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Rafael Holdings (NYSE: RFL) reported its Q4 and FY2024 financial results, highlighting a merger agreement with Cyclo Therapeutics. The company ended with $65.9 million in cash and equivalents. Q4 showed a net loss of $4.5 million ($0.19/share), compared to a gain of $1.3 million in the prior year. FY2024 resulted in a net loss of $34.4 million ($1.45/share), largely due to an $89.9 million R&D expense from the Cornerstone acquisition, partially offset by a $31.3 million receivables recovery. The company increased its stake in Day Three Labs to 84% and began consolidating financial results for both Day Three Labs and Cornerstone Pharmaceuticals.
Rafael Holdings (NYSE: RFL) ha riportato i risultati finanziari del quarto trimestre e dell’anno fiscale 2024, evidenziando un accordo di fusione con Cyclo Therapeutics. L’azienda ha chiuso con 65,9 milioni di dollari in liquidità e equivalenti. Il quarto trimestre ha mostrato una perdita netta di 4,5 milioni di dollari (0,19 dollari per azione), rispetto a un guadagno di 1,3 milioni di dollari nell’anno precedente. L’anno fiscale 2024 ha registrato una perdita netta di 34,4 milioni di dollari (1,45 dollari per azione), principalmente a causa di spese per R&S di 89,9 milioni di dollari legate all’acquisizione di Cornerstone, parzialmente compensate da un recupero di crediti di 31,3 milioni di dollari. L’azienda ha aumentato la sua partecipazione in Day Three Labs all’84% e ha iniziato a consolidare i risultati finanziari sia per Day Three Labs che per Cornerstone Pharmaceuticals.
Rafael Holdings (NYSE: RFL) reportó sus resultados financieros del cuarto trimestre y del año fiscal 2024, destacando un acuerdo de fusión con Cyclo Therapeutics. La compañía terminó con 65,9 millones de dólares en efectivo y equivalentes. El cuarto trimestre mostró una pérdida neta de 4,5 millones de dólares (0,19 dólares por acción), en comparación con una ganancia de 1,3 millones de dólares en el año anterior. El año fiscal 2024 resultó en una pérdida neta de 34,4 millones de dólares (1,45 dólares por acción), principalmente debido a un gasto de I+D de 89,9 millones de dólares por la adquisición de Cornerstone, parcialmente compensado por un recuperación de cuentas por cobrar de 31,3 millones de dólares. La compañía aumentó su participación en Day Three Labs al 84% y comenzó a consolidar los resultados financieros tanto para Day Three Labs como para Cornerstone Pharmaceuticals.
라파엘 홀딩스 (NYSE: RFL)는 2024회계연도 4분기 및 전체 재무 결과를 보고하며 Cyclo Therapeutics와의 합병 계약을 강조했습니다. 이 회사는 6,590만 달러의 현금 및 현금성 자산을 보유하고 종료했습니다. 4분기 순손실은 450만 달러 (주당 0.19달러)였으며, 이전 연도의 130만 달러의 이익과 비교되었습니다. 2024회계연도의 순손실은 3,440만 달러 (주당 1.45달러)로, 이는 주로 Cornerstone 인수로 인한 8,990만 달러의 연구개발 비용에 기인하며, 3,130만 달러의 외상매출금 회수로 부분적으로 상쇄되었습니다. 이 회사는 Day Three Labs에 대한 지분을 84%로 늘렸고, Day Three Labs와 Cornerstone Pharmaceuticals의 재무 결과를 통합하기 시작했습니다.
Rafael Holdings (NYSE: RFL) a rapporté ses résultats financiers du quatrième trimestre et de l’exercice 2024, mettant en avant un accord de fusion avec Cyclo Therapeutics. L’entreprise a terminé avec 65,9 millions de dollars en liquidités et équivalents. Le quatrième trimestre a affiché une perte nette de 4,5 millions de dollars (0,19 $/action), contre un gain de 1,3 million de dollars l’année précédente. L’exercice 2024 a abouti à une perte nette de 34,4 millions de dollars (1,45 $/action), principalement en raison de 89,9 millions de dollars de dépenses en R&D liées à l’acquisition de Cornerstone, partiellement compensées par un recouvrement de créances de 31,3 millions de dollars. L’entreprise a augmenté sa participation dans Day Three Labs à 84 % et a commencé à consolider les résultats financiers des deux, Day Three Labs et Cornerstone Pharmaceuticals.
Rafael Holdings (NYSE: RFL) hat seine finanziellen Ergebnisse für das vierte Quartal und das Geschäftsjahr 2024 veröffentlicht und einen Fusionsvertrag mit Cyclo Therapeutics hervorgehoben. Das Unternehmen schloss mit 65,9 Millionen Dollar an Barmitteln und Äquivalenten ab. Im vierten Quartal gab es einen Nettoverlust von 4,5 Millionen Dollar (0,19 Dollar pro Aktie), verglichen mit einem Gewinn von 1,3 Millionen Dollar im Vorjahr. Das Geschäftsjahr 2024 führte zu einem Nettoverlust von 34,4 Millionen Dollar (1,45 Dollar pro Aktie), hauptsächlich aufgrund von 89,9 Millionen Dollar Forschung & Entwicklungskosten für die Übernahme von Cornerstone, teilweise ausgeglichen durch einen Forderungsrückfluss von 31,3 Millionen Dollar. Das Unternehmen erhöhte seinen Anteil an Day Three Labs auf 84 % und begann, die finanziellen Ergebnisse sowohl von Day Three Labs als auch von Cornerstone Pharmaceuticals zu konsolidieren.
Positive
- Strong cash position of $65.9 million
- Strategic merger agreement with Cyclo Therapeutics advancing pipeline
- Recovery of receivables from Cornerstone worth $31.3 million
- Increased ownership stake in Day Three Labs to 84%
Negative
- Q4 net loss of $4.5 million compared to prior year gain of $1.3 million
- FY2024 net loss increased to $34.4 million from $8.4 million year-over-year
- Significant R&D expense of $89.9 million from Cornerstone acquisition
- Q4 G&A expenses increased to $2.3 million from $1.4 million year-over-year
Insights
The Q4 and FY2024 results reveal significant strategic shifts but concerning financial metrics. The company reported a substantial increase in net loss from continuing operations, rising to $34.4 million ($1.45 per share) for FY2024, compared to $8.4 million ($0.36 per share) in the previous year. The dramatic increase in losses was primarily driven by an $89.9 million R&D expense related to the Cornerstone acquisition.
The cash position remains relatively strong at $65.9 million, providing runway for operations. However, Q4 showed deteriorating performance with a $4.5 million loss compared to a $1.3 million gain in the previous year. The pending merger with Cyclo Therapeutics represents a strategic pivot but adds execution risk. The consolidation of Cornerstone and Day Three Labs has increased operational expenses, though R&D costs decreased year-over-year from $6.3 million to $4.2 million.
The strategic focus on Cyclo Therapeutics’ Trappsol® Cyclo™ for Niemann-Pick Disease Type C1 represents a significant opportunity in the rare disease space. The fully enrolled Phase 3 study, with interim results expected mid-2025, is a important catalyst. While there are existing FDA-approved treatments, the market for rare genetic diseases typically supports multiple therapies due to varying patient responses and needs.
The consolidation of Cornerstone and majority stake in Day Three Labs (84%) diversifies the pipeline but increases operational complexity. The reduction in early-stage R&D spending from $6.3 million to $4.2 million, including the wind-down of Barer Institute programs, suggests a strategic shift toward later-stage assets with nearer-term commercial potential.
Our proposed merger with Cyclo Therapeutics advances our strategy to invest in, develop and commercialize clinical stage assets which address areas of high unmet medical need
NEWARK, N.J., Nov. 06, 2024 (GLOBE NEWSWIRE) — Rafael Holdings, Inc. (NYSE: RFL), today reported its financial results for the fourth quarter and the full fiscal year ended July 31, 2024.
“During fiscal 2024, we made significant progress on our strategy to advance our existing portfolio and to invest in, develop and commercialize clinical stage assets in areas of high unmet medical need. Specifically, we are extremely pleased to have entered into a merger agreement with Cyclo Therapeutics (Nasdaq: CYTH),” said Bill Conkling, CEO of Rafael Holdings. Bill added, “We are encouraged that Cyclo Therapeutics has fully enrolled its pivotal Phase 3 study evaluating Trappsol® Cyclo™ for the treatment of Niemann-Pick Disease Type C1, a rare and fatal genetic disease, and results from the 48-week interim analysis are expected in the middle of 2025. Despite recent FDA approvals, we believe that Trappsol® Cyclo™ has the potential to be a market leader. We anticipate a shareholder vote and closing the merger with Cyclo Therapeutics in the coming months.”
Rafael Holdings, Inc. Fourth Quarter Fiscal Year 2024 Financial Results
As of July 31, 2024, we had cash, cash equivalents and marketable securities of $65.9 million.
For the three months ended July 31, 2024, we recorded a net loss from continuing operations attributable to Rafael Holdings of $4.5 million, or $0.19 per diluted share, versus a net gain from continuing operations of $1.3 million, or $0.06 per diluted share, in the year ago period.
Research and development expenses were $1.5 million for the three months ended July 31, 2024, compared to $1.3 million in the year ago period. The year over year increase relates to activity at Cornerstone and Day Three Labs, which were consolidated with Rafael Holdings during fiscal 2024.
For the three months ended July 31, 2024, general and administrative expenses were $2.3 million. For the same period in the prior year, general and administrative expenses were $1.4 million. The increase was primarily due to additional expenses from Cornerstone and Day Three Labs, which were consolidated with Rafael Holdings during fiscal 2024, as well as increased professional fees related to the Cornerstone and Day Three Labs acquisitions.
Rafael Holdings, Inc. Full Fiscal Year 2024 Financial Results
For the twelve months ended July 31, 2024, we recorded a net loss from continuing operations attributable to Rafael Holdings of $34.4 million, or $1.45 per diluted share, versus a net loss from continuing operations of $8.4 million, or $0.36 per diluted share, in the year ago period. The net loss recorded during fiscal year 2024 was driven by an in-process research and development expense of $89.9 million related to the Cornerstone acquisition, a loss of $1.6 million on our initial investment in Day Three Labs, offset by a recovery of receivables from Cornerstone of $31.3 million and realized and unrealized gains on our investment in Cyclo Therapeutics. During the second quarter of 2024, we increased our investment in Day Three Labs and now hold a majority interest in the company with 84% of the shares outstanding. We began reporting consolidated financial results for Day Three Labs in January 2024 and Cornerstone Pharmaceuticals in March 2024.
Research and development expenses were $4.2 million for the fiscal year ended July 31, 2024, compared to $6.3 million in the year ago period. The year over year reduction is due to the winding down of early-stage programs, including at Barer Institute.
For the fiscal year ended July 31, 2024, general and administrative expenses were $8.9 million versus $8.9 million in the same period in the prior year. The decrease in general and administrative expenses at Rafael Holdings was offset by additional G&A expenses from Cornerstone and Day Three Labs as well as increased professional fees related to the two acquisitions in Fiscal 2024.
About Rafael Holdings, Inc.
Rafael Holdings, Inc. is a holding company with interests in clinical and early-stage pharmaceutical companies including an investment in (and planned merger with) Cyclo Therapeutics Inc. (Nasdaq: CYTH), a biotechnology company dedicated to developing Trappsol® Cyclo™, which is being evaluated in clinical trials, including an ongoing Phase 3 trial for the potential treatment of Niemann-Pick Disease Type C1 (“NPC1”), a rare, fatal, and progressive genetic disorder. Rafael also holds a majority equity interest in LipoMedix Pharmaceuticals Ltd. a clinical stage pharmaceutical company, Barer Institute Inc., a wholly owned preclinical cancer metabolism research operation, and a majority interest in Cornerstone Pharmaceuticals, Inc., formerly known as Rafael Pharmaceuticals Inc., a cancer metabolism-based therapeutics company. Rafael also holds a majority interest in Rafael Medical Devices, LLC., an orthopedic-focused medical device company developing instruments to advance minimally invasive surgeries, and a majority interest in Day Three Labs, Inc., a company which empowers third-party manufacturers to reimagine their existing cannabis offerings enabling them to bring to market better, cleaner, more precise and predictable versions by utilizing Day Three’s pharmaceutical-grade technology and innovation like Unlokt™. The Company’s primary focus is to expand our investment portfolio through opportunistic and strategic investments including therapeutics, which address high unmet medical needs. Upon closing of the planned merger with Cyclo, the Company intends to focus its efforts on making Trappsol® Cyclo™ its lead clinical program.
Forward Looking Statements
This press release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. All statements contained in this press release that do not relate to matters of historical fact should be considered forward-looking statements, including without limitation statements regarding our expectations surrounding the potential, safety, efficacy, and regulatory and clinical progress of our product candidates; plans regarding the further evaluation of clinical data; and the potential of our pipeline, including our internal cancer metabolism research programs. These statements are neither promises nor guarantees, but involve known and unknown risks, uncertainties and other important factors that may cause our actual results, performance or achievements to be materially different from any future results, performance or achievements expressed or implied by the forward-looking statements, including, but not limited to, those disclosed under the caption “Risk Factors” in our Annual Report on Form 10-K for the year ended July 31, 2024, and our other filings with the SEC. These factors could cause actual results to differ materially from those indicated by the forward-looking statements made in this press release. Any such forward-looking statements represent management’s estimates as of the date of this press release. While we may elect to update such forward-looking statements at some point in the future, we disclaim any obligation to do so, even if subsequent events cause our views to change.
Contact:
Barbara Ryan
Barbara.ryan@rafaelholdings.com
(203) 274-2825
| RAFAEL HOLDINGS, INC. | ||||||||
| CONSOLIDATED BALANCE SHEETS | ||||||||
| (in thousands, except share and per share data) | ||||||||
| July 31, 2024 | July 31, 2023 | |||||||
| ASSETS | ||||||||
| CURRENT ASSETS | ||||||||
| Cash and cash equivalents | $ | 2,675 | $ | 21,498 | ||||
| Available-for-sale securities | 63,265 | 57,714 | ||||||
| Interest receivable | 515 | 387 | ||||||
| Convertible note receivable, related party | 5,191 | — | ||||||
| Accounts receivable, net of allowance for doubtful accounts of $245 at July 31, 2024 and July 31, 2023 | 426 | 213 | ||||||
| Prepaid expenses and other current assets | 430 | 914 | ||||||
| Convertible note receivable, related party | 0 | 1,921 | ||||||
| Investment in equity securities | — | 294 | ||||||
| Total current assets | 72,502 | 82,941 | ||||||
| Property and equipment, net | 2,120 | 1,695 | ||||||
| Investments – Cyclo | 12,010 | 4,763 | ||||||
| Investments – Hedge Funds | 2,547 | 4,984 | ||||||
| Investment – Day Three | — | 2,797 | ||||||
| Investments – Other Pharmaceuticals | — | 65 | ||||||
| Convertible note receivable | 1,146 | — | ||||||
| Goodwill | 3,050 | — | ||||||
| Intangible assets, net | 1,847 | — | ||||||
| In-process research and development | 1,575 | 1,575 | ||||||
| Other assets | 35 | 9 | ||||||
| TOTAL ASSETS | $ | 96,832 | $ | 98,829 | ||||
| LIABILITIES AND EQUITY | ||||||||
| CURRENT LIABILITIES | ||||||||
| Accounts payable | $ | 2,556 | $ | 333 | ||||
| Accrued expenses | 1,798 | 763 | ||||||
| Convertible notes payable | 614 | — | ||||||
| Other current liabilities | 113 | 1,023 | ||||||
| Due to related parties | 733 | 26 | ||||||
| Installment note payable | 1,700 | — | ||||||
| Total current liabilities | 7,514 | 2,145 | ||||||
| Accrued expenses, noncurrent | 2,982 | — | ||||||
| Convertible notes payable, noncurrent | 73 | — | ||||||
| Other liabilities | 5 | 55 | ||||||
| TOTAL LIABILITIES | 10,574 | 2,200 | ||||||
| COMMITMENTS AND CONTINGENCIES | ||||||||
| EQUITY | ||||||||
| Class A common stock, $0.01 par value; 35,000,000 shares authorized, 787,163 shares issued and outstanding as of July 31, 2024 and July 31, 2023 | 8 | 8 | ||||||
| Class B common stock, $0.01 par value; 200,000,000 shares authorized, 24,142,535 issued and 23,819,948 outstanding (excluding treasury shares of 101,487) as of July 31, 2024, and 23,635,709 shares issued and 23,490,527 shares outstanding as of July 31, 2023 | 238 | 236 | ||||||
| Additional paid-in capital | 280,048 | 264,010 | ||||||
| Accumulated deficit | (201,743 | ) | (167,333 | ) | ||||
| Treasury stock, at cost; 101,487 and 0 Class B shares as of July 31, 2024 and July 31, 2023, respectively | (168 | ) | — | |||||
| Accumulated other comprehensive income (loss) related to unrealized income on available-for-sale securities | 111 | (353 | ) | |||||
| Accumulated other comprehensive income related to foreign currency translation adjustment | 3,691 | 3,725 | ||||||
| Total equity attributable to Rafael Holdings, Inc. | 82,185 | 100,293 | ||||||
| Noncontrolling interests | 4,073 | (3,664 | ) | |||||
| TOTAL EQUITY | 86,258 | 96,629 | ||||||
| TOTAL LIABILITIES AND EQUITY | $ | 96,832 | $ | 98,829 | ||||
| RAFAEL HOLDINGS, INC. |
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| CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME (LOSS) |
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| (in thousands, except share and per share data) |
|||||||||||||||
| Three Months Ended July 31, | Year Ended July 31, | ||||||||||||||
| 2024 | 2023 | 2024 | 2023 | ||||||||||||
| Revenues | $ | 165 | $ | 68 | $ | 637 | $ | 279 | |||||||
| Cost of infusion Technology revenue | 69 | – | 154 | – | |||||||||||
| G&A Expenses | 2,330 | 1,395 | 8,854 | 8,932 | |||||||||||
| R&D Expenses | 1,543 | 1,266 | 4,170 | 6,312 | |||||||||||
| In-process research and development expense | – | 0 | 89,861 | – | |||||||||||
| Depreciation and amortization | 68 | 18 | 225 | 78 | |||||||||||
| Operating Loss | (3,845 | ) | (2,611 | ) | (102,627 | ) | (15,043 | ) | |||||||
| Interest income | 606 | – | 2,383 | 3,253 | |||||||||||
| Impairment of investments – Other Pharmaceuticals | – | 17 | – | (334 | ) | ||||||||||
| Loss on initial investment in Day Three upon acquisition | – | – | (1,633 | ) | – | ||||||||||
| Realized gain on available-for-sale securities | 251 | – | 1,772 | 154 | |||||||||||
| Realized gain (loss) on investment in equity securities | – | – | (46 | ) | 309 | ||||||||||
| Unrealized gain on investment in equity securities | – | – | – | 33 | |||||||||||
| Realized gain on investment – Cyclo | – | – | 424 | – | |||||||||||
| Unrealized gain on investment – Cyclo | (3,162 | ) | 2,663 | 37 | 2,663 | ||||||||||
| Unrealized gain on convertible notes receivable, due from Cyclo | 1,191 | – | 1,191 | – | |||||||||||
| Unrealized (loss) gain on investment – Hedge Funds | 181 | 100 | 63 | 220 | |||||||||||
| Recovery of receivables from Cornerstone | – | – | 31,305 | – | |||||||||||
| Interest expense | (163 | ) | – | (248 | ) | – | |||||||||
| Other income | – | 1,294 | 118 | – | |||||||||||
| Income (loss) before incomes taxes from continuing operations | (4,941 | ) | 1,463 | (67,261 | ) | (8,745 | ) | ||||||||
| Benefit from taxes | 87 | (4 | ) | 2,680 | 255 | ||||||||||
| Equity in loss of Day Three | – | (203 | ) | (422 | ) | (203 | ) | ||||||||
| Consolidated net loss from continuing operations | (4,854 | ) | 1,256 | (65,003 | ) | (8,693 | ) | ||||||||
| Discontinued Operations | |||||||||||||||
| Loss from discontinued operations related to 520 Property | (65 | ) | – | (306 | ) | ||||||||||
| Gain on disposal of 520 Property | 0 | – | 6,784 | ||||||||||||
| Income from discontinued operations | – | (65 | ) | – | 6,478 | ||||||||||
| Consolidated net loss | (4,854 | ) | 1,191 | (65,003 | ) | (2,215 | ) | ||||||||
| Net loss attributable to noncontrolling interests | (386 | ) | (28 | ) | (30,593 | ) | (339 | ) | |||||||
| Net loss attributable to Rafael Holdings, Inc. | $ | (4,468 | ) | $ | 1,163 | $ | (34,410 | ) | $ | (1,876 | ) | ||||
| Continuing operations earnings (loss) per share | |||||||||||||||
| Net loss from continuing operations | $ | (4,854 | ) | $ | 1,256 | $ | (65,003 | ) | $ | (8,693 | ) | ||||
| Net loss attributable to noncontrolling interests | (386 | ) | -28 | (30,593 | ) | (339 | ) | ||||||||
| Numerator for loss per share from continuing operations | $ | (4,468 | ) | $ | 1,284 | $ | (34,410 | ) | $ | (8,354 | ) | ||||
| Discontinued operations earnings income per share | |||||||||||||||
| Numerator for income from discontinued operations | $ | – | $ | (65 | ) | $ | – | $ | 6,478 | ||||||
| Earnings (loss) per share – Basic and Diluted | |||||||||||||||
| Continuing operations | $ | (0.19 | ) | $ | 0.06 | $ | (1.45 | ) | $ | (0.36 | ) | ||||
| Discontinued operations | – | – | – | 0.28 | |||||||||||
| Total basic earnings (loss) per common share | $ | (0.19 | ) | $ | 0.06 | $ | (1.45 | ) | $ | (0.08 | ) | ||||
| Weighted average number of shares used in calculation of earnings (loss) per share – basic and diluted | 23,916,839 | 22,263,211 | 23,745,516 | 23,263,211 | |||||||||||
FAQ
What was Rafael Holdings (RFL) Q4 2024 net loss per share?
Rafael Holdings reported a Q4 2024 net loss of $0.19 per diluted share.
How much cash does Rafael Holdings (RFL) have as of July 31, 2024?
Rafael Holdings had $65.9 million in cash, cash equivalents and marketable securities as of July 31, 2024.
What caused Rafael Holdings (RFL) increased net loss in FY2024?
The increased net loss was primarily driven by an $89.9 million in-process R&D expense related to the Cornerstone acquisition, partially offset by a $31.3 million recovery of receivables.
When will Cyclo Therapeutics’ Phase 3 study interim results be available for Rafael Holdings (RFL)?
The 48-week interim analysis results from the Phase 3 study are expected in the middle of 2025.
