TORONTO, Nov. 9, 2023
/CNW/ - HLS Therapeutics Inc. ("HLS" or the "Company") (TSX:
HLS), a pharmaceutical company focused on addressing unmet needs in
the treatment of psychiatric disorders and cardiovascular disease,
announces its financial results for the three- and nine-month
periods ended September 30, 2023. All
amounts are in thousands of United
States ("U.S.") dollars unless otherwise stated.
RECENT HIGHLIGHTS
- Q3 2023 revenue was $16.0
million, Adjusted EBITDA1 was $5.1 million and cash from operations was
$5.4 million, compared to
$15.7 million, $6.0 million and $4.2
million, respectively, in Q3 2022.
- Updated the Vascepa promotional services agreement with Pfizer
which should increase salesforce productivity in primary care and
reduce costs starting in 2024.
- Re-entered discussions with British
Columbia on a path forward to a Vascepa Product Listing
Agreement. HLS is currently working through coverage implementation
with the province.
- Amended credit agreement to extend term and increase borrowing
capacity.
"Growth from Vascepa and ongoing consistent performance from
Clozaril drove product sales of $13.4
million in Q3, which is the most ever for HLS in a quarter,"
said Craig Millian, CEO of HLS. "We
also made significant progress on our key commercial imperatives to
drive greater salesforce effectiveness and to improve access and
reimbursement. We recently amended our promotional services
agreement with Pfizer and will implement by year-end what we
believe is an improved primary care go-to-market model for Vascepa.
In addition, we are seeing some improvement with access and
reimbursement in Ontario as well
as making progress in finalizing a product listing agreement for
British Columbia."
Q3 & YEAR-TO-DATE ("YTD") 2023 FINANCIAL &
OPERATIONAL HIGHLIGHTS
- Q3 2023 Vascepa net revenue was C$4.7
million, up 44% compared to C$3.2
million in Q3 2022.
- Vascepa total prescriptions in Q3 2023 increased by 89%
year-over-year from Q3 2022.
- Vascepa prescribers in Q3 2023 increased 86% year-over-year
from Q3 2022.
- Vascepa consistent prescribers2 in Q3 2023 increased
by 97% year-over-year from Q3 2022.
- Clozaril YTD 2023 Canadian net revenue was C$26.0 million, down 2% compared to C$26.6 million in the same period last year.
- Clozaril's YTD 2023 patient growth rate was 1%.
Mr. Millian added: "We continue to see strong growth in Vascepa
prescribing along with an increase in the base of total prescribers
and consistent prescribers. While Q3 includes some seasonality
during the slower summer months, we saw a strong uptick in new and
total prescriptions in September - reaching 2,000 prescriptions per
week for the first time."
OUTLOOK
Vascepa
Supported by progress
against its key commercial imperatives and positive prescribing
trends, HLS believes that it is on track to achieve its fiscal 2023
revenue guidance for Vascepa of C$18-20 million. The Company is also taking
necessary actions to achieve the goal of Vascepa making a positive
contribution to Adjusted EBITDA starting in the second half of
2024.
Royalty Portfolio
The royalties related to
Boston Scientific's Emblem S-ICD, currently the largest royalty
interest in the Company's portfolio, will complete its contracted
term during Q4 2023. This impact will be partially offset by the
expected growth of royalties from Sanofi's Xenpozyme, which had its
commercial launch in the second half of 2022. The net effect of the
transition from four to three products is that revenue from the
royalty portfolio will be lower in fiscal 2024. The Company expects
royalty revenue to grow in subsequent years.
Q3 & YTD 2023 FINANCIAL REVIEW
The Company's
Management's Discussion and Analysis and Consolidated Financial
Statements for the three- and nine-month periods ended September 30, 2023 are available at the Company's
website and at its profile at SEDAR+.
Revenue
|
Three months
ended
September
30,
|
Nine months
ended
September
30,
|
|
2023
|
2022
|
2023
|
2022
|
|
|
|
|
|
Product
sales
|
|
|
|
|
Canada
|
10,153
|
9,570
|
28,755
|
27,500
|
United
States
|
3,289
|
3,590
|
9,680
|
10,751
|
|
13,442
|
13,160
|
38,435
|
38,251
|
Royalty
revenue
|
2,595
|
2,544
|
8,776
|
7,541
|
|
16,037
|
15,704
|
47,211
|
45,792
|
Q3 2023 revenue increased 2% compared to Q3 2022. Q3 2023
revenue increased 4% in constant currency terms, compared to Q3
2022, as the decline in the Canadian dollar had an impact on the
reported values, which are in U.S. dollars.
Product sales – Canada
000's of
CAD
|
Three months
ended
September
30,
|
Nine months
ended.
September
30,
|
|
2023
|
2022
|
%
change
|
2023
|
2022
|
%
change
|
|
|
|
|
|
|
Clozaril
|
8,946
|
9,244
|
(3.2) %
|
26,029
|
26,581
|
(2.1) %
|
Vascepa
|
4,665
|
3,247
|
43.7 %
|
12,661
|
8,720
|
45.2 %
|
Other
|
16
|
—
|
—
|
16
|
—
|
—
|
|
13,627
|
12,491
|
9.1 %
|
38,706
|
35,301
|
9.6 %
|
Q3 2023 product sales in Canada
increased 9% in Canadian dollars, compared to Q3 2022, led by
increased sales of Vascepa, which grew 44% in Q3 2023 in Canadian
dollars compared to Q3 2022. The Vascepa net revenue growth rate
trails the growth rate in prescriptions as net pricing adjusts to
increased public sector volumes.
Clozaril revenue in Canada
declined 3% in Q3 2023 in Canadian dollars, compared to Q3 2022,
but increased 3% sequentially from Q2 2023. Clozaril remains the
leading medication for treatment resistant schizophrenia in
Canada and for the nine-month
period ended September 30, 2023, the
number of patients taking Clozaril increased 1%.
In the U.S., Q3 2023 Clozaril net sales increased 3%
sequentially from Q2 2023 but decreased $0.3
million compared to Q3 2022. The year-over-year decline in
unit volumes was partially offset by small annual price
increases.
Royalty revenues
Royalty revenues were $2.6 million in Q3 2023, up 2% from Q3 2022,
reflecting contribution from all four products in the portfolio.
The year-to-date results include a one-time milestone receipt of
$0.6 million included in Q2 2023
related to the approval of Xenpozyme in 2022.
Operating
Expenses
|
Three months
ended
September
30,
|
Nine months
ended
September
30,
|
|
2023
|
2022
|
2023
|
2022
|
|
|
|
|
|
Cost of product
sales
|
1,870
|
1,357
|
5,091
|
3,464
|
Selling and
marketing
|
5,048
|
4,306
|
15,180
|
12,677
|
Medical, regulatory and
patient support
|
1,675
|
1,498
|
4,188
|
4,121
|
General and
administrative
|
2,316
|
2,527
|
7,040
|
7,040
|
|
10,909
|
9,688
|
31,499
|
27,302
|
Q3 2023 operating expenses increased 13% compared to Q3 2022.
This was driven by an increase in cost of product sales due to the
growth in shipments and sales of Vascepa, as well as higher selling
and marketing costs for Vascepa related to increased selling
activity in primary care. General and administrative expenses
decreased 8% in Q3 2023 compared to Q3 2022 as the Company
maintains prudent management of expenses.
Support costs and strong gross margins remain stable across the
Company's key Clozaril franchises in Canada and the
United States.
Adjusted
EBITDA1
|
Three months
ended
September
30,
|
Nine months
ended
September
30,
|
|
2023
|
2022
|
2023
|
2022
|
|
|
|
|
|
Net loss for the
period
|
(6,901)
|
(4,410)
|
(22,130)
|
(17,169)
|
Stock-based
compensation
|
(19)
|
125
|
63
|
2,170
|
Amortization and
depreciation
|
8,207
|
8,834
|
24,892
|
25,710
|
Finance and related
costs, net
|
4,223
|
1,489
|
9,128
|
2,852
|
Other costs
|
42
|
69
|
4,106
|
4,956
|
Income tax
recovery
|
(424)
|
(91)
|
(347)
|
(29)
|
Adjusted
EBITDA
|
5,128
|
6,016
|
15,712
|
18,490
|
Q3 2023 Adjusted EBITDA was $5.1
million compared to $6.0
million in Q3 2022. The decrease was due primarily to the
increase in operating expenses for Vascepa and was partially offset
by the growth in sales of Vascepa. Clozaril and royalty revenues
continue to generate strong Adjusted EBITDA and cash flow for the
business.
For the nine-month period ended September
30, 2023, the direct contribution to Adjusted EBITDA from
the Clozaril franchise was $21.7
million, while the direct contribution of Vascepa to
Adjusted EBITDA was a loss of $7.0
million.
Net Loss
Net loss for Q3 2023 was ($6.9) million, or ($0.21) per share, compared to a net loss of
($4.4) million, or ($0.14) per share, in Q3 2022. Revenue growth was
offset by the increase in cost of product sales and selling and
marketing expenses related to the selling and marketing of Vascepa,
and higher finance and related costs, net, including fair value
adjustments on financial instruments and the effect of higher
interest rates, including fair value adjustments on the interest
rate swap, resulting in higher net loss for the quarter and
year-to-date period.
Cash from Operations and Financial Position
Cash
generated from operations was $5.4
million in Q3 2023, compared to $4.2
million in Q3 2022. Cash was $21.8
million at September 30, 2023
up from $20.7 million at December 31, 2022.
Credit Agreement Amendment
On August 14, 2023, HLS announced an extension to
its credit agreement, which comprises a senior secured term loan, a
revolver facility and an expansion facility, (the "Amended
Agreement") with a syndicate of bank lenders led by JPMorgan Chase
Bank, N.A.
Under the terms of the Amended Agreement, the maturity date has
been extended to August 11, 2026. The
balance on the revolver facility at the time of the amendment was
combined with the principal amount remaining on the existing senior
secured term loan for a new senior secured term loan balance of
$93.8 million. In addition, there is
a new revolving facility of $30.0
million and an expansion facility of up to $70.0 million to support acquisitions and other
growth opportunities.
As a result, at September 30, 2023
HLS had a strong financial position consisting of $21.8 million in cash, a $30.0 million undrawn revolving facility and a
$70.0 million expansion facility. The
principal amount of the senior secured term loan outstanding at
September 30, 2023 was $91.7 million.
RENEWAL OF NORMAL COURSE ISSUER BID
HLS has filed with
the Toronto Stock Exchange (the "TSX"), and the TSX has accepted,
the Company's notice of intention to renew its Normal Course Issuer
Bid (the "NCIB") for its issued and outstanding common shares
(each a "Common Share"). Pursuant to the NCIB, HLS may, if
considered advisable, purchase for cancellation through the
facilities of the TSX and/or alternative Canadian trading systems,
from time to time over the next 12 months, up to an aggregate of
1,607,892 Common Shares, representing 5% of the 32,157,854 issued
and outstanding Common Shares as of October
31, 2023.
HLS may commence purchases of Common Shares under the NCIB on
November 14, 2023, and the NCIB will
remain in effect until the earliest of: (i) the close of trading on
November 13, 2024, (ii) the date upon
which HLS acquires the maximum number of Common Shares permitted
under the NCIB, and (iii) the date upon which HLS provides written
notice of termination of the NCIB to the TSX. Daily purchases
pursuant to the NCIB will be limited to 5,307 Common Shares, other
than purchases made pursuant to the block purchase exception, based
on the applicable average daily trading volume on the TSX for six
months ending October 31, 2023 of
21,229 Common Shares.
Purchases of Common Shares under the NCIB will be made by
Haywood Securities Inc. ("Haywood") based on the parameters
prescribed by the TSX, the provisions of the Company's credit
agreement and applicable Canadian securities laws at a price per
Common Share equal to the market price at the time of acquisition.
All Common Shares acquired by the Company under the NCIB will be
cancelled.
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
1,620,365 Common Shares in a normal course issuer bid
(the "Previous Bid") that commenced on November 14, 2022 and will expire on November 13, 2023. As of October 31, 2023, HLS had purchased
334,869 Common Shares on the open market at an average
purchase price of C$5.96 per
Common Share under the Previous Bid.
Q3 FISCAL 2023 CONFERENCE CALL
HLS will hold a
conference call today at 8:30 am Eastern
Time to discuss its Q3 2023 financial results. The call will
be hosted by Mr. Craig Millian, CEO,
and Mr. Tim Hendrickson, CFO. To
view the slides that accompany management's discussion, please use
the webcast link.
CONFERENCE ID: 52567994
DATE: Thursday, November 9, 2023
TIME: 8:30 a.m. ET
WEBCAST
LINK: https://app.webinar.net/a9kpB2jB7nW
TRADITIONAL DIAL-IN NUMBER: 1-888-664-6392 or
416-764-8659
RAPIDCONNECT: To instantly join the conference call
by phone, please use the following URL to easily register and be
connected into the conference call automatically:
https://emportal.ink/3ZK16TS
TAPED REPLAY: 1-888-390-0541 or 416-764-8677
REPLAY CODE: 864357#
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
HLS Therapeutics' website at www.hlstherapeutics.com. Please
connect at least 15 minutes prior to the conference call to ensure
adequate time for any software download that may be required to
hear the webcast.
ABOUT HLS THERAPEUTICS INC.
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
1CAUTIONARY 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) "finance
and related costs, net", (iv) "other costs", and (v) "income tax
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.
2CONSISTENT PRESCRIBER
A
consistent prescriber is a physician that has prescribed Vascepa in
at least 4 of the past 5 weeks.
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 March 15, 2023, and
Management's Discussion and Analysis dated November 8, 2023, both of which have been filed
on SEDAR and can be accessed at www.sedarplus.ca. Accordingly,
readers should not place undue reliance on any forward-looking
statements or information. Except as required by applicable
securities laws, forward-looking statements speak only as of the
date on which they are made and HLS undertakes no obligation to
publicly update or revise any forward-looking statement, whether as
a result of new information, future events, or otherwise.
HLS THERAPEUTICS
INC.
|
INTERIM CONSOLIDATED
STATEMENTS OF FINANCIAL POSITION
|
Unaudited
|
[in thousands of U.S.
dollars]
|
|
|
|
|
|
As at
|
As at
|
|
|
September 30,
2023
|
December 31,
2022
|
|
|
|
|
ASSETS
|
|
|
|
Current
|
|
|
|
Cash
|
|
21,808
|
20,723
|
Accounts
receivable
|
|
10,625
|
10,999
|
Inventories
|
|
8,753
|
8,902
|
Income taxes
recoverable
|
|
93
|
195
|
Other current
assets
|
|
2,174
|
3,555
|
Total current
assets
|
|
43,453
|
44,374
|
Property, plant and
equipment
|
|
1,101
|
1,127
|
Intangible
assets
|
|
168,867
|
195,018
|
Deferred tax
asset
|
|
1,152
|
465
|
Other non-current
assets
|
|
655
|
668
|
Total assets
|
|
215,228
|
241,652
|
|
|
|
|
LIABILITIES AND
SHAREHOLDERS' EQUITY
|
Current
|
|
|
|
Accounts payable and
accrued liabilities
|
|
14,011
|
12,785
|
Provisions
|
|
3,867
|
2,934
|
Debt and other
liabilities
|
|
7,101
|
15,471
|
Income taxes
payable
|
|
324
|
—
|
Total current
liabilities
|
|
25,303
|
31,190
|
Debt and other
liabilities
|
|
87,673
|
84,578
|
Deferred tax
liability
|
|
450
|
566
|
Total
liabilities
|
|
113,426
|
116,334
|
|
|
|
|
Shareholders'
equity
|
|
|
|
Share
capital
|
|
263,586
|
265,206
|
Contributed
surplus
|
|
14,175
|
13,821
|
Accumulated other
comprehensive loss
|
|
(5,024)
|
(5,260)
|
Deficit
|
|
(170,935)
|
(148,449)
|
Total shareholders'
equity
|
|
101,802
|
125,318
|
Total liabilities and
shareholders' equity
|
215,228
|
241,652
|
|
|
|
|
|
HLS THERAPEUTICS
INC.
|
INTERIM CONSOLIDATED
STATEMENTS OF LOSS
|
Unaudited
|
[in thousands of U.S.
dollars, except per share amounts]
|
|
|
|
Three months
ended
September
30,
|
Nine months
ended
September
30,
|
|
|
2023
|
2022
|
2023
|
2022
|
|
|
|
|
|
|
Revenue
|
|
16,037
|
15,704
|
47,211
|
45,792
|
|
|
|
|
|
|
Expenses
|
|
|
|
|
|
Cost of product
sales
|
|
1,870
|
1,357
|
5,091
|
3,464
|
Selling and
marketing
|
|
5,048
|
4,306
|
15,180
|
12,677
|
Medical, regulatory and
patient support
|
|
1,675
|
1,498
|
4,188
|
4,121
|
General and
administrative
|
|
2,316
|
2,527
|
7,040
|
7,040
|
Stock-based
compensation
|
|
(19)
|
125
|
63
|
2,170
|
Amortization and
depreciation
|
|
8,207
|
8,834
|
24,892
|
25,710
|
Finance and related
costs, net
|
|
4,223
|
1,489
|
9,128
|
2,852
|
Other costs
|
|
42
|
69
|
4,106
|
4,956
|
Loss before income
taxes
|
|
(7,325)
|
(4,501)
|
(22,477)
|
(17,198)
|
Income tax
recovery
|
|
(424)
|
(91)
|
(347)
|
(29)
|
Net loss for the
period
|
|
(6,901)
|
(4,410)
|
(22,130)
|
(17,169)
|
|
|
|
|
Net loss per
share:
|
|
|
|
Basic and
diluted
|
|
$(0.21)
|
$(0.14)
|
$(0.68)
|
$(0.53)
|
|
|
|
HLS THERAPEUTICS
INC.
|
INTERIM CONSOLIDATED
STATEMENTS OF COMPREHENSIVE LOSS
|
Unaudited
|
[in thousands of U.S.
dollars]
|
|
|
|
Three months
ended
September
30,
|
Nine months
ended
September
30,
|
|
2023
|
2022
|
2023
|
2022
|
|
|
|
|
|
Net loss for the
period
|
(6,901)
|
(4,410)
|
(22,130)
|
(17,169)
|
|
|
|
|
|
Item that may be
reclassified subsequently to net loss
|
|
|
|
|
Unrealized
foreign currency translation adjustment
|
(2,154)
|
(7,578)
|
236
|
(9,564)
|
Comprehensive loss
for the period
|
(9,055)
|
(11,988)
|
(21,894)
|
(26,733)
|
|
|
|
HLS THERAPEUTICS
INC.
|
INTERIM CONSOLIDATED
STATEMENTS OF CHANGES IN SHAREHOLDERS' EQUITY
|
Unaudited
|
[in thousands of U.S.
dollars]
|
|
|
|
|
|
|
|
Share
capital
|
Contributed
surplus
|
Accumulated
other
comprehensive
income (loss)
|
Deficit
|
Total
|
|
|
|
|
|
|
|
Balance, December
31, 2022
|
|
265,206
|
13,821
|
(5,260)
|
(148,449)
|
125,318
|
Stock options
exercised
|
|
178
|
(44)
|
—
|
—
|
134
|
Shares
repurchased
|
|
(1,798)
|
—
|
—
|
826
|
(972)
|
Share purchase
obligation
|
|
—
|
(295)
|
—
|
—
|
(295)
|
Stock option
expense
|
|
—
|
693
|
—
|
—
|
693
|
Net loss for the
period
|
|
—
|
—
|
—
|
(22,130)
|
(22,130)
|
Dividends
declared
|
|
—
|
—
|
—
|
(1,182)
|
(1,182)
|
Unrealized foreign
currency translation adjustment
|
|
—
|
—
|
236
|
—
|
236
|
Balance, September
30, 2023
|
|
263,586
|
14,175
|
(5,024)
|
(170,935)
|
101,802
|
|
|
|
|
|
|
|
Balance, December
31, 2021
|
|
265,917
|
11,717
|
2,959
|
(119,857)
|
160,736
|
Stock options
exercised
|
|
251
|
(67)
|
—
|
—
|
184
|
Shares
repurchased
|
|
(539)
|
—
|
—
|
(109)
|
(648)
|
Share purchase
obligation
|
|
—
|
(255)
|
—
|
—
|
(255)
|
Stock option
expense
|
|
—
|
1,930
|
—
|
—
|
1,930
|
Net loss for the
period
|
|
—
|
—
|
—
|
(17,169)
|
(17,169)
|
Dividends
declared
|
|
—
|
—
|
—
|
(3,768)
|
(3,768)
|
Unrealized foreign
currency translation adjustment
|
|
—
|
—
|
(9,564)
|
—
|
(9,564)
|
Balance, September
30, 2022
|
|
265,629
|
13,325
|
(6,605)
|
(140,903)
|
131,446
|
|
|
|
|
|
|
|
HLS THERAPEUTICS
INC.
|
INTERIM CONSOLIDATED
STATEMENTS OF CASH FLOWS
|
Unaudited
|
[in thousands of U.S.
dollars]
|
|
|
|
Three months
ended
September
30,
|
Nine months
ended
September
30,
|
|
2023
|
2022
|
2023
|
2022
|
|
|
|
|
|
OPERATING
ACTIVITIES
|
|
|
|
|
Net loss for the
period
|
(6,901)
|
(4,410)
|
(22,130)
|
(17,169)
|
Adjustments to
reconcile net loss to cash provided
by operating
activities
|
|
|
Stock-based
compensation
|
(19)
|
125
|
63
|
2,170
|
Amortization and
depreciation
|
8,207
|
8,834
|
24,892
|
25,710
|
Impairment
charge
|
—
|
—
|
2,352
|
3,051
|
Accreted
interest
|
199
|
200
|
580
|
612
|
Fair value adjustment
on financial assets and liabilities
|
2,030
|
(397)
|
3,151
|
(2,567)
|
Deferred income
taxes
|
(541)
|
(196)
|
(803)
|
233
|
Net change in non-cash
working capital balances related to operations
|
2,392
|
(5)
|
3,950
|
1,381
|
Cash provided by
operating activities
|
5,367
|
4,151
|
12,055
|
13,421
|
|
|
|
|
|
INVESTING
ACTIVITIES
|
|
|
|
|
Additions to property,
plant and equipment
|
—
|
(12)
|
(27)
|
(36)
|
Royalty milestone
payment
|
—
|
(10,000)
|
—
|
(10,000)
|
Additions to intangible
assets
|
(40)
|
—
|
(148)
|
(92)
|
Cash used in
investing activities
|
(40)
|
(10,012)
|
(175)
|
(10,128)
|
|
|
|
|
|
FINANCING
ACTIVITIES
|
|
|
|
|
Stock options
exercised
|
—
|
12
|
134
|
184
|
Shares
repurchased
|
(603)
|
(270)
|
(972)
|
(648)
|
Dividends
paid
|
—
|
(1,220)
|
(2,398)
|
(3,769)
|
Repayment of credit
agreement borrowing
|
(2,173)
|
(1,389)
|
(5,683)
|
(7,389)
|
Drawdown under credit
agreement
|
—
|
10,000
|
—
|
10,000
|
Debt costs
|
(1,360)
|
(639)
|
(1,360)
|
(639)
|
Lease
payments
|
(155)
|
(162)
|
(474)
|
(501)
|
Cash provided by
(used in) financing activities
|
(4,291)
|
6,332
|
(10,753)
|
(2,762)
|
|
|
|
|
|
Net increase in cash
during the period
|
1,036
|
471
|
1,127
|
531
|
Foreign currency
translation
|
(160)
|
(352)
|
(42)
|
(431)
|
Cash, beginning of
period
|
20,932
|
21,160
|
20,723
|
21,179
|
Cash, end of
period
|
21,808
|
21,279
|
21,808
|
21,279
|
|
|
|
SOURCE HLS Therapeutics Inc.