- Q3 2021 revenue of
$15.1 million and Adjusted EBITDA of$6.9 million , up 15% and 53%, respectively, from Q3 2020 - Generated strong Vascepa® prescription growth - amid persistent COVID-19 disruptions - achieving increases in prescribers and patients of 30% and 23%, respectively, from the end of Q2 2021
- Vascepa revenue increased 33% sequentially from Q2 2021
- Generated cash from operations of
$12.5 million year-to-date compared to$3.5 million in the same period last year - Announced promotional agreement with Pfizer for Vascepa in
Canada
Q3 FISCAL 2021 HIGHLIGHTS
- Q3 2021 revenue was
$15.1 million compared to$13.1 million in Q3 2020. - Q3 2021 Adjusted EBITDA was
$6.9 million compared to$4.5 million in Q3 2020. - Q3 2021 net loss was
($2.0) million , or ($0.06 ) per common share, compared to net loss of($1.7) million , or ($0.05 ) per common share, in Q3 2020. - Q3 2021 cash generated from operations was
$3.6 million compared to$2.4 million in Q3 2020. - Cash and cash equivalents were
$21.7 million atSeptember 30, 2021 compared to$20.6 million atDecember 31, 2020 . - Pfizer initiated its promotional activity for Vascepa in late September.
- Grew the number of Clozaril patients 3% year-over-year for Q3 2021 and the year-to-date period and gaining market share in the process.
"Revenue and Adjusted EBITDA grew in Q3 driven by strength and resilience with our foundational products as well as a growing contribution from Vascepa," said
"A key step in Vascepa's progress during the quarter was the announcement on
RENEWAL OF NORMAL COURSE ISSUER BID
The Company announced today that it has filed with the
HLS may commence purchases of Common Shares under the NCIB on
Purchases of Common Shares under the NCIB will be made by
The Company also intends to renew the automatic share purchase plan (the "ASPP") with Haywood to allow for the purchase of Common Shares under the NCIB at times when the Company would ordinarily not be permitted to purchase shares due to regulatory restrictions or self-imposed blackout periods.
HLS believes that any purchases pursuant to the NCIB, if considered advisable, will be in the best interests of the Company and will be a desirable use of corporate funds. HLS previously sought and received approval of the TSX to purchase up to 1,587,193 Common Shares in a normal course issuer bid (the "Previous Bid") that commenced on
DIVIDEND
On
These dividends paid on the Company's common shares are designated to be "eligible dividends" for purposes of section 89(1) of the Income Tax Act (
Q3 & YEAR-TO-DATE FISCAL 2021 FINANCIAL REVIEW
The Company's Management's Discussion and Analysis and Consolidated Financial Statements for the three-and nine-month periods ended
Revenue
The following table provides revenue segmentation by revenue type for the three- and nine-month periods ended
Three months ended | Nine months ended | |||
2021 | 2020 | 2021 | 2020 | |
Product sales | ||||
8,619 | 7,383 | 25,364 | 21,737 | |
4,214 | 3,988 | 12,010 | 12,067 | |
12,833 | 11,371 | 37,374 | 33,804 | |
Royalty revenue | 2,227 | 1,758 | 6,945 | 5,820 |
15,060 | 13,129 | 44,319 | 39,624 |
Product Sales
Product sales grew by 13% in Q3 2021 and 11% for the 2021 year-to-date period. The increases primarily reflect growth in sales of Vascepa and the strengthening of the Canadian dollar from its lows at the outset of the pandemic last year. Despite the impact the pandemic has had on market re-opening, Q3 2021 activities led to a 30% increase in Vascepa prescribers and a 23% increase in Vascepa patients from Q2 2021, while Vascepa product sales increased 33% sequentially.
Royalty revenues
On
Royalty revenues in the respective periods of the prior year were
Operating Expenses
| Three months ended | Nine months ended | ||
2021 | 2020 | 2021 | 2020 | |
Cost of product sales | 1,180 | 824 | 2,850 | 2,314 |
Selling and marketing | 3,354 | 2,847 | 10,253 | 9,640 |
Medical, regulatory and patient support | 1,337 | 1,238 | 4,171 | 4,183 |
General and administrative | 2,266 | 3,700 | 6,893 | 8,084 |
8,137 | 8,609 | 24,167 | 24,221 |
Operating expenses in Q3 2021 were
Adjusted EBITDA2 | Three months ended | Nine months ended | ||
2021 | 2020 | 2021 | 2020 | |
Net loss for the period | (1,979) | (1,733) | (8,929) | (8,053) |
Stock-based compensation | (113) | (643) | 1,825 | 111 |
Amortization and depreciation | 7,372 | 6,916 | 22,219 | 23,673 |
Acquisition and transaction costs | 8 | 234 | 92 | 557 |
Finance and related costs, net | 1,448 | (506) | 4,307 | 640 |
Income tax expense (recovery) | 187 | 252 | 638 | (1,525) |
Adjusted EBITDA | 6,923 | 4,520 | 20,152 | 15,403 |
Adjusted EBITDA in Q3 2021 was
(2) See "Cautionary Note Regarding Non-IFRS Measures" section of this press release. |
Net Loss
Net loss for Q3 2021 was
Cash from Operations and Financial Position
Cash generated from operations was
HLS has a strong financial position with
Q3 FISCAL 2021 CONFERENCE CALL
HLS will hold a conference call today at
CONFERENCE ID: | 97175749 |
DATE: | |
TIME: | |
DIAL-IN NUMBER: | 1-888-664-6392 or 416-764-8659 |
WEBCAST LINK: | https://produceredition.webcasts.com/starthere.jsp?ei=1503335&tp_key=b9fb30d53b |
TAPED REPLAY: | 1-888-390-0541 or 416-764-8677 |
REPLAY CODE: | 175749 |
The taped replay will be available for 14 days and the archived webcast will be available for 365 days.
A link to the live audio webcast of the conference call will also be available on the events page of the investors section of
ABOUT
Formed in 2015, HLS is a pharmaceutical company focused on the acquisition and commercialization of late-stage development, commercial stage promoted and established branded pharmaceutical products in the North American markets. HLS's focus is on products targeting the central nervous system and cardiovascular therapeutic areas. HLS's management team is composed of seasoned pharmaceutical executives with a strong track record of success in these therapeutic areas and at managing products in each of these lifecycle stages. For more information visit: www.hlstherapeutics.com
2CAUTIONARY NOTE REGARDING NON-IFRS MEASURES
This press release refers to certain non-IFRS measures. These measures are not recognized measures under IFRS, do not have a standardized meaning prescribed by IFRS and are therefore unlikely to be comparable to similar measures presented by other companies. Rather, these measures are provided as additional information to complement those IFRS measures by providing further understanding of HLS's results of operations from management's perspective. Accordingly, they should not be considered in isolation nor as a substitute for analysis of HLS's financial information reported under IFRS. HLS uses non-IFRS measures to provide investors with supplemental measures of its operating performance and thus highlight trends in its core business that may not otherwise be apparent when relying solely on IFRS financial measures. HLS also believes that securities analysts, investors and other interested parties frequently use non-IFRS measures in the evaluation of issuers. HLS's management also uses non-IFRS measures in order to facilitate operating performance comparisons from period to period, prepare annual operating budgets and assess HLS's ability to meet its future debt service, capital expenditure and working capital requirements.
In particular, management uses Adjusted EBITDA as a measure of HLS's performance. To reconcile net income (loss) for the period with Adjusted EBITDA, each of (i) "stock-based compensation", (ii) "amortization and depreciation", (iii) "acquisition and transaction costs", (iv) "finance and related costs", and (v) "income tax expense (recovery)" appearing in the Consolidated Statement of Net Income (Loss) are added to net income (loss) for the period to determine Adjusted EBITDA. Adjusted EBITDA does not have any standardized meaning prescribed by IFRS and is not necessarily comparable to similar measures presented by other companies. Adjusted EBITDA should not be considered in isolation or as a substitute for net income (loss) prepared in accordance with IFRS as issued by the IASB.
FORWARD LOOKING INFORMATION
This release includes forward-looking statements regarding HLS and its business. Such statements are based on the current expectations and views of future events of HLS's management. In some cases the forward-looking statements can be identified by words or phrases such as "may", "will", "expect", "plan", "anticipate", "intend", "potential", "estimate", "believe" or the negative of these terms, or other similar expressions intended to identify forward-looking statements, including, among others, statements with respect to HLS's pursuit of additional product and pipeline opportunities in certain therapeutic markets, statements regarding growth opportunities, expectations regarding financial performance, and the NCIB and ASPP. The forward-looking events and circumstances discussed in this release may not occur and could differ materially as a result of known and unknown risk factors and uncertainties affecting HLS, including risks relating to the specialty pharmaceutical industry, risks related to the regulatory approval process, economic factors and many other factors beyond the control of HLS. Forward-looking statements and information by their nature are based on assumptions and involve known and unknown risks, uncertainties and other factors which may cause HLS's actual results, performance or achievements, or industry results, to be materially different from any future results, performance or achievements expressed or implied by such forward-looking statement or information. Accordingly, readers should not place undue reliance on any forward-looking statements or information. A discussion of the material risks and assumptions associated with this release can be found in the Company's Annual Information Form dated
REFERENCES
1 MD Analytics, COVID-19 Impact, A 4th wave survey among physicians,
CONDENSED INTERIM CONSOLIDATED STATEMENTS OF FINANCIAL POSITION | |||
Unaudited | |||
[in thousands of | |||
As at | As at | ||
ASSETS | |||
Current | |||
Cash and cash equivalents | 21,736 | 20,612 | |
Accounts receivable | 12,002 | 12,497 | |
Inventories | 9,747 | 10,630 | |
Prepaid expenses and other current assets | 2,590 | 2,172 | |
Total current assets | 46,075 | 45,911 | |
Property, plant and equipment | 1,205 | 1,384 | |
Intangible assets | 235,894 | 253,404 | |
Restricted assets | — | 2,034 | |
Deferred income tax asset | 739 | 1,173 | |
Total assets | 283,913 | 303,906 | |
LIABILITIES AND SHAREHOLDERS' EQUITY | |||
Current | |||
Accounts payable and accrued liabilities | 12,365 | 14,223 | |
Provisions | 3,236 | 4,516 | |
Debt and other liabilities | 14,276 | 16,358 | |
Income taxes payable | 45 | 545 | |
Total current liabilities | 29,922 | 35,642 | |
Debt and other liabilities | 89,207 | 99,015 | |
Deferred income tax liability | 85 | — | |
Total liabilities | 119,214 | 134,657 | |
Shareholders' equity | |||
Share capital | 265,561 | 257,411 | |
Contributed surplus | 11,377 | 11,393 | |
Accumulated other comprehensive income | 2,161 | 2,020 | |
Deficit | (114,400) | (101,575) | |
Total shareholders' equity | 164,699 | 169,249 | |
Total liabilities and shareholders' equity | 283,913 | 303,906 | |
CONDENSED INTERIM CONSOLIDATED STATEMENTS OF LOSS | |||||
Unaudited | |||||
[in thousands of | |||||
Three months ended | Nine months ended | ||||
2021 | 2020 | 2021 | 2020 | ||
Revenue | 15,060 | 13,129 | 44,319 | 39,624 | |
Expenses | |||||
Cost of product sales | 1,180 | 824 | 2,850 | 2,314 | |
Selling and marketing | 3,354 | 2,847 | 10,253 | 9,640 | |
Medical, regulatory and patient support | 1,337 | 1,238 | 4,171 | 4,183 | |
General and administrative | 2,266 | 3,700 | 6,893 | 8,084 | |
Stock-based compensation | (113) | (643) | 1,825 | 111 | |
Amortization and depreciation | 7,372 | 6,916 | 22,219 | 23,673 | |
Operating loss | (336) | (1,753) | (3,892) | (8,381) | |
Acquisition and transaction costs | 8 | 234 | 92 | 557 | |
Finance and related costs, net | 1,448 | (506) | 4,307 | 640 | |
Loss before income taxes | (1,792) | (1,481) | (8,291) | (9,578) | |
Income tax expense (recovery) | 187 | 252 | 638 | (1,525) | |
Net loss for the period | (1,979) | (1,733) | (8,929) | (8,053) | |
Net loss per share: | |||||
Basic and diluted | |||||
CONDENSED INTERIM CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS) | ||||
Unaudited | ||||
[in thousands of | ||||
Three months ended | Nine months ended | |||
2021 | 2020 | 2021 | 2020 | |
Net loss for the period | (1,979) | (1,733) | (8,929) | (8,053) |
Item that may be reclassified subsequently to net loss | ||||
Unrealized foreign currency translation adjustment | (4,039) | 2,910 | 141 | (4,828) |
Comprehensive income (loss) for the period | (6,018) | 1,177 | (8,788) | (12,881) |
HLS THERAPEUTICS INC. | |||||||
INTERIM CONSOLIDATED STATEMENT OF CHANGES IN SHAREHOLDERS' EQUITY | |||||||
Unaudited | |||||||
[in thousands of | |||||||
Share | Contributed | ||||||
capital | surplus | AOCI | Deficit | Total | |||
Balance, December 31, 2020 | 257,411 | 11,393 | 2,020 | (101,575) | 169,249 | ||
Warrants exercised | 3,203 | (192) | - | - | 3,011 | ||
Stock options exercised | 4,976 | (1,314) | - | - | 3,662 | ||
Shares repurchased | (29) | - | - | (18) | (47) | ||
Stock option expense | - | 1,490 | - | - | 1,490 | ||
Net loss for the period | - | - | - | (8,929) | (8,929) | ||
Dividends declared | - | - | - | (3,878) | (3,878) | ||
Foreign currency translation adjustment | - | - | 141 | - | 141 | ||
Balance, September 30, 2021 | 265,561 | 11,377 | 2,161 | (114,400) | 164,699 | ||
Balance, December 31, 2019 | 248,687 | 11,517 | (537) | (81,468) | 178,199 | ||
Warrants exercised | 7,544 | (1,652) | - | - | 5,892 | ||
Stock options exercised | 61 | (16) | - | - | 45 | ||
Stock option expense | - | 1,123 | - | - | 1,123 | ||
Net loss for the period | - | - | - | (8,053) | (8,053) | ||
Dividends declared | - | - | - | (3,535) | (3,535) | ||
Foreign currency translation adjustment | - | - | (4,828) | - | (4,828) | ||
Balance, September 30, 2020 | 256,292 | 10,972 | (5,365) | (93,056) | 168,843 |
CONDENSED INTERIM CONSOLIDATED STATEMENTS OF CASH FLOWS | ||||
Unaudited | ||||
[in thousands of | ||||
Three months ended | Nine months ended | |||
2021 | 2020 | 2021 | 2020 | |
OPERATING ACTIVITIES | ||||
Net loss for the period | (1,979) | (1,733) | (8,929) | (8,053) |
Adjustments to reconcile net loss to cash provided by operating activities | ||||
Stock-based compensation | (113) | (643) | 1,825 | 111 |
Amortization and depreciation | 7,372 | 6,916 | 22,219 | 23,673 |
Accreted interest | 209 | 244 | 577 | 912 |
Fair value adjustment on financial assets and liabilities | (478) | (1,786) | (1,173) | (3,885) |
Foreign exchange | — | — | — | 176 |
Deferred income taxes | 254 | (14) | 519 | (2,352) |
Net change in non-cash working capital balances related to operations | (1,714) | (619) | (2,587) | (7,084) |
Cash provided by operating activities | 3,551 | 2,365 | 12,451 | 3,498 |
INVESTING ACTIVITIES | ||||
Additions to property, plant and equipment | (10) | (5) | (25) | (32) |
Royalty acquisition | — | (30,837) | — | (30,837) |
Rights acquisitions | — | (1,825) | (3,820) | (10,225) |
Other additions to intangible assets | (192) | (2) | (243) | (761) |
Cash used in investing activities | (202) | (32,669) | (4,088) | (41,855) |
FINANCING ACTIVITIES | ||||
Stock options exercised | 1,531 | 7 | 3,662 | 45 |
Warrants exercised | 66 | — | 986 | 1,590 |
Shares repurchased | (47) | — | (47) | — |
Dividends paid | (1,276) | (1,201) | (3,853) | (3,511) |
Repayment of senior secured term loan | (3,000) | (1,250) | (7,500) | (3,882) |
Drawdown of senior secured term loan | — | 20,000 | — | 20,000 |
Debt costs | — | (482) | — | (658) |
Lease payments | (159) | (130) | (476) | (374) |
Cash provided by (used in) financing activities | (2,885) | 16,944 | (7,228) | 13,210 |
Net increase (decrease) in cash and cash equivalents during the period | 464 | (13,360) | 1,135 | (25,147) |
Foreign currency translation | (75) | 588 | (11) | (1,041) |
Cash and cash equivalents, beginning of period | 21,347 | 33,662 | 20,612 | 47,078 |
Cash and cash equivalents, end of period | 21,736 | 20,890 | 21,736 | 20,890 |
SOURCE
© Canada Newswire, source