Aytu BioPharma(US:AYTU)2020-02-14 21:55Financial Performance - Revenues for the three months ended December 31, 2019 increased by 77% compared to the same period in 2018, with annual revenues increasing by 100% and 14% for the years ended June 30, 2019 and 2018, respectively [149]. - Product revenue for Q4 2019 was $3.2 million, a 77% increase from $1.8 million in Q4 2018, driven by the acquisition of the Pediatric Therapeutics portfolio [167]. - For the six months ended December 31, 2019, product revenue was $4.6 million, a 43% increase from $3.2 million in the same period of 2018 [166]. - The company reported a net loss of $214,247 in Q4 2019, significantly improved from a net loss of $4.7 million in Q4 2018, marking a 95% reduction [165]. - The gain from derecognition of contingent consideration was approximately $5.2 million in Q4 2019, contributing to the overall financial improvement [176]. Operating Expenses - Total operating expenses for Q4 2019 were $8.1 million, a 34% increase from $6.3 million in Q4 2018, with selling, general and administrative costs rising by 29.1% [165]. - Selling, general and administrative costs for the six months ended December 31, 2019, increased by 35.3% to $11.7 million from $8.6 million in the prior year [172]. - Research and development expenses decreased by 55.3% to $66,675 in Q4 2019 compared to $149,029 in Q4 2018, primarily due to reduced costs associated with the MiOXSYS System [170]. Cash Flow and Financing - Cash used in operations during the six months ended December 31, 2019 was $9.1 million, compared to $7.0 million for the same period in 2018, primarily due to the acquisition of the Pediatric Portfolio [149]. - Net cash used in operating activities for the six months ended December 31, 2019, was $9.1 million, higher than the net loss of $5.1 million due to derecognition of contingent consideration and increased accounts receivable [178]. - Net cash provided by financing activities in the six months ended December 31, 2019, was $9.3 million, primarily from an October 2019 offering [181]. Acquisitions and Mergers - The acquisition of the Pediatric Portfolio included a total consideration of $4.5 million in cash and approximately 9.8 million shares of Series G Convertible Preferred Stock, along with the assumption of up to $3.5 million in Medicaid rebates and product returns [157]. - The company expects to require capital beyond operating needs to complete and integrate the Pediatric Portfolio acquisition and the merger with Innovus Pharmaceuticals, Inc., which is expected to close on February 14, 2020 [149]. - The merger with Innovus Pharmaceuticals, Inc. is expected to involve the retirement of up to approximately 3.7 million shares of common stock and up to $16 million in milestone payments contingent on achieving certain revenue and profitability milestones [160]. - The company used $4.5 million for the acquisition of Cerecor during the six months ended December 31, 2019 [180]. Asset Position and Equity - The company has a current asset position of $74.5 million, which, along with expected receipts from ongoing product sales, will be used to fund operations [153]. - As of September 30, 2019, the company's stockholders' equity totaled approximately $2.3 million, but subsequent equity financing raised approximately $14.8 million, bringing the equity balance above the minimum Nasdaq requirement of $2.5 million [155]. Future Plans - The company plans to continue seeking to acquire additional commercial-stage or near-market products that offer distinct clinical advantages and patient benefits [148]. - The company has engaged a placement agent to refinance fixed obligations and is in discussions with lenders to establish a debt facility to provide capital [153].