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Kamada Reports Strong First Quarter 2023 Financial Results; Reiterates Revenue and Profitability Guidance
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Kamada Reports Strong First Quarter 2023 Financial Results; Reiterates Revenue and Profitability Guidance






  • Total Revenues for First Quarter of 2023 were $30.7 Million, Up 9% Year-over-Year
  • First Quarter 2023 EBITDA of $3.8 Million, Increase of 16% Year-over-Year
  • Solid First Quarter Results and Expected Continued Momentum Supported by Multiple Growth Drivers Anticipated to Drive Full-Year 2023 EBITDA Growth of Over 30% Year-over-Year
  • Announced $60 Million Private Placement with FIMI Opportunity Funds
  • Received FDA Approval to Manufacture CYTOGAM® at the Company’s Israeli Facility; Expected to Positively Impact Plant Utilization and Efficiency
  • Conference Call and Live Webcast Today at 8:30 AM ET

REHOVOT, Israel and Hoboken, N.J., May 24, 2023 (GLOBE NEWSWIRE) — Kamada Ltd. (NASDAQ: KMDA; TASE: KMDA.TA), a commercial stage global biopharmaceutical company, with a portfolio of marketed products indicated for rare and serious conditions and a leader in the specialty plasma-derived field, today announced financial results for three months ended March 31, 2023.

“We are off to an excellent start to 2023, both financially and operationally,” said Amir London, Kamada’s Chief Executive Officer. “With total revenues in the first quarter of $30.7 million, which represented year-over-year growth of 9%, and EBITDA of $3.8 million, an increase of 16% year-over-year, we achieved the top- and bottom-line growth anticipated in our business to begin the year. Importantly, we continue to effectively leverage multiple growth drivers, including KEDRAB® sales in the U.S, the profitable portfolio of four FDA approved IgGs acquired in late 2021, the sales of our other Proprietary products in the international markets, and our Israeli distribution business.”

“While our first quarter results are impressive, we are equally excited about our outlook for the remainder of the year,” continued Mr. London. “As such, we are reiterating our full-year 2023 revenue guidance of $138 million to $146 million and EBITDA guidance of $22 million to $26 million, which would represent profitability growth of over 30% as compared to 2022. Looking beyond 2023, based on multiple catalysts from our existing business, we continue to anticipate annual double-digit growth rate in revenues and profitability in the foreseeable years ahead.”

“Our prospects were recently further significantly enhanced by the successful completion of multiple key achievements. The $60 million financing agreement signed with FIMI will provide us with financial flexibility, allowing us to accelerate the growth of our existing business and pursue compelling business development opportunities. Moreover, regarding our existing business, the FDA approval to manufacture CYTOGAM® at our facility in Israel, and the initiation of our commercial manufacturing, will positively impact our facility’s utilization and efficiency. In addition, we are encouraged by the most recent progress achieved in our ongoing pivotal Phase 3 InnovAATe clinical trial for the inhaled Alpha-1 Antitrypsin (AAT) therapy for the treatment of Alpha-1 Antitrypsin Deficiency (AATD). The study has enrolled 60 patients to date and the independent Data Safety Monitoring Board (DSMB) recently recommended study continuation without modification for the fifth time since study initiation,” concluded Mr. London.

Financial Highlights for the Three Months Ended March 31, 2023

  • Total revenues were $30.7 million in the first quarter of 2023, compared to $28.1 million in the first quarter of 2022, representing a 9% increase year-over-year.
  • Gross profit and gross margins were $11.8 million and 39%, respectively, in the first quarter of 2023, compared to $11.3 million and 40%, respectively, reported in the prior year period. Cost of goods sold in the Company’s Proprietary segment in the first quarter of 2023 included $1.3 million of depreciation expenses associated with intangible assets generated through the IgG products acquisition. Gross profit and gross margins, excluding such intangible assets depreciation, would have been $13.2 million and 43%, respectively, compared to $12.6 million and 45%, respectively, in the first quarter of 2022.
  • Operating expenses, including R&D, Sales & Marketing (S&M), G&A and other expenses (including excess severance remuneration described below), totaled $11.6 million in the first quarter of 2023, compared to $11.1 million in the first quarter of 2022. S&M costs for the most recently completed first quarter included $0.4 million of depreciation expenses of intangible assets generated through the IgG products acquisition.
  • During the first quarter of 2023, Kamada conducted a planned workforce downsizing at its Israeli plant, optimizing staff level to its capacity needs. As a result of this downsizing, the Company incurred an expense of $0.6 million for excess severance remuneration provided to employees who were laid off. The downsizing is expected to result in an annualized reduction of approximately 6% in the overall Israeli labor costs.
  • Finance expense, net for the first quarter of 2023 included a $1.8 million expense associated with the revaluation of the contingent consideration and other long-term liabilities assumed as part of the IgG products acquisition. For more information with respect to such contingent consideration and other long-term liabilities, please refer to Note 5 of Kamada’s 2022 financial statements included in the 2022 Annual Report on Form 20-F filed on March 15, 2023, with the Securities and Exchange Commission.
  • Net loss was $1.8 million, or $(0.04) per share, in the first quarter of 2023, in line with a net loss of $1.8 million, or $(0.04) per share, in the first quarter of 2022. Excluding depreciation expenses of intangible assets and finance expenses of the contingent consideration and other assumed long-term liabilities associated with the acquired IgG products, the Company would have recorded net income of $1.7 million, or $0.04 per share, in the first quarter of 2023, compared to $1.9 million, or $0.04 per share in the first quarter of 2022.
  • EBITDA, as detailed in the tables below, was $3.8 million in the first quarter of 2023, as compared to $3.3 million in the first quarter of 2022, representing a 16% increase year-over-year.
  • Excluding the $0.6 million expense of the excess severance remuneration paid to the employees who were laid off, EBITDA would have been $4.4 million in the first quarter of 2023, representing a 33% increase year-over-year.
  • Cash used by operating activities was $2.9 million in the first quarter of 2023, as compared to cash provided by operating activities of $5.5 million in the first quarter of 2022.

Balance Sheet Highlights
As of March 31, 2023, Kamada had cash, cash equivalents, and short-term investments of $27.1 million, as compared to $34.3 million on December 31, 2022. This figure does not include the expected net proceeds from the recently announced $60 million financing, which is expected to close during the second half of 2023.

Recent Corporate Highlights

  • Announced that it has entered into a securities purchase agreement with FIMI Opportunity Funds (FIMI), the leading private equity investor in Israel, to purchase $60 million of its ordinary shares in a private placement.
  • Received FDA approval of application to manufacture CYTOGAM® (Cytomegalovirus Immune Globulin Intravenous [Human]) (CMV-IGIV) at the Company’s facility in Beit Kama, Israel.
  • Granted marketing authorization in Switzerland from Swissmedic for GLASSIA® [Alpha-1 Proteinase Inhibitor (Human)], for chronic augmentation and maintenance therapy in adults with clinically evident emphysema due to severe hereditary AATD.
  • Announced that Chief Financial Officer (CFO) Chaime Orlev will remain in role and the appointment of Nir Livneh as the Company’s Vice President, General Counsel and Corporate Secretary.

Fiscal Year 2023 Guidance
Kamada continues to expect to generate fiscal year 2023 total revenues in the range of $138 million to $146 million. The Company also continues to anticipate generating EBITDA during 2023 in the range of $22 million to $26 million, representing profitability growth of over 30% from the year ended December 31, 2022.

Conference Call
Kamada management will host an investment community conference call on Wednesday, May 24, 2023, at 8:30 am Eastern Time to present the Company’s results and answer questions. Shareholders and other interested parties may participate in the conference call by dialing 1-877-407-0792 (from within the U.S.), 1 809-406-247 (from Israel) or 1-201-689-8263 (International) using conference ID 13738719. The call will also be webcast live on the Internet at: https://viavid.webcasts.com/starthere.jsp?ei=1614685&tp_key=87fb1414ee.

Non-IFRS financial measures
We present EBITDA and adjusted EBITDA because we use this non-IFRS financial measure to assess our operational performance, for financial and operational decision-making, and as a means to evaluate period-to-period comparisons on a consistent basis. Management believes this non-IFRS financial measure are useful to investors because: (1) they allow for greater transparency with respect to key metrics used by management in its financial and operational decision-making and provide investors with a meaningful perspective on the current underlying performance of the Company’s core ongoing operations; and (2) they exclude the impact of certain items that are not directly attributable to our core operating performance and that may obscure trends in the core operating performance of the business. Non-IFRS financial measures have limitations as an analytical tool and should not be considered in isolation from, or as a substitute for, our IFRS results. We expect to continue reporting non-IFRS financial measures, adjusting for the items described below, and we expect to continue to incur expenses similar to certain of the non-cash, non-IFRS adjustments described below. Accordingly, unless otherwise stated, the exclusion of these and other similar items in the presentation of non-IFRS financial measures should not be construed as an inference that these items are unusual, infrequent or non-recurring. EBITDA and adjusted EBITDA are not recognized terms under IFRS and do not purport to be an alternative to IFRS terms as an indicator of operating performance or any other IFRS measure. Moreover, because not all companies use identical measures and calculations, the presentation of EBITDA and adjusted EBITDA may not be comparable to other similarly titled measures of other companies. EBITDA and adjusted EBITDA are defined as net income (loss), plus income tax expense, plus or minus financial income or expenses, net, plus or minus income or expense in respect of securities measured at fair value, net, plus or minus income or expenses in respect of currency exchange differences and derivatives instruments, net, plus depreciation and amortization expense, plus non-cash share-based compensation expenses and certain other costs.

About Kamada
Kamada Ltd. (the “Company”) is a commercial stage global biopharmaceutical company with a portfolio of marketed products indicated for rare and serious conditions and a leader in the specialty plasma-derived field, focused on diseases of limited treatment alternatives. The Company is also advancing an innovative development pipeline targeting areas of significant unmet medical need. The Company’s strategy is focused on driving profitable growth from its significant commercial catalysts as well as its manufacturing and development expertise in the plasma-derived and biopharmaceutical fields. The Company’s commercial products portfolio includes six FDA approved plasma-derived biopharmaceutical products: CYTOGAM®, KEDRAB®, WINRHO SDF®, VARIZIG®, HEPAGAM B® and GLASSIA®, as well as KAMRAB®, KAMRHO (D)® and two types of equine-based anti-snake venom (ASV) products. The Company distributes its commercial products portfolio directly, and through strategic partners or third-party distributors in more than 30 countries, including the U.S., Canada, Israel, Russia, Argentina, Brazil, India, Australia and other countries in Latin America, Europe, Middle East, and Asia. The Company leverages its expertise and presence in the Israeli market to distribute, for use in Israel, more than 25 pharmaceutical products that are supplied by international manufacturers. During recent years the Company added eleven biosimilar products to its Israeli distribution portfolio, which, subject to the European Medicines Agency (EMA) and the Israeli Ministry of Health approvals, are expected to be launched in Israel through 2028. The Company owns an FDA licensed plasma collection center in Beaumont, Texas, which currently specializes in the collection of hyper-immune plasma used in the manufacture of KAMRHO (D). In addition to the Company’s commercial operation, it invests in research and development of new product candidates. The Company’s leading investigational product is an inhaled AAT for the treatment of AAT deficiency, for which it is continuing to progress the InnovAATe clinical trial, a randomized, double-blind, placebo-controlled, pivotal Phase 3 trial. FIMI Opportunity Funds, the leading private equity firm in Israel, is the Company’s lead shareholder, beneficially owning approximately 21% of the outstanding ordinary shares and is expected to beneficially own approximately 38% upon the closing of the Private Placement.

Cautionary Note Regarding Forward-Looking Statements
This release includes forward-looking statements within the meaning of Section 21E of the U.S. Securities Exchange Act of 1934, as amended, and the safe harbor provisions of the U.S. Private Securities Litigation Reform Act of 1995. Forward-looking statements are statements that are not historical facts, including statements regarding: (1) 2023 revenue guidance in the range of $138 Million to $146 Million; (2) 2023 EBITDA of $22 million to $26 million representing profitability growth of over 30% from the year ended December 31, 2022; (3) commercial manufacturing of CYTOGAM® in Israel shortly, which will positively impact the facility’s utilization and efficiency; (4) expected annual double-digit growth rate in revenues and profitability in the foreseeable years ahead; (5) effectively leveraging multiple growth drivers, including KEDRAB® sales in the U.S, the portfolio of four FDA approved IgGs acquired in late 2021, the sales of our other Proprietary products in the international markets, and our Israeli distribution business; (6) receiving net proceeds from the recently announced $60 million financing; (7) closing of the recently announced $60 million financing during the second half of 2023; (8) the financing providing the Company with financial flexibility, allowing the Company to accelerate the growth of its existing business and pursue compelling business development opportunities; (9) the downsizing is expected to result in an annualized reduction of approximately 6% in overall Israeli labor costs; and (10) optimism about AATD Phase 3 clinical trial progress. Forward-looking statements are based on Kamada’s current knowledge and its present beliefs and expectations regarding possible future events and are subject to risks, uncertainties and assumptions. Actual results and the timing of events could differ materially from those anticipated in these forward-looking statements as a result of several factors including, but not limited to, success in receiving the necessary shareholder and regulatory approvals for the Private Placement, timing of Kamada’s release of its financial results for the second quarter of 2023, overall stock market conditions and specifically Kamada’s stock price, availability of sufficient raw materials required to maintain manufacturing plans, continued utilization of Kamada’s Israeli manufacturing site, continuation of inbound and outbound international delivery routes, continued demand for the IgG product portfolio, FDA and international health authorities’ approval process, financial conditions of the Company’s customers, suppliers and services providers, Kamada’s ability to integrate the new product portfolio into its current product portfolio, Kamada’s ability to grow the revenues of its new product portfolio, and leverage and expand its international distribution network, Kamada’s ability to manage operating expenses, additional competition in the markets that Kamada competes, regulatory delays, prevailing market conditions and the impact of general economic, industry or political conditions in the U.S., Israel or otherwise, and other risks detailed in Kamada’s filings with the U.S. Securities and Exchange Commission (the “SEC”) including those discussed in its most recent Annual Report on Form 20-F and in any subsequent reports on Form 6-K, each of which is on file or furnished with the SEC and available at the SEC’s website at www.sec.gov. The forward-looking statements made herein speak only as of the date of this announcement and Kamada undertakes no obligation to update publicly such forward-looking statements to reflect subsequent events or circumstances, except as otherwise required by law.

CONTACTS:
Amir London
Chief Executive Officer
IR@kamada.com

Brian Ritchie
LifeSci Advisors, LLC
212-915-2578
britchie@LifeSciAdvisors.com

CONSOLIDATED STATEMENTS OF FINANCIAL POSITION

        As of  
  As of March 31,     December 31,  
  2023     2022     2022  
  Unaudited     Audited  
                 
Assets                
Current Assets                
Cash and cash equivalents $ 27,121       21,967     $ 34,258  
Trade receivables, net   20,925       21,568       27,252  
Other accounts receivables   3,603       7,867       8,710  
Inventories   79,754       64,761       68,785  
Total Current Assets   131,403       116,163       139,005  
                       
Non-Current Assets                      
Property, plant and equipment, net   26,496       26,098       26,157  
Right-of-use assets   5,836       2,990       2,568  
Intangible assets, Goodwill and other long-term assets   145,305       151,858       147,072  
Contract assets   7,755       5,987       7,577  
Total Non-Current Assets   185,392       186,933       183,374  
Total Assets   316,795       303,096     $ 322,379  
Liabilities                      
Current Liabilities                      
Current maturities of bank loans $ 4,444       3,725     $ 4,444  
Current maturities of lease liabilities   1,438       1,017       1,016  
Current maturities of other long term liabilities   29,414       19,095       29,708  
Trade payables   26,210       11,682       32,917  
Other accounts payables   7,350       6,670       7,585  
Deferred revenues   419       40       35  
Total Current Liabilities   69,275       42,229       75,705  
                       
Non-Current Liabilities                      
Bank loans   11,852       16,296       12,963  
Lease liabilities   4,992       3,056       2,177  
Contingent consideration   18,115       22,551       17,534  
Other long-term liabilities   37,280       42,531       37,308  
Deferred revenues         15        
Employee benefit liabilities, net   473       1,268       672  
Total Non-Current Liabilities   72,712       85,717       70,654  
                       
Shareholder’s Equity                      
Ordinary shares   11,736       11,728       11,734  
Additional paid in capital  net   210,665       210,269       210,495  
Capital reserve due to translation to presentation currency   (3,490 )     (3,490 )     (3,490 )
Capital reserve from hedges   (99 )     12       (88 )
Capital reserve from share-based payments   5,750       4,771       5,505  
Capital reserve from employee benefits   539       (149 )     348  
Accumulated deficit   (50,293 )     (47,991 )     (48484 )
Total Shareholder’s Equity   174,808       175,150       176,020  
Total Liabilities and Shareholder’s Equity $ 316,795       303,096     $ 322,379  
                       

CONSOLIDATED STATEMENTS OF PROFIT OR LOSS AND OTHER COMPREHENSIVE INCOME

           
  Three months
period ended
March 31,
    Year ended
December 31,
 
  2023     2022     2022  
  Unaudited     Audited  
                 
Revenues from proprietary products   24,061       23,011     $ 102,598  
Revenues from distribution   6,649       5,082       26,741  
                       
Total revenues   30,710       28,093       129,339  
                       
Cost of revenues from proprietary products   13,224       12,449       58,229  
Cost of revenues from distribution   5,647       4,342       24,407  
                       
Total cost of revenues   18,871       16,791       82,636  
                       
Gross profit   11,839       11,302       46,703  
                       
Research and development expenses   3,231       4,420       13,172  
Selling and marketing expenses   3,922       3,321       15,284  
General and administrative expenses   3,418       3,005       12,803  
Other expenses   979       310       912  
Operating income (loss)   289       246       4,532  
                       
Financial income   25       2       91  
Income (expense) in respect of securities measured at fair value, net                
Income (expenses) in respect of currency exchange differences and derivatives instruments, net   151       169       298  
Revaluation of long-term liabilities   (1,761 )     (2,010 )     (6,266 )
Financial expenses   (500 )     (194 )     (914 )
Income before tax on income   (1,796 )     (1,787 )     (2,259 )
Taxes on income   13       41       62  
                       
Net Income (loss) $ (1,809 )     (1,828 )   $ (2,321 )
                       
Other Comprehensive Income (loss) :                      
Amounts that will be or that have been reclassified to profit or loss when specific conditions are met                      
Gain (loss) from securities measured at fair value through other comprehensive income                      
Gain (loss) on cash flow hedges   (156 )     (108 )     (776 )
Net amounts transferred to the statement of profit or loss for cash flow hedges   145       66       634  
Items that will not be reclassified to profit or loss in subsequent periods:                      
Remeasurement gain (loss) from defined benefit plan   191             497  
Tax effect                
Total comprehensive income (loss) $ (1,629 )     (1,870 )   $ (1,966 )
                       
Earnings per share attributable to equity holders of the Company:                      
Basic net earnings per share   (0.04 )     (0.04 )   $ (0.05 )
Diluted net earnings per share   (0.04 )     (0.04 )   $ (0.05 )
                       

CONSOLIDATED STATEMENTS OF CASH FLOWS

  Three months period Ended     Year Ended  
  March, 31     December 31,  
  2023     2022     2022  
              Audited  
                 
Cash Flows from Operating Activities                
Net income (loss) $ (1,809 )     (1,828 )   $ (2,321 )
                       
Adjustments to reconcile net income to net cash provided by (used in) operating activities:                      
                       
Adjustments to the profit or loss items:                      
                       
Depreciation and impairment   3,123       3,027       12,155  
Financial expenses (income), net   2,085       2,033       6,791  
Cost of share-based payment   415       193       1,153  
Taxes on income   13       41       62  
Loss (gain) from sale of property and equipment   (22 )            
Change in employee benefit liabilities, net   (8 )     (12 )     (111 )
    5,606       5,282       20,050  
Changes in asset and liability items:                      
                       
Decrease (increase) in trade receivables, net   6,306       13,492       7,603  
Decrease (increase) in other accounts receivables   1,362       589       (578 )
Decrease (increase) in inventories   (10,970 )     2,662       (1,361 )
Decrease (increase) in deferred expenses   3,554       (110 )     (1,340 )
Increase (decrease) in trade payables   (6,712 )     (13,649 )     7,055  
Increase (decrease) in other accounts payables   (238 )     (772 )     290  
Decrease in deferred revenues   384             (20 )
    (6,314 )     2,212       11,649  
Cash received (paid) during the period for:                      
                       
Interest paid   (341 )     (194 )     (853 )
Interest received   25       2       97  
Taxes paid   (18 )     (9 )     (36 )
    (334 )     (201 )     (792 )
                       
Net cash provided by (used in) operating activities $ (2,851 )     5,465     $ 28,586  
                       

CONSOLIDATED STATEMENTS OF CASH FLOWS

  Three months period Ended     Year Ended  
  March, 31     December 31,  
  2023     2022     2022  
              Audited  
Cash Flows from Investing Activities                
Purchase of property and equipment and intangible assets   (1,117 )     (513 )     (3,784 )
Proceeds from sale of property and equipment   24              
Business combination                
Net cash provided by (used in) investing activities   (1,093 )     (513 )     (3,784 )
                       
Cash Flows from Financing Activities                      
                       
Proceeds from exercise of share base payments   1       3       9  
Receipt of long-term loans                
Repayment of lease liabilities   (271 )     (295 )     (1,098 )
Repayment of long-term loans   (1,111 )     (16 )     (2,628 )
Repayment of other long-term liabilities   (1,500 )     (1,500 )     (5,626 )
Net cash provided by (used in) financing activities   (2,881 )     (1,808 )     (9,343 )
                       
Exchange differences on balances of cash and cash equivalent   (312 )     236       212  
                       
Increase (decrease) in cash and cash equivalents   (7,137 )     3,380       15,671  
                       
Cash and cash equivalents at the beginning of the period   34,258       18,587       18,587  
                       
Cash and cash equivalents at the end of the period $ 27,121       21,967     $ 34,258  
                       
Significant non-cash transactions                      
Right-of-use asset recognized with corresponding lease liability $ 3,580       174     $ 551  
Purchase of property and equipment and Intangible assets $ 292       254     $ 618  
                       

NON-IFRS MEASURES

  Three months period ended   Year ended  
  March 31,   December 31,  
  2023     2022   2022  
  In thousands
Net income $ (1,809 )   $ (1,828 $ (2,321 )
Taxes on income   13       41     62  
Financial expense (income), net   2,085       2,033     6,791  
Depreciation and amortization expense   3,123       2,886     12,155  
Non-cash share-based compensation expenses   415       155     1,153  
Adjusted EBITDA $ 3,827     $ 3,286   $ 17,840  

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