ThermoGenesis Holdings Announces Financial Results for the Second Quarter Ended June 30, 2020 and Provides Corporate Update
ThermoGenesis Holdings, Inc. (THMO) reported a Q2 2020 net revenue of $2.2 million, down 48% from $4.3 million in Q2 2019. This decline was due to reduced AXP disposable sales amid the COVID-19 pandemic, affecting the cord blood industry. Gross profit was a loss of $2.6 million compared to a profit of $2.0 million year-over-year. However, CAR-TXpress™ sales increased by $400,000 thanks to distributor Corning. The company expects sales to return to normal post-pandemic and is strategically expanding its product offerings, including COVID-19 solutions.
- CAR-TXpress™ sales increased by $400,000 from the prior period.
- The company has launched a SARS-CoV-2 IgM/IgG Antibody Test Kit, authorized for Emergency Use by the FDA.
- Improved cash position with $7.0 million in cash and equivalents at June 30, 2020.
- Net revenues decreased by 48% from $4.3 million in Q2 2019 to $2.2 million in Q2 2020.
- Gross profit loss of $(2.6) million compared to a profit of $2.0 million in the same quarter last year.
- Adjusted EBITDA loss of $4.7 million compared to an adjusted EBITDA of $53,000 in Q2 2019.
RANCHO CORDOVA, Calif., Aug. 14, 2020 /PRNewswire/ -- ThermoGenesis Holdings, Inc. (Nasdaq: THMO), a market leader in automated cell processing tools and services in the cell and gene therapy field, today announced financial and operating results for the second quarter ended June 30, 2020 and provided a corporate strategic update.
Second Quarter and Subsequent Achievements:
- In April 2020, the Company's
19% -owned joint venture, ImmuneCyte, acquired worldwide intellectual property for development of fully human antibody therapeutics for COVID-19, including four high-affinity monoclonal antibody drug candidates against SARS-CoV-2 and tools for screening and quantifying efficacy of such neutralizing antibodies. Results of the research related to these neutralizing antibody therapeutics were published in an article entitled, "Cross-neutralization antibodies against SARS-CoV-2 and RBD mutations from convalescent patient antibody libraries," in bioRxiv in June 2020. - On June 4, at the 2020 annual stockholder meeting, the Company received majority stockholder approval to authorize a new class of non-voting class B common stock. The Company intends to issue shares of the class B common stock to existing stockholders as a dividend payout. The class B common stock will be publicly traded under a separate ticker from its current class of common stock. The Company intends to use the class B shares as a vehicle to assist with future strategic acquisitions. The timing of the dividend will be determined by the Company at a later date.
- On June 11, the Company filed patent applications for a point-of-care device which improves the speed and accuracy of its lateral flow immunoassays (LFIA) to detect COVID-19 IgM and IgG antibodies from a single drop of blood.
- On June 23, Corning Incorporated's Life Sciences Division began the commercial launch of the Company's X-SERIES® cell processing platform under the ThermoGenesis® and Corning® dual brand, as part of the previously announced global distribution agreement.
- On June 29, the Company was added to the Russell Microcap® Index.
- On August 11, the Company entered into a supply agreement with BioHit Healthcare (Hefei) Co., Ltd., to market, under the ThermoGenesis brand, its SARS-CoV-2 IgM/IgG Antibody Test Kit, which has already received Emergency Use Authorization (EUA) from the U.S. Food and Drug Administration (FDA). Marketing activities are expected to begin on August 17, 2020.
"During the last few months, we adapted our strategy to develop and market a range of solutions to fight the global pandemic," stated Chris Xu, Ph.D., Chief Executive Officer of ThermoGenesis. "Notably, we contracted with a new manufacturer for a SARS-CoV-2 (COVID-19) IgM/IgG Antibody Test Kit which has already obtained EUA designation from the FDA and look forward to begin marketing next week. We plan to further differentiate this kit with the addition of a lateral flow immunoassay cartridge testing kit reader, now in the final stages of development, which is designed to improve the speed and accuracy of the COVID-19 antibody assay. Our research team has already filed a number of key patent applications around the reader, which allows for big data analysis, which we believe will be essential information as we continue to re-open our society and our economy."
Dr. Xu continued, "Also of note, was the commercial launch of our proprietary X-SERIES cell processing platform by our global distributor, Corning Life Sciences, under the ThermoGenesis and Corning® dual brand. We remain committed to expanding our robust product line of automated cellular processing tools and services to become a market leader for cell banking and cell therapies, which will sustain our growth beyond this COVID-19 pandemic."
Jeff Cauble, Chief Financial Officer of ThermoGenesis, added, "The second quarter marked one of our best quarters for CAR-TXpress™ sales, up
Financial Results for the Quarter Ended June 30, 2020
Net revenues. Net revenues for the three months ended June 30, 2020 were
Gross profit. Gross profit (loss) was
Sales and marketing expenses. For the three months ended June 30, 2020 sales and marketing expenses were
Research and development expenses. Research and development expenses were
General and administrative expenses. General and administrative expenses for the three months ended June 30, 2020 were
Interest expense. Interest expense for the three months ended June 30, 2020 was
Net loss. For the quarter ended June 30, 2020, the Company reported a comprehensive loss attributable to common stockholders of
Adjusted EBITDA. In addition to the results reported under US GAAP, the Company also uses a non-GAAP measure to evaluate operating performance and to facilitate the comparison of its historical results and trends. The Company uses the metric to determine operational cash flow. Adjusted EBITDA loss for the quarter ended June 30, 2020 was
At June 30, 2020, the Company had cash and cash equivalents totaling
Conference Call and Webcast Information
ThermoGenesis will host a conference call today at 1:30 p.m. PT/4:30 p.m. ET. To participate in the conference call, please dial 1-844-889-4331 (domestic), 1-412-380-7406 (international) or 1-866-605-3852 (Canada). To access a live webcast of the call, please visit: https://thermogenesis.com/investors/news-and-events/events-webcasts.
A webcast replay will be available on ThermoGenesis' website for three months by visiting the Investor page of the Company's website at www.thermogenesis.com.
About ThermoGenesis Holdings, Inc.
ThermoGenesis Holdings, Inc. develops, commercializes, and markets a range of automated technologies for CAR-T and other cell-based therapies. The Company currently markets a full suite of solutions for automated clinical biobanking, point-of-care applications, and automation for immuno-oncology, including its semi-automated, functionally-closed CAR-TXpress™ platform, which streamlines the manufacturing process for the emerging CAR-T immunotherapy market. For more information about ThermoGenesis, please visit: www.thermogenesis.com.
Forward-Looking Statements
This press release contains "forward-looking statements" within the meaning of the U.S. Private Securities Litigation Reform Act of 1995. The forward-looking statements involve risks and uncertainties that could cause actual results to differ materially from the forward-looking statements contained herein. When used in this press release, the words "anticipate," "believe," "estimate," "expect" and similar expressions as they relate to the Company or its management are intended to identify such forward-looking statements. Actual results, performance or achievements could differ materially from the results expressed in or implied by these forward-looking statements. Readers should be aware of important factors that, in some cases, have affected, and in the future could affect, actual results to differ materially from those expressed in any forward-looking statements made by or on behalf of the Company. These factors include without limitation, the ability to obtain capital and other financing in the amounts and at the times needed to launch new products, market acceptance of new products, the nature and timing of regulatory approvals for both new products and existing products for which the Company proposes new claims, realization of forecasted revenues, expenses and income, initiatives by competitors, price pressures, failure to meet FDA regulated requirements governing the Company's products and operations (including the potential for product recalls associated with such regulations), risks associated with initiating manufacturing for new products, failure to meet Foreign Corrupt Practice Act regulations, legal proceedings, uncertainty associated with the COVID-19 pandemic, and other risk factors listed from time to time in our reports with the Securities and Exchange Commission ("SEC"), including, in particular, those set forth in ThermoGenesis Holdings' Form 10-K for the year ended December 31, 2019.
Company Contact:
Wendy Samford
916-858-5191
ir@thermogenesis.com
Investor Contact:
Paula Schwartz, Rx Communications
917-322-2216
pschwartz@rxir.com
Financials
ThermoGenesis Holdings, Inc. | ||||
Condensed Consolidated Balance Sheets | ||||
June 30, 2020 | December 31, 2019 | |||
(Unaudited) | ||||
ASSETS | ||||
Current assets: | ||||
Cash and cash equivalents | ||||
Restricted cash | -- | 1,000,000 | ||
Accounts receivable, net | 1,654,000 | 1,278,000 | ||
Inventories, net | 5,189,000 | 3,824,000 | ||
Prepaid expenses and other current assets | 837,000 | 602,000 | ||
Total current assets | 14,664,000 | 9,861,000 | ||
Equipment and leasehold improvements, net | 1,657,000 | 2,028,000 | ||
Right-of-use operating lease assets, net | 797,000 | 859,000 | ||
Goodwill | 781,000 | 781,000 | ||
Intangible assets, net | 1,406,000 | 1,467,000 | ||
Other assets | 48,000 | 218,000 | ||
Total assets | ||||
LIABILITIES AND EQUITY | ||||
Current liabilities: | ||||
Accounts payable | ||||
Other current liabilities | 3,369,000 | 5,238,000 | ||
Total current liabilities | 6,605,000 | 6,685,000 | ||
Long-term liabilities | 7,418,000 | 7,613,000 | ||
ThermoGenesis Holdings, Inc. stockholders' equity | 5,014,000 | 386,000 | ||
Noncontrolling interests | 316,000 | 530,000 | ||
Total liabilities and equity | ||||
ThermoGenesis Holdings, Inc. | |||||||
Condensed Consolidated Statements of Operations | |||||||
(Unaudited) | |||||||
Three Months Ended | Six Months Ended | ||||||
2020 | 2019 | 2020 | 2019 | ||||
Net revenues | |||||||
Cost of revenues | 4,874,000 | 2,354,000 | 6,582,000 | 4,057,000 | |||
Gross profit (loss) | (2,632,000) | 1,951,000 | (1,140,000) | 3,211,000 | |||
Expenses: | |||||||
Sales and marketing | 442,000 | 384,000 | 886,000 | 725,000 | |||
Research and development | 578,000 | 611,000 | 1,187,000 | 1,175,000 | |||
General and administration | 1,536,000 | 1,218,000 | 3,184,000 | 2,478,000 | |||
Total operating expenses | 2,556,000 | 2,213,000 | 5,257,000 | 4,378,000 | |||
Loss from operations | (5,188,000) | (262,000) | (6,397,000) | (1,167,000) | |||
Interest expense | (1,314,000) | (1,211,000) | (4,845,000) | (2,343,000) | |||
Other income (expenses) | (8,000) | (2,000) | 2,000 | (11,000) | |||
Loss on equity method investments | -- | -- | (13,000) | -- | |||
Total other expense | (1,322,000) | (1,213,000) | (4,856,000) | (2,354,000) | |||
Net loss | (6,510,000) | (1,475,000) | (11,253,000) | (3,521,000) | |||
Loss attributable to noncontrolling interests | (73,000) | (178,000) | (214,000) | (354,000) | |||
Net loss attributable to common stockholders | |||||||
ThermoGenesis Holdings, Inc. | |||
Condensed Consolidated Statements of Cash Flows | |||
(Unaudited) | |||
Six Months Ended June 30, | |||
2020 | 2019 | ||
Cash flows from operating activities: | |||
Net cash used in operating activities | |||
Cash flows from investing activities: | |||
Capital expenditures | (23,000) | (142,000) | |
Cash flows from financing activities: | |||
Proceeds from convertible promissory note-related party | 4,287,000 | 1,513,000 | |
Payments on finance lease obligations | (22,000) | (15,000) | |
Proceeds from issuance of common stock, net of expenses | 5,214,000 | 756,000 | |
Proceeds from the exercise of options, warrants and pre-funded warrants | 1,683,000 | 23,000 | |
Proceeds from long-term debt | -- | 800,000 | |
Proceeds from note payable | 646,000 | -- | |
Net cash provided by financing activities | 11,808,000 | 3,077,000 | |
Effects of foreign currency rate changes on cash and cash equivalents | (5,000) | -- | |
Net increase (decrease) in cash, cash equivalents and restricted cash | 2,827,000 | 24,000 | |
Cash, cash equivalents and restricted cash at beginning of period | 4,157,000 | 3,400,000 | |
Cash, cash equivalents and restricted cash at end of period | |||
ThermoGenesis Holdings, Inc. | ||||||||
Reconciliation of Adjusted EBITDA to Net Loss | ||||||||
(Unaudited) | ||||||||
Three Months Ended June 30, | Six Months Ended June 30, | |||||||
2020 | 2019 | 2020 | 2019 | |||||
Net loss | ||||||||
Deduct: | ||||||||
Interest expense | (1,314,000) | (1,211,000) | (4,845,000) | (2,343,000) | ||||
Other income (expense) | (8,000) | (2,000) | 2,000 | (11,000) | ||||
Loss on equity method investments | -- | -- | (13,000) | -- | ||||
Loss from operations | ||||||||
Add: | ||||||||
Depreciation and amortization | 193,000 | 190,000 | 392,000 | 402,000 | ||||
Stock-based compensation expense | 314,000 | 125,000 | 381,000 | 206,000 | ||||
Adjusted EBITDA | ||||||||
The Company defines adjusted EBITDA as income (or loss) from operations less, depreciation, amortization, stock compensation and impairment of intangible assets.
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SOURCE ThermoGenesis Holdings, Inc.
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