Oct 3, 2019 SOURCE: PR NewsWire
Rafael Holdings Reports Fourth Quarter and Full Fiscal Year 2019 Results
NEWARK, N.J., Oct. 3, 2019 /PRNewswire/ -- Rafael Holdings, Inc., (NYSE American: RFL), reported revenue of $4.9 million and a loss per share of $0.35 for the fiscal year ended July 31, 2019. Fourth quarter revenue was $1.4 million and the loss per share was $0.16.
Recent Operational Highlights
-- Rafael Pharmaceuticals, a clinical-stage pharmaceutical company in which
the Company holds preferred equity and a warrant to increase ownership
to 56% of the fully diluted equity interests, reached an out-licensing
agreement with Ono Pharmaceutical Co., Ltd. of Japan. Ono gained
exclusive rights to develop and commercialize Rafael Pharma's lead drug
candidate, CPI-613® (devimistat) and related compounds for all
indications in certain Asia-Pacific region countries. Rafael Pharma
received an upfront payment of $12.9 million, with the right to an
additional $150.3 million contingent on attainment of certain
developmental and commercial milestones. Rafael Pharma will also receive
low-double digit royalties based on net sales.
-- Rafael Pharma continued to expand its pivotal Phase 3 trial of
CPI-613(®) (devimistat) for patients with relapsed or refractory acute
myeloid leukemia (AML) adding clinical trial sites in France, Austria,
South Korea and Spain.
-- Rafael Pharma continued to expand its pivotal Phase 3 trial of
CPI-613(®) (devimistat) in combination with modified FOLFIRINOX as a
first-line treatment for patients with metastatic pancreatic cancer
adding clinical trial sites in France, Korea and Israel.
-- Future Oncology, a peer-reviewed medical journal, published two
manuscripts about the details of ongoing Phase 2 and Phase 3 studies at
Rafael Pharma.
-- LipoMedix Pharmaceuticals, a clinical-stage company in which we hold a
majority interest, was awarded a Horizon 2020 Phase 1 grant for the
project: Promitil® - a new 'smart' nanomedicine for cancer
chemo-radiotherapy. Horizon 2020 is a research and innovation program of
the European Union.
Remarks by Howard Jonas, Chairman and CEO of Rafael Holdings
"During the fourth quarter, our key pharma holding, Rafael Pharma, continued to advance its clinical development programs, including pivotal, multi-jurisdictional, Phase 3 trials of CPI-613(®) (devimistat). Rafael Pharma also reached an out-licensing agreement with Ono Pharmaceuticals reflecting the promise of Rafael Pharma's lead drug candidate.
"In addition, we have established a wholly-owned venture to develop a pipeline of therapeutic compounds including compounds to regulate cancer metabolism. The venture is pursuing collaborative research agreements with scientists from top academic institutions.
"We also continue our efforts to realize the value of our real estate holdings including our 20-story commercial property and associated garage in Newark, New Jersey."
About Rafael Holdings, Inc.:
Rafael Holdings, Inc., ("Rafael Holdings" or "the Company"), a Delaware corporation, owns interests in commercial real estate assets and clinical-stage pharmaceutical companies. The commercial real estate holdings consist of properties in Newark, New Jersey, Piscataway, New Jersey and in Israel. The pharmaceutical holdings include interests in Rafael Pharmaceuticals, Inc., a clinical-stage, oncology-focused, pharmaceutical company and in LipoMedix Pharmaceuticals Ltd., a clinical-stage oncology-focused pharmaceutical company based in Israel.
RAFAEL HOLDINGS, INC.
CONSOLIDATED BALANCE SHEETS
(in thousands, except share data)
July 31,
2019 2018
ASSETS
CURRENT ASSETS
Cash and cash equivalents $
12,024 $
15,803
Trade accounts receivable, net of allowance for doubtful accounts of $122 and $82 at July 31, 2019 and 2018,
respectively 450 287
Marketable securities 24,701
Due from Rafael Pharmaceuticals 280 3,300
Prepaid expenses and other current assets 507 421
Total current assets 13,261 44,512
Property and equipment, net 48,733 50,113
Investments - Rafael Pharmaceuticals 70,018 13,300
Investments - Other Pharmaceuticals 2,000 2,000
Investments - Hedge Funds 5,125 4,218
Deferred income tax assets, net 19
In-process research and development and patents 1,575 1,651
Other assets 1,412 1,126
TOTAL ASSETS $
142,143 $
116,920
LIABILITIES AND EQUITY
CURRENT LIABILITIES
Trade accounts payable $
795 $
367
Accrued expenses 605 500
Other current liabilities 27 24
Total current liabilities 1,427 891
Due to Related Parties 65 276
Convertible debt, net of discount of $54 - Related Party 14,946
Other liabilities 292 188
Accrued interest on convertible note - Related Party 649
TOTAL LIABILITIES 17,379 1,355
COMMITMENTS AND CONTINGENCIES
EQUITY
Class A common stock, $0.01 par value; 50,000,000 shares authorized, 787,163 shares issued and outstanding as of
July 31, 2019 and 2018, respectively 8 8
Class B common stock, $0.01 par value; 200,000,000 shares authorized, 13,142,502 and 11,762,346 shares issued and
outstanding as of July 31, 2019 and 2018, respectively 131 118
Additional paid-in capital 112,898 103,636
Accumulated deficit (5,840) (1,108)
Accumulated other comprehensive income 3,784 4,043
Total equity attributable to Rafael Holdings, Inc. 110,981 106,697
Noncontrolling interests 13,783 8,868
TOTAL EQUITY 124,764 115,565
TOTAL LIABILITIES AND EQUITY $
142,143 $
116,920
RAFAEL HOLDINGS, INC.
CONSOLIDATED AND COMBINED STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS
(in thousands, except share data)
Year Ended July 31,
2019 2018
REVENUES:
Rental - Third Party $
1,452 $
1,275
Rental - Related Party 2,125 2,223
Parking 874 873
Other - Related Party 480
Total Revenue 4,931 4,371
COSTS AND EXPENSES:
Selling, general and administrative 8,821 5,519
Research and development 1,027 995
Depreciation and amortization 1,779 1,698
Loss from operations (6,696) (3,841)
Interest income, net 469 16
Net gains resulting from foreign exchange transactions 47 32
Net loss on equity investments (104)
Gain on sales of marketable securities 330 12
Unrealized gain on Investments - Hedge Funds 907
Gain on disposal of bonus shares 246
Loss before income taxes (4,943) (3,639)
Benefit from (provision for) income taxes 19 (8,437)
Net Loss (4,924) (12,076)
Net loss attributable to noncontrolling interests (231) (427)
Net loss attributable to Rafael Holdings, Inc. $
(4,693) $
(11,649)
OTHER COMPREHENSIVE LOSS
Net Loss $
(4,924) $
(12,076)
Unrealized loss on marketable securities (308)
Unrealized gain on available-for-sale securities 1,869
Foreign currency translation adjustments 298 166
Total Comprehensive Loss (4,626) (10,349)
Comprehensive income (loss) attributable to noncontrolling interests 173 (107)
Total Comprehensive Loss attributable to Rafael Holdings, Inc. $
(4,453) $
(10,456)
Loss per share attributable to Rafael Holdings, Inc. common stockholders:
Basic and diluted $
(0.35) $
(0.93)
Weighted average number of shares used in calculation of loss per share:
Basic and diluted 13,275,239 12,485,000
RAFAEL HOLDINGS, INC.
CONSOLIDATED AND COMBINED STATEMENTS OF CASH FLOWS
(in thousands, except share data)
Year Ended July 31,
2019 2018
Operating activities
Net loss $
(4,924) $
(12,076)
Adjustments to reconcile net loss to net cash used in operating activities:
Depreciation and amortization 1,779 1,698
Deferred income taxes (19) 8,859
Interest income on Rafael Pharmaceuticals Series D Convertible Note (848)
Interest income (37)
Net realized and unrealized gain on sale of marketable securities (330)
Net realized and unrealized gain on Investments - Hedge Funds (907)
Provision for doubtful accounts 122
Non-cash compensation 372 104
Amortization of debt discount 17 657
Realized gain on disposal of bonus shares (246)
Loss on disposal of fixed assets 13
Net gain resulting from foreign exchange transactions (32)
Change in assets and liabilities:
Trade accounts receivable (285) (23)
Other current assets and prepaid expenses (86) (258)
Write off of patents 76
Other assets 275 (586)
Accounts payable and accrued expenses 533 (35)
Other current liabilities 3 (10)
Due to Related Party 654 2
Due from Related Party (280)
Accrued Interest - Related Party 649
Other liabilities 104 118
Net cash used in operating activities (3,132) (1,815)
Investing activities
Purchases of property and equipment (399) (710)
Proceeds from sale and maturity of marketable securities 25,031 6,670
Purchase of investments (151)
Cash advances to IDT Corporation, net of repayments (1,700)
Investment in Rafael Pharmaceuticals (55,870)
Net cash (used in) provided by investing activities (31,238) 4,109
Financing activities
Contribution from noncontrolling interest of consolidated entity 4,587
Repayment of loan by Rafael Pharmaceuticals, including interest 3,335
Proceeds from sale of shares 7,777
Proceeds from exercise of options 190 864
Cash advances from IDT Corporation, net of repayments 886
Proceeds from issuance of convertible note 15,000
Net cash provided by financing activities 30,889 1,750
Effect of exchange rate changes on cash and cash equivalents (298) 3
Net (decrease) increase in cash and cash equivalents (3,779) 4,047
Cash and cash equivalents at beginning of year 15,803 11,756
Cash and cash equivalents at end of year $
12,024 $
15,803
Supplemental Schedule of Non-Cash Investing and Financing Activities
Adoption effect of ASU 2016-01 $
39
$
Beneficial conversion feature of convertible debt - related party $
71
$
Series D Convertible Note and accrued interest converted to Series D Preferred Stock $
10,848
$
Related Party deposit utilized to purchase Class B Common Stock $
864
$
Cash payments made for taxes
$
$
Cash payments made for interest
$
$
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SOURCE Rafael Holdings, Inc.
