Kamada Reports Second Quarter and First Half 2021 Financial Results, Recent Achievements and Corporate Development Activities

Wednesday, 11. August 2021 13:00
  • Second Quarter 2021 Revenues were $24.2 Million
  • In Connection with the Transition of GLASSIA® Manufacturing, Kamada Largely Completed a Workforce Downsizing in the Second Quarter that will Result in an Approximately 10% Annual Labor Cost Reduction  
  • Pivotal Phase 3 InnovAATe Trial for Inhaled AAT for Treatment of Alpha-1 Antitrypsin Deficiency Continues to Advance as Kamada Evaluates Strategic Partnering Opportunities
  • Ongoing Expansion of Plasma Collection Capacity at Recently Acquired U.S. Plasma Collection Center; Company Intends to Open Additional Centers
  • Kamada Continues to Explore Additional Business Development Opportunities that Utilize and Expand the Company's Core Plasma-Derived Development, Manufacturing and Commercialization Expertise, and Further its Strategic Objective of Evolving into a Fully Integrated Specialty Plasma Company

REHOVOT, Israel, Aug. 11, 2021 (GLOBE NEWSWIRE) -- Kamada Ltd. (NASDAQ: KMDA; TASE: KMDA.TA), a plasma-derived biopharmaceutical company, today announced financial results for the three and six months ended June 30, 2021.

“Our business continued to perform as anticipated throughout the first half of 2021,” said Amir London, Kamada’s Chief Executive Officer. “Despite the expected decrease in revenue as compared to the first half of last year due to the planned transition of GLASSIA manufacturing to Takeda later this year, we achieved gross margins of 37 percent in the first half of 2021, as compared to 34 percent during the first six months of 2020. As an outlook for the second half of 2021, we anticipate a reduction in overall gross margins mainly due to anticipated change in products sales mix.”

“We continue to progress the pivotal Phase 3 InnovAATe clinical trial of our proprietary Inhaled AAT for the treatment of Alpha-1 Antitrypsin Deficiency (AATD) and are exploring a potential commercial partnership with respect to this product. We are pleased with the level of external interest generated in this therapy to date,” continued Mr. London.

“Moreover, we initiated the planning for the opening of additional U.S. plasma collection centers by leveraging our existing U.S. Food and Drug Administration license. In addition, we continue to achieve important progress around the advancement of our business development priorities and are exploring potential strategic transactions that would utilize and expand our core plasma-derived development, manufacturing, and commercialization expertise. We believe we have multiple prospects that would represent significant steps toward accomplishing our strategic goal of becoming a fully-integrated specialty plasma company,” concluded Mr. London.

Financial Highlights for the Three Months Ended June 30, 2021

  • Total revenues were $24.2 million in the second quarter of 2021, compared to $33.1 million recorded in the second quarter of 2020.
  • Gross profit was $9.1 million in the second quarter of 2021, compared to $11.1 million reported in the second quarter of 2020.
  • In connection with the transition of GLASSIA manufacturing to Takeda, during the second quarter of 2021, the Company largely completed the planned workforce downsizing and incurred a one-time expense of $0.6 million related to excess severance remuneration for the employees who were laid-off as part of this downsizing. The downsizing process is expected to result in an annualized reduction of approximately 10% in overall labor costs.
  • Net income was $0.9 million, or $0.02 per share, in the second quarter of 2021, as compared to net income of $3.5 million, or $0.10 per share, in the second quarter of 2020.
  • Adjusted EBITDA, as detailed in the tables below, was $2.4 million in the second quarter of 2021, as compared to $5.5 million in the second quarter of 2020. Adjusted EBITDA in the second quarter of 2021, excluding one-time severance expenses, was $3.0 million.
  • Cash used in operating activities was $3.3 million in the second quarter of 2021, as compared to cash provided by operating activities of $10.7 million in the second quarter of 2020.

Financial Highlights for the Six Months Ended June 30, 2021

  • Total revenues were $49.1 million in the first six months of 2021, compared to $66.4 million recorded in the first six months of 2020.
  • Gross profit was $18.0 million in the first six months of 2021, compared to $22.6 million reported in the first six months of 2020.
  • Net income was $3.6 million, or $0.08 per share, in the first six months of 2021, as compared to net income of $8.7 million, or $0.20 per share, in the first six months 2020.
  • Adjusted EBITDA, as detailed in the tables below, was $6.2 million in the first six months of 2021, as compared to $11.8 million in the first six months of 2020. Adjusted EBITDA in the first six months of 2021, excluding one-time severance expenses, was $6.7 million.
  • Cash used in operating activities was $1.2 million in the first six months of 2021, as compared to cash provided by operating activities of $8.7 million in the first six months of 2020.

Balance Sheet Highlights
As of June 30, 2021, the Company had cash, cash equivalents, and short-term investments of $104.6 million, as compared to $109.3 million on December 31, 2020.

Recent Corporate Highlights

  • The FDA approved a label update for KEDRAB® (Rabies Immune Globulin [Human]), establishing the product’s safety and effectiveness in children.  KEDRAB is now indicated for passive, transient post-exposure prophylaxis of rabies infection in persons of all ages when given promptly following contact with a rabid or possibly rabid animal.
  • Completed the supply of our plasma-derived COVID-19 Immunoglobulin (IgG) investigational product to the Israeli Ministry of Health (IMOH) for the treatment of hospitalized COVID-19 patients.

Conference Call
Kamada management will host an investment community conference call on Wednesday, August 11, 2021, at 8:30am Eastern Time to discuss these results and answer questions. Shareholders and other interested parties may participate in the conference call by dialing 877-407-0792 (from within the U.S.), 1-809-406-247 (from Israel), or 201-689-8263 (International) and entering the conference identification number: 13721962. The call will also be webcast live on the Internet at http://public.viavid.com/index.php?id=145993

About Kamada
Kamada Ltd. (the “Company”) is a global specialty plasma-derived biopharmaceutical company with a diverse portfolio of marketed products, a robust development pipeline and industry-leading manufacturing capabilities. The Company’s strategy is focused on driving profitable growth from its current commercial products, its plasma-derived development pipeline and its manufacturing expertise, while evolving into a vertically integrated plasma-derived company. The Company’s two leading commercial products are GLASSIA® and KEDRRAB®. GLASSIA was the first liquid, ready-to-use, intravenous plasma-derived AAT product approved by the FDA. The Company markets GLASSIA in the U.S. through a strategic partnership with Takeda Pharmaceuticals Company Limited ("Takeda") and in other countries through local distributors. Pursuant to an agreement with Takeda, the Company will continue to produce GLASSIA for Takeda through 2021 and Takeda will initiate its own production of GLASSIA for the U.S. market in 2021, at which point Takeda will commence payment of royalties to the Company until 2040. KEDRAB is an FDA approved anti-rabies immune globulin (Human) for post-exposure prophylaxis treatment. KEDRAB is being marketed in the U.S. through a strategic partnership with Kedrion S.p.A. The Company has additional four plasma-derived products administered by injection or infusion, that are marketed through distributors in more than 15 countries, including Israel, Russia, Brazil, Argentina, India and other countries in Latin America and Asia. The Company has two leading development programs; an inhaled AAT for the treatment of AAT deficiency for which the Company is currently conducting the InnovAATe clinical trial, a randomized, double-blind, placebo-controlled, pivotal Phase 3 trial, and a plasma-derived hyperimmune immunoglobulin (IgG) product as a potential treatment for coronavirus disease (COVID-19). The Company leverages its expertise and presence in the Israeli pharmaceutical market to distribute in Israel more than 20 products that are manufactured by third parties and have recently added nine biosimilar products to its Israeli distribution portfolio, which, subject to EMA and the Israeli MOH approvals, are expected to be launched in Israel between the years 2022 and 2025. FIMI Opportunity Fund, the leading private equity investor in Israel, is the Company’s lead shareholder, beneficially owning approximately 21% of the outstanding ordinary shares.

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) workforce downsizing resulting in an approximate 10% annual labor cost reduction, 2) anticipation of a reduction in overall gross margins during the second half of 2021 mainly due to anticipated change in products sales mix, 3) optimism about commercial partnership prospects associated with our Inhaled AAT product, 4) plans for the opening of additional plasma collection centers in the U.S. by leveraging our FDA license, 5) optimism about strategic business development opportunities that will utilize and expand our core plasma-derived development, manufacturing, and commercialization expertise, and 6) the belief that those opportunities are may be significant steps toward accomplishing our strategic goal of becoming a fully integrated specialty plasma company.  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, the continued evolvement of the COVID-19 pandemic, its scope, effect and duration, availability of sufficient raw materials required to maintain manufacturing plans, the effects of the COVID-19 pandemic and related government mandates on the availability of adequate levels of work-force required to maintain manufacturing plans, disruption to the supply chain due to COVID-19 pandemic, continuation of inbound and outbound international delivery routes, impact of the workforce downsizing plan, continued demand for Kamada’s products, including GLASSIA and KEDRAB, in the U.S. market and its Distribution segment related products in Israel, financial conditions of the Company’s customer, suppliers and services providers, ability to reap the benefits of the recent acquisition of the plasma collection center, including the ability to open additional U.S. plasma centers, the ability to continue enrollment of the pivotal Phase 3 InnovAATe clinical trial and ability to find a suitable commercial partnership for this product, unexpected results of clinical studies, including plasma-derived IgG treatment for COVID-19 and the level of demand for such product, 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. 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:
Chaime Orlev
Chief Financial Officer
IR@kamada.com

Bob Yedid
LifeSci Advisors, LLC
646-597-6989
Bob@LifeSciAdvisors.com


CONSOLIDATED STATEMENTS OF FINANCIAL POSITION

       
       
  As of
June 30,
  As of
December 31,
 
  2021  2020  2020 
          
  Unaudited  Audited 
       
Assets U.S Dollars in thousands 
Current Assets         
Cash and cash equivalents $68,416  $57,399  $70,197 
Short-term investments  36,137   47,272   39,069 
Trade receivables, net  27,743   19,823   22,108 
Other accounts  receivables  2,450   2,980   4,524 
Inventories  44,601   47,646   42,016 
Total Current Assets  179,347   175,120   177,914 
             
Non-Current Assets            
Property, plant and equipment, net  25,665   24,574   25,679 
Right-of-use-assets  3,453   3,796   3,440 
Other long term assets  3,413   1,058   1,573 
Contract assets  4,472   911   2,059 
Deferred taxes  -   632   - 
Total Non-Current Assets  37,003   30,971   32,751 
Total Assets $216,350  $206,091  $210,665 
Liabilities            
Current Liabilities            
Current maturities of bank loans $61  $431  $238 
Current maturities of lease liabilities  1,149   990   1,072 
Trade payables  17,948   22,760   16,110 
Other accounts payables  6,989   5,497   7,547 
Deferred revenues  -   589   - 
Total Current Liabilities  26,147   30,267   24,967 
             
Non-Current Liabilities            
Bank loans  5   63   36 
Lease liabilities  3,401   3,704   3,593 
Deferred revenues  3,025   1,025   2,025 
Employee benefit liabilities, net  1,429   1,267   1,406 
Total Non-Current Liabilities  7,860   6,059   7,060 
             
Shareholder’s Equity            
Ordinary shares  11,716   11,662   11,706 
Additional paid in capital  209,942   207,731   209,760 
Capital reserve due to translation to presentation currency  (3,490)  (3,490)  (3,490)
Capital reserve from hedges  58   411   357 
Capital reserve from share-based payments  4,746   6,204   4,558 
Capital reserve from employee benefits  (320)  (356)  (320)
Accumulated deficit  (40,309)  (52,397)  (43,933)
Total Shareholder’s Equity  182,343   169,765   178,638 
Total Liabilities and Shareholder’s Equity $216,350  $206,091  $210,665 



CONSOLIDATED STATEMENTS OF PROFIT OR LOSS AND OTHER COMPREHENSIVE INCOME

          
  Six months period ended  Three months period ended  Year ended 
  June 30,  June 30,  December 31, 
  2021  2020  2021  2020  2020 
                
          
  Unaudited  Unaudited  Audited 
                
          
  U.S Dollars In thousands 
                
Revenues from proprietary products $40,193  $47,942  $19,323  $22,625  $100,916 
Revenues from distribution  8,946   18,437   4,916   10,464   32,330 
                     
Total revenues  49,139   66,379   24,239   33,089   133,246 
                     
Cost of revenues from proprietary products  23,527   27,881   11,059   12,934   57,750 
Cost of revenues from distribution  7,609   15,932   4,108   9,040   27,944 
                     
Total cost of revenues  31,136   43,813   15,167   21,974   85,694 
                     
Gross profit  18,003   22,566   9,072   11,115   47,552 
                     
Research and development expenses  5,364   6,970   2,736   3,623   13,609 
Selling and marketing expenses  2,547   2,118   1,424   1,178   4,518 
General and administrative expenses  6,112   4,619   3,303   2,307   10,139 
Other expenses  570   34   563   32   49 
Operating income  3,410   8,825   1,046   3,975   19,237 
                     
Financial income  209   615   99   298   1,027 
Income (expense) in respect of securities measured at fair value, net *  -   102   -   -   102 
Income (expenses) in respect of currency exchange differences and derivatives instruments, net  121   65   (145)  (367)  (1,535)
Financial expenses  (116)  (135)  (63)  (58)  (266)
Income before tax on income  3,624   9,472   937   3,848   18,565 
Taxes on income  -   796   -   390   1,425 
                     
Net Income $3,624  $8,676  $937  $3,458  $17,140 
                     
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  -   (188)  -   -   (188)
Gain (loss) on cash flow hedges  (43)  441   30   200   876 
Net amounts transferred to the statement of profit or loss for cash flow hedges  (256)  (7)  (2)  (41)  (528)
Items that will not be reclassified to profit or loss in subsequent periods:                    
Remeasurement gain (loss) from defined benefit plan  -   -   -   -   64 
Tax effect  -   15   -   (12)  19 
Total comprehensive income $3,325  $8,937  $965  $3,605  $17,383 
                     
Earnings per share attributable to equity holders of the Company:                    
Basic net earnings per share $0.08  $0.20  $0.02  $0.10  $0.39 
Diluted net earnings per share $0.08  $0.20  $0.02  $0.10  $0.38 



CONSOLIDATED STATEMENTS OF CASH FLOWS

          
  Six months period Ended  Three months period Ended  Year Ended 
  June, 30  June, 30  December 31, 
  2021  2020  2021  2020  2020 
                
  Unaudited  Audited 
       
  U.S Dollars In thousands 
Cash Flows from Operating Activities               
Net income $3,624  $8,676  $937  $3,458  $17,140 
                     
Adjustments to reconcile net income to net cash provided by (used in) operating activities:                    
                     
Adjustments to the profit or loss items:                    
                     
Depreciation and impairment  2,372   2,380   1,225   1,188   4,897 
Financial expenses (income), net  (214)  (647)  109   127   672 
Cost of share-based payment  370   588   155   330   977 
Taxes on income  -   796   -   390   1,425 
Loss (gain) from sale of property and equipment  -   (6)  -   (6)  (7)
Change in employee benefit liabilities, net  23   (2)  60   16   201 
   2,551   3,109   1,549   2,045   8,165 
Changes in asset and liability items:                    
                     
Decrease (increase) in trade receivables, net  (5,646)  3,416   (7,231)  6,432   1,332 
Decrease (increase) in other accounts receivables  1,629   741   1,643   (772)  115 
Increase in inventories  (2,401)  (4,473)  (3,446)  (5,859)  1,157 
Decrease (increase) in deferred expenses  (2,362)  (911)  (1,209)  (490)  (3,085)
Increase (decrease) in trade payables  1,139   (2,719)  2,623   4,497   (9,560)
Increase (decrease) in other accounts payables  (799)  (314)  1,346   866   1,736 
Decrease in deferred revenues  1,000   793   500   396   1,204 
   (7,440)  (3,467)  (5,774)  5,070   (7,101)
Cash received (paid) during the period for:                    
                     
Interest paid  (107)  (107)  (59)  (52)  (209)
Interest received  217   601   76   150   1,211 
Taxes paid  (23)  (74)  (9)  (13)  (101)
   87   420   8   85   901 
                     
Net cash provided by operating activities $(1,178) $8,738  $(3,280) $10,658  $19,105 



CONSOLIDATED STATEMENTS OF CASH FLOWS

          
  Six months period Ended  Three months period Ended  Year Ended 
  June, 30  June, 30  December 31, 
  2021  2020  2021  2020  2020 
                
  Unaudited  Audited 
       
  U.S Dollars In thousands 
Cash Flows from Investing Activities               
                
Proceeds of investment in short term investments, net $2,967  $(15,646) $11,967  $-  $(7,646)
Purchase of property and equipment and intangible assets  (1,463)  (1,901)  (1,332)  (1,005)  (5,488)
Proceeds from sale of property and equipment  -   6   -   6   7 
Acquisition of  subsidiary (LLC), net (1)  (1,404)  -   -       - 
Net cash used in investing activities  100   (17,541)  10,635   (999)  (13,127)
                     
Cash Flows from Financing Activities                    
                     
Proceeds from exercise of share base payments  10   20   3   15   64 
Repayment of lease liabilities  (595)  (540)  (306)  (262)  (1,103)
Repayment of long-term loans  (206)  (247)  (85)  (124)  (492)
Proceeds from issuance of ordinary shares, net  -   24,895   -   -   24,895 
                     
Net cash provided by (used in) financing activities  (791)  24,128   (388)  (371)  23,364 
                     
Exchange differences on balances of cash and cash equivalent  88   (588)  13   (1,177)  (1,807)
                     
Increase in cash and cash equivalents  (1,781)  14,737   6,980   8,111   27,535 
                     
Cash and cash equivalents at the beginning of the period  70,197   42,662   61,436   49,288   42,662 
                     
Cash and cash equivalents at the end of the period $68,416  $57,399  $68,416  $57,399  $70,197 
                     
Significant non-cash transactions                    
Right-of-use asset recognized with corresponding lease liability $588  $345  $286  $287  $539 
Purchase of property and equipment $748  $722  $748  $722  $722 


Appendix A (1) Six months
period
Ended
June, 30
2021
 
Acquisition of a subsidiary that was first consolidated   
    
Current Assets (exclusive of cash and cash equivalents)  (184)
Non Current Assets  (1,460)
Current Liabilities  240 
   (1,404)


Adjusted EBITDA               
  Six months period ended  Three months period ended  Year ended 
  June 30,  June 30,  December 31, 
  2021  2020  2021  2020  2020 
                
  In thousands 
Net income $3,624  $8,676  $937  $3,458  $17,140 
Taxes on income  -     796   -     390   1,425 
Financial expense (income), net  (214)  (647)  109   127   692 
Depreciation and amortization expense  2,372   2,380   1,225   1,188   4,897 
Non-cash share-based compensation expenses  370   588   155   330   977 
Adjusted EBITDA $6,152  $11,793  $2,426  $5,493  $25,131 


Adjusted net income               
  Six months period ended  Three months period ended  Year ended 
  June 30,  June 30,  December 31, 
  2021  2020  2021  2020  2020 
                
  In thousands 
Net income $3,624  $8,676  $937  $3,458  $17,140 
Share-based compensation charges  370   588   155   330   977 
Adjusted net income $3,994  $9,264  $1,092  $3,788  $18,117 

 


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