Q3 Steady as she goes
Cipher earns $796,000 (U.S.) from continuing ops in Q3
2021-11-11 17:11 ET - News Release
Mr. Craig Mull reports
CIPHER ANNOUNCES THIRD QUARTER AND YEAR-TO-DATE 2021 FINANCIAL RESULTS
Cipher Pharmaceuticals Inc. has released its financial and operating results for the three and nine months ended Sept. 30, 2021. Unless otherwise noted, all figures are in U.S. dollars.
Year-to-Date (Nine months ended September 30, 2021) Financial Highlights
(All figures in U.S. dollars, compared to nine months ended September 30, 2020, unless otherwise noted)
Total revenue increased 4.1% to $16.1 million compared to $15.5 million
SG&A decreased 7% to $4.1 million compared to $4.4 million
Adjusted EBITDA1 increased to $9.8 million
Basic EPS increased 12% to $0.19 compared to $0.17
Excluding one-time charges, basic and diluted EPS was $0.26 3 (CDN$0.33) compared to basic and diluted EPS of $0.17 and $0.16 respectively
As at September 30, 2021, the Company had $15.6 (CDN$19.9) million in cash or $0.59 per share (CDN$0.75)
Normal Course Issuer Bid 864,100 shares repurchased and cancelled to the end of September 30, 2021
Q3 2021 Financial Highlights
(All figures are in U.S. dollars)
Total revenue $4.5 million compared to $4.8 million in Q3 2021
Adjusted EBITDA decreased to $2.2 million compared to $2.8 million
Basic EPS $0.03 compared to $0.06
Excluding one-time charges, basic and diluted EPS for the three months ended September 30, 2021 was $0.06 4 (CDN$0.08) compared to $0.06 in Q3 2020
Normal Course Issuer Bid 233,100 shares repurchased and cancelled during the three months ended September 30, 2021
Management Commentary
Craig Mull, Interim CEO commented, "Our year-to-date results continue to trend positively. Revenue, Adjusted EBITDA and EPS all showed growth compared to the same period last year. We generated $8.1 million in cash from operating activities in the nine months ending September 30, 2021, ending the period with $15.6 million in cash, placing us in an excellent position as we continue to actively pursue profitable growth opportunities and maximize the income generated from our distribution agreements."
"During the quarter, the Company elected to assign the office lease for its corporate head office to a third party, which will result in a savings of CAD$2.2 million over the remainder of the lease term. As a result of this transaction, the Company paid an inducement payment which impacted EPS. Excluding this charge, EPS for the quarter would have been $0.06 and EPS for the nine months ended September 30 th would have been $0.21. Our year-to-date EPS was also impacted by the legal provision we took earlier this year, if you exclude this, EPS would have been $0.26 for the nine months ended September 30, 2021."
"Our product revenue increased 30% year-to-date and increased 27% in Q3 compared to the same period in the prior year. Product revenue continues to be driven by the strength of Epuris which ended the quarter with 43% market share, compared to 41% in the prior year. Subsequent to quarter end, Italmex, our distribution partner for isotretinoin products in Mexico, received approval of Epuris 10mg, and 20mg in Mexico by COFEPRIS. Under the terms of the agreement with Italmex, Cipher is eligible for a royalty on Epuris sales in Mexico."
"During the second quarter, we launched Absorica AG with our marketing partner Sun Pharmaceutical Industries, Inc. ("Sun Pharma"). During the third quarter, license fees were down sequentially, due to the combination of normal draw down of launched quantities at the wholesale level, as well as seasonality associated with the product. Q3 is the seasonally weakest quarter of the year for isotretinoin products due to the summer months, which reduce prescribing trends."
Outlook
Cipher anticipates several key milestones in 2021 that will continue to enhance long term value, including:
Realignment of distribution to increase royalty income.
Improved profitability of our hospital business through a distribution agreement with Verity
Normal Course Issuer Bid - 864,100 shares repurchased and cancelled to the end of September 30, 2021
Actively pursuing product and business acquisitions with a focus on high growth potential and near-term profitability
Financial Statements and MD&A
Cipher's Financial Statements for the quarter ended September 30, 2021 and Management's Discussion and Analysis (the "MD&A") for the three and nine-months ended September 30, 2021 are available on the Company's website at www.cipherpharma.com in the "Investors" section under "Financial Reports" and on SEDAR at www.sedar.com.
Notice of Conference Call
Cipher will hold a conference call on November 12, 2021, at 8:30 a.m. (ET) to discuss its financial results and other corporate developments. To access the conference call by telephone, dial 647-792-1241 or 866-248-8441 and use conference ID 9256970. A live audio webcast will be available at https://produceredition.webcasts.com/starthere.jsp?ei=1511252&tp_key=b261dfbc7e An archived replay of the webcast will be available until November 19, 2021.