LSL PHARMA GROUP INC (TSXV: LSL) - LSL Pharma Group Inc. ("the
Company" or "LSL Pharma Group"), a Canadian integrated
pharmaceutical company, has announced its financial results for the
third quarter ended September 30, 2023. The Company's MD&A and
unaudited consolidated financial statements are available on
SEDAR+. Unless otherwise indicated, all amounts are expressed in
Canadian dollars.
" LSL Pharma Group has made solid progress since
the start of the year, with both subsidiaries contributing to its
improved financial and operating performance," said François
Roberge, President and CEO of LSL Pharma Group. "The acceleration
of production at LSL Laboratories ("LSL") is progressing according
to plan, following the move to new facilities in La Pocatière
earlier this year. We have also completed optimization measures at
the Steri-Med Pharma ("Steri-Med") plant, with a view to increase
its production capacity by early 2024 to meet growing demand for
our products."
SELECTED FINANCIAL INFORMATION(in thousands of
Canadian dollars, except per share amounts) |
Third quarter ended |
Nine months ended |
Sept. 30,2023 |
|
Sept. 30,2022 |
|
Sept. 30,2023 |
|
Sept. 30,2022 |
|
Revenue |
2,512 |
|
2,642 |
|
6,570 |
|
5,924 |
|
Gross margin |
467 |
|
(13 |
) |
1,546 |
|
(935 |
) |
Adjusted EBITDA1 |
96 |
|
(865 |
) |
(166 |
) |
(3,872 |
) |
Net loss |
(762 |
) |
(1,467 |
) |
(7,996 |
) |
(5,045 |
) |
Net loss per share |
(0.01 |
) |
(0.02 |
) |
(0.10 |
) |
(0.08 |
) |
Weighted average number of shares outstanding
('000s) |
82,434 |
|
64,647 |
|
79,617 |
|
64,647 |
|
____________________________1 Adjusted EBITDA is
a non-IFRS measure. See the Non-IFRS financial measures section for
definitions and reconciliations.
THIRD-QUARTER RESULTS
For the third quarter ended September 30, 2023,
LSL Pharma Group recorded revenues of $2.5M, down slightly from
$2.6M for the same period last year, but up 24% sequentially from
$2.0M in the last two quarters of the current fiscal year.
The year-over-year variation reflects the
gradual resumption of LSL's activities following the transition to
its new manufacturing plant, as well as an extended summer shutdown
at the Steri-Med plant to improve production flow and optimize
equipment and production facilities. In addition, the sequential
increase largely reflects the impact of the new LSL plant, as well
as the effectiveness of measures implemented in previous
periods.
Adjusted EBITDA, which excludes non-recurring
items, amounted to $0.1M, compared with a loss of $0.9 million a
year earlier. This marked improvement is mainly attributable to the
increase in gross profit, which totalled $0.5M compared with a loss
of $13,000 last year, and to a significant reduction of
administrative expenses of over 25%.
The net loss for the third quarter was $0.8M, or
$0.01 per share, a 47% improvement over last year's net loss of
$1.5M, or $0.02 per share.
RESULTS FOR THE FIRST NINE MONTHS OF
2023
For the first nine months of 2023 fiscal year,
LSL Pharma Group revenues reached $6.6M, up 11% from $5.9M for the
same period last year. Gross profit amounted to $1.5M, compared
with a loss of $0.9M a year earlier. Adjusted EBITDA showed a loss
of $0.2M, a marked improvement over the $3.9M loss posted the
previous year. Net loss totaled $8.0M, or $0.01 per share, versus a
loss of $5.0M, or $0.08 per share, a year earlier.
FINANCIAL SITUATION
Reflecting the private placements concluded in
the first quarter of the year, shareholders' equity stood at $9.8M
at September 30, 2023, compared with $5.6M at the beginning of the
year. Long-term debt, including the current portion, totalled
$10.0M, compared with $9.3M at the beginning of the year. Working
capital stood at ($8.2M), compared with ($7.0M) at December 31,
2022, while $4.9M of long-term debt is now shown as a current
liability due to its maturity date.
SUBSEQUENT EVENT
On November 1st , 2023, the Company announced
the closing of the first tranche of its brokered private placement
(the "Offering") through the issuance of 229,300 convertible
unsecured debentures at a price of $10 per debenture, for gross
proceeds of $2,293,000 out of a total of $5,000,000 (assuming full
exercise of the agent's option to increase the size of the Offering
to $1,000,000). The net proceeds of the Offering will be used for
working capital, capital expenditures and general corporate
purposes. A second tranche of the Offering is expected to close
before the end of the fourth quarter.
OUTLOOK
"The coming quarters look promising, as we take
advantage of increased production capacity at each of our
subsidiary. Starting with the fourth quarter of 2023 and into 2024,
we'll be taking advantage of the new agreements unveiled last
October. Initially, Steri-Med will supply sterile ophthalmic
ointment for the treatment of newborns in US hospitals under an
exclusive agreement with US specialty pharmaceutical company Fera
Pharmaceuticals, LLC. In addition, LSL will begin deliveries
against new purchase orders for natural health products, the value
of which could exceed $2.6M on an annual basis. Finally, we are
pursuing our efforts to make strategic acquisitions that will
enable us to further expand our product range and customer base,"
concluded Mr. Roberge.
NON-IFRS FINANCIAL MEASURES
The non-IFRS financial measures included in this
press release are not recognized measures under IFRS and do not
have a standardized meaning prescribed by IFRS; they may therefore
not be comparable to similar measures presented by other issuers.
When used, these measures are defined so as to permit
reconciliation with the most comparable IFRS measure. These
measures are provided as supplementary information to complement
IFRS measures, by providing a better understanding of the Company's
operating results, from its perspective. Accordingly, they should
not be considered in isolation, nor as a substitute for analysis of
the LSL Pharma Group's IFRS financial information. Despite the
importance of these measures to management in setting objectives
and assessing performance, the Company emphasizes that they are
non-IFRS measures whose usefulness to investors may be limited.
The Company uses non-IFRS measures, such as
EBITDA and Adjusted EBITDA, to provide investors with an additional
measure of its operating performance and thus highlight trends in
its core business that might not otherwise be apparent if only IFRS
financial measures were used. The Company also notes that financial
analysts, investors and other interested parties frequently use
non-IFRS measures in assessing issuers. LSL Group Pharma also uses
non-IFRS measures to facilitate period-to-period comparisons of
operating performance, to prepare annual operating budgets, and to
assess its ability to meet future debt servicing, capital
expenditure and working capital requirements. The definition and
reconciliation of EBITDA and Adjusted EBITDA used and presented by
the Company with the most directly comparable IFRS measures are
detailed below.
EBITDA is defined as net income
or loss adjusted for income tax expense, depreciation of property,
plant and equipment, amortization of intangible assets, interest on
short-term and long-term debt, and other financing costs such as
foreign exchange gains or losses, interest income and other.
Management uses EBITDA to assess the Company's operating
performance.
Adjusted EBITDA is defined as
EBITDA adjusted for special employee recruitment and severance
costs, special professional fees, stock-based compensation and
other costs of issuing warrants or options, moving expenses and
other expenses related to the Company's listing on the TSX Venture
Exchange. The Company uses Adjusted EBITDA as a key measure of
business performance when comparing results to budgets, forecasts
and prior years. Management believes that Adjusted EBITDA is a more
accurate measure of cash flow generation than, for example, cash
flow from operations, as it eliminates cash flow fluctuations
caused by unusual changes in working capital.
Reconciliation of net loss to EBITDA and adjusted
EBITDA (in thousands of Canadian dollars)* |
Third quarter ended |
Nine months ended |
Sept. 30,2023 |
|
Sept. 30,2022 |
|
Sept. 30,2023 |
|
Sept. 30,2022 |
|
Net loss |
(762 |
) |
(1,467 |
) |
(7,996 |
) |
(5,045 |
) |
Net financial expenses |
426 |
|
341 |
|
1 269 |
|
408 |
|
Amortization |
347 |
|
249 |
|
885 |
|
750 |
|
EBITDA |
11 |
|
(877 |
) |
(5,842 |
) |
(3,887 |
) |
Cost of reverse takeover |
- |
|
- |
|
2,488 |
|
- |
|
Moving expenses |
1 |
|
- |
|
133 |
|
- |
|
Stock-based compensation expensesRecruitment and severance
costs |
-84 |
|
-12 |
|
2,97184 |
|
-- |
|
Adjusted EBITDA |
96 |
|
(865 |
) |
(166 |
) |
(3,887 |
) |
* Some calculation discrepancies are due to
rounding.
CAUTION REGARDING FORWARD-LOOKING
STATEMENTS
This press release may contain forward-looking
statements as defined under applicable Canadian securities
legislation. Forward-looking statements can generally be identified
by the use of forward-looking terminology such as "may", "will",
"expect", "intend", "estimate", "continue" or similar expressions.
Forward-looking statements are based on a number of assumptions and
are subject to various known and unknown risks and uncertainties,
many of which are beyond the Company's ability to control or
predict, that could cause actual results or performance to differ
materially from those expressed or implied in such forward-looking
statements. These risks and uncertainties include, but are not
limited to, those identified in the Company's filings with Canadian
securities regulatory authorities, such as legislative or
regulatory developments, increased competition, technological
change and general economic conditions. All forward-looking
statements made herein should be read in conjunction with such
documents.
Readers are cautioned not to place undue
reliance on forward-looking statements. No assurance can be given
that any of the events referred to in the forward-looking
statements will transpire, and if any of them do, the actual
results, performance or achievements of the Company may differ
materially from those expressed or implied by the forward-looking
statements. All forward-looking statements contained in this press
release speak only as of the date of this press release. The
Company does not undertake to update these forward-looking
statements, whether as a result of new information, future events
or otherwise, except as required by law.
ABOUT LSL PHARMA INC.
LSL Pharma Group is an integrated Canadian
pharmaceutical company specializing in the development, manufacture
and distribution of high-quality natural health products and
dietary supplements in solid dosage forms, as well as high-quality
sterile ophthalmic pharmaceuticals. For further information, please
visit the following websites www.groupelslpharma.com,
www.laboratoirelsl.com and www.sterimedpharma.com.
Neither TSX Venture Exchange nor its Regulation
Services Provider (as that term is defined in the policies of the
TSX Venture Exchange) accepts responsibility for the adequacy or
accuracy of this release.
CONTACT :François Roberge,
President and CEO Telephone: 514 664-7700E-mail:
Investors@groupelslpharma.com
LSL Pharma (TSXV:LSL)
Historical Stock Chart
From May 2024 to Jun 2024
LSL Pharma (TSXV:LSL)
Historical Stock Chart
From Jun 2023 to Jun 2024