Aeterna Zentaris Reports First Quarter 2019 Financial and Operating Results
May 07 2019 - 5:12PM
Aeterna Zentaris Inc. (NASDAQ: AEZS) (TSX: AEZS)
today reported its financial and operating results for the first
quarter ended March 31, 2019.
All Amounts are in U.S. Dollars
Highlights
- In March 2019, the Board formed a Special Committee to review
strategic options available to the Company and engaged Torreya
Partners to assist in that process
- In January 2019, European Medicines Agency granted marketing
authorization for macimorelin for diagnosis of adult growth hormone
deficiency
- Net loss for the first quarter of 2019 $4.9 million, compared
to net income of $14.4 million for the same period in 2018
- As of March 31, 2019, we had $11.4 million of unrestricted cash
and cash equivalents
Summary of First Quarter
Results
For the three-month period ended March 31, 2019,
we reported a consolidated net loss of $4.9 million, or $0.30 loss
per common share, as compared with a consolidated net income of
$14.4 million, or $0.88 income per common share, for the
three-month period ended March 31, 2018. The $19.3 million decline
in net loss results primarily from a reduction of $24.6 million in
total revenues and $3.9 million increase in net finance loss,
offset by a reduction of tax expense of $6.9 million and of
operating expenses of $2.3 million. In January 2018, the Company
received a $24.0 million cash payment under a license and
assignment agreement for Macrilen™ (macimorelin).
Condensed Interim Consolidated Financial
Statements and Management’s Discussion and Analysis
For reference, the condensed interim
consolidated financial statements as at March 31, 2019 and for the
three-month periods ending March 31, 2019 and 2018 and management’s
discussion and analysis of financial condition and results of
operations for the first quarter ended March 31, 2019, will be
found at www.zentaris.com in the "Investors" section and at
the Company’s profile at www.sedar.com and www.sec.gov.
The following tables set out summary
consolidated financial information for the periods indicated. The
results of operations for interim periods are not necessarily
indicative of the results to be expected for a full year or any
future period. The information presented herein does not contain
disclosures required by IFRS for consolidated financial statements
and should be read in conjunction with the Company’s audited annual
consolidated financial statements for the year ended December 31,
2018.
About Aeterna Zentaris Inc.
Aeterna Zentaris Inc. is a specialty
biopharmaceutical company engaged in commercializing novel
pharmaceutical therapies, principally through out-licensing
arrangements. Aeterna Zentaris is the licensor and party to a
license and assignment agreement with a subsidiary of Novo Nordisk
A/S to carry out development, manufacturing, registration,
regulatory, and supply chain for the commercialization of Macrilen™
(macimorelin), which is to be used in the diagnosis of patients
with adult growth hormone deficiency in the United States and
Canada. In addition, we are actively pursuing business development
opportunities for macimorelin in the rest of the world and to
monetize the value of our non-strategic assets.
Forward-Looking Statements
This press release contains forward-looking
statements (as defined by applicable securities legislation) made
pursuant to the safe-harbor provision of the U.S. Securities
Litigation Reform Act of 1995, which reflect our current
expectations regarding future events. Forward-looking statements
may include, but are not limited to statements preceded by,
followed by, or that include the words "will," "expects,"
"believes," "intends," "would," "could," "may," "anticipates," and
similar terms that relate to future events, performance, or our
results. Forward-looking statements involve known and unknown risks
and uncertainties, including those discussed in this press release
and in our Annual Report on Form 20-F, under the caption "Key
Information -Risk Factors" filed with the relevant Canadian
securities regulatory authorities in lieu of an annual information
form and with the U.S. Securities and Exchange Commission. Known
and unknown risks and uncertainties could cause our actual results
to differ materially from those in forward-looking statements. Such
risks and uncertainties include, among others, our now heavy
dependence on the success of Macrilen™ (macimorelin) and related
out-licensing arrangements and the continued availability of funds
and resources to successfully launch the product, our strategic
review process, the ability of the Special Committee to carry out
its mandate, the ability of Aeterna Zentaris to enter into
out-licensing, development, manufacturing and marketing and
distribution agreements with other pharmaceutical companies and
keep such agreements in effect, reliance on third parties for the
manufacturing and commercialization of Macrilen™
(macimorelin), potential disputes with third parties, leading to
delays in or termination of the manufacturing, development,
out-licensing or commercialization of our product candidates, or
resulting in significant litigation or arbitration, and, more
generally, uncertainties related to the regulatory process, our
ability to efficiently commercialize or out-license Macrilen™
(macimorelin), the degree of market acceptance of Macrilen™
(macimorelin), our ability to obtain necessary approvals from the
relevant regulatory authorities to enable us to use the desired
brand names for our products, the impact of securities class action
litigation or other litigation on our cash flow, results of
operations and financial position, our ability to take advantage of
business opportunities in the pharmaceutical industry, our ability
to protect our intellectual property, the potential of liability
arising from shareholder lawsuits and general changes in economic
conditions. Investors should consult our quarterly and annual
filings with the Canadian and U.S. securities commissions for
additional information on risks and uncertainties. Given these
uncertainties and risk factors, readers are cautioned not to place
undue reliance on these forward-looking statements. We disclaim any
obligation to update any such factors or to publicly announce any
revisions to any of the forward-looking statements contained herein
to reflect future results, events or developments, unless required
to do so by a governmental authority or applicable law.
Contact:
Leslie Auld
Chief Financial Officer
Aeterna Zentaris Inc.
IR@aezsinc.com
(843) 900-3211
Aeterna
Zentaris Inc. |
Condensed Interim
Consolidated Statements of Comprehensive (Loss) Income |
For the
three months ended March 31, 2019 and 2018 |
(in thousands of US dollars, except share and per share
data)
|
|
|
|
Three months
ended March 31, |
|
|
(Unaudited) |
|
2019 |
|
2018 |
|
|
|
|
$ |
|
$ |
|
|
Revenues |
|
|
|
|
|
|
Royalty income |
|
13 |
|
|
— |
|
|
|
Licensing revenue |
|
18 |
|
|
24,568 |
|
|
|
Sales commission and other |
|
6 |
|
|
90 |
|
|
|
Total revenues |
|
37 |
|
|
24,658 |
|
|
|
Operating
expenses |
|
|
|
|
|
|
Research and development costs |
|
528 |
|
|
833 |
|
|
|
General and administrative expenses |
|
1,637 |
|
|
2,786 |
|
|
|
Selling expenses |
|
304 |
|
|
1,641 |
|
|
|
Impairment of right of use
asset |
|
337 |
|
|
— |
|
|
|
Write-off of other current
assets |
|
169 |
|
|
— |
|
|
|
Total operating expenses |
|
2,975 |
|
|
5,260 |
|
|
|
(Loss) income from operations |
|
(2,938 |
) |
|
19,398 |
|
|
|
|
|
|
|
|
|
|
(Loss) gain due to changes in foreign currency
exchange rates |
|
64 |
|
|
48 |
|
|
|
Change in fair value of warrant liability |
|
(2,061 |
) |
|
1,828 |
|
|
|
Other finance income |
|
24 |
|
|
18 |
|
|
|
Net finance (loss) income |
|
(1,973 |
) |
|
1,894 |
|
|
|
(Loss) income before income taxes |
|
(4,911 |
) |
|
21,292 |
|
|
|
Income tax expense |
|
— |
|
|
(6,868 |
) |
|
|
Net (loss) income |
|
(4,911 |
) |
|
14,424 |
|
|
|
Other comprehensive (loss)
income: |
|
|
|
|
|
|
Items that may be reclassified subsequently to profit
or loss: |
|
|
|
|
|
|
Foreign currency translation adjustments |
|
84 |
|
|
(222 |
) |
|
|
Items that will not be reclassified to profit or
loss: |
|
|
|
|
|
|
Actuarial loss on defined benefit plans |
|
(735 |
) |
|
— |
|
|
|
Comprehensive (loss) income |
|
(5,562 |
) |
|
14,202 |
|
|
|
Net (loss) income per share
[basic] |
|
(0.30 |
) |
|
0.88 |
|
|
|
Net (loss) income per
share [diluted] |
|
(0.30 |
) |
|
0.87 |
|
|
|
Weighted average number of shares
outstanding: |
|
|
|
|
|
|
Basic |
|
16,440,760 |
|
|
16,440,760 |
|
|
|
Diluted |
|
16,440,760 |
|
|
16,493,363 |
|
|
|
|
Aeterna
Zentaris Inc. |
|
Condensed Interim Consolidated Statements of Financial
Position |
|
|
(in thousands of US dollars) |
(Unaudited) |
|
March 31, 2019 |
|
December 31, 2018 |
|
|
$ |
|
$ |
ASSETS |
|
|
|
|
Current
assets |
|
|
|
|
Cash and cash equivalents |
|
11,357 |
|
|
14,512 |
|
Trade and other
receivables |
|
612 |
|
|
294 |
|
Inventory |
|
540 |
|
|
240 |
|
Prepaid expenses and other
current assets |
|
894 |
|
|
1,210 |
|
Total current
assets |
|
13,403 |
|
|
16,256 |
|
Restricted cash equivalents |
|
363 |
|
|
418 |
|
Right of use
assets |
|
451 |
|
|
— |
|
Property, plant and
equipment |
|
59 |
|
|
65 |
|
Identifiable
intangible assets |
|
55 |
|
|
62 |
|
Goodwill |
|
8,053 |
|
|
8,210 |
|
Total
assets |
|
22,384 |
|
|
25,011 |
|
LIABILITIES |
|
|
|
|
Current
liabilities |
|
|
|
|
Payables and accrued
liabilities |
|
2,668 |
|
|
2,966 |
|
Provision for restructuring and other costs |
|
200 |
|
|
887 |
|
Income taxes payable |
|
1,637 |
|
|
1,669 |
|
Current portion of deferred revenues |
|
74 |
|
|
74 |
|
Current portion of lease liabilities |
|
624 |
|
|
— |
|
Current portion of warrant liability |
|
420 |
|
|
— |
|
Total current
liabilities |
|
5,623 |
|
|
5,596 |
|
Deferred
revenues |
|
240 |
|
|
258 |
|
Lease liabilities |
|
718 |
|
|
— |
|
Warrant
liability |
|
5,275 |
|
|
3,634 |
|
Employee future
benefits |
|
13,647 |
|
|
13,205 |
|
Non-current portion of provision for
restructuring and other costs |
|
441 |
|
|
411 |
|
Total
liabilities |
|
25,944 |
|
|
23,104 |
|
SHAREHOLDERS'
(DEFICIENCY) EQUITY |
|
|
|
|
Share
capital |
|
222,335 |
|
|
222,335 |
|
Other
capital |
|
89,437 |
|
|
89,342 |
|
Deficit |
|
(315,427 |
) |
|
(309,781 |
) |
Accumulated other
comprehensive income |
|
95 |
|
|
11 |
|
Total shareholders'
(deficiency) equity |
|
(3,560 |
) |
|
1,907 |
|
Total liabilities and
shareholders' (deficiency) equity |
|
22,384 |
|
|
25,011 |
|
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