Will Bio-Works Technologies (NGM:BIOWKS) Spend Its Cash Wisely?

Just because a business does not make any money, does not mean that the stock will go down. For example, Bio-Works Technologies (NGM:BIOWKS) shareholders have done very well over the last year, with the share price soaring by 164%. Having said that, unprofitable companies are risky because they could potentially burn through all their cash and become distressed.

In light of its strong share price run, we think now is a good time to investigate how risky Bio-Works Technologies' cash burn is. For the purpose of this article, we'll define cash burn as the amount of cash the company is spending each year to fund its growth (also called its negative free cash flow). The first step is to compare its cash burn with its cash reserves, to give us its 'cash runway'.

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Does Bio-Works Technologies Have A Long Cash Runway?

You can calculate a company's cash runway by dividing the amount of cash it has by the rate at which it is spending that cash. When Bio-Works Technologies last reported its September 2025 balance sheet in November 2025, it had zero debt and cash worth kr22m. Importantly, its cash burn was kr29m over the trailing twelve months. That means it had a cash runway of around 9 months as of September 2025. That's quite a short cash runway, indicating the company must either reduce its annual cash burn or replenish its cash. The image below shows how its cash balance has been changing over the last few years.

See our latest analysis for Bio-Works Technologies

How Well Is Bio-Works Technologies Growing?

It was fairly positive to see that Bio-Works Technologies reduced its cash burn by 37% during the last year. And operating revenue was up by 9.3% too. On balance, we'd say the company is improving over time. Of course, we've only taken a quick look at the stock's growth metrics, here. This graph of historic earnings and revenue shows how Bio-Works Technologies is building its business over time.

How Hard Would It Be For Bio-Works Technologies To Raise More Cash For Growth?

Given Bio-Works Technologies' revenue is receding, there's a considerable chance it will eventually need to raise more money to spend on driving growth. Issuing new shares, or taking on debt, are the most common ways for a listed company to raise more money for its business. One of the main advantages held by publicly listed companies is that they can sell shares to investors to raise cash and fund growth. We can compare a company's cash burn to its market capitalisation to get a sense for how many new shares a company would have to issue to fund one year's operations.

Since it has a market capitalisation of kr228m, Bio-Works Technologies' kr29m in cash burn equates to about 13% of its market value. As a result, we'd venture that the company could raise more cash for growth without much trouble, albeit at the cost of some dilution.

Is Bio-Works Technologies' Cash Burn A Worry?

Even though its cash runway makes us a little nervous, we are compelled to mention that we thought Bio-Works Technologies' cash burn reduction was relatively promising. Even though we don't think it has a problem with its cash burn, the analysis we've done in this article does suggest that shareholders should give some careful thought to the potential cost of raising more money in the future. On another note, we conducted an in-depth investigation of the company, and identified 6 warning signs for Bio-Works Technologies (2 can't be ignored!) that you should be aware of before investing here.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.