Full Press Release Details
Rafael Holdings Reports Second Quarter
Fiscal Year 2021 Results
NEWARK, NJ - March 17, 2021: Rafael Holdings, Inc.,
(NYSE: RFL), reported revenue of $1.0 million and a loss per share of $0.50 for the second quarter of its 2021 fiscal year, the
three months ended January 31, 2021.
Q2 FY 2021 Consolidated Financial and Operational Highlights
Q2 FY 2021 - Pharmaceutical Holdings - Recent
Rafael Pharmaceuticals
At January 31, 2021, the Company and its affiliates collectively
owned securities representing 51% of the issued and outstanding capital stock of Rafael Pharmaceuticals and approximately 41%
on a fully diluted basis including shares beneficially held through its interest in RP Finance, LLC., a funding vehicle. Recent
developments announced by Rafael Pharmaceuticals include:
The FDA has granted Orphan Drug Designation for CPI-613 (devimistat)
for the treatment of soft tissue sarcoma. Rafael Pharmaceuticals' clinical trial will focus on the treatment of relapsed
or refractory clear cell sarcoma.
At January 31, 2021, Rafael Holdings held 68% of the issued
and outstanding ordinary shares of LipoMedix, a development-stage Israeli company focused on the development of an innovative,
safe and effective cancer therapy based on liposome delivery.
LipoMedix announced that its lead compound, Promitil
(PL-MLP), will be manufactured in the United States by ForDoz Pharma (ForDoz), a specialty pharmaceutical company focused on the
development, manufacturing, and commercialization of value-added sterile and complex injectable products.
The Barer Institute, a wholly owned subsidiary of Rafael Holdings,
has identified and begun to develop new therapeutic compounds, including compounds to regulate cancer metabolism, through internal
development and in-licensing. It is working to validate newly discovered biomarkers for resistance and sensitivity within its portfolio
compounds and to identify certain novel targetable mechanisms of action.
The Barer Institute announced that it had reached an
agreement with Princeton University's Office of Technology Licensing for an exclusive worldwide license to its SHMT (serine
hydroxymethyltransferase) inhibitor program and related intellectual property from the laboratory of Professor Joshua Rabinowitz,
Department of Chemistry.
Remarks by Howard Jonas, Chairman and CEO of Rafael
"The progress being made by our pharma partners is highlighted
by our Board's selection of Ameet Mallik to join as CEO of Rafael Holdings beginning on May 1, 2021. Ameet is an extraordinarily
capable and accomplished pharma executive with deep knowledge of oncological drug development and commercialization. Together with
Bill Conkling, who has joined our team as Chief Commerical Officer, Ameet will lead our effort to realize the potential of Rafael
Holdings including its investments in Rafael Pharmaceuticals, LipoMedix, and the Barer Institute."
About Rafael Holdings, Inc.:
Rafael Holdings is focused on development of novel cancer therapies.
The Company is a significant investor in two clinical stage oncology companies, Rafael Pharmaceuticals, Inc. and LipoMedix Pharmaceuticals
Ltd. Through its wholly owned Barer Institute subsidiary, the Company is developing a pipeline of compounds focused on the regulation
of cancer metabolism. For more information, visit rafaelholdings.com.
Chief Financial Officer, Rafael Holdings, Inc.
RAFAEL HOLDINGS, INC.
CONSOLIDATED BALANCE SHEETS
(unaudited, in thousands, except share and
| January 31, 2021 | July 31, 2020 | |||||||
| ASSETS | ||||||||
| CURRENT ASSETS | ||||||||
| Cash and cash equivalents | $ | 6,086 | $ | 6,206 | ||||
| Trade accounts receivable, net of allowance for doubtful accounts of $117 and $218 at January 31, 2021 and July 31, 2020, respectively | 124 | 267 | ||||||
| Due from Rafael Pharmaceuticals | 360 | 118 | ||||||
| Prepaid expenses and other current assets | 116 | 273 | ||||||
| Assets held for sale | - | 2,968 | ||||||
| Total current assets | 6,686 | 9,832 | ||||||
| Property and equipment, net | 43,760 | 44,433 | ||||||
| Equity investment - RP Finance LLC | 383 | 192 | ||||||
| Due from RP Finance LLC | 3,750 | - | ||||||
| Investments - Rafael Pharmaceuticals | 79,141 | 70,018 | ||||||
| Investments - Other Pharmaceuticals | 477 | 1,201 | ||||||
| Investments - Hedge Funds | 8,943 | 7,510 | ||||||
| Deferred income tax assets, net | - | 6 | ||||||
| In-process research and development and patents | 1,575 | 1,575 | ||||||
| Other assets | 1,534 | 1,580 | ||||||
| TOTAL ASSETS | $ | 146,249 | $ | 136,347 | ||||
| LIABILITIES AND EQUITY | ||||||||
| CURRENT LIABILITIES | ||||||||
| Trade accounts payable | $ | 495 | $ | 921 | ||||
| Accrued expenses | 643 | 1,191 | ||||||
| Amount due for purchase of membership interest | 9,500 | 3,500 | ||||||
| Other current liabilities | 162 | 115 | ||||||
| Due to related parties | 29 | - | ||||||
| Total current liabilities | 10,829 | 5,727 | ||||||
| Other liabilities | 33 | 92 | ||||||
| TOTAL LIABILITIES | 10,862 | 5,819 | ||||||
| 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 January 31, 2021 and July 31, 2020, respectively | 8 | 8 | ||||||
| Class B common stock, $0.01 par value; 200,000,000 shares authorized, 15,664,476 issued and 15,652,120 outstanding as of January 31, 2021, and 15,034,598 issued and 15,028,536 outstanding as of July 31, 2020 | 155 | 149 | ||||||
| Additional paid-in capital | 142,746 | 129,136 | ||||||
| Accumulated deficit | (25,866 | ) | (16,255 | ) | ||||
| Accumulated other comprehensive income related to foreign currency translation adjustment | 3,761 | 3,762 | ||||||
| Total equity attributable to Rafael Holdings, Inc. | 120,804 | 116,800 | ||||||
| Noncontrolling interests | 14,583 | 13,728 | ||||||
| TOTAL EQUITY | 135,387 | 130,528 | ||||||
| TOTAL LIABILITIES AND EQUITY | $ | 146,249 | $ | 136,347 |
RAFAEL HOLDINGS, INC.
CONSOLIDATED STATEMENTS OF OPERATIONS
(unaudited, in thousands, except share and
| Three Months Ended January 31, | Six Months Ended January 31, | |||||||||||||||
| 2021 | 2020 | 2021 | 2020 | |||||||||||||
| REVENUE | ||||||||||||||||
| Rental - Third Party | $ | 190 | $ | 370 | $ | 426 | 716 | |||||||||
| Rental - Related Party | 527 | 527 | 1,047 | 1,047 | ||||||||||||
| Parking | 122 | 219 | 299 | 443 | ||||||||||||
| Other - Related Party | 120 | 120 | 240 | 240 | ||||||||||||
| Total revenue | 959 | 1,236 | 2,012 | 2,446 | ||||||||||||
| COSTS AND EXPENSES | ||||||||||||||||
| Selling, general and administrative | 2,767 | 2,221 | 5,359 | 4,262 | ||||||||||||
| Research and development | 1,568 | 448 | 2,083 | 693 | ||||||||||||
| Depreciation and amortization | 441 | 473 | 878 | 939 | ||||||||||||
| Impairment - Altira | 7,000 | - | 7,000 | - | ||||||||||||
| Loss from operations | (10,817 | ) | (1,906 | ) | (13,308 | ) | (3,448 | ) | ||||||||
| Interest (expense) income, net | (1 | ) | 33 | (1 | ) | (31 | ) | |||||||||
| Net loss resulting from foreign exchange transactions | - | - | - | (5 | ) | |||||||||||
| Gain on sale of building | - | - | 749 | - | ||||||||||||
| Impairment of investments - Other Pharmaceuticals | - | - | (724 | ) | - | |||||||||||
| Unrealized gain on investments - Hedge Funds | 2,489 | 557 | 3,433 | 520 | ||||||||||||
| Loss before income taxes | (8,329 | ) | (1,316 | ) | (9,851 | ) | (2,964 | ) | ||||||||
| Provision for income taxes | (4 | ) | (12 | ) | (9 | ) | (16 | ) | ||||||||
| Equity in earnings of RP Finance | 96 | - | 192 | - | ||||||||||||
| Consolidated net loss | (8,237 | ) | (1,328 | ) | (9,668 | ) | (2,980 | ) | ||||||||
| Net loss attributable to noncontrolling interests | (72 | ) | (75 | ) | (57 | ) | (129 | ) | ||||||||
| Net loss attributable to Rafael Holdings, Inc. | $ | (8,165 | ) | $ | (1,253 | ) | $ | (9,611 | ) | $ | (2,851 | ) | ||||
| OTHER COMPREHENSIVE LOSS | ||||||||||||||||
| Net loss | $ | (8,237 | ) | $ | (1,328 | ) | $ | (9,668 | ) | $ | (2,980 | ) | ||||
| Foreign currency translation adjustment | 37 | (34 | ) | (1 | ) | (28 | ) | |||||||||
| Total comprehensive loss | (8,200 | ) | (1,362 | ) | (9,669 | ) | (3,008 | ) | ||||||||
| Comprehensive loss attributable to noncontrolling interests | 10 | (18 | ) | (11 | ) | (16 | ) | |||||||||
| Total comprehensive loss attributable to Rafael Holdings, Inc. | $ | (8,210 | ) | $ | (1,344 | ) | $ | (9,658 | ) | $ | (2,992 | ) | ||||
| Loss per share | ||||||||||||||||
| Basic and diluted | $ | (0.50 | ) | $ | (0.08 | ) | $ | (0.60 | ) | $ | (0.18 | ) | ||||
| Weighted average number of shares used in calculation of loss per share | ||||||||||||||||
| Basic and diluted | 16,172,421 | 15,790,400 | 15,997,571 | 15,715,442 |
RAFAEL HOLDINGS, INC.
CONSOLIDATED STATEMENT OF CASH FLOWS
(unaudited, in thousands)
| Six Months Ended January 31, | ||||||||
| 2021 | 2020 | |||||||
| Operating activities | ||||||||
| Net loss | $ | (9,668 | ) | $ | (2,980 | ) | ||
| Adjustments to reconcile net loss to net cash used in operating activities | ||||||||
| Depreciation and amortization | 878 | 939 | ||||||
| Deferred income taxes | 6 | 12 | ||||||
| Net unrealized gain on investments - Hedge Funds | (3,433 | ) | (520 | ) | ||||
| Impairment of investments - Other Pharmaceuticals | 724 | - | ||||||
| Impairment - Altira | 7,000 | - | ||||||
| Equity in earnings of RP Finance | (192 | ) | - | |||||
| Provision for doubtful accounts | 104 | 48 | ||||||
| Stock-based compensation | 719 | 411 | ||||||
| Amortization of debt discount | - | 54 | ||||||
| Gain on sale of building | (749 | ) | - | |||||
| Change in assets and liabilities: | ||||||||
| Trade accounts receivable | 39 | 77 | ||||||
| Prepaid expenses and other current assets | 157 | 181 | ||||||
| Other assets | 46 | (38 | ) | |||||
| Accounts payable and accrued expenses | (933 | ) | (252 | ) | ||||
| Due from Rafael Pharmaceuticals | (242 | ) | - | |||||
| Other current liabilities | 47 | |||||||
| Due to related parties | 29 | 126 | ||||||
| Other liabilities | (59 | ) | 42 | |||||
| Net cash used in operating activities | (5,527 | ) | (1,900 | ) | ||||
| Investing activities | ||||||||
| Purchase of investment in Altira | (1,000 | ) | - | |||||
| Purchases of property and equipment | (205 | ) | (456 | ) | ||||
| Payments to fund RP Finance | (3,750 | ) | - | |||||
| Proceeds from sale of building | 3,658 | - | ||||||
| Proceeds related to distribution of Hedge Funds | 2,000 | - | ||||||
| Investment in Rafael Pharmaceuticals | (9,123 | ) | - | |||||
| Net cash used in investing activities | (8,420 | ) | (456 | ) | ||||
| Financing activities | ||||||||
| Contribution from noncontrolling interest of consolidated entity | 912 | - | ||||||
| Proceeds from exercise of options | 43 | - | ||||||
| Proceeds from issuance of shares | 13,000 | - | ||||||
| Payments for taxes related to shares withheld for employee taxes | (146 | ) | (116 | ) | ||||
| Net cash provided by (used in) financing activities | 13,809 | (116 | ) | |||||
| Effect of exchange rate changes on cash and cash equivalents | 18 | (30 | ) | |||||
| Net decrease in cash and cash equivalents | (120 | ) | (2,502 | ) | ||||
| Cash and cash equivalents, beginning of period | 6,206 | 12,024 | ||||||
| Cash and cash equivalents, end of period | $ | 6,086 | $ | 9,522 | ||||
| Supplemental schedule of noncash investing and financing activities | ||||||||
| Conversion of LipoMedix bridge notes | $ | - | $ | 200 | ||||
| Conversions of related party convertible notes payable and accrued interest | $ | - | $ | 15,668 |