Harrow Announces Third Quarter 2024 Financial Results
Third Quarter 2024 and Recent Selected Highlights:
-
Revenues increased
44% from in the prior-year quarter to$34.3 million $49.3 million -
GAAP net loss of
$(4.2) million -
Adjusted EBITDA of
$8.8 million -
Operating cash flow of
$3 million -
Cash and cash equivalents of
as of September 30, 2024$72.6 million -
VEVYE® total prescriptions up
55% over the second quarter of 2024 -
IHEEZO® customer unit demand volume up
15% over the second quarter of 2024 - TRIESENCE® October 2024 relaunch underway
- Expansion of access and affordability through multiple new partnerships
- First major Medicare Part D win for VEVYE with major plan sponsors
- Fourth quarter revenue indicates meaningful overperformance of 2024 revenue guidance from the capture of third quarter revenue slack and positive demand trends for VEVYE, IHEEZO, and TRIESENCE
“We are pleased with our progress in the third quarter of 2024,” said Mark L. Baum, Chief Executive Officer of Harrow. “Alongside
Third quarter 2024 figures of merit:
|
For the Three Months Ended
|
|
For the Nine Months Ended
|
||||||||||||
|
2024 |
|
2023 |
|
2024 |
|
2023 |
||||||||
Total revenues |
$ |
49,257,000 |
|
|
$ |
34,265,000 |
|
|
$ |
132,783,000 |
|
|
$ |
93,838,000 |
|
Gross margin |
|
76 |
% |
|
|
71 |
% |
|
|
74 |
% |
|
|
70 |
% |
Core gross margin(1) |
|
80 |
% |
|
|
78 |
% |
|
|
78 |
% |
|
|
77 |
% |
Net loss |
|
(4,220,000 |
) |
|
|
(4,391,000 |
) |
|
|
(24,258,000 |
) |
|
|
(15,263,000 |
) |
Core net loss(1) |
|
(1,619,000 |
) |
|
|
(2,983,000 |
) |
|
|
(13,455,000 |
) |
|
|
(4,519,000 |
) |
Adjusted EBITDA(1) |
|
8,808,000 |
|
|
|
9,209,000 |
|
|
|
17,838,000 |
|
|
|
25,556,000 |
|
Basic and diluted net loss per share |
|
(0.12 |
) |
|
|
(0.13 |
) |
|
|
(0.68 |
) |
|
|
(0.48 |
) |
Core basic and diluted net loss per share(1) |
|
(0.05 |
) |
|
|
(0.09 |
) |
|
|
(0.38 |
) |
|
|
(0.14 |
) |
(1) |
Core gross margin, core net loss, core basic and diluted net loss per share (collectively, “Core Results”), and Adjusted EBITDA are non‑GAAP measures. For additional information, including a reconciliation of such Core Results and Adjusted EBITDA to the most directly comparable measures presented in accordance with GAAP, see the explanation of non‑GAAP measures and reconciliation tables at the end of this release. |
Conference Call and Webcast
The Company’s management team will host a conference call and live webcast tomorrow morning, Thursday, November 14, 2024, at 8:00 a.m. Eastern time to discuss the third quarter 2024 results and provide a business update. Participants can access the live conference call via webcast on the “Investors” page of Harrow’s website. To participate via telephone, please register in advance using this link. Upon registration, all telephone participants will receive a confirmation email with detailed instructions, including a unique dial-in number and PIN, for accessing the call. A replay of the conference call webcast will be archived on the Company’s website for one year.
About Harrow
Harrow, Inc. (Nasdaq: HROW) is a leading eyecare pharmaceutical company engaged in the discovery, development, and commercialization of innovative ophthalmic pharmaceutical products for the North American market. Harrow helps eyecare professionals preserve the gift of sight by making its portfolio of prescription and non‑prescription pharmaceutical products accessible and affordable to millions of patients each year. For more information about Harrow, please visit harrow.com.
Forward-Looking Statements
This press release contains “forward-looking statements” within the meaning of the
HARROW, INC. |
|||||
CONDENSED CONSOLIDATED BALANCE SHEETS |
|||||
|
|||||
|
September 30,
|
|
December 31,
|
||
(unaudited) |
|
|
|||
ASSETS |
|||||
Cash and cash equivalents |
$ |
72,601,000 |
|
$ |
74,085,000 |
All other current assets |
|
74,461,000 |
|
|
65,397,000 |
Total current assets |
|
147,062,000 |
|
|
139,482,000 |
All other assets |
|
204,477,000 |
|
|
172,682,000 |
TOTAL ASSETS |
$ |
351,539,000 |
|
$ |
312,164,000 |
|
|
|
|
||
LIABILITIES AND STOCKHOLDERS’ EQUITY |
|||||
Current liabilities |
$ |
95,005,000 |
|
$ |
49,344,000 |
Loans payable, net of unamortized debt discount |
|
186,057,000 |
|
|
183,172,000 |
All other liabilities |
|
12,856,000 |
|
|
9,237,000 |
TOTAL LIABILITIES |
|
293,918,000 |
|
|
241,753,000 |
TOTAL STOCKHOLDERS' EQUITY |
|
57,621,000 |
|
|
70,411,000 |
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY |
$ |
351,539,000 |
|
$ |
312,164,000 |
HARROW, INC. |
|||||||||||||||
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS |
|||||||||||||||
|
|||||||||||||||
|
For the Three Months Ended
|
|
For the Nine Months Ended
|
||||||||||||
|
|
2024 |
|
|
|
2023 |
|
|
|
2024 |
|
|
|
2023 |
|
Total revenues |
$ |
49,257,000 |
|
|
$ |
34,265,000 |
|
|
$ |
132,783,000 |
|
|
$ |
93,838,000 |
|
Cost of sales |
|
12,018,000 |
|
|
|
10,067,000 |
|
|
|
35,110,000 |
|
|
|
28,338,000 |
|
Gross profit |
|
37,239,000 |
|
|
|
24,198,000 |
|
|
|
97,673,000 |
|
|
|
65,500,000 |
|
Selling, general and administrative |
|
33,645,000 |
|
|
|
21,033,000 |
|
|
|
94,275,000 |
|
|
|
56,878,000 |
|
Research and development |
|
2,273,000 |
|
|
|
1,421,000 |
|
|
|
7,475,000 |
|
|
|
3,316,000 |
|
Total operating expenses |
|
35,918,000 |
|
|
|
22,454,000 |
|
|
|
101,750,000 |
|
|
|
60,194,000 |
|
Income (loss) from operations |
|
1,321,000 |
|
|
|
1,744,000 |
|
|
|
(4,077,000 |
) |
|
|
5,306,000 |
|
Total other expense, net |
|
5,521,000 |
|
|
|
4,596,000 |
|
|
|
19,506,000 |
|
|
|
19,333,000 |
|
Income tax expense |
|
(20,000 |
) |
|
|
(1,539,000 |
) |
|
|
(675,000 |
) |
|
|
(1,236,000 |
) |
Net loss attributable to Harrow, Inc. |
$ |
(4,220,000 |
) |
|
$ |
(4,391,000 |
) |
|
$ |
(24,258,000 |
) |
|
$ |
(15,263,000 |
) |
Net loss per share of common stock, basic and diluted |
$ |
(0.12 |
) |
|
$ |
(0.13 |
) |
|
$ |
(0.68 |
) |
|
$ |
(0.48 |
) |
HARROW, INC. |
|||||||
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS |
|||||||
|
|||||||
|
For the Nine Months Ended
|
||||||
2024 |
|
|
2023 |
|
|||
Net cash (used in) provided by: |
|
|
|
||||
Operating activities |
$ |
(4,423,000 |
) |
|
$ |
(4,856,000 |
) |
Investing activities |
|
4,396,000 |
|
|
|
(152,350,000 |
) |
Financing activities |
|
(1,457,000 |
) |
|
|
126,546,000 |
|
Net change in cash and cash equivalents |
|
(1,484,000 |
) |
|
|
(30,660,000 |
) |
Cash and cash equivalents at beginning of the period |
|
74,085,000 |
|
|
|
96,270,000 |
|
Cash and cash equivalents at end of the period |
$ |
72,601,000 |
|
$ |
65,610,000 |
Non-GAAP Financial Measures
In addition to the Company’s results of operations determined in accordance with
Adjusted EBITDA
The Company defines Adjusted EBITDA as net loss, excluding the effects of stock‑based compensation and expenses, interest, taxes, depreciation, amortization, investment loss (income), net, and, if any and when specified, other non-recurring income or expense items. Management believes that the most directly comparable GAAP financial measure to Adjusted EBITDA is net loss. Adjusted EBITDA has limitations and should not be considered as an alternative to gross profit or net loss as a measure of operating performance or to net cash (used in) provided by operating, investing, or financing activities as a measure of ability to meet cash needs.
The following is a reconciliation of Adjusted EBITDA, a non-GAAP measure, to the most comparable GAAP measure, net loss, for the three months and nine months ended September 30, 2024 and for the same periods in 2023:
HARROW, INC. |
|||||||||||||||
RECONCILIATION OF NET LOSS TO ADJUSTED EBITDA |
|||||||||||||||
For the Three Months Ended
|
For the Nine Months Ended
|
||||||||||||||
|
2024 |
|
2023 |
|
2024 |
|
2023 |
||||||||
GAAP net loss |
$ |
(4,220,000 |
) |
|
$ |
(4,391,000 |
) |
|
$ |
(24,258,000 |
) |
|
$ |
(15,263,000 |
) |
Stock-based compensation and expenses |
|
4,385,000 |
|
|
|
4,476,000 |
|
|
|
12,825,000 |
|
|
|
11,521,000 |
|
Interest expense, net |
|
5,525,000 |
|
|
|
5,749,000 |
|
|
|
16,411,000 |
|
|
|
16,200,000 |
|
Income taxes |
|
20,000 |
|
|
|
1,539,000 |
|
|
|
675,000 |
|
|
|
1,236,000 |
|
Depreciation |
|
497,000 |
|
|
|
405,000 |
|
|
|
1,382,000 |
|
|
|
1,095,000 |
|
Amortization of intangible assets |
|
2,605,000 |
|
|
|
2,584,000 |
|
|
|
7,708,000 |
|
|
|
7,634,000 |
|
Investment loss (income), net |
|
- |
|
|
|
(1,348,000 |
) |
|
|
3,171,000 |
|
|
|
(2,676,000 |
) |
Other (income) expense, net |
|
(4,000 |
) |
|
195,000 |
|
|
(76,000 |
) |
|
5,809,000 |
(1) |
|||
Adjusted EBITDA | $ |
8,808,000 |
|
$ |
9,209,000 |
|
$ |
17,838,000 |
|
$ |
25,556,000 |
(1) |
Includes |
Core Results
Harrow Core Results, including core gross margin, core net loss, and core basic and diluted loss per share exclude (1) all amortization and impairment charges of intangible assets, excluding software development costs, (2) net gains and losses on investments and equity securities, including equity method gains and losses and equity valued at fair value through profit and loss (FVPL), and preferred stock dividends, and (3) gains/losses on forgiveness of debt. In certain periods, Core Results may also exclude fair value adjustments of financial assets in the form of options to acquire a company carried at FVPL, obligations related to product recalls, certain acquisition‑related items, restructuring charges/releases and associated items, related legal items, gains/losses on early extinguishment of debt or debt modifications, impairments of property, plant and equipment and software, as well as income and expense items that management deems exceptional and that are or are expected to accumulate within the year to be over a
The following is a reconciliation of Core Results, non-GAAP measures, to the most comparable GAAP measures for the three months and nine months ended September 30, 2024 and for the same periods in 2023:
For the Three Months Ended September 30, 2024 |
|||||||||||||||||
GAAP
|
|
Amortization
|
|
Investment
|
|
Other
|
|
Core
|
|||||||||
Gross profit |
$ |
37,239,000 |
|
|
$ |
2,191,000 |
|
$ |
- |
|
$ |
- |
|
|
$ |
39,430,000 |
|
Gross margin |
|
76 |
% |
|
|
|
|
|
|
|
|
80 |
% |
||||
Operating income |
|
1,321,000 |
|
|
|
2,605,000 |
|
|
- |
|
|
- |
|
|
|
3,926,000 |
|
(Loss) income before taxes |
|
(4,200,000 |
) |
|
|
2,605,000 |
|
|
- |
|
|
(4,000 |
) |
|
|
(1,599,000 |
) |
Taxes |
|
(20,000 |
) |
|
|
- |
|
|
- |
|
|
- |
|
|
|
(20,000 |
) |
Net (loss) income |
|
(4,220,000 |
) |
|
|
2,605,000 |
|
|
- |
|
|
(4,000 |
) |
|
|
(1,619,000 |
) |
Basic and diluted loss per share ($)(1) |
|
(0.12 |
) |
|
|
|
|
|
|
|
|
(0.05 |
) |
||||
Weighted average number
|
|
35,702,200 |
|
|
|
|
|
|
|
|
|
35,702,200 |
|
For the Nine Months Ended September 30, 2024 |
|||||||||||||||||
GAAP
|
|
Amortization
|
|
Investment
|
|
Other
|
|
Core
|
|||||||||
Gross profit |
$ |
97,673,000 |
|
|
$ |
6,471,000 |
|
$ |
- |
|
$ |
- |
|
|
$ |
104,144,000 |
|
Gross margin |
|
74 |
% |
|
|
|
|
|
|
|
|
78 |
% |
||||
Operating loss |
|
(4,077,000 |
) |
|
|
7,708,000 |
|
|
- |
|
|
- |
|
|
|
3,631,000 |
|
(Loss) income before taxes |
|
(23,583,000 |
) |
|
|
7,708,000 |
|
|
3,171,000 |
|
|
(76,000 |
) |
|
|
(12,780,000 |
) |
Taxes |
|
(675,000 |
) |
|
|
- |
|
|
- |
|
|
- |
|
|
|
(675,000 |
) |
Net (loss) income |
|
(24,258,000 |
) |
|
|
7,708,000 |
|
|
3,171,000 |
|
|
(76,000 |
) |
|
|
(13,455,000 |
) |
Basic and diluted loss
|
|
(0.68 |
) |
|
|
|
|
|
|
|
|
(0.38 |
) |
||||
Weighted average number
|
|
35,597,409 |
|
|
|
|
|
|
|
|
|
35,597,409 |
|
For the Three Months Ended September 30, 2023 |
|||||||||||||||||
GAAP
|
|
Amortization
|
|
Investment
|
|
Other
|
|
Core
|
|||||||||
Gross profit |
$ |
24,198,000 |
|
|
$ |
2,480,000 |
|
$ |
- |
|
|
$ |
- |
|
$ |
26,678,000 |
|
Gross margin |
|
71 |
% |
|
|
|
|
|
|
|
|
78 |
% |
||||
Operating income |
|
1,744,000 |
|
|
|
2,584,000 |
|
|
- |
|
|
|
- |
|
|
4,328,000 |
|
(Loss) income before taxes |
|
(2,852,000 |
) |
|
|
2,584,000 |
|
|
(1,348,000 |
) |
|
|
195,000 |
|
|
(1,421,000 |
) |
Taxes |
|
(1,539,000 |
) |
|
|
- |
|
|
- |
|
|
|
- |
|
|
(1,539,000 |
) |
Net (loss) income |
|
(4,391,000 |
) |
|
|
2,584,000 |
|
|
(1,348,000 |
) |
|
|
195,000 |
|
|
(2,960,000 |
) |
Basic and diluted loss per share ($)(1) |
|
(0.13 |
) |
|
|
|
|
|
|
|
|
(0.09 |
) |
||||
Weighted average number
|
|
34,255,197 |
|
|
|
|
|
|
|
|
|
34,255,197 |
|
For the Nine Months Ended September 30, 2023 |
|||||||||||||||||
GAAP
|
|
Amortization
|
|
Investment
|
|
Other
|
|
Core
|
|||||||||
Gross profit |
$ |
65,500,000 |
|
|
$ |
7,174,000 |
|
$ |
- |
|
|
$ |
- |
|
$ |
72,674,000 |
|
Gross margin |
|
70 |
% |
|
|
|
|
|
|
|
|
77 |
% |
||||
Operating income |
|
5,306,000 |
|
|
|
7,634,000 |
|
|
- |
|
|
|
- |
|
|
12,940,000 |
|
(Loss) income before taxes |
|
(14,027,000 |
) |
|
|
7,634,000 |
|
|
(2,676,000 |
) |
|
|
5,786,000 |
|
|
(3,283,000 |
) |
Taxes |
|
(1,236,000 |
) |
|
|
- |
|
|
- |
|
|
|
- |
|
|
(1,236,000 |
) |
Net (loss) income |
|
(15,263,000 |
) |
|
|
7,634,000 |
|
|
(2,676,000 |
) |
|
|
5,786,000 |
|
|
(4,519,000 |
) |
Basic and diluted loss
|
|
(0.48 |
) |
|
|
|
|
|
|
|
|
(0.14 |
) |
||||
Weighted average number
|
|
31,689,947 |
|
|
|
|
|
|
|
|
|
31,689,947 |
|
(1) |
Core basic and diluted loss per share is calculated using the weighted-average number of shares of common stock outstanding during the period. Core basic and diluted loss per share also contemplates dilutive shares associated with equity‑based awards as described in Note 2 and elsewhere in the Condensed Consolidated Financial Statements included in the Company’s Quarterly Report on Form 10-Q for the quarter ended September 30, 2024. |
View source version on businesswire.com: https://www.businesswire.com/news/home/20241113897614/en/
Jamie Webb, Director of Communications and Investor Relations
jwebb@harrowinc.com
615-733-4737
Source: Harrow, Inc.