6-K
Sofgen Pharma S.A. (PROCF)
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM6-K
REPORT OF FOREIGN PRIVATEISSUER PURSUANT TO RULE 13a-16 OR 15d-16
UNDER THE SECURITIES EXCHANGEACT OF 1934
For the month of December 2021
Commission File Number: 001-40851
ProcapsGroup, S.A.
(Translation of registrant’s name in English)
9 rue de Bitbourg, L-1273
Luxembourg
Grand Duchy of Luxembourg
R.C.S. Luxembourg: B253360
Tel : +356 7995-6138
(Address of Principal ExecutiveOffices)
Indicate by check mark whether the registrant files or will file annual reports under cover of 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): ☐
Note: Regulation S-T Rule 101(b)(1) only permits the submission in paper of a Form 6-K if submitted solely to provide an attached annual report to security holders.
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): ☐
Note: Regulation S-T Rule 101(b)(7) only permits the submission in paper of a Form 6-K if submitted to furnish a report or other document that the registrant foreign private issuer must furnish and make public under the laws of the jurisdiction in which the registrant is incorporated, domiciled or legally organized (the registrant’s “home country”), or under the rules of the home country exchange on which the registrant’s securities are traded, as long as the report or other document is not a press release, is not required to be and has not been distributed to the registrant’s security holders, and, if discussing a material event, has already been the subject of a Form 6-K submission or other Commission filing on EDGAR.
INFORMATION CONTAINEDIN THIS REPORT ON FORM 6-K
Financial Results
On November 19, 2021, Procaps Group, S.A. (the “Company”) issued a press release announcing its financial results for the third quarter ended September 30, 2021. The press release was furnished as Exhibit 99.1 to a previous Current Report on Form 6-K, dated November 19, 2021. On November 23, 2021, the Company announced a correction to the Adjusted EBITDA figure in the press release, which did not reflect an adjustment for transaction expenses in the amount of $500,000. As a result of the correction, the Company’s Adjusted EBITDA for the three months ended September 30, 2021 was $25.0 million instead of the previously reported $24.5 million.
The Unaudited Condensed Consolidated Interim Financial Statements for the third quarter ended September 30, 2021 are filed as Exhibit 99.1 to this Report on Form 6-K and are incorporated by reference into the registration statement on Form F-1 filed with the Securities and Exchange Commission on November 24, 2021 (File No. 333-261366).
Exhibit Index
| Exhibit Number | Exhibit Title |
|---|---|
| 99.1 | Unaudited Condensed Consolidated Interim Financial Statements for the third quarter ended September 30, 2021. |
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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, thereunto duly authorized.
| PROCAPS GROUP, S.A. | |
|---|---|
| By: | /s/ Ruben Minski |
| Name: | Ruben Minski |
| Title: | Chief Executive Officer |
Dated: December 10, 2021
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Exhibit 99.1
Procaps Group S.A. and subsidiaries (The Group)
Unaudited Condensed Consolidated Interim Statementof Financial Position
As of September 30, 2021 and December 31, 2020
(In thousands of United States Dollars, unlessotherwise stated)
| As of<br><br> September 30,<br><br> 2021 | As of <br><br>December 31, <br><br>2020 | ||||
|---|---|---|---|---|---|
| Assets | |||||
| Non-current assets | |||||
| Property, plant and equipment, net | $ | 71,259 | 70,335 | ||
| Right-of-use assets | 36,645 | 43,195 | |||
| Goodwill | 6,851 | 6,863 | |||
| Intangible assets | 24,754 | 27,583 | |||
| Investments in joint ventures | 2,478 | 2,460 | |||
| Other financial assets | 440 | 761 | |||
| Deferred tax assets | 6,675 | 21,769 | |||
| Other assets | 2,778 | 1,870 | |||
| Total non-current assets | 151,880 | 174,836 | |||
| Cash | 100,192 | 4,229 | |||
| Trade and other receivables, net | 110,023 | 96,493 | |||
| Inventories, net | 76,981 | 64,284 | |||
| Amounts owed by related parties | 3,398 | 2,562 | |||
| Current tax assets | 21,314 | 16,774 | |||
| Other current assets | 960 | 360 | |||
| Total current assets | 312,868 | 184,702 | |||
| Total assets | $ | 464,748 | 359,538 | ||
| Liabilities and stockholders’ equity (deficit) | |||||
| Total equity (deficit) | $ | 36,305 | (254,678 | ) | |
| Borrowings | 101,932 | 339,738 | |||
| Amounts owed to related parties | 11,190 | 12,163 | |||
| Warrant liability | 33,950 | — | |||
| Deferred tax liabilities | 1,451 | 18,890 | |||
| Other liabilities | 3,173 | 3,797 | |||
| Total non-current liabilities | 151,696 | 374,588 | |||
| Borrowings | 116,713 | 102,621 | |||
| Trade and other payables, net | 132,462 | 106,275 | |||
| Amounts owed to related parties | 5,703 | 8,459 | |||
| Current tax liabilities | 14,249 | 9,393 | |||
| Provisions | 1,663 | 1,829 | |||
| Other liabilities | 5,957 | 11,051 | |||
| Total current liabilities | 276,747 | 239,628 | |||
| Total liabilities and stockholders' equity (deficit) | $ | 464,748 | 359,538 |
Procaps Group S.A. and subsidiaries (The Group)
Unaudited Condensed Consolidated Interim Statementof Profit or Loss
For the three and nine months ended September30, 2021 and 2020
(In thousands of United States Dollars, unlessotherwise stated)
| For the three months ended<br><br> September 30 | ||||||
|---|---|---|---|---|---|---|
| 2021 | 2020 | |||||
| Revenue | $ | 106,829 | 79,313 | |||
| Cost of sales | (44,577 | ) | (31,525 | ) | ||
| Gross profit | 62,252 | 47,788 | ||||
| Sales and marketing expenses | (22,841 | ) | (19,234 | ) | ||
| Administrative expenses | (21,011 | ) | (14,370 | ) | ||
| Finance expenses | (50,651 | ) | (14,236 | ) | ||
| Other expenses | (1,107 | ) | (1,668 | ) | ||
| Income (loss) before tax | $ | (33,358 | ) | (1,720 | ) | |
| Income tax expense | (3,566 | ) | 751 | |||
| Loss for the period | $ | (36,924 | ) | (969 | ) | |
| For the nine months ended<br><br> September 30 | ||||||
| --- | --- | --- | --- | --- | --- | --- |
| 2021 | 2020 | |||||
| Revenue | $ | 283,206 | 213,320 | |||
| Cost of sales | (123,152 | ) | (90,133 | ) | ||
| Gross profit | 160,054 | 123,187 | ||||
| Sales and marketing expenses | (61,191 | ) | (53,352 | ) | ||
| Administrative expenses | (64,670 | ) | (43,857 | ) | ||
| Finance expenses | (79,242 | ) | (39,763 | ) | ||
| Other expenses | (3,179 | ) | (5,406 | ) | ||
| Income (loss) before tax | $ | (48,228 | ) | (19,191 | ) | |
| Income tax expense | (6,342 | ) | (701 | ) | ||
| Loss for the period | $ | (54,570 | ) | (19,892 | ) |
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Procaps Group S.A. and subsidiaries (The Group)
Unaudited Condensed Consolidated Interim Statementof Cash Flows
For the nine months ended September 30, 2021and 2020
(In thousands of United States Dollars, unlessotherwise stated)
| For the nine months ended<br><br> September 30 | ||||||
|---|---|---|---|---|---|---|
| 2021 | 2020 | |||||
| Operating activities | ||||||
| Loss for the period | $ | (54,570 | ) | $ | (19,892 | ) |
| Adjustments to reconcile net loss with net cash from operating activities: | ||||||
| Depreciation of property, plant and equipment | 4,184 | 4,062 | ||||
| Depreciation of right-of-use | 3,281 | 3,098 | ||||
| Amortization of intangibles | 5,892 | 4,705 | ||||
| Income tax expense | 6,342 | 701 | ||||
| Finance expenses | 79,242 | 39,763 | ||||
| Share of result of joint ventures | (371 | ) | (416 | ) | ||
| Net (gain)/loss on sale of property, plant and equipment | 710 | — | ||||
| Inventory provision | 3,263 | 3,538 | ||||
| Provision for bad debt | 741 | (2,087 | ) | |||
| Provisions | 1,182 | 1,599 | ||||
| Cash flow from operating activities before changes in working capital | $ | 49,896 | $ | 35,071 | ||
| (Increase)/decrease in operating assets and liabilities: | ||||||
| Trade and other receivables | (14,271 | ) | 20,526 | |||
| Amounts owed by related parties | (835 | ) | (7,038 | ) | ||
| Inventories | (15,523 | ) | 828 | |||
| Current tax assets | (4,540 | ) | (5,295 | ) | ||
| Other current assets | (563 | ) | (47 | ) | ||
| Trade and other payables | (10,975 | ) | (12,772 | ) | ||
| Amounts owed to related parties | (252 | ) | 9,148 | |||
| Current tax liabilities | (1,120 | ) | (3,542 | ) | ||
| Other liabilities | 13,710 | (4,534 | ) | |||
| Provisions | (1,182 | ) | (2,110 | ) | ||
| Other financial assets | 321 | — | ||||
| Other assets | (946 | ) | (4,027 | ) | ||
| Cash generated from operations | $ | 13,720 | $ | 26,208 | ||
| Dividends received | 300 | — | ||||
| Income tax paid | (2,711 | ) | 3,291 | |||
| Cash flow from operating activities | $ | 11,309 | $ | 29,499 | ||
| Investing activities | ||||||
| Acquisition of property, plant and equipment | (10,933 | ) | (5,641 | ) | ||
| Proceeds from sale of property, plant and equipment | 26 | — | ||||
| Acquisition of intangibles | (5,898 | ) | (5,595 | ) | ||
| Cash flow used in investing activities | $ | (16,805 | ) | $ | (11,236 | ) |
| Financing activities | ||||||
| Proceeds from borrowings | 122,042 | 89,950 | ||||
| Payments on borrowings | (80,101 | ) | (75,209 | ) | ||
| Payments to related parties | (3,577 | ) | (4,836 | ) | ||
| Interest paid on borrowings | (9,527 | ) | (7,997 | ) | ||
| Payment of lease liabilities | (4,354 | ) | (3,511 | ) | ||
| Cash obtained from acquisition | 91,585 | — | ||||
| Cash flow generated from (used in) financing activities | $ | 116,068 | $ | (1,603 | ) | |
| Net increase/(decrease) in cash | 110,572 | 16,660 | ||||
| Cash less bank overdrafts at beginning of the period | 4,229 | 2,042 | ||||
| Effect of exchange rate fluctuations | (14,609 | ) | (12,229 | ) | ||
| Cash less bank overdrafts at end of the period | $ | 100,192 | $ | 6,473 | ||
| Non-cash financing and investing activities (1) | $ | 948 | $ | 6,418 |
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Procaps Group S.A. and subsidiaries (The Group)
Unaudited Condensed Consolidated Interim Statementof Changes in Equity
For the nine months ended September 30, 2021and 2020
(In thousands of United States Dollars, unless otherwise stated)
| Attributable<br> to equity holders of the Group | ||||||||||||||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Issued<br><br> Capital | Share<br><br> premium | Reserves ^1^ | Accumulated<br><br> deficit | Other<br><br> Comprehensive<br><br> Income | Total | Non-<br><br>controlling<br><br> interest | Total<br><br> equity<br><br> (deficit) | |||||||||||||||
| Balance<br> as of December 31, 2019 | 2,001 | 54,412 | 28,681 | (305,634 | ) | (23,753 | ) | (244,293 | ) | 346 | (243,947 | ) | ||||||||||
| Loss<br> for the period | — | — | — | (20,620 | ) | — | (20,620 | ) | 728 | (19,892 | ) | |||||||||||
| Transfer<br> reserves | — | — | 11,177 | (11,177 | ) | — | — | — | — | |||||||||||||
| Other<br> comprehensive income | — | — | — | — | 11,600 | 11,600 | — | 11,600 | ||||||||||||||
| Non-controlling<br> interest | — | — | — | 728 | — | 728 | — | 728 | ||||||||||||||
| Balance<br> as of September 30, 2020 | $ | 2,001 | $ | 54,412 | $ | 39,858 | $ | (336,703 | ) | $ | (12,153 | ) | $ | (252,585 | ) | $ | 1,074 | $ | (251,511 | ) | ||
| Balance<br> as of December 31, 2020 | 2,001 | 54,412 | 39,897 | (327,344 | ) | (24,421 | ) | (255,455 | ) | 778 | (254,677 | ) | ||||||||||
| Loss<br> for the period | — | — | — | (54,947 | ) | — | (54,947 | ) | 377 | (54,570 | ) | |||||||||||
| Transfer<br> reserves | — | — | (8 | ) | 8 | — | — | — | — | |||||||||||||
| Other<br> comprehensive income | — | — | — | — | (3,894 | ) | (3,894 | ) | — | (3,894 | ) | |||||||||||
| Non-controlling<br> interest | — | — | 377 | — | 377 | — | 377 | |||||||||||||||
| Share<br> redemption and issuance in business combination | (873 | ) | 201,304 | 148,638 | — | 349,069 | — | 349,069 | ||||||||||||||
| Balance<br> as of September 30, 2021 | $ | 1,128 | $ | 255,716 | $ | 39,889 | $ | (233,268 | ) | $ | (28,315 | ) | $ | 35,150 | $ | 1,155 | $ | 36,305 | ||||
| ^1^ | Includes the appropriate values from net income to comply with<br>legal provisions related to asset protection according to applicable jurisdictions with cumulative earnings. | |||||||||||||||||||||
| --- | --- |
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