Kamada Ltd 6-K, filed Nov 22, 2022
Kamada Ltd (KMDA)
About this 6-K
Kamada Ltd filed this 6-K on November 22, 2022.
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM
Report of Foreign Private Issuer
Pursuant to Rule 13a-16 or 15d-16
of the Securities Exchange Act of 1934
For the Month of November 2022
Commission File Number
(Translation of registrant’s name into English)
2 Holzman Street
Science Park, P.O. Box 4081
Rehovot 7670402
Israel
(Address of principal executive offices)
Indicate by check mark whether the registrant files or will file annual reports under cover Form 20-F or Form 40-F.
Form 20-F ☒ Form 40-F ☐
Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(1): ____
Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(7): ____
Indicate by check mark whether the registrant by furnishing the information contained in this Form is also thereby furnishing the information to the Commission pursuant to Rule 12g3-2(b) under the Securities Exchange Act of 1934.
Yes ☐ No ☒
If “Yes” is marked, indicate below the file number assigned to the registrant in connection with Rule 12g3-2(b): 82-____
This Form 6-K is being incorporated by reference into the Registrant’s Form S-8 Registration Statements, File Nos. 333-192720, 333-207933, 333-215983, 333-222891, 333-233267 and 333-265866.
The following exhibit is attached:
| 99.1 | Kamada Reports Strong Third Quarter Financial Results Demonstrating Successful Strategic Transition and Reiterates 2022 Financial Guidance | |
| 99.2 | Kamada Ltd’s Consolidated Financial Statements as of September 30, 2022 (Unaudited) | |
| 101.INS | Inline XBRL Instance Document. | |
| 101.SCH | Inline XBRL Taxonomy Extension Schema Document. | |
| 101.CAL | Inline XBRL Taxonomy Extension Calculation Linkbase Document. | |
| 101.DEF | Inline XBRL Taxonomy Extension Definition Linkbase Document. | |
| 101.LAB | Inline XBRL Taxonomy Extension Label Linkbase Document. | |
| 101.PRE | Inline XBRL Taxonomy Extension Presentation Linkbase Document. | |
| 104 | Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101). |
1
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
| Date: November 22, 2022 | KAMADA LTD. | |
| By: | /s/ Yifat Philip | |
|
Yifat Philip Vice President General Counsel and | ||
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EXHIBIT INDEX
| EXHIBIT NO. | DESCRIPTION | |
| 99.1 | Kamada Reports Strong Third Quarter Financial Results Demonstrating Successful Strategic Transition and Reiterates 2022 Financial Guidance | |
| 99.2 | Kamada Ltd’s Consolidated Financial Statements as of September 30, 2022 (Unaudited) | |
| 101.INS | Inline XBRL Instance Document. | |
| 101.SCH | Inline XBRL Taxonomy Extension Schema Document. | |
| 101.CAL | Inline XBRL Taxonomy Extension Calculation Linkbase Document. | |
| 101.DEF | Inline XBRL Taxonomy Extension Definition Linkbase Document. | |
| 101.LAB | Inline XBRL Taxonomy Extension Label Linkbase Document. | |
| 101.PRE | Inline XBRL Taxonomy Extension Presentation Linkbase Document. | |
| 104 | Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101). |
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Exhibit 99.1
Kamada
Reports Strong Third Quarter Financial Results Demonstrating Successful Strategic
Transition and Reiterates 2022 Financial Guidance
| ● | Third Quarter 2022 Revenues of $32.2 Million, a 40% Increase Compared to Prior Year Period; Reaping the Benefits of the Acquired IgG Portfolio |
| ● | Strong Results Represent Completion of the Company’s Strategic Transformation into a Diversified Commercial Entity with Multiple Growth Drivers |
| ● | Adjusted EBITDA for the Third Quarter was $6.0 Million, or 19% Margin, and for First Nine Months was $10.6 Million or 13% Margin, Within Annual Guidance, and Representing 58% Increase Year-over-Year |
| ● | Generated Operating Cash Flow of $5.5 Million in the Third Quarter and $21.8 Million in the First Nine Months of 2022, Supporting the Increase of Cash Position to $31.3 Million as of September 30, 2022 |
| ● | Kamada’s Positive Outlook for the Fourth Quarter Supports Reiteration of Fiscal Year 2022 Revenue Guidance of $125 Million - $135 Million, Representing a 20% to 30% Increase Over 2021 and Adjusted EBITDA Margins Between 12%-15%, More Than 2.5x Over 2021 |
Rehovot, Israel, and Hoboken, NJ – November 22, 2022 -- Kamada Ltd. (NASDAQ: KMDA; TASE: KMDA.TA), a vertically integrated global biopharmaceutical company, focused on specialty plasma-derived therapeutics, today announced financial results for the three and nine months ended September 30, 2022.
“Our strong third quarter performance is consistent with our forecasted positive outlook for the second half of the year,” said Amir London, Kamada’s Chief Executive Officer. “Our business is beginning to reap the significant benefits of the acquired portfolio of four FDA-approved IgGs, consisting of CYTOGAM®, HEPAGAM B®, VARIZIG® and WINRHO®SDF. We have now completed our rapid transition from our past dependency on GLASSIA® sales to Takeda to a diversified, fully integrated commercial company and a global leader in the plasma-derived specialty market. In the third quarter, we generated total revenues of $32.2 million, representing a 40% increase year-over-year, and overall gross margins increased to 40% as compared to 25% in the third quarter of 2021. Importantly, each of our expected key revenue and profitability drivers, including our new IgG portfolio, as well as KEDRAB® sales and GLASSIA royalty income, contributed significantly to our sales and profitability growth. Based on our expectation for continued revenue growth and enhanced profitability in the fourth quarter of the year, we are reiterating our full-year 2022 financial guidance, which represents a 20% to 30% increase over 2021 revenue and more than 2.5x over 2021 adjusted EBITDA.”
“I am pleased to report that over recent months, as part of the establishment of our direct presence in the U.S. market, we deployed a team of U.S.-based experienced sales and medical affairs professionals who have rapidly established our operations in this key market. The U.S. sales team is making good progress in promoting our portfolio of specialty plasma-derived IgG products to physicians and other healthcare practitioners through direct engagement and opportunities at medical conventions. The Medical Affairs team is working to educate physicians, while addressing their scientific and clinical inquiries, including participating in major medical conferences in the U.S. These activities represent the first time in over a decade that these hyper-immune specialty products have been supported by field-based activity in the U.S. We are encouraged by the positive feedback received from key U.S. physicians who are seeking to publish new clinical data related to our portfolio, while conducting educational symposiums that we believe will have a positive impact on the understanding of these products, thereby contributing to continued growth in demand,” continued Mr. London.
“In addition, we continue to make significant progress promoting our commercial portfolio outside the U.S. market. To this end, we recently reported an $11.4 million agreement to supply VARIZIG to an international organization, as well as the extension of an existing tender for the supply, in Canada, of the four IgG products for a total of $22.0 million over the next three years. These significant accomplishments are key factors in ensuring our continued growth. Looking further ahead, we continue to forecast revenue growth at a double-digit rate in the foreseeable years beyond 2022, driven by our proprietary product catalysts, our plasma collection operations, GLASSIA’s royalties and the planned launch of eleven biosimilar products in Israel,” concluded Mr. London.
Financial Highlights for the Three Months Ended September 30, 2022
| ● | Total revenues were $32.2 million in the third quarter of 2022, a 40% increase from the $23.0 million recorded in the third quarter of 2021. Total revenues during the third quarter of 2022 included strong sales from the portfolio of four acquired FDA-approved IgG products. Total revenues included $3.5 million of sales-based royalty income from Takeda based on GLASSIA sales in the U.S. |
| ● | Gross profit and gross margins were $12.9 million and 40%, respectively, in the third quarter of 2022, compared to $5.7 million and 25%, respectively, reported in the third quarter of 2021. The increase in profitability was driven by a positive product sales mix, including sales of our four new IgG products, KEDRAB and GLASSIA royalties. Cost of goods sold in the Company’s Proprietary segment in the third quarter of 2022 included $1.3 million of depreciation expenses associated with intangible assets generated through the IgG products acquisition. Gross profit and gross margins, excluding such intangible assets depreciation, would have been $14.2 million and 44%, respectively. |
| ● | Operating expenses, including R&D, Sales & Marketing (S&M), G&A and other expenses, totaled $10.3 million in the third quarter of 2022, as compared to $6.5 million in the third quarter of 2021. This increase was attributable to increased S&M costs associated with expanded U.S. commercial operations and increased costs associated with accelerating recruitment for the ongoing pivotal Phase 3 clinical trial of Inhaled AAT. S&M costs for the quarter included $0.4 million of depreciation expenses of intangible assets generated through the IgG products acquisition. |
| ● | Finance expense, net for the third quarter of 2022 included a $2.0 million expense associated with the revaluation of the contingent consideration and other long-term liabilities assumed as part of the IgG products acquisition. For more information with respect to such contingent consideration and other long-term liabilities, please refer to Note 5 of the Company’s 2021 financial statements included in the 2021 Annual Report on Form 20-F filed on March 15, 2022, with the Securities and Exchange Commission. |
| ● | Net income was $0.5 million, or $0.01 per share, in the third quarter of 2022, as compared to a net loss of $0.8 million, or $(0.02) per share, in the third quarter of 2021. Excluding depreciation expenses of intangible assets mentioned above and finance expense associated with the revaluation of the contingent consideration and other assumed long-term liabilities, the Company would have recorded net income of $4.3 million, or $0.10 per share, in the third quarter of 2022. |
| ● | Adjusted EBITDA, as detailed in the tables below, was $6.0 million in the third quarter of 2022, as compared to $0.6 million in the third quarter of 2021. |
| ● | Cash provided by operating activities was $5.5 million in the third quarter of 2022, as compared to cash used in operating activities of $2.7 million in the third quarter of 2021. |
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Financial Highlights for the Nine Months Ended September 30, 2022
| ● | Total revenues for the first nine months of 2022 were $83.9 million, a 16% increase from the $72.2 million generated in the first nine months of 2021. The increase in revenues is mainly attributable to sales of the acquired four IgG products. |
| ● | Gross profit and gross margins for the first nine months of 2022 were $31.4 million and 37%, respectively, compared to $23.7 million and 33%, respectively, in the prior year period. Gross profit and gross margins in the first nine months of 2022, excluding intangible assets depreciation and a $4.3 million loss related to the labor strike concluded in July 2022, would have been $39.7 million and 47%, respectively, representing a significant increase year-over-year. |
| ● | Operating expenses, including R&D, S&M, G&A and other expenses, totaled $30.9 million in the first nine months of 2022, as compared to $21.1 million in the first nine months 2021. This increase was attributable to an increase in S&M costs associated with the recently acquired portfolio marketing and commercial operation, as well as increased R&D costs, primarily due to advancing the pivotal Phase 3 InnovAATe trial for Inhaled AAT through the opening of new clinical sites and the manufacturing of clinical supply for the study. S&M costs for the first nine months included $1.3 million of depreciation expenses of intangible assets generated through the IgG products acquisition. |
| ● | Finance expense, net for the first nine months of 2022 included a $5.9 million expense associated with the revaluation of the contingent consideration and other long-term liabilities, assumed as part of the IgG products acquisition. |
| ● | Net loss for the first nine months of 2022 was $5.3 million, or $(0.12) per share, as compared to net income of $2.8 million, or $0.06 per share, in the prior year period. Excluding loss associated with the labor strike, depreciation expenses of intangible assets generated through the recent acquisition and finance expense associated with the revaluation of the contingent consideration and other assumed long-term liabilities, the Company would have recorded net income of $10.2 million, or $0.23 per share, in the first nine months of 2022. |
| ● | Adjusted EBITDA, as detailed in the tables below, was $10.6 million in the first nine months of 2022, as compared to $6.7 million in the first nine months of 2021, representing a 58% increase year-over-year, and 13% margins, which is in line with Kamada’s annual guidance. Excluding loss associated with the labor strike, Adjusted EBITDA would have been $14.9 million, representing an 18% margin. |
| ● | Cash provided by operating activities during the first nine months of 2022 was $21.8 million, as compared to cash used in operating activities of $3.9 million during the first nine months of 2021. |
Balance Sheet Highlights
As of September 30, 2022, the Company had cash and cash equivalents of $31.3 million, as compared to $18.6 million as of December 31, 2021. Kamada’s strong cash position is driven by continued positive operational cash flows, which is indicative of the significant momentum in the Company’s commercial operations.
Fiscal Year 2022 Guidance
Kamada continues to expect to generate fiscal year 2022 total revenues in the range of $125 million to $135 million, which would represent 20% to 30% growth compared to fiscal year 2021. The Company also anticipates generating adjusted EBITDA during 2022 at a rate of 12% to 15% of total revenues, representing more than 2.5x of the adjusted EBITDA for the year ended December 31, 2021.
Recent Corporate Highlights
| ● | Awarded extension to existing Canadian supply tender for the portfolio of four specialty IgG products acquired in 2021. The supply extension secures ongoing sales of approximately $7.5 million per year for 2023-2025, with an option to extend for up to an additional two years. |
| ● | Reported acceleration of enrollment in ongoing pivotal Phase 3 clinical trial of Inhaled AAT. The independent DSMB recommended study continuation without modification for the fourth time since study initiation. Based on encouraging safety observed to date, trial inclusion criteria revised to also include patients with severe airflow limitation, thereby expanding the potential patient treatment population. Kamada intends to meet with the FDA and EMA during the first half of 2023 to discuss study progress and potential opportunities to shorten the regulatory pathway. |
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Conference Call
Kamada management will host an investment community conference call on Tuesday, November 22, at 8:30am Eastern Time to discuss these results and answer questions. Shareholders and other interested parties may participate in the conference call by dialing 1-877-407-0792 (from within the U.S.), 1 809-406-247 (from Israel), or 1 201-689-8263 (International) and entering the conference identification number: 13734312. The call will also be webcast live on the Internet at:
https://viavid.webcasts.com/starthere.jsp?ei=1582277&tp_key=8121e668e3.
Non-IFRS financial measures
We present EBITDA and adjusted EBITDA because we use this non-IFRS financial measure to assess our operational performance, for financial and operational decision-making, and as a means to evaluate period-to-period comparisons on a consistent basis. Management believes this non-IFRS financial measure are useful to investors because: (1) they allow for greater transparency with respect to key metrics used by management in its financial and operational decision-making and provide investors with a meaningful perspective on the current underlying performance of the Company’s core ongoing operations; and (2) they exclude the impact of certain items that are not directly attributable to our core operating performance and that may obscure trends in the core operating performance of the business. Non-IFRS financial measures have limitations as an analytical tool and should not be considered in isolation from, or as a substitute for, our IFRS results. We expect to continue reporting non-IFRS financial measures, adjusting for the items described below, and we expect to continue to incur expenses similar to certain of the non-cash, non-IFRS adjustments described below. Accordingly, unless otherwise stated, the exclusion of these and other similar items in the presentation of non-IFRS financial measures should not be construed as an inference that these items are unusual, infrequent or non-recurring. EBITDA and adjusted EBITDA are not recognized terms under IFRS and do not purport to be an alternative to IFRS terms as an indicator of operating performance or any other IFRS measure. Moreover, because not all companies use identical measures and calculations, the presentation of EBITDA and adjusted EBITDA may not be comparable to other similarly titled measures of other companies. EBITDA and adjusted EBITDA are defined as net income (loss), plus income tax expense, plus or minus financial income or expenses, net, plus or minus income or expense in respect of securities measured at fair value, net, plus or minus income or expenses in respect of currency exchange differences and derivatives instruments, net, plus depreciation and amortization expense, plus non-cash share-based compensation expenses and certain other costs.
About Kamada
Kamada Ltd. (the “Company”) is a vertically integrated global biopharmaceutical company, focused on specialty plasma-derived therapeutics, with a diverse portfolio of marketed products, a robust development pipeline and industry-leading manufacturing capabilities. The Company’s strategy is focused on driving profitable growth from our current commercial activities as well as our manufacturing and development expertise in the plasma-derived biopharmaceutical market. The Company’s commercial products portfolio includes its developed and FDA approved products GLASSIA® and KEDRAB® as well as its recently acquired FDA approved plasma-derived hyperimmune products CYTOGAM®, HEPAGAM B®, VARIZIG® and WINRHO®SDF. The Company has additional four plasma-derived products which are registered in markets outside the U.S. The Company distributes its commercial products portfolio directly, and through strategic partners or third-party distributors in more than 30 countries, including the U.S., Canada, Israel, Russia, Brazil, Argentina, India and other countries in Latin America and Asia. The Company has a diverse portfolio of development pipeline products including an inhaled AAT for the treatment of AAT deficiency for which the Company is currently conducting the InnovAATe clinical trial, a randomized, double-blind, placebo-controlled, pivotal Phase 3 trial. The Company leverages its expertise and presence in the Israeli pharmaceutical market to distribute in Israel more than 20 products that are manufactured by third parties and have recently added eleven biosimilar products to its Israeli distribution portfolio, which, subject to EMA and the Israeli MOH approvals, are expected to be launched in Israel through 2028. FIMI Opportunity Fund, the leading private equity investor in Israel, is the Company’s lead shareholder, beneficially owning approximately 21% of the outstanding ordinary shares.
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Cautionary Note Regarding Forward-Looking Statements
This release includes forward-looking statements within the meaning of Section 21E of the U.S. Securities Exchange Act of 1934, as amended, and the safe harbor provisions of the U.S. Private Securities Litigation Reform Act of 1995. Forward-looking statements are statements that are not historical facts, including statements regarding: 1) fiscal year 2022 guidance, 2) revenue growth at a double-digit rate in the foreseeable years beyond 2022, driven by Kamada’s proprietary product catalysts, plasma collection operations, GLASSIA’s royalties and the planned launch of 11 biosimilar products in Israel, 3) continued revenue growth and enhanced profitability in the fourth quarter of the year, 4) Kamada becoming a diversified, fully integrated commercial company and a global leader in the plasma-derived specialty market, 5) optimism about the positive feedback received from key U.S. physicians to enable the expansion of sales of our IgG portfolio, 6) the encouraging safety observed to date relating to the Phase 3 clinical trial of Inhaled AAT, and 7) planned meeting with the FDA and EMA during the first half of 2023 to discuss study progress and potential opportunities to shorten the regulatory pathway. Forward-looking statements are based on Kamada’s current knowledge and its present beliefs and expectations regarding possible future events and are subject to risks, uncertainties and assumptions. Actual results and the timing of events could differ materially from those anticipated in these forward-looking statements as a result of several factors including, but not limited to, the continued evolvement of the COVID-19 pandemic, its scope, effect and duration, availability of sufficient raw materials required to maintain manufacturing plans, disruption to the supply chain due to COVID-19 pandemic, continuation of inbound and outbound international delivery routes, continued demand for Kamada’s products, financial conditions of the Company’s customer, suppliers and services providers, Kamada’s ability to integrate the new product portfolio into its current product portfolio, Kamada’s ability to grow the revenues of its new product portfolio, and leverage and expand its international distribution network, ability to reap the benefits of the recent acquisition of the plasma collection center, including the ability to open additional U.S. plasma centers, and acquisition of the FDA-approved plasma-derived hyperimmune commercial products, the ability to continue enrollment of the pivotal Phase 3 InnovAATe clinical trial in new locations, unexpected results of clinical studies, Kamada’s ability to manage operating expenses, additional competition in the markets that Kamada competes, regulatory delays, prevailing market conditions and the impact of general economic, industry or political conditions in the U.S., Israel or otherwise, and other risks detailed in Kamada’s filings with the U.S. Securities and Exchange Commission (the “SEC”) including those discussed in its most recent Annual Report on Form 20-F and in any subsequent reports on Form 6-K, each of which is on file or furnished with the SEC and available at the SEC’s website at www.sec.gov. The forward-looking statements made herein speak only as of the date of this announcement and Kamada undertakes no obligation to update publicly such forward-looking statements to reflect subsequent events or circumstances, except as otherwise required by law.
###
CONTACTS:
Chaime Orlev
Chief Financial Officer
IR@kamada.com
Bob Yedid
LifeSci Advisors, LLC
646-597-6989
Bob@LifeSciAdvisors.com
5
CONSOLIDATED STATEMENTS OF FINANCIAL POSITION
| As of September 30, | As of December 31, | |||||||||||
| 2022 | 2021 | 2021 | ||||||||||
| Unaudited | Audited | |||||||||||
| U.S Dollars in thousands | ||||||||||||
| Assets | ||||||||||||
| Current Assets | ||||||||||||
| Cash and cash equivalents | $ | 31,252 | $ | 99,840 | $ | 18,587 | ||||||
| Trade receivables, net | 23,997 | 26,548 | 35,162 | |||||||||
| Other accounts receivables | 6,884 | 4,392 | 8,872 | |||||||||
| Inventories | 73,029 | 48,163 | 67,423 | |||||||||
| Total Current Assets | 135,162 | 178,943 | 130,044 | |||||||||
| Non-Current Assets | ||||||||||||
| Property, plant and equipment, net | 25,898 | 25,856 | 26,307 | |||||||||
| Right-of-use assets | 2,793 | 3,361 | 3,092 | |||||||||
| Intangible assets, Goodwill and other long-term assets | 148,620 | 3,380 | 153,663 | |||||||||
| Contract assets | 7,164 | 4,987 | 5,561 | |||||||||
| Total Non-Current Assets | 184,475 | 37,584 | 188,623 | |||||||||
| Total Assets | $ | 319,637 | $ | 216,527 | $ | 318,667 | ||||||
| Liabilities | ||||||||||||
| Current Liabilities | ||||||||||||
| Current maturities of bank loans | $ | 4,444 | $ | 52 | $ | 2,631 | ||||||
| Current maturities of lease liabilities | 1,004 | 1,181 | 1,154 | |||||||||
| Current maturities of other long term liabilities | 25,095 | - | 17,986 | |||||||||
| Trade payables | 30,619 | 19,010 | 25,104 | |||||||||
| Other accounts payables | 7,948 | 6,346 | 7,142 | |||||||||
| Deferred revenues | 40 | - | 40 | |||||||||
| Total Current Liabilities | 69,150 | 26,589 | 54,057 | |||||||||
| Non-Current Liabilities | ||||||||||||
| Bank loans | 14,074 | - | 17,407 | |||||||||
| Lease liabilities | 2,414 | 3,283 | 3,160 | |||||||||
| Contingent consideration | 20,705 | - | 21,995 | |||||||||
| Other long-term liabilities | 39,915 | - | 43,929 | |||||||||
| Deferred revenues | 15 | 3,575 | 15 | |||||||||
| Employee benefit liabilities, net | 813 | 1,467 | 1,280 | |||||||||
| Total Non-Current Liabilities | 77,936 | 8,325 | 87,786 | |||||||||
| Shareholder’s Equity | ||||||||||||
| Ordinary shares | 11,732 | 11,720 | 11,725 | |||||||||
| Additional paid in capital net | 210,355 | 210,005 | 210,204 | |||||||||
| Capital reserve due to translation to presentation currency | (3,490 | ) | (3,490 | ) | (3,490 | ) | ||||||
| Capital reserve from hedges | (257 | ) | 35 | 54 | ||||||||
| Capital reserve from share-based payments | 5,427 | 4,817 | 4,643 | |||||||||
| Capital reserve from employee benefits | 212 | (320 | ) | (149 | ) | |||||||
| Accumulated deficit | (51,428 | ) | (41,154 | ) | (46,163 | ) | ||||||
| Total Shareholder’s Equity | 172,551 | 181,613 | 176,824 | |||||||||
| Total Liabilities and Shareholder’s Equity | $ | 319,637 | $ | 216,527 | $ | 318,667 | ||||||
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CONSOLIDATED STATEMENTS OF PROFIT OR LOSS AND OTHER COMPREHENSIVE INCOME
| Nine months period ended | Three months period ended | Year ended | ||||||||||||||||||
| September 30, | September 30, | December 31, | ||||||||||||||||||
| 2022 | 2021 | 2022 | 2021 | 2021 | ||||||||||||||||
| Unaudited | Unaudited | Audited | ||||||||||||||||||
| U.S Dollars In thousands | ||||||||||||||||||||
| Revenues from proprietary products | $ | 67,198 | $ | 57,316 | $ | 25,580 | $ | 17,123 | $ | 75,521 | ||||||||||
| Revenues from distribution | 16,702 | 14,857 | 6,637 | 5,911 | 28,121 | |||||||||||||||
| Total revenues | 83,900 | 72,173 | 32,217 | 23,034 | 103,642 | |||||||||||||||
| Cost of revenues from proprietary products | 37,856 | 35,605 | 13,151 | 12,078 | 48,194 | |||||||||||||||
| Cost of revenues from distribution | 14,632 | 12,835 | 6,196 | 5,226 | 25,120 | |||||||||||||||
| Total cost of revenues | 52,488 | 48,440 | 19,347 | 17,304 | 73,314 | |||||||||||||||
| Gross profit | 31,412 | 23,733 | 12,870 | 5,730 | 30,328 | |||||||||||||||
| Research and development expenses | 10,181 | 7,909 | 3,118 | 2,545 | 11,357 | |||||||||||||||
| Selling and marketing expenses | 10,435 | 3,803 | 3,843 | 1,256 | 6,278 | |||||||||||||||
| General and administrative expenses | 9,481 | 8,803 | 3,165 | 2,691 | 12,636 | |||||||||||||||
| Other expenses | 801 | 612 | 182 | 42 | 753 | |||||||||||||||
| Operating income (loss) | 514 | 2,606 | 2,562 | (804 | ) | (696 | ) | |||||||||||||
| Financial income | 32 | 277 | 29 | 68 | 295 | |||||||||||||||
| Income (expenses) in respect of currency exchange differences and derivatives instruments, net | 756 | 74 | 163 | (48 | ) | (207 | ) | |||||||||||||
| Financial Income (expense) in respect of contingent consideration and other long- term liabilities. | (5,924 | ) | - | (2,049 | ) | - | (947 | ) | ||||||||||||
| Financial expenses | (583 | ) | (178 | ) | (211 | ) | (61 | ) | (330 | ) | ||||||||||
| Income before tax on income | (5,205 | ) | 2,779 | 494 | (845 | ) | (1,885 | ) | ||||||||||||
| Taxes on income | 60 | - | 10 | - | 345 | |||||||||||||||
| Net Income (loss) | $ | (5,265 | ) | $ | 2,779 | $ | 484 | $ | (845 | ) | $ | (2,230 | ) | |||||||
| Other Comprehensive Income (loss): | ||||||||||||||||||||
| Amounts that will be or that have been reclassified to profit or loss when specific conditions are met | ||||||||||||||||||||
| Gain (loss) on cash flow hedges | (830 | ) | 25 | (46 | ) | 68 | 185 | |||||||||||||
| Net amounts transferred to the statement of profit or loss for cash flow hedges | 519 | (347 | ) | 231 | (91 | ) | (488 | ) | ||||||||||||
| Items that will not be reclassified to profit or loss in subsequent periods: | ||||||||||||||||||||
| Remeasurement gain (loss) from defined benefit plan | 361 | - | (59 | ) | - | 171 | ||||||||||||||
| Total comprehensive income (loss) | $ | (5,215 | ) | $ | 2,457 | $ | 610 | $ | (868 | ) | $ | (2,362 | ) | |||||||
| Earnings per share attributable to equity holders of the Company: | ||||||||||||||||||||
| Basic net earnings per share | $ | (0.12 | ) | $ | 0.06 | $ | 0.01 | $ | (0.02 | ) | $ | (0.05 | ) | |||||||
| Diluted net earnings per share | $ | (0.12 | ) | $ | 0.06 | $ | 0.01 | $ | (0.02 | ) | $ | (0.05 | ) | |||||||
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CONSOLIDATED STATEMENTS OF CASH FLOWS
| Nine months period Ended | Three months period Ended | Year Ended | ||||||||||||||||||
| September, 30 | September, 30 | December 31, | ||||||||||||||||||
| 2022 | 2021 | 2022 | 2021 | 2021 | ||||||||||||||||
| Unaudited | Audited | |||||||||||||||||||
| U.S Dollars In thousands | ||||||||||||||||||||
| Cash Flows from Operating Activities | ||||||||||||||||||||
| Net income (loss) | $ | (5,265 | ) | $ | 2,779 | $ | 484 | $ | (845 | ) | $ | (2,230 | ) | |||||||
| Adjustments to reconcile net income to net cash provided by (used in) operating activities: | ||||||||||||||||||||
| Adjustments to the profit or loss items: | ||||||||||||||||||||
| Depreciation and impairment | 9,143 | 3,612 | 3,055 | 1,240 | 5,609 | |||||||||||||||
| Financial expenses (income), net | 5,719 | (173 | ) | 2,068 | 41 | 1,189 | ||||||||||||||
| Cost of share-based payment | 935 | 504 | 366 | 134 | 529 | |||||||||||||||
| Taxes on income | 60 | - | 10 | - | 345 | |||||||||||||||
| Change in employee benefit liabilities, net | (106 | ) | 61 | (10 | ) | 38 | 45 | |||||||||||||
| 15,751 | 4,004 | 5,489 | 1,453 | 7,717 | ||||||||||||||||
| Changes in asset and liability items: | ||||||||||||||||||||
| Decrease (increase) in trade receivables, net | 10,744 | (4,446 | ) | (6,358 | ) | 1,200 | (12,861 | ) | ||||||||||||
| Decrease (increase) in other accounts receivables | 2,917 | 1,556 | 844 | (73 | ) | (1,634 | ) | |||||||||||||
| Decrease (increase) in inventories | (5,606 | ) | (5,963 | ) | (8,509 | ) | (3,562 | ) | (2,373 | ) | ||||||||||
| Decrease (increase) in deferred expenses | (2,596 | ) | (4,759 | ) | (2,112 | ) | (2,397 | ) | (6,883 | ) | ||||||||||
| Increase (decrease) in trade payables | 5,895 | 2,725 | 13,738 | 1,586 | 7,917 | |||||||||||||||
| Increase (decrease) in other accounts payables | 566 | (1,482 | ) | 2,083 | (683 | ) | (392 | ) | ||||||||||||
| Decrease in deferred revenues | - | 1,550 | - | 550 | 1,815 | |||||||||||||||
| 11,920 | (10,819 | ) | (314 | ) | (3,379 | ) | (14,411 | ) | ||||||||||||
| Cash received (paid) during the period for: | ||||||||||||||||||||
| Interest paid | (550 | ) | (139 | ) | (170 | ) | (32 | ) | (228 | ) | ||||||||||
| Interest received | 15 | 357 | 12 | 140 | 375 | |||||||||||||||
| Taxes paid | (27 | ) | (32 | ) | (9 | ) | (9 | ) | (42 | ) | ||||||||||
| (562 | ) | 186 | (167 | ) | 99 | 105 | ||||||||||||||
| Net cash provided by (used in) operating activities | $ | 21,844 | $ | (3,850 | ) | $ | 5,492 | $ | (2,672 | ) | $ | (8,819 | ) | |||||||
8
CONSOLIDATED STATEMENTS OF CASH FLOWS
| Nine months period Ended | Three months period Ended | Year Ended | ||||||||||||||||||
| September, 30 | September, 30 | December 31, | ||||||||||||||||||
| 2022 | 2021 | 2022 | 2021 | 2021 | ||||||||||||||||
| Unaudited | Audited | |||||||||||||||||||
| U.S Dollars In thousands | ||||||||||||||||||||
| Cash Flows from Investing Activities | ||||||||||||||||||||
| Investment in short term investments, net | $ | - | $ | 39,083 | $ | - | $ | 36,116 | $ | 39,083 | ||||||||||
| Purchase of property and equipment and intangible assets | (2,807 | ) | (2,986 | ) | (1,616 | ) | (1,523 | ) | (3,730 | ) | ||||||||||
| Business combination | - | (1,404 | ) | - | - | (96,403 | ) | |||||||||||||
| Net cash provided by (used in) investing activities | (2,807 | ) | 34,693 | (1,616 | ) | 34,593 | (61,050 | ) | ||||||||||||
| Cash Flows from Financing Activities | ||||||||||||||||||||
| Proceeds from exercise of share base payments | 7 | 14 | 1 | 4 | 19 | |||||||||||||||
| Receipt of long-term loans | - | - | - | 20,000 | ||||||||||||||||
| Repayment of lease liabilities | (842 | ) | (903 | ) | (269 | ) | (308 | ) | (1,221 | ) | ||||||||||
| Repayment of long-term loans | (1,517 | ) | (221 | ) | (1,116 | ) | (15 | ) | (205 | ) | ||||||||||
| Repayment of other long-term liabilities | (4,120 | ) | - | (877 | ) | - | - | |||||||||||||
| Net cash provided by (used in) financing activities | (6,472 | ) | (1,110 | ) | (2,261 | ) | (319 | ) | 18,593 | |||||||||||
| Exchange differences on balances of cash and cash equivalent | 100 | (90 | ) | (296 | ) | (178 | ) | (334 | ) | |||||||||||
| Increase (decrease) in cash and cash equivalents | 12,665 | 29,643 | 1,319 | 31,424 | (51,610 | ) | ||||||||||||||
| Cash and cash equivalents at the beginning of the period | 18,587 | 70,197 | 29,933 | 68,416 | 70,197 | |||||||||||||||
| Cash and cash equivalents at the end of the period | $ | 31,252 | $ | 99,840 | $ | 31,252 | $ | 99,840 | $ | 18,587 | ||||||||||
| Significant non-cash transactions | ||||||||||||||||||||
| Right-of-use asset recognized with corresponding lease liability | $ | 526 | $ | 769 | $ | 230 | $ | 181 | $ | 845 | ||||||||||
| Purchase of property and equipment and Intangible assets | $ | 134 | $ | 352 | $ | 134 | $ | 352 | $ | 1,001 | ||||||||||
9
NON-IFRS MEASURES – ADJUSTED EBITDA
| Nine months period ended | Three months period ended | Year ended | ||||||||||||||||||
| September 30, | September 30, | December 31, | ||||||||||||||||||
| 2022 | 2021 | 2022 | 2021 | 2021 | ||||||||||||||||
| In thousands | ||||||||||||||||||||
| Net income | $ | (5,265 | ) | $ | 2,779 | $ | 484 | $ | (845 | ) | $ | (2,230 | ) | |||||||
| Taxes on income | 60 | - | 10 | - | 345 | |||||||||||||||
| Financial expense (income), net | 5,719 | (173 | ) | 2,068 | 41 | 1,189 | ||||||||||||||
| Depreciation and amortization expense | 9,143 | 3,612 | 3,055 | 1,240 | 5,609 | |||||||||||||||
| Non-cash share-based compensation expenses | 935 | 504 | 366 | 134 | 529 | |||||||||||||||
| Adjusted EBITDA | $ | 10,592 | $ | 6,722 | $ | 5,983 | $ | 570 | $ | 5,442 | ||||||||||
10
Exhibit 99.2
KAMADA LTD.
CONSOLIDATED FINANCIAL STATEMENTS
AS OF SEPTEMBER 30, 2022
TABLE OF CONTENTS
- - - - - - - - - - -
KAMADA LTD.
CONSOLIDATED STATEMENTS OF FINANCIAL POSITION
| As of September 30, | As of December 31, | |||||||||||
| 2022 | 2021 | 2021 | ||||||||||
| Unaudited | Audited | |||||||||||
| U.S Dollars in thousands | ||||||||||||
| Assets | ||||||||||||
| Current Assets | ||||||||||||
| Cash and cash equivalents | $ | $ | $ | |||||||||
| Trade receivables, net | ||||||||||||
| Other accounts receivables | ||||||||||||
| Inventories | ||||||||||||
| Total Current Assets | ||||||||||||
| Non-Current Assets | ||||||||||||
| Property, plant and equipment, net | ||||||||||||
| Right-of-use assets | ||||||||||||
| Intangible assets, Goodwill and other long-term assets | ||||||||||||
| Contract assets | ||||||||||||
| Total Non-Current Assets | ||||||||||||
| Total Assets | $ | $ | $ | |||||||||
| Liabilities | ||||||||||||
| Current Liabilities | ||||||||||||
| Current maturities of bank loans | $ | $ | $ | |||||||||
| Current maturities of lease liabilities | ||||||||||||
| Current maturities of other long term liabilities | ||||||||||||
| Trade payables | ||||||||||||
| Other accounts payables | ||||||||||||
| Deferred revenues | ||||||||||||
| Total Current Liabilities | ||||||||||||
| Non-Current Liabilities | ||||||||||||
| Bank loans | - | |||||||||||
| Lease liabilities | ||||||||||||
| Contingent consideration | ||||||||||||
| Other long-term liabilities | ||||||||||||
| Deferred revenues | ||||||||||||
| Employee benefit liabilities, net | ||||||||||||
| Total Non-Current Liabilities | ||||||||||||
| Shareholder’s Equity | ||||||||||||
| Ordinary shares | ||||||||||||
| Additional paid in capital net | ||||||||||||
| Capital reserve due to translation to presentation currency | ( | ) | ( | ) | ( | ) | ||||||
| Capital reserve from hedges | ( | ) | ||||||||||
| Capital reserve from share-based payments | ||||||||||||
| Capital reserve from employee benefits | ( | ) | ( | ) | ||||||||
| Accumulated deficit | ( | ) | ( | ) | ( | ) | ||||||
| Total Shareholder’s Equity | ||||||||||||
| Total Liabilities and Shareholder’s Equity | $ | $ | $ | |||||||||
The accompanying Notes are an integral part of the Consolidated Financial Statements.
2
KAMADA LTD.
CONSOLIDATED STATEMENTS OF PROFIT OR LOSS AND OTHER COMPREHENSIVE INCOME
| Nine months period ended | Three months period ended | Year ended | ||||||||||||||||||
| September 30, | September 30, | December 31, | ||||||||||||||||||
| 2022 | 2021 | 2022 | 2021 | 2021 | ||||||||||||||||
| Unaudited | Unaudited | Audited | ||||||||||||||||||
| U.S Dollars In thousands | ||||||||||||||||||||
| Revenues from proprietary products | $ | $ | $ | $ | $ | |||||||||||||||
| Revenues from distribution | ||||||||||||||||||||
| Total revenues | ||||||||||||||||||||
| Cost of revenues from proprietary products | ||||||||||||||||||||
| Cost of revenues from distribution | ||||||||||||||||||||
| Total cost of revenues | ||||||||||||||||||||
| Gross profit | ||||||||||||||||||||
| Research and development expenses | ||||||||||||||||||||
| Selling and marketing expenses | ||||||||||||||||||||
| General and administrative expenses | ||||||||||||||||||||
| Other expenses | ||||||||||||||||||||
| Operating income (loss) | ( | ) | ( | ) | ||||||||||||||||
| Financial income | ||||||||||||||||||||
| Income (expenses) in respect of currency exchange differences and derivatives instruments, net | ( | ) | ( | ) | ||||||||||||||||
| Financial Income (expense) in respect of contingent consideration and other long- term liabilities. | ( | ) | ( | ) | ( | ) | ||||||||||||||
| Financial expenses | ( | ) | ( | ) | ( | ) | ( | ) | ( | ) | ||||||||||
| Income before tax on income | ( | ) | ( | ) | ( | ) | ||||||||||||||
| Taxes on income | ||||||||||||||||||||
| Net Income (loss) | $ | ( | ) | $ | $ | $ | ( | ) | $ | ( | ) | |||||||||
| Other Comprehensive Income (loss): | ||||||||||||||||||||
| Amounts that will be or that have been reclassified to profit or loss when specific conditions are met | ||||||||||||||||||||
| Gain (loss) on cash flow hedges | ( | ) | ( | ) | ||||||||||||||||
| Net amounts transferred to the statement of profit or loss for cash flow hedges | ( | ) | ( | ) | ( | ) | ||||||||||||||
| Items that will not be reclassified to profit or loss in subsequent periods: | ||||||||||||||||||||
| Remeasurement gain (loss) from defined benefit plan | ( | ) | ||||||||||||||||||
| Total comprehensive income (loss) | $ | ( | ) | $ | $ | $ | ( | ) | $ | ( | ) | |||||||||
| Earnings per share attributable to equity holders of the Company: | ||||||||||||||||||||
| Basic net earnings per share | $ | ( | ) | $ | $ | $ | ( | ) | $ | ( | ) | |||||||||
| Diluted net earnings per share | $ | ( | ) | $ | $ | $ | ( | ) | $ | ( | ) | |||||||||
The accompanying Notes are an integral part of the Consolidated Financial Statements.
3
KAMADA LTD.
CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY
| Share | Additional paid in | Capital reserve due to translation to presentation | Capital reserve from | Capital reserve from sharebased | Capital reserve from employee | Accumulated | Total | |||||||||||||||||||||||||
| capital | capital | currency | hedges | payments | benefits | deficit | equity | |||||||||||||||||||||||||
| Unaudited | ||||||||||||||||||||||||||||||||
| In thousands | ||||||||||||||||||||||||||||||||
| Balance as of January 1, 2022 (audited) | $ | $ | $ | ( | ) | $ | $ | $ | ( | ) | $ | ( | ) | $ | ||||||||||||||||||
| Net income | ( | ) | ( | ) | ||||||||||||||||||||||||||||
| Other comprehensive income (loss) | ( | ) | - | - | ||||||||||||||||||||||||||||
| Tax effect | - | - | ||||||||||||||||||||||||||||||
| Total comprehensive income (loss) | ( | ) | - | ( | ) | ( | ) | |||||||||||||||||||||||||
| Exercise and forfeiture of share-based payment into shares | ( | ) | - | |||||||||||||||||||||||||||||
| Cost of share-based payment | - | |||||||||||||||||||||||||||||||
| Balance as of September 30, 2022 | $ | $ | $ | ( | ) | $ | ( | ) | $ | $ | $ | ( | ) | $ | ||||||||||||||||||
| Share | Additional paid in | Capital reserve due to translation to presentation | Capital reserve from | Capital reserve from sharebased | Capital reserve from employee | Accumulated | Total | |||||||||||||||||||||||||
| capital | capital | currency | hedges | payments | benefits | deficit | equity | |||||||||||||||||||||||||
| Unaudited | ||||||||||||||||||||||||||||||||
| In thousands | ||||||||||||||||||||||||||||||||
| Balance as of January 1, 2021 (audited) | $ | $ | $ | ( | ) | $ | $ | $ | ( | ) | $ | ( | ) | $ | ||||||||||||||||||
| Net income | - | |||||||||||||||||||||||||||||||
| Other comprehensive income (loss) | - | ( | ) | - | ( | ) | ||||||||||||||||||||||||||
| Tax effect | ||||||||||||||||||||||||||||||||
| Total comprehensive income (loss) | - | ( | ) | - | ||||||||||||||||||||||||||||
| Exercise and forfeiture of share-based payment into shares | - | ( | ) | - | ||||||||||||||||||||||||||||
| Cost of share-based payment | - | - | ||||||||||||||||||||||||||||||
| Balance as of September 30, 2021 | $ | $ | $ | ( | ) | $ | $ | $ | ( | ) | $ | ( | ) | $ | ||||||||||||||||||
The accompanying Notes are an integral part of the Consolidated Financial Statements.
4
KAMADA LTD.
CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY
| Share | Additional paid in | Capital reserve due to translation to presentation | Capital reserve from | Capital reserve from sharebased | Capital reserve from employee | Accumulated | Total | |||||||||||||||||||||||||
| capital | capital | currency | hedges | payments | benefits | deficit | equity | |||||||||||||||||||||||||
| Unaudited | ||||||||||||||||||||||||||||||||
| In thousands | ||||||||||||||||||||||||||||||||
| Balance as of July 1, 2022 | $ | $ | $ | ( | ) | $ | ( | ) | $ | $ | $ | ( | ) | $ | ||||||||||||||||||
| Net income | - | |||||||||||||||||||||||||||||||
| Other comprehensive income (loss) | - | ( | ) | |||||||||||||||||||||||||||||
| Tax effect | ||||||||||||||||||||||||||||||||
| Total comprehensive income (loss) | - | ( | ) | |||||||||||||||||||||||||||||
| Exercise and forfeiture of share-based payment into shares | - | ( | ) | - | ||||||||||||||||||||||||||||
| Cost of share-based payment | - | - | ||||||||||||||||||||||||||||||
| Balance as of September 30, 2022 | $ | $ | $ | ( | ) | $ | ( | ) | $ | $ | $ | ( | ) | $ | ||||||||||||||||||
| Share capital | Additional paid in capital | Capital reserve due to translation to presentation currency | Capital reserve from hedges | Capital reserve from sharebased payments | Capital reserve from employee benefits | Accumulated deficit | Total equity | |||||||||||||||||||||||||
Unaudited | ||||||||||||||||||||||||||||||||
| In thousands | ||||||||||||||||||||||||||||||||
| Balance as of July 1, 2021 | $ | $ | $ | ( | ) | $ | $ | $ | ( | ) | $ | ( | ) | $ | ||||||||||||||||||
| Net income | - | - | ( | ) | ( | |||||||||||||||||||||||||||
| Other comprehensive income (loss) | - | - | ( | ) | - | ( | ) | |||||||||||||||||||||||||
| Taxes effect | ||||||||||||||||||||||||||||||||
| Total comprehensive income (loss) | - | - | ( | ) | - | ( | ) | ( | ||||||||||||||||||||||||
| Exercise and forfeiture of share-based payment into shares | - | - | ( | ) | - | |||||||||||||||||||||||||||
| Cost of share-based payment | - | - | - | |||||||||||||||||||||||||||||
| Balance as of September 30, 2021 | $ | $ | $ | ( | ) | $ | $ | $ | ( | ) | $ | ( | ) | $ | ||||||||||||||||||
The accompanying Notes are an integral part of the Consolidated Financial Statements.
5
KAMADA LTD.
CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY
| Share capital | Additional paid in capital | Capital reserve due to translation to presentation currency | Capital reserve from hedges | Capital reserve from sharebased payments | Capital reserve from employee benefits | Accumulated deficit | Total equity | |||||||||||||||||||||||||
| Audited | ||||||||||||||||||||||||||||||||
| In thousands | ||||||||||||||||||||||||||||||||
| Balance as of January 1, 2021 (audited) | $ | $ | $ | ( | ) | $ | $ | $ | ( | ) | $ | ( | ) | $ | ||||||||||||||||||
| Net income | - | - | ( | ) | ( | ) | ||||||||||||||||||||||||||
| Other comprehensive income (loss) | - | - | ( | ) | - | ( | ) | |||||||||||||||||||||||||
| Taxes effect | - | - | - | - | - | - | - | - | ||||||||||||||||||||||||
| Total comprehensive income (loss) | - | - | ( | ) | ( | ) | ( | ) | ||||||||||||||||||||||||
| Exercise and forfeiture of share-based payment into shares | - | - | ( | ) | ||||||||||||||||||||||||||||
| Cost of share-based payment | - | - | ||||||||||||||||||||||||||||||
| Balance as of December 31, 2021 | $ | $ | $ | ( | ) | $ | $ | $ | ( | ) | $ | ( | ) | $ | ||||||||||||||||||
The accompanying Notes are an integral part of the Consolidated Financial Statements.
6
KAMADA LTD.
CONSOLIDATED STATEMENTS OF CASH FLOWS
| Nine months period Ended | Three months period Ended | Year Ended | ||||||||||||||||||
| September, 30 | September, 30 | December 31, | ||||||||||||||||||
| 2022 | 2021 | 2022 | 2021 | 2021 | ||||||||||||||||
| Unaudited | Audited | |||||||||||||||||||
| U.S Dollars In thousands | ||||||||||||||||||||
| Cash Flows from Operating Activities | ||||||||||||||||||||
| Net income (loss) | $ | ( | ) | $ | $ | $ | ( | ) | $ | ( | ) | |||||||||
| Adjustments to reconcile net income to net cash provided by (used in) operating activities: | ||||||||||||||||||||
| Adjustments to the profit or loss items: | ||||||||||||||||||||
| Depreciation and impairment | ||||||||||||||||||||
| Financial expenses (income), net | ( | ) | ||||||||||||||||||
| Cost of share-based payment | ||||||||||||||||||||
| Taxes on income | ||||||||||||||||||||
| Change in employee benefit liabilities, net | ( | ) | ( | ) | ||||||||||||||||
| Changes in asset and liability items: | ||||||||||||||||||||
| Decrease (increase) in trade receivables, net | ( | ) | ( | ) | ( | ) | ||||||||||||||
| Decrease (increase) in other accounts receivables | ( | ) | ( | ) | ||||||||||||||||
| Decrease (increase) in inventories | ( | ) | ( | ) | ( | ) | ( | ) | ( | ) | ||||||||||
| Decrease (increase) in deferred expenses | ( | ) | ( | ) | ( | ) | ( | ) | ( | ) | ||||||||||
| Increase (decrease) in trade payables | ||||||||||||||||||||
| Increase (decrease) in other accounts payables | ( | ) | ( | ) | ( | ) | ||||||||||||||
| Decrease in deferred revenues | ||||||||||||||||||||
| ( | ) | ( | ) | ( | ) | ( | ) | |||||||||||||
| Cash received (paid) during the period for: | ||||||||||||||||||||
| Interest paid | ( | ) | ( | ) | ( | ) | ( | ) | ( | ) | ||||||||||
| Interest received | ||||||||||||||||||||
| Taxes paid | ( | ) | ( | ) | ( | ) | ( | ) | ( | ) | ||||||||||
| ( | ) | ( | ) | |||||||||||||||||
| Net cash provided by (used in) operating activities | $ | $ | ( | ) | $ | $ | ( | ) | $ | ( | ) | |||||||||
The accompanying Notes are an integral part of the Consolidated Financial Statements.
7
KAMADA LTD.
CONSOLIDATED STATEMENTS OF CASH FLOWS
| Nine months period Ended | Three months period Ended | Year Ended | ||||||||||||||||||
| September, 30 | September, 30 | December 31, | ||||||||||||||||||
| 2022 | 2021 | 2022 | 2021 | 2021 | ||||||||||||||||
| Unaudited | Audited | |||||||||||||||||||
| U.S Dollars In thousands | ||||||||||||||||||||
| Cash Flows from Investing Activities | ||||||||||||||||||||
| Investment in short term investments, net | $ | $ | $ | $ | $ | |||||||||||||||
| Purchase of property and equipment and intangible assets | ( | ) | ( | ) | ( | ) | ( | ) | ( | ) | ||||||||||
| Business combination | ( | ) | ( | ) | ||||||||||||||||
| Net cash provided by (used in) investing activities | ( | ) | ( | ) | ( | ) | ||||||||||||||
| Cash Flows from Financing Activities | ||||||||||||||||||||
| Proceeds from exercise of share base payments | ||||||||||||||||||||
| Receipt of long-term loans | ||||||||||||||||||||
| Repayment of lease liabilities | ( | ) | ( | ) | ( | ) | ( | ) | ( | ) | ||||||||||
| Repayment of long-term loans | ( | ) | ( | ) | ( | ) | ( | ) | ( | ) | ||||||||||
| Repayment of other long-term liabilities | ( | ) | ( | ) | ||||||||||||||||
| Net cash provided by (used in) financing activities | ( | ) | ( | ) | ( | ) | ( | ) | ||||||||||||
| Exchange differences on balances of cash and cash equivalent | ( | ) | ( | ) | ( | ) | ( | ) | ||||||||||||
| Increase (decrease) in cash and cash equivalents | ( | ) | ||||||||||||||||||
| Cash and cash equivalents at the beginning of the period | ||||||||||||||||||||
| Cash and cash equivalents at the end of the period | $ | $ | $ | $ | $ | |||||||||||||||
| Significant non-cash transactions | ||||||||||||||||||||
| Right-of-use asset recognized with corresponding lease liability | $ | $ | $ | $ | $ | |||||||||||||||
| Purchase of property and equipment and Intangible assets | $ | $ | $ | $ | $ | |||||||||||||||
The accompanying Notes are an integral part of the Consolidated Financial Statements.
8
KAMADA LTD.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
Note 1:- General
General description of the Company and its activity
Kamada Ltd. (the “Company”) is a vertically integrated global biopharmaceutical company, focused on specialty plasma-derived therapeutics, with a diverse portfolio of marketed products, a robust development pipeline and industry-leading manufacturing capabilities. The Company’s strategy is focused on driving profitable growth from our current commercial activities as well as our manufacturing and development expertise in the plasma-derived biopharmaceutical market. The Company’s commercial products portfolio includes its developed and FDA approved products GLASSIA® and KEDRRAB® as well as its recently acquired FDA approved plasma-derived hyperimmune products CYTOGAM®, HEPAGAM B®, VARIZIG® and WINRHO®SDF. The Company has additional four plasma-derived products which are registered in markets outside the U.S. The Company distributes its commercial products portfolio directly, and through strategic partners or third party distributors in more than 30 countries, including the U.S., Canada, Israel, Russia, Brazil, Argentina, India and other countries in Latin America and Asia. The Company has a diverse portfolio of development pipeline products including an inhaled AAT for the treatment of AAT deficiency for which the Company is currently conducting the InnovAATe clinical trial, a randomized, double-blind, placebo-controlled, pivotal Phase 3 trial. The Company leverages its expertise and presence in the Israeli pharmaceutical market to distribute in Israel more than 20 products that are manufactured by third parties and have recently added eleven biosimilar products to its Israeli distribution portfolio, which, subject to EMA and the Israeli MOH approvals, are expected to be launched in Israel between the years 2022 and 2028.
In November 2021, the Company acquired a portfolio of four FDA approved plasma-derived hyperimmune commercial products from Saol Therapeutics (“Saol”). The acquisition of this portfolio furthers the Company’s core objective to become a fully integrated specialty plasma company with strong commercial capabilities in the U.S. market, as well as to expand to new markets, mainly in the Middle East/North Africa region, and to broaden the Company’s portfolio offering in existing markets. The Company’s wholly owned U.S. subsidiary, Kamada Inc., will be responsible for the commercialization of the four products in the U.S. market, including direct sales to wholesalers and local distributers. Refer to Note 5 of the Company’s annual financial statements as of December 31, 2021.
The Company markets GLASSIA in the U.S.
through a strategic partnership with Takeda Pharmaceuticals Company Limited (“Takeda”). Pursuant to an agreement with Takeda,
the Company terminated the production and sale of GLASSIA to Takeda during 2021 resulting in a significant reduction in revenues. Takeda
initiated its own production of GLASSIA for the U.S. market.
9
KAMADA LTD.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
Note 2:- Significant Accounting Policies
| a. | Basis of preparation of the interim consolidated financial statements: |
The interim consolidated financial statements have been prepared in accordance with generally accepted accounting principles for the preparation of financial statements for interim periods, as prescribed in IAS 34, “Interim Financial Reporting”.
| b. | Implementation of new accounting standards: |
| i. | Amendment to IAS 1, Presentation of Financial Statements: Classification of Liabilities as Current or Non-Current |
In January 2020, the IASB issued an amendment to IAS 1, “Presentation of Financial Statements” (“IAS 1 Amendment”) regarding the criteria for determining the classification of liabilities as current or non-current. IAS 1 Amendment replaces certain requirements for classifying liabilities as current or non-current. Thus, for example, according to the IAS 1 Amendment, a liability will be classified as non-current when the entity has the right to defer settlement for at least 12 months after the reporting period, and it “has substance” and is in existence at the end of the reporting period, this instead of the requirement that there be an “unconditional” right. According to the IAS 1 Amendment, a right is in existence at the reporting date only if the entity complies with conditions for deferring settlement at that date. Furthermore, the Amendment clarifies that the conversion option of a liability will affect its classification as current or non-current, other than when the conversion option is recognized as equity.
The IAS 1 Amendment is effective for reporting periods beginning on or after January 1, 2023 with earlier application being permitted. IAS 1 Amendment is applicable retrospectively, including an amendment to comparative data.
The Company believes that the adoption of IAS 1 Amendment will not have an effect on its financial statements.
| ii. | Amendment to IAS 12, Income Taxes: Deferred Tax related to Assets and Liabilities arising from a Single Transaction (“IAS 12 Amendment”) |
IAS 12 Amendment narrows the scope of the exemption from recognizing deferred taxes as a result of temporary differences created at the initial recognition of assets and/or liabilities, so that it does not apply to transactions that give rise to equal and offsetting temporary differences.
As a result, companies will need to recognize a deferred tax asset or a deferred tax liability for these temporary differences at the initial recognition of transactions that give rise to equal and offsetting temporary differences, such as lease transactions and provisions for decommissioning and restoration.
IAS 12 Amendment is effective for annual periods beginning on or after January 1, 2023, by amending the opening balance of the retained earnings or adjusting a different component of equity in the period the Amendment was first adopted. Earlier application is permitted.
The Company has not yet commenced examining the effects of applying IAS 12 Amendment on the financial statements.
10
KAMADA LTD.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
Note 3:- Significant events in the reporting period
| i | Grant of options to the purchase ordinary shares of the Company to employees, executive officers, CEO and Board of Directors members |
On February 28, 2022, the Company’s Board of Directors approved
the grant of options to purchase up to
As of September 30, 2022, the Company granted, out the above mentioned, to employees and executive officers total of:
| - | Under the Israeli Share Option Plan:
On February 28, 2022,
On March 01, 2022,
On March 13, 2022, | |
On May 01, 2022,
The grant of options to the CEO and the Board of Directors members are subject to the approval of the General Meeting of Shareholders that is expected to take place during December 2022 |
| - | Under the US Share Option Plan:
On February 28, 2022,
On March 01, 2022,
On March 15, 2022,
On July 16, 2022,
On September 01, 2022, |
| - | On August 23, 2022, the Company’s Board of Directors approved
the grant of |
| Under the Israeli Share Option Plan:
|
| Under the US Share Option Plan:
|
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KAMADA LTD.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
Note 3:- Significant events in the reporting period (cont.)
| ii | Labor strike at the Company’s manufacturing plant at Beit Kama, Israel |
| - | On April 26, 2022, during the course of the Company’s negotiations with the Histadrut - General Federation of Labor in Israel (the “Histadrut”) and the Employees’ Committee of Kamada’s Beit Kama production facility in Israel (the “Employee’s Committee”), on the extension of a collective bargaining agreement, the Employee’s Committee elected to declare a labor strike in the Beit Kama plant.
On July 15, 2022, the Company, the Employees’s Committee, and the Histadrut, signed a new collective agreement detailing the understandings reached between the parties. The agreement will be effective through the end of 2029, while certain economic terms may be renegotiated by the parties following the lapse of the first four years of the term of the agreement. As a result of execution of the agreement the labor strike ended, and the unionized employees returned to work at the Beit Kama production facility.
As a result of the labor strike, the Company recorded, during the second quarter and the Third quarter of 2022, a loss of $ |
| iii | Increase in the yield of high-quality corporate bonds |
| As of September 30, 2022, there was an increase, compared to December 31, 2021, in the yield of high-quality corporate bonds which effect the discount rate of defined benefit obligations.
The effect of the changes in the aforementioned discount rate resulted in a reduction in the employee benefit liability, net as of September 30, 2022, in relation to December 31, 2021, in the amount of $ |
| iv | During May 2022, the Company terminated a distribution agreement with a third-party engaged to distribute the Company’s proprietary products in Russia and Ukraine (the “Distributor”), and a power of attorney granted, in connection with such distribution agreement, to an affiliate of the Distributor (the “Affiliate). On July 18, 2022, the Affiliate notified the Company of the filing of a request for a conciliation hearing with the Court in Geneva relying on the terminated power of attorney and seeking damages for the alleged inability to sell the remaining product inventory previously acquired from the Company and compensation for the lost customer base. The purpose of a conciliation hearing is to explore the possibility of an out-of-court settlement and not to address the merits of the claims. The outcome of such hearing is not binding. Nonetheless, the conciliation request has not yet been formally served upon the Company, which is a procedural request to proceed with the hearing. At this stage, it is not possible to assess the prospects and scope of any claims against the Company and any potential liabilities as such conciliation request is an initial procedure and the claims are not fully substantiated. The Company intends to vigorously defend itself against any claims if and when they arise from these matters. |
Note 4:- Operating Segments
| a. | General: |
The company has two operating segments, as follows:
| Proprietary Products | - | Development, manufacturing, lessening sales and distribution of plasma-derived protein therapeutics |
| Distribution | - | Distribute imported drug products in Israel, which are manufactured by third parties. |
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KAMADA LTD.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
Note 4:- Operating Segments (cont.)
| b. | Reporting on operating segments: |
| Proprietary Products | Distribution | Total | ||||||||||
| U.S Dollars in thousands | ||||||||||||
| Unaudited | ||||||||||||
| Nine months period ended September 30, 2022 | ||||||||||||
| Revenues | $ | $ | $ | |||||||||
| Gross profit | $ | $ | $ | |||||||||
| Unallocated corporate expenses | ( | ) | ||||||||||
| Finance expenses, net | ( | ) | ||||||||||
| Income before taxes on income | $ | ( | ) | |||||||||
| Proprietary Products | Distribution | Total | ||||||||||
| U.S Dollars in thousands | ||||||||||||
| Unaudited | ||||||||||||
| Nine months period ended September 30, 2021 | ||||||||||||
| Revenues | $ | $ | $ | |||||||||
| Gross profit | $ | $ | $ | |||||||||
| Unallocated corporate expenses | ( | ) | ||||||||||
| Finance expenses, net | ||||||||||||
| Income before taxes on income | $ | |||||||||||
| Proprietary | ||||||||||||
| Products | Distribution | Total | ||||||||||
| U.S Dollars in thousands | ||||||||||||
| Unaudited | ||||||||||||
| Three months period ended September 30, 2022 | ||||||||||||
| Revenues | $ | $ | $ | |||||||||
| Gross profit | $ | $ | $ | |||||||||
| Unallocated corporate expenses | ( | ) | ||||||||||
| Finance expenses, net | ( | ) | ||||||||||
| Income before taxes on income | $ | |||||||||||
| Proprietary | ||||||||||||
| Products | Distribution | Total | ||||||||||
| U.S Dollars in thousands | ||||||||||||
| Unaudited | ||||||||||||
| Three months period ended September 30, 2021 | ||||||||||||
| Revenues | $ | $ | $ | |||||||||
| Gross profit | $ | $ | $ | |||||||||
| Unallocated corporate expenses | ( | ) | ||||||||||
| Finance expenses, net | ( | ) | ||||||||||
| Income before taxes on income | $ | ( | ) | |||||||||
13
KAMADA LTD.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
Note 4:- Operating Segments (cont.)
| b. | Reporting on operating segments: |
| Proprietary Products | Distribution | Total | ||||||||||
| U.S Dollars in thousands | ||||||||||||
| Audited | ||||||||||||
| Year Ended December 31, 2021 | ||||||||||||
| Revenues | $ | $ | $ | |||||||||
| Gross profit | $ | $ | $ | |||||||||
| Unallocated corporate expenses | ( | ) | ||||||||||
| Finance expenses, net | ( | ) | ||||||||||
| Income before taxes on income | $ | ( | ) | |||||||||
| c. | Reporting on operating segments by geographic region: |
| Nine months period ended September 30, 2022 | ||||||||||||
| Proprietary Products | Distribution | Total | ||||||||||
| U.S Dollars in thousands | ||||||||||||
| Unaudited | ||||||||||||
| Geographical markets | ||||||||||||
| U.S.A and North America | $ | $ | $ | |||||||||
| Israel | ||||||||||||
| Europe | ||||||||||||
| Latin America | ||||||||||||
| Asia | ||||||||||||
| Others | ||||||||||||
| $ | $ | $ | ||||||||||
| Nine months period ended September 30, 2021 | ||||||||||||
| Proprietary Products | Distribution | Total | ||||||||||
| U.S Dollars in thousands | ||||||||||||
| Unaudited | ||||||||||||
| Geographical markets | ||||||||||||
| U.S.A and North America | $ | $ | ||||||||||
| Israel | ||||||||||||
| Europe | ||||||||||||
| Latin America | ||||||||||||
| Asia | ||||||||||||
| Others | ||||||||||||
| $ | $ | $ | ||||||||||
14
KAMADA LTD.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
Note 4:- Operating Segments (cont.)
| c. | Reporting on operating segments by geographic region: |
| Three months period ended September 30, 2022 | ||||||||||||
| Proprietary Products | Distribution | Total | ||||||||||
| U.S Dollars in thousands | ||||||||||||
| Unaudited | ||||||||||||
| Geographical markets | ||||||||||||
| U.S.A and North America. | $ | $ | $ | |||||||||
| Israel | ||||||||||||
| Europe | ||||||||||||
| Latin America | ||||||||||||
| Asia | ||||||||||||
| Others | ||||||||||||
| $ | $ | $ | ||||||||||
| Three months period ended September 30, 2021 | ||||||||||||
| Proprietary Products | Distribution | Total | ||||||||||
| U.S Dollars in thousands | ||||||||||||
| Unaudited | ||||||||||||
| Geographical markets | ||||||||||||
| U.S.A and North America. | $ | - | $ | |||||||||
| Israel | ||||||||||||
| Europe | ||||||||||||
| Latin America | ||||||||||||
| Asia | ||||||||||||
| Others | ||||||||||||
| $ | $ | $ | ||||||||||
| Year ended December 31, 2021 | ||||||||||||
| Proprietary Products | Distribution | Total | ||||||||||
| U.S Dollars in thousands | ||||||||||||
| Audited | ||||||||||||
| Geographical markets | ||||||||||||
| U.S.A and North America | $ | $ | $ | |||||||||
| Israel | ||||||||||||
| Europe | ||||||||||||
| Latin America | ||||||||||||
| Asia | ||||||||||||
| Others | ||||||||||||
| $ | $ | $ | ||||||||||
15
KAMADA LTD.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
Note 5:- Financial Instruments
| a. | Classification of financial instruments by fair value hierarchy |
Financial assets (liabilities) measured at fair value
| Level 1 | Level 2 | Level 3 | ||||||||||
| U.S Dollars in thousands | ||||||||||||
| September 30, 2022 | ||||||||||||
| Derivatives instruments | $ | $ | ( | ) | ||||||||
| Contingent consideration | $ | ( | ) | |||||||||
| September 30, 2021 | ||||||||||||
| Derivatives instruments | $ | $ | ( | ) | $ | |||||||
| December 31, 2021 | ||||||||||||
| Derivatives instruments | $ | $ | $ | |||||||||
| Contingent consideration | $ | $ | $ | ( | ) | |||||||
During the Nine months ended on September 30, 2022 there were no transfers due to the fair value measurement of any financial instrument from Level 1 to Level 2, and furthermore, there were no transfers to or from Level 3 due to the fair value measurement of any financial instrument.
16