- Fourth quarter revenue of $16.5
million, Adjusted EBITDA of $8.7
million and cash from operations of $5.8 million
- Produced strong Vascepa® prescription growth amid COVID-19
challenges: more than 2,000 patients and more than 550 prescribers
at end of Q4, which are increases of more than 70% and 55%,
respectively, from the end of Q3
- As of March 18, 2021 , reached
agreement with private insurers in Canada, representing > 90% of privately
covered lives, to provide reimbursement coverage for
Vascepa
TORONTO, March 18, 2021 /CNW/ - HLS Therapeutics Inc.
("HLS" or the "Company") (TSX: HLS), a specialty pharmaceutical
company focusing on central nervous system ("CNS") and
cardiovascular markets, announces its financial results for the
three- and twelve-month periods ended December 31, 2020. All amounts are in thousands
of United States ("U.S.") dollars
unless otherwise stated.
Q4 & FISCAL 2020 FINANCIAL HIGHLIGHTS
- Q4 2020 revenue was $16.5 million
compared to $13.9 million in Q4 2019;
Fiscal 2020 revenue was $56.1 million
compared to $54.2 million in
2019.
- Q4 2020 Adjusted EBITDA was $8.7
million compared to $7.2
million in Q4 2019; Fiscal 2020 Adjusted EBITDA was
$24.1 million compared to
$31.6 million in 2019, which reflects
investment in the launch of Vascepa.
- Q4 2020 net loss was ($7.3)
million, or ($0.23) per common
share, compared to net loss of ($12.2)
million, or ($0.40) per common
share, in Q4 2019; Fiscal 2020 net loss was ($15.3) million, or ($0.48) per common share, compared to net loss of
($19.6) million, or ($0.67) per common share, in 2019.
- Q4 2020 cash generated from operations was $5.8 million compared to $2.3 million in Q4 2019; Fiscal 2020 cash
generated from operations was $9.3
million compared to $26.4
million in 2019, which reflects investment in the launch of
Vascepa.
- Cash and cash equivalents were $20.6
million as at December 31,
2020 compared to $47.1 million
at December 31, 2019.
Q4 & FISCAL 2020 BUSINESS HIGHLIGHTS
- Vascepa was added to Health Canada's Register of Innovative
Drugs and as a result the product will benefit from data protection
for a term of eight years.
- Launched Vascepa in the Canadian market.
- CADTH recommended Vascepa be reimbursed for patients with
established cardiovascular disease.
- PMPRB notified HLS that Vascepa's introductory price submission
is compliant.
- Increased the peak-year sales estimate for Vascepa to
C$275-325 million, from C$150-250 million.
- Launched CSAN Pronto in the Canadian market.
- Acquired a portfolio of four royalty interests that is
forecasted to generate average annual Adjusted EBITDA of
$11.0 million per year for a ten-year
period.
- Health Canada approved the use
of PERSERIS®, a novel long-acting injectable of risperidone, for
the treatment of schizophrenia in adults.
- Health Canada approved MyCare™
Psychiatry Lab Assays for use in diagnostic lab settings to measure
blood levels in patients prescribed six of the most common
antipsychotic drugs.
- Co-founder Gilbert Godin
succeeded retiring CEO and co-founder Greg
Gubitz.
- Announced a Normal Course Issuer Bid to purchase up to 5% of
the Company's issued and outstanding Common Shares.
"Q4 was a strong finish to a year in which we made progress on
launching significant growth drivers for the business, despite the
challenges posed by the COVID-19 pandemic, as exemplified by
multiple lockdowns across Canada,
including in the two largest provinces during November and
December," said Gilbert Godin, CEO
of HLS. "Our financial results reflect the resilience and strength
of Clozaril as well as our new royalty portfolio, which together
serve as our foundational products. The reliable cash flow received
from these products enables us to invest in the expansion of our
product portfolio and in the significant organic growth potential
of transformational products, such as Vascepa."
"In February, we launched Vascepa and during the year we
achieved a number of important milestones that help provide greater
visibility towards reaching our peak-year sales estimate for the
product. Among those milestones, Vascepa was granted data
protection for eight years, it received a favorable reimbursement
recommendation from CADTH, a favorable notification from the PMPRB
on pricing and, as of today, we have reached agreements with
private insurers representing more than 90% of privately covered
lives in Canada to reimburse
Vascepa for patients in-label."
"While COVID-19 has had an impact on our launch efforts –
restricting face-to-face interactions with practitioners and
broadly limiting patient visits to doctors' offices - we are still
making undeniable progress as evidenced by the growing number of
prescribers and patients, and overall, the number of prescriptions
that have been written. Cardiovascular disease remains the number
one killer worldwide, indicating that there is strong need for a
product like Vascepa that has shown 25-30% relative risk reduction
of a major adverse cardiac event, including death1."
"We also made progress in 2020 adding other products to our
portfolio and advancing them towards commercialization. PERSERIS
and the MyCare Psychiatry Lab Assays are products in the CNS
therapeutic market, and both were approved by Health Canada in Q4.
Both products are novel treatment options for practitioners and can
leverage our existing commercial infrastructure, relationships and
reach in the Canadian psychiatric market. We expect to have both in
the market in the second half of 2021. With Trinomia, Health Canada
advised they would wait for results of an ongoing clinical trial
involving the product, which is expected to finish at the end of
this year. Following completion of that trial, we will be in a
better position to determine the regulatory path forward for the
product. Finally, we added a diversified portfolio of royalty
interests on the global sales of four significant products that are
already contributing meaningfully to our results."
DIVIDEND
On March 17, 2021, the Company's
Board of Directors declared a dividend of C$0.05 per outstanding common share to be paid on
June 15, 2021, to shareholders of
record as of April 30, 2021.
These dividends paid on the Company's common shares are
designated to be "eligible dividends" for purposes of section 89(1)
of the Income Tax Act (Canada).
Q4 & FISCAL 2020 FINANCIAL REVIEW
The Company's Management's Discussion and Analysis and
Consolidated Financial Statements for the three- and twelve-month
periods ended December 31, 2020 are available at the Company's
website and at its profile at SEDAR.
Revenue
The following table provides revenue segmentation by revenue
type for the three- and twelve-month periods ended December 31, 2020:
|
Three months
ended
December
31,
|
Year
ended
December
31,
|
|
2020
|
2019
|
2020
|
2019
|
|
|
|
|
|
Product
sales
|
|
|
|
|
Canada
|
7,656
|
7,023
|
29,393
|
27,159
|
United States
|
4,198
|
4,406
|
16,265
|
17,433
|
|
11,854
|
11,429
|
45,658
|
44,592
|
Royalty
revenue
|
4,631
|
2,508
|
10,451
|
9,568
|
|
16,485
|
13,937
|
56,109
|
54,160
|
Product Sales
The Company's product sales grew by 2% in fiscal 2020, led by 8%
growth in product sales in Canada,
despite the continued impact of the COVID-19 pandemic. These
results reflect the resiliency of the Company's Clozaril franchises
in Canada and the U.S. as well as
the introduction of Vascepa in Canada.
Despite additional pandemic-related restrictions in major
markets within Canada in Q4 2020,
the number of Clozaril patients in Canada grew approximately 2% year-over-year.
Q4 2020 Clozaril product sales in Canada were essentially flat compared to Q4
2019. Excluding the impact of trade inventory adjustments and the
impact of the timing of deliveries around the year-end holidays on
revenue recognition, Clozaril revenue growth in the quarter would
have been consistent with the steady growth in patients. Steady
growth in the number of Canadian physicians prescribing Vascepa as
well as in the number of patients taking the medication has
resulted in an increase to Vascepa product sales, which grew 42%
sequentially in Q4 2020 compared to Q3 2020.
Royalty revenues
Absorica royalty revenue was $8.1
million for fiscal 2020, down $1.5
million from $9.6 million in
fiscal 2019. HLS terminated its ownership of these marketing rights
effective December 31, 2020, in line
with its previously disclosed intention to do so.
On September 30, 2020, HLS
acquired a diversified portfolio of royalty interests on global
sales of four different products. The portfolio generated royalty
revenues of $2.3 million in Q4 2020
and HLS realized a gain of $0.5
million as actual royalties received for Q3 2020 were in
excess of the estimated acquired royalty receivable. Initial
results are tracking ahead of the Company's expectations as total
royalties received or receivable by HLS for the six-month period
from July 1, 2020 to December 31, 2020 were $4.8 million, of which $2.3 million has been included in royalty
revenues.
Operating Expenses
|
Three months
ended
December
31,
|
Year
ended
December
31,
|
|
2020
|
2019
|
2020
|
2019
|
|
|
|
|
|
Cost of product
sales
|
1,311
|
484
|
3,625
|
1,932
|
Selling and
marketing
|
3,260
|
2,028
|
12,900
|
6,256
|
Medical, regulatory
and patient support
|
1,284
|
1,520
|
5,467
|
5,287
|
General and
administrative
|
2,403
|
2,669
|
10,487
|
9,042
|
|
8,258
|
6,701
|
32,479
|
22,517
|
The cost of product sales increased in fiscal 2020 as a result
of the introduction of Vascepa and CSAN Pronto in Canada. Selling and marketing activities
increased by $6.6 million in fiscal
2020 relative to last year, reflecting the additional costs related
to the introduction of Vascepa in Canada, which included the salesforce
expansion at the start of the year, as well as the roll-out of CSAN
Pronto. The $1.5 million increase in
general and administrative costs included $1.3 million of expense associated with the
retirement of the Company's founding CEO. For Q4 2020, operating
expenses increased by $1.6 million
compared to Q4 2019. Increases in selling and marketing costs
primarily related to the introduction of Vascepa accounted for
$1.2 million of this increase.
Adjusted EBITDA2
|
Three months
ended
December
31,
|
Year
ended
December
31,
|
|
2020
|
2019
|
2020
|
2019
|
|
|
|
|
|
Net loss for the
period
|
(7,278)
|
(12,220)
|
(15,331)
|
(19,552)
|
Stock-based
compensation
|
2,420
|
2,034
|
2,531
|
3,761
|
Amortization and
depreciation
|
9,513
|
8,154
|
33,186
|
32,510
|
Acquisition and
transaction costs
|
152
|
327
|
709
|
957
|
Finance and related
costs
|
3,372
|
9,497
|
4,012
|
14,878
|
Income tax expense
(recovery)
|
557
|
(556)
|
(968)
|
(911)
|
Adjusted
EBITDA
|
8,736
|
7,236
|
24,139
|
31,643
|
Adjusted EBITDA for fiscal 2020 decreased by $7.5 million compared to the prior year due to
the $10.0 million increase in
operating expenses, which were primarily the result of the increase
in the selling and marketing costs to support the Vascepa launch in
Canada. The financial contribution
in fiscal 2020 from the growth of Clozaril and Vascepa product
sales in Canada and the addition
of the acquired portfolio of royalty interests were more than
sufficient to off-set the impact on Adjusted EBITDA of the erosion
of Clozaril product sales in the US market and the decline in the
final year of the Absorica royalty revenues.
Adjusted EBITDA for Q4 2020 increased by $1.5 million from Q4 2019. The increase was
primarily due to $2.3 million of
revenue from the acquisition of the portfolio of royalty interests,
growth in Canadian product sales and the realized gain of
$0.5 million on the acquired royalty
receivable, offset in part by the $1.6
million increase in operating expenses.
(2) See "Cautionary Note Regarding Non-IFRS
Measures" section of this press release.
Net Loss
Net loss for the Q4 2020 and fiscal 2020 periods was
($7.3) million, or ($0.23) per share, and ($15.3) million, or ($0.48) per share, compared to ($12.2) million, or ($0.40) per share, and ($19.6) million, or ($0.67) per share, in the prior year periods. Net
loss decreased in 2020, primarily due to higher revenue and lower
finance and related costs, offset in part by higher operating
expenses to support the launch of Vascepa and CSAN Pronto.
Cash from Operations and Financial Position
Cash generated from operations was $5.8
million in Q4 2020, compared to cash generated from
operations of $2.3 million in Q4
2019. For fiscal 2020, cash generated from operations was
$9.3 million compared to $26.4 million in the same period last year. The
decrease in the 2020 periods is attributable to the expenditures
associated with the launch of Vascepa, including the purchase of
inventory, and the launch of CSAN Pronto.
As at December 31, 2020, the
Company had cash and cash equivalents of $20.6 million compared to $47.1 million at December
31, 2019. Factors impacting the change in cash balance since
the end of 2019 include increased selling and marketing costs
related to Vascepa's launch, initial inventory purchases for the
product, the purchase of the royalty portfolio announced on
September 30, 2020 and a $3.75 million milestone payment made to Amarin
when Vascepa received confirmation of eight years of data
protection in Canada.
HLS has a strong financial position with $20.6 million of cash and cash equivalents, a
$35.0 million revolving facility that
was undrawn at December 31, 2020, and
the Company may also request to be provided with incremental loans,
up to a maximum amount of $70.0
million, to support acquisitions and other growth
opportunities. In addition, earlier this year, the Company filed a
preliminary short-form base shelf prospectus with the securities
commissions in each of the provinces and territories of
Canada, other than Quebec, to raise up to C$250.0 million over a period of 25 months should
an appropriate strategic opportunity emerge.
Q4 & FISCAL 2020 CONFERENCE CALL
HLS will hold a conference call today at 8:30 am Eastern Time to discuss its Q4 &
FISCAL 2020 financial results. The call will be hosted by Mr.
Gilbert Godin, Chief Executive
Officer and Mr. Tim Hendrickson,
Chief Financial Officer. To view the slides that accompany
management's discussion, please use the webcast link.
CONFERENCE
ID:
|
39965985
|
|
|
DATE:
|
Thursday, March 18,
2021
|
|
|
TIME:
|
8:30 a.m. Eastern
Standard Time
|
|
|
DIAL-IN
NUMBER:
|
1-888-664-6392 or
416-764-8659
|
|
|
WEBCAST
LINK:
|
https://produceredition.webcasts.com/starthere.jsp?ei=1425876&tp_key=3150153748
|
|
|
TAPED
REPLAY:
|
1-888-390-0541 or
416-764-8677
|
|
|
REPLAY
CODE:
|
965985
|
The taped replay will be available for 14 days and the archived
webcast will be available for 365 days.
A link to the live audio webcast of the conference call will
also be available on the events page of the investors section of
HLS Therapeutics' website at www.hlstherapeutics.com. Please
connect at least 15 minutes prior to the conference call to ensure
adequate time for any software download that may be required to
hear the webcast.
REFERENCES
1Bhatt DL, Steg PG, Miller M, Brinton EA, Jacobson
TA, Ketchum SB, Doyle RT, Juliano RA, Jiao L, Granowitz C, Tardif
JC, Ballantyne CM. Cardiovascular Risk Reduction with Icosapent
Ethyl for Hypertriglyceridemia. N Engl J Med 2019;380:11-22.
ABOUT HLS THERAPEUTICS INC.
Formed in 2015, HLS is a specialty pharmaceutical company
focused on the acquisition and commercialization of late stage
development, commercial stage promoted and established branded
pharmaceutical products in the North American markets. HLS's focus
is on products targeting the central nervous system and
cardiovascular therapeutic areas. HLS's management team is composed
of seasoned pharmaceutical executives with a strong track record of
success in these therapeutic areas and at managing products in each
of these lifecycle stages. For more information visit:
www.hlstherapeutics.com
2CAUTIONARY NOTE REGARDING NON-IFRS
MEASURES
This press release refers to certain non-IFRS measures. These
measures are not recognized measures under IFRS, do not have a
standardized meaning prescribed by IFRS and are therefore unlikely
to be comparable to similar measures presented by other companies.
Rather, these measures are provided as additional information to
complement those IFRS measures by providing further understanding
of HLS's results of operations from management's perspective.
Accordingly, they should not be considered in isolation nor as a
substitute for analysis of HLS's financial information reported
under IFRS. HLS uses non-IFRS measures to provide investors with
supplemental measures of its operating performance and thus
highlight trends in its core business that may not otherwise be
apparent when relying solely on IFRS financial measures. HLS also
believes that securities analysts, investors and other interested
parties frequently use non-IFRS measures in the evaluation of
issuers. HLS's management also uses non-IFRS measures in order to
facilitate operating performance comparisons from period to period,
prepare annual operating budgets and assess HLS's ability to meet
its future debt service, capital expenditure and working capital
requirements.
In particular, management uses Adjusted EBITDA as a
measure of HLS's performance. To reconcile net income (loss)
for the period with Adjusted EBITDA, each of (i) "stock-based
compensation", (ii) "amortization and depreciation", (iii)
"acquisition and transaction costs", (iv) "finance and related
costs", and (v) "income tax recovery" appearing in the Consolidated
Statement of Net Income (Loss) are added to net income (loss) for
the period to determine Adjusted EBITDA. Adjusted EBITDA does not
have any standardized meaning prescribed by IFRS and is not
necessarily comparable to similar measures presented by other
companies. Adjusted EBITDA should not be considered in
isolation or as a substitute for net income (loss) prepared in
accordance with IFRS as issued by the IASB.
FORWARD LOOKING INFORMATION
This release includes forward-looking statements regarding
HLS and its business. Such statements are based on the current
expectations and views of future events of HLS's management. In
some cases the forward-looking statements can be identified by
words or phrases such as "may", "will", "expect", "plan",
"anticipate", "intend", "potential", "estimate", "believe" or the
negative of these terms, or other similar expressions intended to
identify forward-looking statements, including, among others,
statements with respect to HLS's pursuit of additional product and
pipeline opportunities in certain therapeutic markets, statements
regarding growth opportunities, expectations regarding financial
performance, and the NCIB and ASPP. The forward-looking events and
circumstances discussed in this release may not occur and could
differ materially as a result of known and unknown risk factors and
uncertainties affecting HLS, including risks relating to the
specialty pharmaceutical industry, risks related to the regulatory
approval process, economic factors and many other factors beyond
the control of HLS. Forward-looking statements and information by
their nature are based on assumptions and involve known and unknown
risks, uncertainties and other factors which may cause HLS's actual
results, performance or achievements, or industry results, to be
materially different from any future results, performance or
achievements expressed or implied by such forward-looking statement
or information. Accordingly, readers should not place undue
reliance on any forward-looking statements or information. A
discussion of the material risks and assumptions associated with
this release can be found in the Company's Annual Information Form
dated March 17, 2021 and Management's
Discussion and Analysis dated March
17, 2021, both of which have been filed on SEDAR
and can be accessed at www.sedar.com. Accordingly, readers should
not place undue reliance on any forward-looking statements or
information. Except as required by applicable securities laws,
forward-looking statements speak only as of the date on which they
are made and HLS undertakes no obligation to publicly update or
revise any forward-looking statement, whether as a result of new
information, future events, or otherwise.
HLS THERAPEUTICS
INC
|
CONSOLIDATED
STATEMENTS OF FINANCIAL POSITION
|
[in thousands of U.S.
dollars]
|
|
|
|
|
|
As
at
|
As
at
|
|
|
December 31,
2020
|
December 31,
2019
|
|
|
|
|
ASSETS
|
|
|
|
Current
|
|
|
|
Cash and cash
equivalents
|
|
20,612
|
47,078
|
Accounts
receivable
|
|
12,497
|
11,858
|
Inventories
|
|
10,630
|
2,055
|
Derivative financial
instruments
|
|
—
|
271
|
Prepaid expenses and
other current assets
|
|
2,172
|
1,838
|
Total current
assets
|
|
45,911
|
63,100
|
Property, plant and
equipment
|
|
1,384
|
1,276
|
Intangible
assets
|
|
253,404
|
252,050
|
Restricted
assets
|
|
2,034
|
2,188
|
Deferred tax
asset
|
|
1,173
|
1,057
|
Total
assets
|
|
303,906
|
319,671
|
|
|
|
|
|
Current
|
|
|
|
Accounts payable and
accrued liabilities
|
|
14,223
|
13,466
|
Provisions
|
|
4,516
|
5,471
|
Debt and other
financial liabilities
|
|
16,358
|
27,855
|
Income taxes
payable
|
|
545
|
347
|
Total current
liabilities
|
|
35,642
|
47,139
|
Debt and other
financial liabilities
|
|
99,015
|
91,822
|
Deferred tax
liability
|
|
—
|
2,511
|
Total
liabilities
|
|
134,657
|
141,472
|
|
|
|
|
Shareholders'
equity
|
|
|
|
Share
capital
|
|
257,411
|
248,687
|
Contributed
surplus
|
|
11,393
|
11,517
|
Accumulated other
comprehensive income (loss)
|
|
2,020
|
(537)
|
Deficit
|
|
(101,575)
|
(81,468)
|
Total shareholders'
equity
|
|
169,249
|
178,199
|
Total liabilities and
shareholders' equity
|
303,906
|
319,671
|
HLS THERAPEUTICS
INC
|
CONSOLIDATED
STATEMENTS OF NET LOSS
|
[in thousands of U.S.
dollars, except per share amounts]
|
|
Three months
ended
December
31,
|
Year
ended
December
31,
|
|
2020
|
2019
|
2020
|
2019
|
|
|
|
|
|
Revenues
|
16,485
|
13,937
|
56,109
|
54,160
|
|
|
|
|
|
Expenses
|
|
|
|
|
Cost of product
sales
|
1,311
|
484
|
3,625
|
1,932
|
Selling and
marketing
|
3,260
|
2,028
|
12,900
|
6,256
|
Medical, regulatory
and patient support
|
1,284
|
1,520
|
5,467
|
5,287
|
General and
administrative
|
2,403
|
2,669
|
10,487
|
9,042
|
Stock-based
compensation
|
2,420
|
2,034
|
2,531
|
3,761
|
Amortization and
depreciation
|
9,513
|
8,154
|
33,186
|
32,510
|
Operating
loss
|
(3,706)
|
(2,952)
|
(12,087)
|
(4,628)
|
Realized gain on
acquired royalty receivable
|
(509)
|
—
|
(509)
|
—
|
Acquisition and
transaction costs
|
152
|
327
|
709
|
957
|
Finance and related
costs, net
|
3,372
|
9,497
|
4,012
|
14,878
|
Loss before income
taxes
|
(6,721)
|
(12,776)
|
(16,299)
|
(20,463)
|
Income tax expense
(recovery)
|
557
|
(556)
|
(968)
|
(911)
|
Net loss for the
period
|
(7,278)
|
(12,220)
|
(15,331)
|
(19,552)
|
|
|
|
|
|
Net loss per
share:
|
|
|
|
|
Basic and
diluted
|
$(0.23)
|
$(0.40)
|
$(0.48)
|
$(0.67)
|
|
|
|
HLS THERAPEUTICS
INC
|
CONSOLIDATED
STATEMENTS OF COMPREHENSIVE INCOME (LOSS)
|
[in thousands of U.S.
dollars]
|
|
Three months
ended
December
31,
|
Year
ended
December
31,
|
|
2020
|
2019
|
2020
|
2019
|
|
|
|
|
|
Net loss for the
period
|
(7,278)
|
(12,220)
|
(15,331)
|
(19,552)
|
|
|
|
|
|
Item that may be
reclassified subsequently to net loss
|
|
|
|
|
Unrealized foreign currency translation adjustment
|
7,385
|
2,598
|
2,557
|
6,918
|
Comprehensive
income (loss) for the period
|
107
|
(9,622)
|
(12,774)
|
(12,634)
|
HLS THERAPEUTICS
INC
|
CONSOLIDATED
STATEMENTS OF CHANGES IN SHAREHOLDERS' EQUITY
|
[in thousands of U.S.
dollars]
|
|
|
|
|
|
|
|
Share
capital
|
Contributed
surplus
|
Accumulated
other
comprehensive
income (loss)
|
Deficit
|
Total
|
|
|
|
|
|
|
|
Balance, December
31, 2018
|
|
210,360
|
12,973
|
(7,455)
|
(57,389)
|
158,489
|
Common shares
issued
|
|
37,329
|
—
|
—
|
—
|
37,329
|
Share issuance
costs
|
|
(2,411)
|
—
|
—
|
—
|
(2,411)
|
Warrants
exercised
|
|
3,395
|
(3,358)
|
—
|
—
|
37
|
Stock options
exercised
|
|
14
|
—
|
—
|
—
|
14
|
Warrants
granted
|
|
—
|
470
|
—
|
—
|
470
|
Stock option
expense
|
|
—
|
1,432
|
—
|
—
|
1,432
|
Net loss for the
year
|
|
—
|
—
|
—
|
(19,552)
|
(19,552)
|
Dividends
declared
|
|
—
|
—
|
—
|
(4,527)
|
(4,527)
|
Unrealized foreign
currency translation adjustment
|
|
—
|
—
|
6,918
|
—
|
6,918
|
Balance, December
31, 2019
|
|
248,687
|
11,517
|
(537)
|
(81,468)
|
178,199
|
Warrants
exercised
|
|
8,663
|
(1,652)
|
—
|
—
|
7,011
|
Stock options
exercised
|
|
61
|
(16)
|
—
|
—
|
45
|
Stock option
expense
|
|
—
|
1,544
|
—
|
—
|
1,544
|
Net loss for the
year
|
|
—
|
—
|
—
|
(15,331)
|
(15,331)
|
Dividends
declared
|
|
—
|
—
|
—
|
(4,776)
|
(4,776)
|
Unrealized foreign
currency translation adjustment
|
|
—
|
—
|
2,557
|
—
|
2,557
|
Balance, December
31, 2020
|
|
257,411
|
11,393
|
2,020
|
(101,575)
|
169,249
|
|
|
|
|
|
|
HLS THERAPEUTICS
INC
|
CONSOLIDATED
STATEMENTS OF CASH FLOWS
|
[in thousands of U.S.
dollars]
|
|
|
|
Three months
ended
December
31,
|
Year
ended
December
31,
|
|
2020
|
2019
|
2020
|
2019
|
|
|
|
|
|
OPERATING
ACTIVITIES
|
|
|
|
|
Net loss for the
period
|
(7,278)
|
(12,220)
|
(15,331)
|
(19,552)
|
Adjustments to
reconcile net loss to cash provided by operating
activities
|
|
|
|
|
Stock-based
compensation
|
2,420
|
2,034
|
2,531
|
3,761
|
Amortization and
depreciation
|
9,513
|
8,154
|
33,186
|
32,510
|
Accreted
interest
|
261
|
425
|
1,173
|
1,979
|
Fair value adjustment
on financial assets and liabilities
|
1,642
|
8,729
|
(2,243)
|
9,384
|
Unrealized foreign
exchange
|
—
|
(982)
|
176
|
(982)
|
Deferred income
taxes
|
(131)
|
(919)
|
(2,483)
|
(2,241)
|
Net change in
non-cash working capital balances related to
operations
|
(581)
|
(2,876)
|
(7,665)
|
1,549
|
Cash provided by
operating activities
|
5,846
|
2,345
|
9,344
|
26,408
|
|
|
|
|
|
INVESTING
ACTIVITIES
|
|
|
|
|
Additions to
property, plant and equipment
|
(4)
|
(60)
|
(36)
|
(199)
|
Royalty
acquisition
|
(855)
|
—
|
(31,692)
|
—
|
Rights
acquisitions
|
(1,825)
|
(4,325)
|
(12,050)
|
(12,800)
|
Other additions to
intangible assets
|
(138)
|
(697)
|
(899)
|
(2,360)
|
Cash used in
investing activities
|
(2,822)
|
(5,082)
|
(44,677)
|
(15,359)
|
|
|
|
|
|
FINANCING
ACTIVITIES
|
|
|
|
|
Common shares
issued
|
—
|
—
|
—
|
37,329
|
Common share issuance
costs
|
—
|
(69)
|
—
|
(2,648)
|
Stock options
exercised
|
—
|
13
|
45
|
14
|
Warrants
exercised
|
—
|
2
|
1,590
|
37
|
Dividends
paid
|
(1,238)
|
(1,143)
|
(4,749)
|
(4,332)
|
Drawdown of senior
secured term loan
|
—
|
—
|
20,000
|
—
|
Repayment of senior
secured term loan
|
(2,250)
|
(1,250)
|
(6,132)
|
(5,000)
|
Debt costs
|
—
|
—
|
(658)
|
(1,000)
|
Lease
payments
|
(158)
|
(132)
|
(532)
|
(453)
|
Cash provided by
(used in) financing activities
|
(3,646)
|
(2,579)
|
9,564
|
23,947
|
|
|
|
|
|
Net increase
(decrease) in cash and cash equivalents during the
period
|
(622)
|
(5,316)
|
(25,769)
|
34,996
|
Foreign exchange on
cash and cash equivalents
|
344
|
1,051
|
(697)
|
1,152
|
Cash and cash
equivalents, beginning of period
|
20,890
|
51,343
|
47,078
|
10,930
|
Cash and cash
equivalents, end of period
|
20,612
|
47,078
|
20,612
|
47,078
|
|
|
|
|
SOURCE HLS Therapeutics Inc.