MONTREAL, QUEBEC–(Marketwired – May 11, 2017) – Knight Therapeutics Inc. (TSX:GUD) (“Knight” or the “Company”), a leading Canadian specialty pharmaceutical company, today reported financial results for its first quarter ended March 31, 2017. All dollar amounts are in thousands except for per share amounts. All currencies are Canadian unless otherwise specified.
“This quarter marked a major milestone for Knight as we began commercializing our first innovative pharmaceutical product in Canada with the relaunch of Movantik®,” said Jonathan Ross Goodman, CEO of Knight Therapeutics Inc. “Looking ahead, we are focused on advancing our product pipeline and capitalizing on opportunities to add new products to our portfolio that will improve the health of Canadians.”
Financial Results
For the quarter ended March 31, 2017, Knight reported revenues of $1,750, an increase of $682 over the same period last year, and net income of $6,047, an increase of $5,570 over the same period last year.
As at March 31, 2017, the Company had $763,778 in cash, cash equivalents and marketable securities and 142,759,326 common shares outstanding.
First Quarter Highlights
- Announced the commercial relaunch of Movantik® in Canada
- Submitted Iluvien® for regulatory approval by Health Canada
- Received full repayment of the balance of secured loans to Apicore Inc. and Pro Bono Bio PLC
Conference Call Notice
Knight will host a conference call to discuss its first quarter results today at 8:30 am ET. Investors and other interested parties may call 1-877-223-4471 (Operator Assisted Toll-Free) or 647-788-4922 (local or international).
A taped replay of the conference call will be available from today at 11:30 a.m. ET until June 11, 2017 at 11:59 p.m. ET. To access the replay, please call 1-800-585-8367 or 416-621-4642 and use access code 13628658.
About Knight Therapeutics Inc.
Knight Therapeutics Inc., headquartered in Montreal, Canada, is a specialty pharmaceutical company focused on acquiring or in-licensing innovative pharmaceutical products for the Canadian and select international markets. Knight Therapeutics Inc.’s shares trade on TSX under the symbol GUD. For more information about Knight Therapeutics Inc., please visit the company’s web site at www.gudknight.com or www.sedar.com.
Forward-Looking Statement
This document contains forward-looking statements for Knight Therapeutics Inc. and its subsidiaries. These forward-looking statements, by their nature, necessarily involve risks and uncertainties that could cause actual results to differ materially from those contemplated by the forward-looking statements. Knight Therapeutics Inc. considers the assumptions on which these forward-looking statements are based to be reasonable at the time they were prepared, but cautions the reader that these assumptions regarding future events, many of which are beyond the control of Knight Therapeutics Inc. and its subsidiaries, may ultimately prove to be incorrect. Factors and risks, which could cause actual results to differ materially from current expectations are discussed in Knight Therapeutics Inc.’s Annual Report and in Knight Therapeutics Inc.’s Annual Information Form for the year ended December 31, 2016. Knight Therapeutics Inc. disclaims any intention or obligation to update or revise any forward-looking statements whether as a result of new information or future events, except as required by law.
INTERIM CONSOLIDATED BALANCE SHEETS
[Unaudited] [In thousands of Canadian dollars]| As at | March 31, 2017 | December 31, 2016 |
| ASSETS | ||
| Current | ||
| Cash and cash equivalents | 519,522 | 514,942 |
| Marketable securities | 244,256 | 221,108 |
| Trade and other receivables | 7,977 | 6,440 |
| Inventories | 689 | 790 |
| Other current financial assets | 41,635 | 51,789 |
| Income taxes receivable | 4,786 | 4,683 |
| Total current assets | 818,865 | 799,752 |
| Property and equipment | 37 | 32 |
| Intangible assets | 13,787 | 14,153 |
| Other financial assets | 78,076 | 90,643 |
| Investment in associate | 77,907 | 80,113 |
| Deferred income tax assets | 5,621 | 6,077 |
| Total assets | 994,293 | 990,770 |
| LIABILITIES AND SHAREHOLDERS’ EQUITY | ||
| Current | ||
| Accounts payable and accrued liabilities | 2,933 | 3,207 |
| Income taxes payable | 6,007 | 5,659 |
| Other balances payable | 532 | 537 |
| Deferred other income | 263 | 355 |
| Total current liabilities | 9,735 | 9,758 |
| Deferred other income | 363 | 417 |
| Other balances payable | 900 | 877 |
| Total liabilities | 10,998 | 11,052 |
| Shareholders’ equity | ||
| Share capital | 761,003 | 760,447 |
| Warrants | 785 | 785 |
| Contributed surplus | 10,120 | 9,469 |
| Accumulated other comprehensive income | 26,754 | 30,431 |
| Retained earnings | 184,633 | 178,586 |
| Total shareholders’ equity | 983,295 | 979,718 |
| Total liabilities and shareholders’ equity | 994,293 | 990,770 |
INTERIM CONSOLIDATED STATEMENTS OF INCOME
[Unaudited] [In thousands of Canadian dollars, except for share and per share amounts]| Three months ended March 31, | ||||
| 2017 | 2016 | |||
| Revenues | 1,750 | 1,068 | ||
| Cost of goods sold | 288 | 246 | ||
| Gross margin | 1,462 | 822 | ||
| Expenses | ||||
| Selling and marketing | 363 | – | ||
| General and administrative | 2,468 | 2,193 | ||
| Research and development | 416 | 283 | ||
| (1,785 | ) | (1,654 | ) | |
| Depreciation of property and equipment | – | 8 | ||
| Amortization of intangible assets | 326 | 41 | ||
| Interest income | (5,860 | ) | (4,816 | ) |
| Other income | (308 | ) | (1,099 | ) |
| Net gain on financial assets | (3,375 | ) | (1,729 | ) |
| Share of net income of associate | (319 | ) | (854 | ) |
| Foreign exchange loss | 243 | 3,770 | ||
| Income before income taxes | 7,508 | 3,025 | ||
| Income tax expense | ||||
| Current | 480 | 2,541 | ||
| Deferred | 981 | 7 | ||
| Net income for the period | 6,047 | 477 | ||
| Attributable to shareholders of the Company | ||||
| Basic earnings per share | 0.04 | 0.005 | ||
| Diluted earnings per share | 0.04 | 0.005 | ||
| Weighted average number of common shares outstanding | ||||
| Basic | 142,720,536 | 103,475,043 | ||
| Diluted | 143,626,773 | 103,688,167 | ||
INTERIM CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME
[Unaudited] [In thousands of Canadian dollars]| Three months ended March 31, | ||||
| 2017 | 2016 | |||
| Net income for the period | 6,047 | 477 | ||
| Realized gain reclassified to statement of income net of tax of $64 (2016: net of tax of $64) | (973 | ) | (410 | ) |
| Other comprehensive income (loss) to be reclassified to statement of income in subsequent periods: | ||||
| Unrealized (loss) gain on available-for-sale financial instruments net of tax of $434 (2016: net of tax of $72) | (1,046 | ) | 421 | |
| Unrealized loss on translation of foreign operations | (1,658 | ) | (10,978 | ) |
| Other comprehensive (loss) for the period | (3,677 | ) | (10,967 | ) |
| Total comprehensive income (loss) for the period | 2,370 | (10,490 | ) | |
INTERIM CONSOLIDATED STATEMENT OF CHANGES IN SHAREHOLDERS’ EQUITY
[Unaudited] [In thousands of Canadian dollars]| Share capital | Warrants | Contributed surplus | Accumulated other comprehensive income | Retained earnings | Total shareholders’ equity | ||||
| Balance as at January 1, 2016 | 439,148 | 161 | 6,772 | 35,955 | 160,026 | 642,062 | |||
| Net income for the three-month period | – | – | – | – | 477 | 477 | |||
| Realized gain reclassified to statement of income | – | – | – | (410 | ) | – | (410 | ) | |
| Unrealized gain on available for sale financial instruments | – | – | – | 421 | – | 421 | |||
| Unrealized loss on translation of foreign operations | – | – | – | (10,978 | ) | – | (10,978 | ) | |
| Comprehensive (loss) income | – | – | – | (10,967 | ) | 477 | (10,490 | ) | |
| Share-based compensation expense | – | – | 1,073 | – | – | 1,073 | |||
| Issuance under share purchase plan | 28 | – | – | – | – | 28 | |||
| Balance as at March 31, 2016 | 439,176 | 161 | 7,845 | 24,988 | 160,503 | 632,673 | |||
| Balance as at January 1, 2017 | 760,447 | 785 | 9,469 | 30,431 | 178,586 | 979,718 | |||
| Net income for the three-month period | – | – | – | – | 6,047 | 6,047 | |||
| Realized gain reclassified to statement of income | – | – | – | (973 | ) | – | (973 | ) | |
| Unrealized loss on available for sale financial instruments | – | – | – | (1,046 | ) | – | (1,046 | ) | |
| Unrealized loss on translation of foreign operations | – | – | – | (1,658 | ) | – | (1,658 | ) | |
| Comprehensive (loss) income | – | – | – | (3,677 | ) | 6,047 | 2,370 | ||
| Share-based compensation expense | – | – | 846 | – | – | 846 | |||
| Issuance under share option plan | 513 | – | (195 | ) | – | – | 318 | ||
| Issuance under share purchase plan | 43 | – | – | – | – | 43 | |||
| Balance as at March 31, 2017 | 761,003 | 785 | 10,120 | 26,754 | 184,633 | 983,295 |
INTERIM CONSOLIDATED STATEMENT OF CASH FLOWS
[Unaudited] [In thousands of Canadian dollars]| Three months ended March 31, | |||||
| 2017 | 2016 | ||||
| OPERATING ACTIVITIES | |||||
| Net income for the period | 6,047 | 477 | |||
| Adjustments reconciling net income to operating cash flows: | |||||
| Deferred tax | 981 | 7 | |||
| Share-based compensation expense | 846 | 1,073 | |||
| Depreciation and amortization | 326 | 49 | |||
| Accretion of interest | (1,078 | ) | (1,105 | ) | |
| Realized gain on financial assets | (976 | ) | (656 | ) | |
| Unrealized gain on financial assets | (2,399 | ) | (1,073 | ) | |
| Foreign exchange loss | 204 | 3,760 | |||
| Share of net income from associate | (319 | ) | (854 | ) | |
| Dividends from associate | – | 2,423 | |||
| Other adjustments | (301 | ) | (142 | ) | |
| 3,331 | 3,959 | ||||
| Changes in non-cash working capital related to operations | 905 | 576 | |||
| Cash inflow from operating activities | 4,236 | 4,535 | |||
| INVESTING ACTIVITIES | |||||
| Purchase of marketable securities | (44,291 | ) | (147,399 | ) | |
| Purchase of intangibles | – | (2,924 | ) | ||
| Issuance of loans receivable | – | (34,851 | ) | ||
| Purchase of equities | (2,819 | ) | (3,461 | ) | |
| Investment in funds | (4,141 | ) | (5,833 | ) | |
| Proceeds from marketable securities | 20,486 | 152,226 | |||
| Proceeds from repayments of loans receivable | 28,058 | 1,018 | |||
| Proceeds from disposal of equities | 709 | 5,619 | |||
| Proceeds from distribution of funds | 2,154 | – | |||
| Cash inflow (outflow) from investing activities | 156 | (35,605 | ) | ||
| FINANCING ACTIVITIES | |||||
| Share option plan | 345 | – | |||
| Share purchase plan | 43 | 28 | |||
| Cash inflow from financing activities | 388 | 28 | |||
| Increase (decrease) in cash during the period | 4,780 | (31,042 | ) | ||
| Cash and cash equivalents, beginning of the period | 514,942 | 237,481 | |||
| Net foreign exchange difference | (200 | ) | (1,654 | ) | |
| Cash and cash equivalents, end of the period | 519,522 | 204,785 | |||
| Supplemental cash flow information: | |||||
| Interest received | 4,018 | 3,773 | |||
| Income taxes paid | 286 | 2,334 | |||
| Cash and cash equivalents | 519,522 | 204,785 | |||
| Marketable securities | 244,256 | 221,450 | |||
| 763,778 | 426,235 | ||||
Jeffrey Kadanoff, P.Eng., MBA
Chief Financial Officer
514-484-GUD1 (4831)
514-481-4116 (FAX)
[email protected]
www.gudknight.com
