award divided by the trailing volume-weighted average stock price of the Company, pursuant to the terms of the underlying award agreements. These include RSUs to be granted to the new CEO from 2022, the annual RSU award to be granted in 2022 to an executive officer, and the RSUs and options to be granted to certain supervisory board members annually in 2022 and thereafter.

Notes to the unaudited interim condensed consolidated financial statements as of December 31, 2020 and June 30, 2021 and for the three months and six months ended June 30, 2020 and 2021

The option and RSUs for the years 2019-2021 as included in the table above reflect the activity related to the share-based payment awards ESOP 2019, management, supervisory board and employees.

Grants awarded

During the six months ended June 30, 2021 the following awards were granted:


Award Type (2019 Plan)	Market/ Performance Based Vesting Conditions	Number of Awards	Vesting Conditions	Expiration Date
RSUs	No	105,804	Four equal tranches over a four-year period, starting January 1, 2022, April 1, 2022 or on each anniversary of the grant date	10th anniversary of Grant Date
RSUs	No	30,000	Three equal tranches over a three-year period starting January 1, 2022	10th anniversary of Grant Date
RSUs	No	15,000	Three equal tranches of which the first tranche vested immediately and the two remaining annual tranches will vest starting January 1, 2022	10th anniversary of Grant Date
Options	No	15,152	Four equal tranches over a four-year period following each anniversary of the grant date	10th anniversary of Grant Date
Options	Yes	15,000	Three equal tranches over a three-year period starting January 1, 2022	10th anniversary of Grant Date

The grant date fair value of these grants will be recognized in profit or loss over the service period by using the graded approach.

15,000 of the options referred to above vest only if the 20 trading day volume-weighted average stock price of the Company’s shares preceding the vesting date of each tranche exceeds the exercise price of USD 12.52. This hurdle is considered a market condition. Therefore, expenses would not be reversed, if the tranches do not ultimately vest. The other options have no market or performance-based vesting conditions.

The RSUs referred to above have no market or performance-based vesting conditions. Each RSU represents a right to receive a payment in cash or shares equal to the value of the RSU at the exercise date. The Company has a choice to settle either in cash, in shares or a combination thereof. In line with this, both types of awards are to be settled in shares and expire on the 10th anniversary of the grant date.

Additionally, during the three months ended June 30, 2021 the Company entered into an award agreement with an executive officer under which the officer shall receive annual RSU awards to be granted following each fiscal year, upon approval by the Supervisory Board, based upon achievement of the officer’s annual variable remuneration target. The service period of the annual RSUs to be granted in 2022 has commenced during the three months ended June 30, 2021, corresponding with the employment start date, as entitlement to the RSU grant is dependent on continuing service with the Company through the grant date and annual variable remuneration target. However, the grant date criteria for these awards will not be met until such time the value of the award and number of RSUs to be granted are approved and fixed pursuant to the underlying award agreement.

Notes to the unaudited interim condensed consolidated financial statements as of December 31, 2020 and June 30, 2021 and for the three months and six months ended June 30, 2020 and 2021

During the six months ended June 30, 2021, an award of 75,000 options granted in 2020 has been modified by removing the condition that the 20 trading day volume-weighted average stock price of the Company’s share preceding the vesting date of each tranche exceeds the exercise price of USD 11.60. This change was accounted for as a modification under IFRS 2 and the incremental fair value of USD 226k will be recorded in the statement of comprehensive income over the vesting period of the remaining grant, together with the remaining original grant date fair value yet to be recognised.

The fair value of the RSUs is based on the observed value of the underlying shares. As no dividend payments are expected over the vesting period, no further adjustment is required. The weighted average fair value of RSUs granted under the 2019 Plan during the three months and six months ended June 30, 2021 was USD 10.17 and USD 10.91, respectively. The fair value of the options awarded is determined using a Monte Carlo simulation model. The Monte Carlo simulation model utilizes multiple input variables to estimate the probability that market conditions will be achieved. The weighted average fair value of the options granted under the 2019 Plan during the three months ended June 30, 2021 was USD 7.59 and USD 7.47, respectively.

Exercises

During the six months ended June, 2021, 140,169 ESOP 2017 options were exercised. The weighted average share price at the date of exercise was USD 11.67. During the six months ended June 30, 2021, 187,430 RSUs were exercised. The weighted average share price at the date of exercise was USD 11.74.

12Commitments

Future payments for non-cancellable leases

The Group has various lease contracts in relation to the expansion of the Rostock headquarters and leasing of the Frankfurt laboratory, Airport Berlin, Airport Düsseldorf, Airport Cologne/ Bonn, Airport Munich, Airport Frankfurt and additional laboratory space in Hamburg. The future lease payments and utilities for these non-cancellable lease contracts are EUR 1,667k within one year, EUR 2,424k within five years and EUR 4,219k thereafter (December 31, 2020: EUR 283k, EUR 1,686k and EUR 4,855k respectively).

The Group has various non-cancellable lease contracts of office equipment and storage spaces which had a lease term of less than 12 months or were related to leases of low-value assets, and therefore the short-term lease recognition exemption was applied to these contracts. The future lease payments for these non-cancellable lease contracts are EUR 16k within one year (December 31, 2020: EUR 33k) and EUR 2k within five years (December 31, 2020: EUR 9k).

Notes to the unaudited interim condensed consolidated financial statements as of December 31, 2020 and June 30, 2021 and for the three months and six months ended June 30, 2020 and 2021

Future payment obligations

As of June 30, 2021, the Group concluded agreements with suppliers, for goods and services to be provided subsequent to June 30, 2021 with a total payment obligation of approximately EUR 2,857k (December 31, 2020: EUR 4,669k).

13Contingent Liabilities

●

In May 2016, the Company was informed in writing by the Universitair Medisch Centrum Utrecht ("UMCU") that a claim had been initiated against UMCU regarding a prenatal diagnostic test that the Company conducted at their request which failed to identify a specific mutation present in a patient. On October 1, 2018, the UMCU and Neon Underwriting Limited formally filed a legal claim in the local court in Rostock, Germany against the Company alleging that the Company’s negligence in performing the test resulted in the misdiagnosis of the patient. UMCU is seeking recovery for compensatory damages as a result of the alleged misdiagnosis. By court order of November 8, 2018, the Regional Court of Rostock set the amount in dispute at EUR 880k.

On November 12, 2018, the Company submitted a notice to the Regional Court of Rostock with the intention to defend against the claim. On January 3, 2019, the Company filed a motion to dismiss in which the Company denied the merits of the claim. UMCU and Neon Underwriting Limited responded to this motion on March 15, 2019 with a statement of reply, and the parties have since made several court filings setting out their arguments since. By order dated June 3, 2019, the Regional Court of Rostock provided a first set of questions to be answered by an expert witness. Following a request by the Court, the Director of the Institute of Genetics at the University of Bonn recommended a professor for human genetics from the University of Aachen be appointed as an expert witness in this case. The Company agreed to such recommendation.

As of June 30, 2021, the amount in dispute was EUR 1.3 million. The matter was assigned to a new judge, due to the illness of the prior judge, and the decision to appoint the recommended expert witness is still pending.

The Company intends to continue to rigorously defend its position and considers that it is not probable the legal claim towards the Company will be successful and as a result has not recognized a provision for this claim as of June 30, 2021. In addition, in case a settlement would be required, the Company believes that the corresponding liability will be fully covered by the respective existing insurance policies.

●

Certain of our original shareholders agreed to reimburse us for the payments that we make to option holders under the 2016 Plan. Upon completion of the Follow-on Equity Offering, the relevant payables to the holders of vested options were settled mainly by the proceeds received from such original shareholders from the sale of their shares in the Follow-on Equity Offering. We have received a demand from one such original shareholder that alleges that it should have paid less to us in connection with the settlement of such payables. We believe such demand to be baseless and, should such original shareholder institute formal legal proceedings against us, intend to defend our interests vigorously.

●

The higher regional court of Rostock issued a final decision by which it has retroactively invalidated a contract entered into between Centogene GmbH (the “Company”) and the State of Mecklenburg-Western Pomerania (“MVP”) for COVID-19 testing, due to non-compliance by MVP with the public tender requirements of the German government. As a result of the invalidation, MVP now has a claim under German law against the Company for repayment of the full amount invoiced and received under the contract (EUR 2.3 million). The Company also has a claim against MVP for compensation for the value of services provided in expectation of the validity of the contract.

The understanding between MVP and Centogene is that the Company’s services were provided at market value and that despite the court’s invalidation of the contract, Centogene has a claim against MVP for EUR 2.3 million. Thus the amounts of these two claims would be expected to equal each other and could be

Notes to the unaudited interim condensed consolidated financial statements as of December 31, 2020 and June 30, 2021 and for the three months and six months ended June 30, 2020 and 2021

offset against one another. A contractual agreement putting this understanding in writing has been finalized and signed.

14Subsequent Events

Grant of restricted stock units

In the third quarter of 2021, 22,936 RSUs were granted to management, subject to the terms of the 2019 Plan and the applicable award agreement. The RSUs will vest in four equal tranches over a four-year period starting August 16, 2021.

Grants to CEO

In 2020 the Company and the new CEO entered into an award agreement under the 2019 Plan pursuant to which the CEO will receive certain awards in the form of RSUs, which have no exercise price. According to the agreement, a total of 324,000 RSUs were granted to the CEO on December 1, 2020, subject to the purchase of ordinary shares of the Company in the amount of CHF 1,000,000 within a certain period after the grant date. The CEO has initiated purchases under this program. Due to the short trading windows as defined in the Company’s insider trading rules in which the CEO was able to purchase shares, the Supervisory Board extended the period in which these purchases can be made and has agreed to allocate the grant pro rata to the percentage of the CHF 1,000,000 invested by the CEO in purchases of shares in the Company.

Legal settlement

In July 2021, Centogene GmbH and the State of Mecklenburg-Western Pomerania (“MVP”) entered into an agreement regarding Centogene’s cost compensation claim with respect to a previously invalidated COVID-19 testing contract. This settlement did not result in a required adjustment to the interim condensed consolidated financial statements.

Contingent Liability

On August 7, 2021, our partnering laboratory physician Prof. Dr. Peter Bauer was informed in writing by the Public Prosecutor's Office in Fulda that a criminal investigation had been initiated against him regarding allegedly falsely billing statements submitted to the Association of Statutory Health Insurance Physicians in Hessen (Kassenärztliche Vereinigung Hessen). The aggregate amount in question is EUR 42,268.50. The Company intends to support Prof. Dr. Peter Bauer in the defense of the case.

Exhibit 99.3

MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

The following discussion of our financial condition and results of operations should be read in conjunction with Centogene N.V.’s unaudited interim condensed consolidated financial statements as of December 31, 2020, and June 30, 2021, and for the three and six months ended June 30, 2020 and 2021 included as Exhibit 99.2 to this report on Form 6-K. We also recommend that you read our management’s discussion and analysis as well as our audited consolidated financial statements and the notes thereto included in our annual report for the year ended December 31, 2020, on Form 20-F, filed with the U.S. Securities and Exchange Commission (the “SEC”) pursuant to the U.S. Securities and Exchange Act of 1934, as amended, on April 15, 2021 (the “Annual Report”).

Unless otherwise indicated or the context otherwise requires, all references to “Centogene N.V.” or the “Company,” “we,” “our,” “ours,” “us,” or similar terms refer to Centogene N.V. and its subsidiaries.

The following discussion is based on our financial information prepared in accordance with International Financial Reporting Standards (“IFRS”) as issued by the International Accounting Standards Board (“IASB”), which may differ in material respects from generally accepted accounting principles in the United States and other jurisdictions.

This discussion and analysis is dated as of September 1, 2021.

Overview

We are a commercial-stage company with our core businesses focused on rare diseases that transforms real-world clinical and genetic or other data into actionable information for patients, physicians and pharmaceutical companies. Our goal is to bring rationality to treatment decisions and to accelerate the development of new orphan drugs by using our knowledge of the global rare disease market, including epidemiological and clinical data and innovative biomarkers. Our platform includes multiomic data (such as epidemiologic, phenotypic, and genetic and other data) that reflects a global population, as well as a biobank of these patients’ blood samples. We believe this represents the only platform that comprehensively analyzes multi-level data to improve the understanding of rare hereditary diseases, which can aid in the identification of patients and improve our pharmaceutical partners’ ability to bring orphan drugs to the market.

We have identified three reportable segments:

●

Pharmaceutical. Our pharmaceutical solutions provide a variety of services to our pharmaceutical partners, including target discovery, early patient recruitment and identification, epidemiological insights, biomarker discovery and patient monitoring. Our information platforms, access to rare disease patients and their biomaterials, and ability to develop proprietary technologies and biomarkers enable us to provide services to our pharmaceutical partners in all phases of the drug development process as well as post-commercialization. Revenues from our pharmaceutical segment are generated primarily from collaboration agreements with our pharmaceutical partners. In addition, we have a variety of biomarker programs, and we are also pursuing a multi-omics approach, with a focus on the metabolome, to enhance diagnostic yields beyond genetic sequencing and testing and building a biomarker discovery pipeline for rare diseases. Our novel approach includes a tandem mass spectrometry methodology and artificial intelligence and, combined with the large volume of datasets in our global rare disease platform, has demonstrated value by enhancing diagnostic information and contributing to our biomarker pipeline. Such and other biomarker candidates are then further validated and optimized in epidemiological clinical trials.

●

Diagnostics. Our diagnostics segment provides genome, exome and targeted genetic sequencing, testing and interpretation as well as other diagnostics services to our clients worldwide, who are typically physicians, laboratories or hospitals, either directly or through distributors. As of June 30, 2021, we believe we offer the broadest diagnostic testing portfolio for rare diseases, covering over 19,000 genes using over 10,000 different tests. In turn, the data collected from our diagnostics services and biomaterials allow us to continue to grow our repository and our CentoMD database.

●

COVID-19 testing. While not a core business, our COVID-19 testing business has been managed and reported as a separate segment since the third quarter of 2020 due to its financial significance for our Company. We started offering COVID-19 testing in March 2020. Our initial COVID-19 test was a molecular diagnostic test performed for the in vitro qualitative detection of RNA from the SARS-CoV-2 in oropharyngeal samples from presymptomatic probands according to the recommended testing by public health authority guidelines. It has also been validated in the College of American Pathologists (CAP) / Clinical Laboratory Improvement Amendments of 1988 (CLIA) / International Organization for Standardization (ISO) certified analytical laboratory and has received Emergency Use Authorization (EUA) from the Food and Drug

Administration (FDA) for use by authorized laboratories. The majority of these tests are performed in airport locations at the Frankfurt, Hamburg, Munich, Cologne/Bonn, Dusseldorf, and Berlin airports. Furthermore, tests are offered through collaborations with the state government and other companies. The vast majority of our testing volume is RT-PCR testing whereby we also offer antigen testing, genotyping analysis and full virus genome sequencing.

In the three months ended June 30, 2021, we received over 709,000 total test requests, of which 679,900 account for COVID-19 tests. Excluding the COVID-19 test requests, we received 29,100 test requests in the three months ended June 30, 2021, representing a 54.4% increase as compared to the three months ended June 30, 2020 of 18,850 non-COVID-19 related test requests. In the six months ended June 30, 2021, we received over 1,591,000 total test requests, of which 1,532,100 account for COVID-19 tests. Excluding the COVID-19 test requests, we received 58,900 test requests in the six months ended June 30, 2021, representing a 15.4% increase as compared to the six months ended June 30, 2020 of 51,050 non-COVID-19 related test requests.

Our total revenue for the three months ended June 30, 2021 was €51,871 thousand, an increase of €42,152 thousand, or 433.7%, from €9,719 thousand for the three months ended June 30, 2020. Our pharmaceutical, diagnostics and COVID-19 segments contributed 5.5%, 12.9% and 81.6%, respectively, of our total revenues for the three months ended June 30, 2021, as compared to 40.5%, 37.9% and 21.7% for the pharmaceutical, diagnostics and COVID-19 segments, respectively, of our total revenues for the three months ended June 30, 2020. The number of test requests received by our pharmaceutical segment in the three months ended June 30, 2021 was 13,600, representing an increase of 37.4% as compared to 9,900 test requests received in the three months ended June 30, 2020. Test requests received by our diagnostics segment in the three months ended June 30, 2021, was 13,900, representing an increase of 90.4% as compared to 7,300 in the three months ended June 30, 2020. The number of test requests received by our COVID-19 segment in the three months ended June 30, 2021, was 679,900, compared to 69,750 in the three months ended June 30, 2020.

Our total revenue for the six months ended June 30, 2021 was €116,831 thousand, an increase of €95,007 thousand, or 435.3%, from €21,824 thousand for the six months ended June 30, 2020. Our pharmaceutical, diagnostics and COVID-19 segments contributed 5.5%, 11.2% and 83.3%, respectively, of our total revenues for the six months ended June 30, 2021, as compared to 38.9%, 51.4% and 9.7% for the pharmaceutical, diagnostics and COVID-19 segments, respectively, of our total revenues for the six months ended June 30, 2020. The number of test requests received by our pharmaceutical segment in the six months ended June 30, 2021 was 26,700, representing a decrease of 2.9% as compared to 27,500 test requests received in the six months ended June 30, 2020, due to sustained negative effects of the pandemic since the second quarter of 2020. Test requests received by our diagnostics segment in the six months ended June 30, 2021, was 27,700, representing an increase of 38.5% as compared to 20,000 in the six months ended June 30, 2020. The number of test requests received by our COVID-19 segment in the six months ended June 30, 2021, was 1,532,100, compared to 70,050 in the six months ended June 30, 2020.

Since the inception of our business, our research and development has been substantially devoted to our biomarkers, knowledge-based platform and interpretation-based solutions. For the three months ended June 30, 2021, we incurred research and development expenses of €4,053 thousand, an increase of €934 thousand, or 29.9%, from €3,119 thousand for the three months ended June 30, 2020. We received 1,600 test requests for our internal research and development projects in the three months ended June 30, 2021, representing an decrease of 3% as compared to 1,650 test requests in the three months ended June 30, 2020. For the six months ended June 30, 2021, we incurred research and development expenses of €8,388 thousand, an increase of €2,578 thousand, or 44.4%, from €5,810 thousand for the six months ended June 30, 2020. We received 4,500 test requests for our internal research and development projects in the six months ended June 30, 2021, representing an increase of 27% as compared to 3,550 test requests in the six months ended June 30, 2020.

For the three months ended June 30, 2021, our loss before taxes was €7,896 thousand, a decrease of €2,464 thousand, or 24%, from €10,360 thousand for the three months ended June 30, 2020. For the six months ended June 30, 2021, our loss before taxes was €12,785 thousand, a decrease of €6,182 thousand, or 33%, from €18,967 thousand for the six months ended June 30, 2020.

Recent Developments

Effect of the COVID-19 Pandemic

The COVID-19 pandemic, which began in December 2019, has spread worldwide and continues to cause many governments to maintain measures to slow the spread of the outbreak through quarantines, travel restrictions, closures of borders and mandatory maintenance of physical distance between individuals.

Since the second quarter of 2020, the COVID-19 pandemic has resulted in a slowdown in our Diagnostics and Pharmaceutical businesses. As part of the Company’s initiative to assist local, national and international authorities, as well as other partners in their efforts to facilitate the earliest possible diagnosis of COVID-19 and thereby contribute to allowing society to return to a “new” normal, the Company commenced testing for COVID-19 in March 2020.

During the three and six months ended June 30, 2021, we continued the COVID-19 testing activities started in 2020 with a leading role in providing testing services at airports in Germany. Furthermore, new variants of the virus have emerged since mid-December 2020. How these mutations develop and their impact on the effectiveness of vaccines is not yet fully clear. Furthermore, vaccination campaigns in several countries started during the three and six months ended June 30, 2021, and due to the expected increasing availability of vaccines in 2021, the expectation is that governments will further reduce restrictions during 2021. How and when this, and possible travel related testing, would affect the potential prolongation of the need for testing on a broader scale is not clear yet.

Total investments in COVID-19 testing as of June 30, 2021 amounted to €2,388 thousand, of which €2,034 thousand are COVID-19 related mobile test laboratories and equipment. An amount of €354 thousand is included in intangible assets and relates to the development of CENTOGENE’s Corona Test Portal.

Although we are taking a number of measures aimed at minimizing disruptions to our business and operations, and while the provision of testing for the COVID-19 virus is anticipated to generate additional revenues for us, the full extent to which the global COVID-19 pandemic may impact our business will depend on future developments, which are highly uncertain and cannot be predicted, such as the duration of the pandemic, the availability of vaccines, the probability of the occurrence of further outbreaks and the ultimate impact on the financial markets and the global economy, which could result in an unforeseen negative impact on our business and our future results of operations.

Research and Development

Despite the disruption from the COVID-19 pandemic, we continued to expand our medical and genetic knowledge of rare genetic diseases, with the vision of shortening the diagnostics process for rare disease patients and accelerating the development of new orphan drugs.

As of June 30, 2021, our global proprietary rare disease platform included a real-world data repository with approximately 650 thousand patients representing 120 different countries, an increase of 9% as compared to the number of patients in our platform as of December 31, 2020 of 600 thousand patients. The size of this repository is significant when it is understood that datasets of as low as 20 patients can improve diagnostics interpretation power and accelerate pharmaceutical validation.

Financial Operations Overview

Our revenue is principally derived from the provision of pharmaceutical solutions and diagnostic tests enabled by our knowledge and interpretation-based platform, as well as from our COVID-19 testing solution.

Besides the recent impact of our COVID-19 testing related revenue, we expect our revenue to increase over time as we continue to expand our commercial efforts internationally with a focus on further growth in our pharmaceutical segment. Within our core business, we expect revenue from our diagnostics and pharmaceutical segments to grow in absolute terms. The development of the COVID-19 testing revenues will strongly depend on the further development of the COVID-19 pandemic.

Changes in revenue mix between our pharmaceutical, diagnostics and COVID-19 segments can impact our results period over period. In general, the gross margin generated by our pharmaceutical segment is higher in comparison to our diagnostics and COVID-19 segments, respectively.

Results of Operations

Three and Six Months Ended June 30, 2021 Compared to Three and Six Months Ended June 30, 2020


	For the Three Months Ended		For the Six Months Ended
	June 30,		June 30,
	2020	2021	2020	2021

	(unaudited,
	€ in thousands)
Condensed consolidated statement of comprehensive loss:
Revenue	9,719	51,871	21,824	116,831
Cost of sales	6,815	43,760	13,833	95,707
Gross profit	2,904	8,111	7,991	21,124
Research and development expenses	3,119	4,053	5,810	8,388
General administrative expenses	7,767	10,494	15,665	22,090
Selling expenses	2,386	1,942	4,712	3,891
Impairment of financial assets	500	580	1,674	675
Other operating income	801	1,276	1,746	1,642
Other operating expenses	37	2	138	36
Operating loss	(10,104)	(7,684)	(18,262)	(12,314)
Interest and similar income	13	—	13	—
Interest and similar expenses	269	212	718	471
Finance costs, net	(256)	(212)	(705)	(471)
Loss before taxes	(10,360)	(7,896)	(18,967)	(12,785)
Income tax expenses	—	124	129	124
Loss for the period	(10,360)	(8,020)	(19,096)	(12,909)
Other comprehensive income/(loss)	(6)	(191)	70	(70)
Total comprehensive loss for the period	(10,366)	(8,211)	(19,026)	(12,979)
Attributable to:
Equity holders of the parent	(10,364)	(8,222)	(18,963)	(13,025)
Non-controlling interests	(2)	11	(63)	46
	(10,366)	(8,211)	(19,026)	(12,979)

Loss per share – Basic and diluted (in €)	(0.52)	(0.37)	(0.95)	(0.58)

Revenue

Our total revenues for the three and six months ended June 30, 2021 were €51,871 thousand and €116,831 thousand, respectively, representing an increase of €42,152 thousand and €95,007 thousand, respectively, or 433.7% and 435.3%, respectively, as compared to the three and six months ended June 30, 2020 with COVID-19 testing accounting for most of the increase.

The graphic below shows the number of test requests for the diagnostics, pharmaceutical and COVID-19 segments, as well as the number of test requests received for our internal research projects during the three and six months ended June 30, 2021 and 2020.

The breakdown of our revenue by segment was as follows:


	For the Three Months		For the Six Months
	Ended June 30,		Ended June 30,
	2020	2021	2020	2021

	(unaudited,
	€ in thousands)
Revenue by segment:
Pharmaceutical	3,940	2,831	8,490	6,429
Diagnostics	3,684	6,715	11,226	13,098
COVID-19	2,095	42,325	2,108	97,304
Total Revenue	9,719	51,871	21,824	116,831

Revenues from Pharmaceutical segment

Revenues from our pharmaceutical segment were €2,831 thousand for the three months ended June 30, 2021, a decrease of €1,109 thousand, or 28.1%, from €3,940 thousand for the three months ended June 30, 2020. Our partnership agreements are structured on a fee per sample basis, milestone basis, fixed fee basis, royalty basis or a combination thereof. The 28.1% decrease was primarily due to the impact of the COVID-19 pandemic, which slowed the clinical studies of our pharmaceutical partners.

Revenues from our pharmaceutical segment were €6,429 thousand for the six months ended June 30, 2021, a decrease of €2,061 thousand, or 24.3%, from €8,490 thousand for the six months ended June 30, 2020.

During the six months ended June 30, 2021, we entered into twelve new collaborations and successfully completed 25 collaborations resulting in a total of 53 active collaborations at June 30, 2021, compared to 66 active collaborations at December 31, 2020 and 63 active collaborations as of June 30, 2020. Revenues from our new collaborations totalled €2,074 thousand and €2,150 thousand, respectively, for the three and six months ended June 30, 2021 with no upfront payments.

The graphs below show our revenues for the three and six months ended June 30, 2021 and 2020, resulting from our collaborations with our pharmaceutical partners, split between drug development stages:

During the three and six months ended June 30, 2021, revenues from one pharmaceutical partner represented 4.1% and 4.4% (or 22.1% and 26.4%, respectively, if COVID-19 revenues are excluded) of our total revenue, as compared to 26.2% and 26.4%, respectively, for the three and six months ended June 30, 2020.

Revenues from Diagnostics segment

Revenues from our diagnostics segment were €6,715 thousand for the three months ended June 30, 2021, an increase of €3,031 thousand, or 82.3%, from €3,684 thousand for the three months ended June 30, 2020. We received approximately 13,900 test requests in our diagnostics segment during the three months ended June 30, 2021, representing an increase of approximately 90.4% as compared to approximately 7,300 test requests received for the three months ended June 30, 2020.

Revenues from our diagnostics segment were €13,098 thousand for the six months ended June 30, 2021, an increase of €1,872 thousand, or 16.7%, from €11,226 thousand for the six months ended June 30, 2020. We received approximately 27,700 test requests in our diagnostics segment during the six months ended June 30, 2021, representing an increase of approximately 38.5% as compared to approximately 20,000 test requests received for the six months ended June 30, 2020.

For the three and six months ended June 30, 2021 and 2020, our total diagnostic segment revenues were split amongst our primary testing products as follows:

The increase in revenues was primarily related to an increase in test requests for WES and WGS during the three months ended June 30, 2021. Total revenues from WES and WGS for the three months ended June 30, 2021 amounted to €3,270 thousand, representing an increase of 67% as compared to €1,953 thousand for the three months ended June 30, 2020. The total number of WES and WGS test requests received in the diagnostics segment for the three months ended June 30, 2021 was approximately 4,159, representing an increase of 104% as compared to approximately 2,040 test requests received for the three months ended June 30, 2020. Total revenues from WES and WGS for the six months ended June 30, 2021 amounted to €6,431 thousand, representing an increase of 6% as compared to €6,062 thousand for the six months ended June 30, 2020. The total number of WES and WGS test requests received in the diagnostics segment for the six months ended June 30, 2021 was approximately 8,365, representing an increase of 28% as compared to approximately 6,540 test requests received for the six months ended June 30, 2020.

Revenues from COVID-19 testing segment

Revenues generated from our COVID-19 business for the three months ended June 30, 2021 amounted to €42,325 thousand. We received 679,900 requests for our COVID-19 tests in the three months ended June 30, 2021 as compared to 69,750 in the three months ended June 30, 2020. During the three months ended June 30, 2021, revenues from our largest COVID-19 testing partner represented 12.9% of our total revenues.

Revenues generated from our COVID-19 business for the six months ended June 30, 2021 amounted to €97,304 thousand. We received 1,532,100 requests for our COVID-19 tests in the six months ended June 30, 2021 as compared to 70,050 in the six months ended June 30, 2020. During the six months ended June 30, 2021, revenues from our largest COVID-19 testing partner represented 15.2% of our total revenues.

Revenue by geographical region

The breakdown of our revenue from all of our segments, in the aggregate, by geographical region was as follows:


	For the Three Months		For the Six Months
	Ended June 30,		Ended June 30,
	2020	2021	2020	2021

	(unaudited,
	€ in thousands)
Revenue by geographical region:
Europe	3,227	43,530	4,888	99,014
of which: Germany	2,115	40,380	2,207	92,778
of which: Netherlands	—	1,774	3	3,544
Middle East	1,834	3,976	6,252	8,140
North America	4,373	3,585	9,496	8,234
of which: United States	4,365	3,537	9,339	8,125
Latin America	219	633	965	1,058
Asia Pacific	66	147	223	385
Total Revenue	9,719	51,871	21,824	116,831

In cases where our pharmaceutical partners are developing a new rare disease treatment, we generally anticipate that the final approved treatment will be made available globally. As a result, we allocate the revenues of our pharmaceutical segment by geographical region by reference to the location where each pharmaceutical partner mainly operates, which is based on the region from which most of their revenues are generated. The allocation of revenues in our diagnostics and COVID-19 segments is based on the location of each customer.

Our North America region contributed €3,585 thousand to revenues for the three months ended June 30, 2021, a decrease of €788 thousand, or 18%, from €4,373 thousand for the three months ended June 30, 2020, primarily driven by the decrease in revenues from our pharmaceutical segment, of which over 96.5% are allocated to the North America region. Revenues from the North America region for the six months ended June 30, 2021 decreased to €8,234 thousand, representing a decrease of €1,262 thousand, or 13.3%, from €9,496 thousand, which is mainly due to a decrease in revenues from the pharmaceutical segment. Revenues from the North America region represented 6.9% and 7.0%, respectively, of our total revenues for the three and six months ended June 30, 2021, as compared to 45.0% and 43.5%, respectively, for the three and six months ended June 30, 2020.

Our Middle East region contributed €3,976 thousand to revenues for the three months ended June 30, 2021, an increase of €2,142 thousand, or 117%, from €1,834 thousand for the three months ended June 30, 2020. This revenue increase was primarily attributable

to the increase in diagnostic sales. Revenues from the Middle East region contributed €8,140 thousand to revenues for the six months ended June 30, 2021, an increase of €1,888 thousand, or 30.2%, from €6,252 thousand for the six months ended June 30, 2020. This revenue increase was primarily attributable to the increase in diagnostic sales. Revenues from the Middle East region represented 7.7% and 7.0%, respectively, of our total revenues for the three and six months ended June 30, 2021, as compared to 18.9% and 28.6%, respectively, for the three and six months ended June 30, 2020.

Our Europe region contributed €43,530 thousand to revenue for the three months ended June 30, 2021, an increase of €40,303 thousand, or 1249%, from €3,227 thousand for the three months ended June 30, 2020. Revenues from the Europe region contributed €99,014 thousand to revenue for the six months ended June 30, 2021, an increase of €94,126 thousand, or 1925.7%, from €4,888 thousand for the six months ended June 30, 2020. The increase was mainly driven by revenues from our COVID-19 testing during the year, as over 92.8% and 93.7%, respectively, of such revenues were generated in Germany in the three and six months ended June 30, 2021. Revenues from the Europe region represented 83.9% and 84.7%, respectively, of our total revenues for the three and six months ended June 30, 2021 as compared to 33.2% and 22.4%, respectively, for the three and six months ended June 30, 2020.

Cost of Sales

Cost of sales increased by €36,945 thousand, or 542.1%, to €43,760 thousand for the three months ended June 30, 2021, from €6,815 thousand for the three months ended June 30, 2020 and increased by €81,874 thousand, or 591.9%, to €95,707 thousand for the six months ended June 30, 2021, from €13,833 thousand for the six months ended June 30, 2020. Cost of sales for the three and six months ended June 30, 2021, represented 84.4% and 81.9% of total revenue, representing an increase of 14.2 percentage points and 18.5 percentage points, respectively, as compared to 70.1% and 63.4%, respectively, for the three and six months ended June 30, 2020.

Cost of sales incurred by our pharmaceutical segment for the three and six months ended June 30, 2021 represented 71.2% and 65.2%, respectively, of the revenues from the segment, representing an increase of 21.4 percentage points and 19.8 percentage points, respectively, as compared to 49.8% and 45.4%, respectively, for the three and six months ended June 30, 2020 for our pharmaceutical segment. The movements are related to the relative portion of revenues from clinical study related collaborations, where higher staff costs and consumable costs are incurred as compared to patient screening collaborations where consumable costs are comparatively lower due to different technologies being used in the testing.

Cost of sales incurred by our diagnostics segment for the three and six months ended June 30, 2021 represented 68.5% and 65.9%, respectively, of the revenues from the segment, representing a decrease of 25.0 percentage points and 8.9 percentage points, respectively, as compared to 93.5% and 74.8%, respectively for the three and six months ended June 30, 2020. The decrease is due to the streamlining of costs generated through investments made in cost efficient equipments in previous years.

Cost of sales incurred by our COVID-19 segment for the three and six months ended June 30, 2021 represent 87.8% and 85.2%, respectively, of the revenues from the segment, representing an increase of 20.5 percentage points and 18.4 percentage points, respectively, as compared to 67.3% and 66.8%, respectively for the three and six months ended June 30, 2020. The increase is mainly due to the expansion of the segment since the prior year which required reallocation of some fixed costs incurred for the segment, such as depreciation of laboratory equipment, as well as personnel costs for employees for laboratory operations.

Gross Profit

As a result of the cost savings generated through the diagnostics segment and margin earned on increased COVID-19 revenues, our gross profit increased by €5,207 thousand, or 179.3%, to €8,111 thousand for the three months ended June 30, 2021, from €2,904 thousand for the three months ended June 30, 2020, while our gross profit for the six months ended June 30, 2021, increased by €13,133 thousand, or 164.3%, to €21,124 thousand from €7,991 thousand for the six months ended June 30, 2020.

Research and Development Expenses

Research and development expenses increased by €934 thousand, or 29.9%, to €4,053 thousand for the three months ended June 30, 2021, from €3,119 thousand for the three months ended June 30, 2020, while our research and development expense increased by €2,578 thousand, or 44.4%, to €8,388 thousand for the six months ended June 30, 2021, from €5,810 thousand for the six months ended June 30, 2020. The increase mainly represents personnel costs and IT-related expenses incurred in the biomarker and AI research and development phase that do not qualify for capitalization.

General Administrative Expenses

General administrative expenses increased by €2,727 thousand, or 35.1%, to €10,494 thousand for the three months ended June 30, 2021, from €7,767 thousand for the three months ended June 30, 2020, while general administrative expenses increased by €6,425 thousand, or 41.0%, to €22,090 thousand for the six months ended June 30, 2021, from €15,665 thousand for the six months ended June 30, 2020.

The increase is principally due to increased personnel costs, legal and administrative costs and additional expenditure on IT support and data centers. In addition, the corporate expenses included share-based compensation expenses of €2,234 thousand and €4,276 thousand, respectively, for the three and six months ended June 30, 2021, an increase of €1,898 thousand and €2,883 thousand, respectively, as compared to €336 thousand and €1,393 thousand, respectively for the three and six months ended June 30, 2020.

Selling Expenses

Selling expenses for the three and six months ended June 30, 2021 were €1,942 thousand and €3,891 thousand respectively, representing a decrease of €444 thousand, or 18.6% as compared to €2,386 thousand for the three months ended June 30, 2020, and a decrease of €821 thousand, or 17.4%, as compared to €4,712 thousand for the six months ended June 30, 2020. The decreases for the three and six months ended June 30, 2021 were principally due to a reduction in personnel expenses as well as a decrease in expenses incurred for conferences and exhibitions due to travel restrictions and other social-distancing measures as a result of the COVID-19 pandemic.

Impairment of financial assets

Impairment expenses for financial assets for the three and six months ended June 30, 2021 were €580 thousand and €675 thousand, respectively, representing an increase of €80 thousand from €500 thousand for the three months ended June 30, 2020 and a decrease of €999 thousand from €1,674 thousand for the six months ended June 30, 2020, respectively. These impairments were related to the re-assessment of the receivables and contract assets arising from contracts with customers, partly due to the effect of the COVID-19 pandemic.

Other Operating Income / (Expenses)

Other operating income increased by €475 thousand, or 59.3%, to €1,276 thousand for the three months ended June 30, 2021, from €801 thousand for the three months ended June 30, 2020 and decreased by €104 thousand, or 6.0%, to €1,642 thousand for the six months ended June 30, 2021, from €1,746 thousand for the six months ended June 30, 2020 principally due to higher grant income during the period.

Other operating expenses decreased by €35 thousand, or 94.6% to €2 thousand in the three months ended June 30, 2021 and decreased by €102 thousand, or 73.9% to €36 thousand in the six months ended June 30, 2021 compared to €37 thousand and €138 thousand, respectively, for the three and six months ended June 30, 2020.

Interest and Similar Income / (Expenses)

Net financial costs decreased by €44 thousand and €234 thousand, respectively to €212 thousand and €471 thousand, respectively, for the three and six months ended June 31, 2021, from €256 thousand and €705 thousand, respectively, for the three and six months ended June 30, 2020, principally due to the reduction of interest expenses on loans by €53 thousand and €89 thousand, respectively, in the three and six months ended June 30, 2021.

Loss Before Taxes

As a result of the factors described above, our loss before taxes for the three and six months ended June 30, 2021 were €7,896 thousand and €12,785 thousand, respectively, representing a decrease of €2,464 thousand and €6,182 thousand, respectively, from a loss before taxes of €10,360 thousand and €18,967 thousand, respectively, for the three and six months ended June 30, 2020.

Segment Adjusted EBITDA

We evaluate segment performance based on segment results and measure it with reference to Adjusted EBITDA. Adjusted EBITDA is a financial measure which is not defined by IFRS, which we define as income/loss before finance costs (net), taxes, and

depreciation and amortization (including impairments), adjusted to exclude corporate expenses as well as share-based payment expenses. Our Segment Adjusted EBITDA was as follows:


	For the Three Months		For the Six Months
	Ended June 30,		Ended June 30,
	2020	2021	2020	2021

	(unaudited,
	€ in thousands)
Segment Adjusted EBITDA:
Pharmaceutical	1,799	647	4,407	2,144
Diagnostics	(1,636)	580	(1,358)	1,633
COVID-19	812	6,251	621	16,418
Total segment Adjusted EBITDA	975	7,478	3,670	20,195

Adjusted EBITDA from our pharmaceutical segment for the three and six months ended June 30, 2021 was €647 thousand and €2,144 thousand, respectively, representing a decrease of €1,152 thousand and €2,263 thousand, respectively, as compared to €1,799 thousand and €4,407 thousand, respectively, for the three and six months ended June 30, 2020. The decrease was primarily attributable to the decrease in revenues from the pharmaceutical segment, as well as the increase in cost of sales.

Adjusted EBITDA from our diagnostics segment for the three and six months ended June 30, 2021, was €580 thousand and €1,633 thousand, respectively, an increase of €2,216 thousand and €2,991 thousand, respectively, as compared to negative €1,636 thousand and negative €1,358 thousand, respectively, for the three and six months ended June 30, 2020. The increase is mainly due to the increase in revenues and an impairment of financial assets of €500 thousand and €1,674 thousand, respectively, recognized for the three and six months ended June 30, 2020, compared to €580 thousand and €675 thousand, respectively, for the three and six months ended June 30, 2021.

Adjusted EBITDA from our COVID-19 segment for the three and six months ended June 30, 2021 was €6,251 thousand and €16,418 thousand, respectively, as compared to €812 thousand and €621 thousand, respectively, for the three and six months ended June 30, 2020.

Liquidity and Capital Resources

Our cash requirements are principally for working capital and capital expenditures of all our businesses, including expansions and improvements to our laboratory facilities, technology infrastructure and research and development activities. In fiscal year 2021 and beyond, we anticipate that our capital expenditures in our rare disease business will increase from prior periods as we continue to increase our research and development efforts. Historically, our main source of liquidity has been our secured loans, municipal loans and government funding of research programs, and proceeds from our initial and July 2020 follow-on equity offerings.

Our financial condition and liquidity are and will continue to be influenced by a variety of factors, including our ability to continue to generate cash flows from our operations, our capital expenditure requirements, and the impact of the COVID-19 pandemic on financial markets and the global economy.

Our known material liquidity needs for periods beyond the next twelve months are described below under “Contractual Obligations and Commitments”. We believe that our existing cash and cash equivalents will enable us to fund our operating expenses and capital expenditure requirements for more than 12 months.

Comparative Cash Flows

The table below summarizes our consolidated statement of cash flows for the six months ended June 30, 2021 and 2020:


	For the six Months
	Ended June 30,
	2020	2021

	(unaudited,
	€ in thousands)
Consolidated statement of cash flows:
Cash flow used in operating activities	(14,636)	(7,830)
Cash flow used in investing activities	(6,634)	(4,785)
Cash flow used in financing activities	(2,425)	(761)
Net decrease in cash and cash equivalents	(23,695)	(13,376)
Cash and cash equivalents at the beginning of the period	41,095	48,156
Cash and cash equivalents at the end of the period	17,400	34,780

Operating Activities

Our cash flow used in operating activities primarily relates to changes in the components of our working capital, including cash received from our COVID-19 business, pharmaceutical partners and diagnostics clients, and payments made to our suppliers.

For the six months ended June 30, 2021, cash flow used in operating activities was €7,830 thousand, a decrease of €6,806 thousand as compared to cash flow used in operating activities of €14,636 thousand for the six months ended June 30, 2020. This change was mainly due to our COVID-19 testing business segment.

Investing Activities

Our cash flow used in investing activities consists of investments in intangible assets, and in property, plant and equipment.

For the six months ended June 30, 2021, cash flow used in investing activities was €4,785 thousand, as compared to cash flow used of €6,634 thousand from investing activities for the six months ended June 30, 2020. The decrease is mainly due to a reduction in COVID-19 related investments. During the six months ended June 2021, investments made in respect of COVID-19 testing were €2,388 thousand, of which €2,034 thousand was included in property, plant and equipment and €354 thousand related to the development of CENTOGENE’s Corona Test Portal.

Cash used in investment activities in our rare disease business includes mainly costs incurred in the development of new products and solutions, and the development of our IT driven and interpretation-based solutions. It also includes investment in property, plant and equipment used in the laboratories and other business operations.

Financing Activities

For the six months ended June 30, 2021, cash flow used in financing activities was €761 thousand, a decrease of €1,664 thousand as compared to cash flow used of €2,425 thousand for the six months ended June 30, 2020. The decrease was primarily driven by the bank overdrafts which contributed €1,769 thousand as compared to €928 thousand for the six months ended June 30, 2020. Furthermore, the amount used for the repayment of loans decreased from €1260 thousand for the six months ended June 30, 2020 to €185 thousand for the six months ended June 30, 2021.

Off-Balance Sheet Arrangements

We did not have during the periods presented, and we do not currently have, any off-balance sheet arrangements, as defined in the rules and regulations of the SEC.

Contractual Obligations and Commitments

The table below presents the residual contractual terms of the financial liabilities and commitments, including estimated interest payments. The figures are undiscounted gross amounts, including estimated interest payments and interest on undrawn loan funds as of June 30, 2021, but without showing the impact of offsetting.



	Total		Between 1	Between 3
	contractual	Less than	and	and	More than
	cashflow	1 year	3 years	5 years	5 years



Secured bank loans	767	567	200	—	—
Bank overdraft	3,316	3,316	—	—	—
Other bank loans	—	—	—	—	—
Lease liabilities ⁽¹⁾	31,146	5,683	6,745	4,701	14,017
Trade payables and purchase obligations ⁽²⁾	16,870	16,870	—	—	—
Total	52,099	26,436	6,945	4,701	14,017

(1)

Lease liabilities include leases related to lease contracts for land and buildings, offices, as well as various items including motor vehicles and other equipment which are accounted for according to IFRS 16, and measured at the present value of lease payments over the lease term at the commencement date of the leases.

Lease liabilities also include cash flows in relation to the expansion of our Rostock headquarters and leasing of our Frankfurt laboratory, our Airport Berlin, Airport Düsseldorf, Airport Cologne/ Bonn, Airport Munich and Airport Frankfurt testing centers and additional laboratory space in Hamburg that are not accounted for yet. The future lease payments and utilities for these non-cancellable lease contracts are €1,667 thousand within one year, €2,424 thousand within five years and €4,219 thousand thereafter as at June 30, 2021.

(2)

Purchase obligations relate to concluded agreements with suppliers, for goods and services to be provided subsequent to June 30, 2021.

Critical Accounting Policies and Estimates

There have been no material changes to the critical accounting policies and estimates described in “Item 5. Operating and Financial Review and Prospects—H. Critical Accounting Policies and Estimates” in our Annual Report.

JOBS Act Exemption

As a company with less than US$1.07 billion in revenue during our last fiscal year, we qualify as an “emerging growth company” as defined in the JOBS Act. As an emerging growth company, we are not required to provide an auditor attestation report on our system of internal controls over financial reporting. This exemption will apply for a period of five years following the completion of our initial public offering (November 6, 2019) or until we no longer meet the requirements of being an “emerging growth company,” whichever is earlier. We would cease to be an emerging growth company if we have more than US$1.07 billion in annual revenue, have more than US$700 million in market value of our common shares held by non-affiliates or issue more than US$1.0 billion of non-convertible debt over a three-year period.

Cautionary Statement Regarding Forward Looking Statements

Forward-looking statements are based on our management’s beliefs and assumptions and on information currently available to our management. Such statements are subject to risks and uncertainties, and actual results may differ materially from those expressed or implied in the forward-looking statements due to various factors, including, but not limited to, those identified under the heading “Risk Factors” in our Annual Report filed with the SEC on April 15, 2021. These risks and uncertainties include factors relating to:

· our ability to effectively manage our future growth and to execute our business strategy;

· our ability to generate sufficient revenue from our relationships with our pharmaceutical partners and clients, and to otherwise maintain our current relationships, or enter into new relationships, with pharmaceutical partners and clients;

· the effects of the COVID-19 pandemic on our business, financial position and results of operations;

· economic, political or social conditions and the effects of these conditions on our pharmaceutical partners’ and diagnostics clients’ businesses and levels of business activity;

· our expectations for our products and solutions achieving commercial market acceptance, and our ability to keep pace with the rapidly evolving industry in which we operate;

· our assumptions regarding market size in the rare disease industry and our growth potential;

· our pharmaceutical partners’ and clients’ need for rare disease information products and solutions and any perceived advantage of our products over those of our competitors;

· our ability to manage our international expansion, including our exposure to new and complex business, regulatory, political, operational, financial, and economic risks, and numerous and conflicting legal and regulatory requirements;

· our continued reliance on our senior management team, in particular our CEO, and other qualified personnel and our ability to retain such personnel;

· our ability to obtain, maintain, protect and enforce sufficient patent and other intellectual property protection for any products or solutions we develop and for our technology;

· the ongoing protection of our trade secrets, know-how, and other confidential and proprietary information;

· our ability to remediate our material weakness on internal control over financial reporting;

· general economic, political, demographic and business conditions in North America, the Middle East, Europe and other regions in which we operate;

· changes in government and industry regulation and tax matters;

· other factors that may affect our financial condition, liquidity and results of operations; and

· other risk factors discussed under “Item 3. Key Information—D. Risk Factors” in our Annual Report.

You should refer to the section in our Annual Report titled “Risk Factors” for a discussion of important factors that may cause our actual results to differ materially from those expressed or implied by our forward-looking statements. As a result of these factors, we cannot assure you that the forward-looking statements included herein or incorporated by reference herein will prove to be accurate. Furthermore, if our forward-looking statements prove to be inaccurate, the inaccuracy may be material. In light of the significant uncertainties in these forward-looking statements, you should not regard these statements as a representation or warranty by us or any other person that we will achieve our objectives and plans in any specified time frame or at all. We undertake no obligation to publicly update any forward-looking statements, whether as a result of new information, future events or otherwise, except as required by law.