Full Press Release Details
Rafael Holdings Reports First Quarter Fiscal
2025 Financial Results
Upon completion of our proposed merger with
Cyclo Therapeutics the Company intends to focus its efforts on Cyclo's lead clinical program Trappsol Cyclo
NEWARK, NJ - December 11, 2024 (GLOBE
NEWSWIRE) - Rafael Holdings, Inc. (NYSE: RFL), today reported its financial results for the first quarter of fiscal year 2025 ended
"We anticipate proceeding to a shareholder
vote on our pending merger agreement with Cyclo Therapeutics, Inc. (Nasdaq: CYTH) in the first calendar
quarter of 2025 and closing promptly post shareholder approvals. Upon closing of the merger, the Company intends to focus its strategic
efforts and resources on what will then be the Company's lead clinical program and core asset, Trappsol Cyclo .
Accordingly, we are currently evaluating our other operating entities and portfolio of assets," said Bill Conkling, CEO of Rafael
Holdings. Bill added, "We are encouraged that Cyclo Therapeutics has fully enrolled its pivotal
Phase 3 study evaluating Trappsol Cyclo for the treatment of Niemann-Pick
Disease Type C1, a rare and fatal genetic disease, and results from the 48-week interim analysis are expected in the middle of 2025. Despite
recent FDA approvals of other treatments for NPC Type C1, we believe that Trappsol Cyclo
has the potential to be a market leader."
Rafael Holdings, Inc. First Quarter Fiscal Year 2025 Financial Results
As of October 31, 2024, we had cash, cash equivalents
and marketable securities of $54.3 million.
For the three months ended October 31, 2024, we
recorded a net loss attributable to Rafael Holdings of $9.0 million, or $0.37 per share, versus a net loss of $3.6
million, or $0.15 per share in the year ago period. The year over year increase in losses was attributable to the combined unrealized
losses of $6.0 on the Company's investment in Cyclo as well as in the convertible notes receivable from Cyclo, versus $2.1 million
in unrealized losses on the Company's investment in Cyclo in the year ago period.
Research and development expenses were $1.3 million
for the three months ended October 31, 2024, compared to $0.5 million in the year ago period. The year over year increase relates to activity
at Cornerstone and Day Three, which were consolidated with Rafael Holdings during fiscal 2024.
For the three months ended October 31, 2024, general
and administrative expenses were $2.5 million. For the same period in the prior year, general and administrative expenses were $2.0 million.
The increase was primarily due to additional expenses from Cornerstone and Day Three, as well as increased professional fees related to
the proposed Cyclo merger.
About Rafael Holdings, Inc.
Rafael Holdings, Inc. is a holding company with
interests in clinical and early-stage pharmaceutical companies including an investment in (and planned merger with) Cyclo Therapeutics
Inc. (Nasdaq: CYTH), a biotechnology company dedicated to developing Trappsol Cyclo , which is being evaluated in
clinical trials, including an ongoing Phase 3 trial for the potential treatment of Niemann-Pick Disease Type C1 ("NPC1"),
a rare, fatal, and progressive genetic disorder. Rafael also holds a majority equity interest in LipoMedix Pharmaceuticals Ltd.
a clinical stage pharmaceutical company, Barer Institute Inc., a wholly owned preclinical cancer metabolism research operation, a majority
interest in Cornerstone Pharmaceuticals, Inc., formerly known as Rafael Pharmaceuticals Inc., a cancer metabolism-based therapeutics company,
a majority interest in Rafael Medical Devices, LLC., an orthopedic-focused medical device company developing instruments to advance minimally
invasive surgeries, and a majority interest in Day Three Labs, Inc., a company which empowers third-party manufacturers to reimagine their
existing cannabis offerings enabling them to bring to market better, cleaner, more precise and predictable versions by utilizing Day Three's
pharmaceutical-grade technology and innovation like Unlokt . The Company's primary focus is to expand our investment
portfolio through opportunistic and strategic investments including therapeutics, which address high unmet medical needs. Upon closing
of the planned merger with Cyclo Therapeutics, the Company intends to focus its efforts on making Trappsol Cyclo
its lead clinical program.
Forward Looking Statements
This press release contains forward-looking statements
within the meaning of the Private Securities Litigation Reform Act of 1995. All statements contained in this press release that do not
relate to matters of historical fact should be considered forward-looking statements, including without limitation statements regarding
our expectations surrounding the potential, safety, efficacy, and regulatory and clinical progress of our product candidates; plans regarding
the further evaluation of clinical data; and the potential of our pipeline, including our internal cancer metabolism research programs.
These statements are neither promises nor guarantees, but involve known and unknown risks, uncertainties and other important factors that
may cause our actual results, performance or achievements to be materially different from any future results, performance or achievements
expressed or implied by the forward-looking statements, including, but not limited to, those disclosed under the caption "Risk Factors"
in our Annual Report on Form 10-K for the year ended July 31, 2024, and our other filings with the SEC. These factors could cause actual
results to differ materially from those indicated by the forward-looking statements made in this press release. Any such forward-looking
statements represent management's estimates as of the date of this press release. While we may elect to update such forward-looking
statements at some point in the future, we disclaim any obligation to do so, even if subsequent events cause our views to change.
RAFAEL HOLDINGS, INC.
CONSOLIDATED BALANCE SHEETS
(in thousands, except share and per share data)
| October 31, 2024 | July 31, 2024 | |||||||
| (audited) | ||||||||
| ASSETS | ||||||||
| CURRENT ASSETS | ||||||||
| Cash and cash equivalents | $ | 8,159 | $ | 2,675 | ||||
| Available-for-sale securities | 46,138 | 63,265 | ||||||
| Interest receivable | 438 | 515 | ||||||
| Convertible note receivables, due from Cyclo | 12,603 | 5,191 | ||||||
| Accounts receivable, net of allowance for credit losses of $245 at October 31, 2024 and July 31, 2024 | 201 | 426 | ||||||
| Prepaid expenses and other current assets | 2,942 | 430 | ||||||
| Total current assets | 70,481 | 72,502 | ||||||
| Property and equipment, net | 2,078 | 2,120 | ||||||
| Investments - Hedge Funds | - | 2,547 | ||||||
| Investments - Cyclo | 7,645 | 12,010 | ||||||
| Convertible note receivable classified as available-for-sale | 1,161 | 1,146 | ||||||
| Goodwill | 3,050 | 3,050 | ||||||
| Intangible assets, net | 1,818 | 1,847 | ||||||
| In-process research and development | 1,575 | 1,575 | ||||||
| Other assets | 27 | 35 | ||||||
| TOTAL ASSETS | $ | 87,835 | $ | 96,832 | ||||
| LIABILITIES AND EQUITY | ||||||||
| CURRENT LIABILITIES | ||||||||
| Accounts payable | $ | 2,700 | $ | 2,556 | ||||
| Accrued expenses | 1,379 | 1,798 | ||||||
| Convertible notes payable | 614 | 614 | ||||||
| Other current liabilities | 112 | 113 | ||||||
| Due to related parties | 734 | 733 | ||||||
| Installment note payable | 1,700 | 1,700 | ||||||
| Total current liabilities | 7,239 | 7,514 | ||||||
| Accrued expenses, noncurrent | 3,138 | 2,982 | ||||||
| Convertible notes payable, noncurrent | 74 | 73 | ||||||
| Other liabilities | - | 5 | ||||||
| TOTAL LIABILITIES | 10,451 | 10,574 | ||||||
| COMMITMENTS AND CONTINGENCIES | ||||||||
| EQUITY | ||||||||
| Class A common stock, $0.01 par value; 35,000,000 shares authorized, 787,163 shares issued and outstanding as of October 31, 2024 and July 31, 2024 | 8 | 8 | ||||||
| Class B common stock, $0.01 par value; 200,000,000 shares authorized, 24,135,035 issued and 23,785,043 outstanding (excluding treasury shares of 101,487) as of October 31, 2024, and 24,142,535 issued and 23,819,948 outstanding (excluding treasury shares of 101,487) as of July 31, 2024 | 238 | 238 | ||||||
| Additional paid-in capital | 280,359 | 280,048 | ||||||
| Accumulated deficit | (210,749 | ) | (201,743 | ) | ||||
| Treasury stock, at cost; 101,487 Class B shares as of October 31, 2024 and July 31, 2024 | (168 | ) | (168 | ) | ||||
| Accumulated other comprehensive income related to unrealized income on available-for-sale securities | 132 | 111 | ||||||
| Accumulated other comprehensive income related to foreign currency translation adjustment | 3,696 | 3,691 | ||||||
| Total equity attributable to Rafael Holdings, Inc. | 73,516 | 82,185 | ||||||
| Noncontrolling interests | 3,868 | 4,073 | ||||||
| TOTAL EQUITY | 77,384 | 86,258 | ||||||
| TOTAL LIABILITIES AND EQUITY | $ | 87,835 | $ | 96,832 |
RAFAEL HOLDINGS, INC.
CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE
(unaudited, in thousands,
except share and per share data)
| Three Months Ended October 31, | ||||||||
| 2024 | 2023 | |||||||
| Revenues | $ | 128 | $ | 68 | ||||
| Cost of infusion technology revenue | 37 | - | ||||||
| SG&A Expenses | 2,523 | 2,040 | ||||||
| R&D Expenses | 1,326 | 489 | ||||||
| Depreciation and amortization | 86 | 17 | ||||||
| Operating Loss | (3,844 | ) | (2,478 | ) | ||||
| Interest income | 568 | 582 | ||||||
| Realized gain on available-for-sale securities | 194 | 177 | ||||||
| Realized loss on investment in equity securities | - | (46 | ) | |||||
| Realized gain on investments - Cyclo | - | 424 | ||||||
| Unrealized loss on investments - Cyclo | (4,365 | ) | (2,124 | ) | ||||
| Unrealized loss on convertible notes receivable, due from Cyclo | (1,588 | ) | - | |||||
| Unrealized loss on investments - Hedge Funds | - | (166 | ) | |||||
| Interest expense | (162 | ) | - | |||||
| Other income | (2 | ) | 93 | |||||
| Loss before Incomes Taxes | (9,199 | ) | (3,538 | ) | ||||
| Taxes | (12 | ) | (6 | ) | ||||
| Equity in loss of Day Three Labs Inc. | - | (216 | ) | |||||
| Consolidated net loss | (9,211 | ) | (3,760 | ) | ||||
| Net loss attributable to noncontrolling interests | (205 | ) | (122 | ) | ||||
| Net loss attributable to Rafael Holdings, Inc. | $ | (9,006 | ) | $ | (3,638 | ) | ||
| Loss per share | ||||||||
| Basic and diluted | (0.37 | ) | (0.15 | ) | ||||
| Loss per basic common share | $ | (0.37 | ) | $ | (0.15 | ) | ||
| Weighted average shares in calculation | 25,062,854 | 23,644,647 |