Workflow
Rafael(RFL) - 2025 Q3 - Quarterly Results
RafaelRafael(US:RFL)2025-06-11 11:19

Executive Summary & Recent Developments Recent corporate milestones include a significant merger, anticipated clinical data, and a successful capital raise for financial strengthening Key Highlights Rafael Holdings completed its merger with Cyclo Therapeutics and anticipates topline data from the pivotal Phase 3 TransportNPC™ study for Niemann-Pick Disease Type C1 later this month. The company also enhanced its financial position by closing a $25 million rights offering - Merger with Cyclo Therapeutics completed, with anticipation of topline data from the 48-week interim analysis of the pivotal Phase 3 TransportNPC™ study for Niemann-Pick Disease Type C1 later this month23 - Closed a $25 million rights offering, raising net proceeds of $24.9 million after expenses, strengthening the company's financial position34 Financial Performance Overview Reduced net losses for Q3 and 9M FY2025 were reported, with increased expenses from recent mergers Third Quarter Fiscal Year 2025 Results For the third quarter ended April 30, 2025, Rafael Holdings reported a significantly reduced net loss compared to the prior year, primarily due to non-cash items and the absence of a large in-process R&D expense from the previous year. R&D and G&A expenses increased due to the inclusion of Cyclo Therapeutics post-merger and other consolidated entities Key Financials for Three Months Ended April 30 | Metric | Q3 FY2025 (in millions) | Q3 FY2024 (in millions) | Change (YoY) | | :-------------------------------- | :---------------------- | :---------------------- | :------------- | | Cash and Cash Equivalents (as of April 30, 2025) | $37.9 | N/A | N/A | | Net Loss Attributable to Rafael Holdings | $(4.8) | $(32.4) | $(27.6) decrease | | Loss Per Share | $(0.19) | $(1.36) | $(1.17) decrease | | Research and Development Expenses | $3.0 | $1.5 | $1.5 increase | | General and Administrative Expenses | $3.2 | $1.9 | $1.3 increase | - The year-over-year decrease in net loss is primarily attributable to non-cash items, including lower unrealized losses on Cyclo equity investment ($1.4 million vs. $4.4 million) and the absence of an $89.9 million in-process R&D expense related to the Cornerstone acquisition, partially offset by a $31.3 million recovery of receivables from Cornerstone in the prior year5 - Increases in R&D and G&A expenses are due to the inclusion of Cyclo Therapeutics following the March 25, 2025 merger, and the activity of Cornerstone and Day Three, which were consolidated during fiscal 202467 First Nine Months Fiscal Year 2025 Results For the first nine months of fiscal year 2025, Rafael Holdings also reported a reduced net loss compared to the prior year, driven by the impact of the prior year's in-process R&D expense and unrealized gains on Cyclo equity. R&D and G&A expenses increased for similar reasons as the quarterly results Key Financials for Nine Months Ended April 30 | Metric | 9M FY2025 (in millions) | 9M FY2024 (in millions) | Change (YoY) | | :-------------------------------- | :---------------------- | :---------------------- | :------------- | | Net Loss Attributable to Rafael Holdings | $(18.4) | $(29.9) | $(11.5) decrease | | Loss Per Share | $(0.73) | $(1.26) | $(0.53) decrease | | Research and Development Expenses | $5.3 | $2.6 | $2.7 increase | | General and Administrative Expenses | $8.3 | $6.5 | $1.8 increase | - The decrease in net loss for the nine-month period is primarily due to the prior year's $89.9 million in-process R&D expense related to the Cornerstone acquisition (net with a $31.3 million recovery of receivables) and $3.2 million in unrealized gains on the Company's investment in Cyclo equity8 - Increased R&D and G&A expenses are attributed to the merger with Cyclo Therapeutics (closed March 25, 2025) and the consolidation of Cornerstone and Day Three during fiscal 2024910 Business Overview Rafael Holdings is a holding company with diverse interests in clinical-stage pharmaceutical and other companies Company Profile and Portfolio Rafael Holdings, Inc. is a holding company with interests in various clinical and early-stage pharmaceutical and other companies. Its wholly-owned subsidiary, Cyclo Therapeutics, LLC, is focused on developing Trappsol Cyclo™ for Niemann-Pick Disease Type C1. The company also holds majority equity interests in LipoMedix, Cornerstone Pharmaceuticals, Rafael Medical Devices, and Day Three Labs - Rafael Holdings, Inc. holds interests in clinical and early-stage pharmaceutical and other companies11 - Wholly-owned subsidiary, Cyclo Therapeutics, LLC, is a clinical-stage biotechnology company developing Trappsol Cyclo™ for Niemann-Pick Disease Type C1 (NPC1)11 - Other majority equity interests include LipoMedix Pharmaceuticals Ltd. (clinical-stage pharmaceutical), Cornerstone Pharmaceuticals, Inc. (cancer metabolism-based therapeutics), Rafael Medical Devices, LLC (orthopedic medical devices), and Day Three Labs, Inc. (cannabis offerings)11 Financial Statements Consolidated financial statements detail changes in assets, liabilities, and equity, and a reduced net loss Consolidated Balance Sheets The consolidated balance sheet shows an increase in total assets for Rafael Holdings as of April 30, 2025, primarily driven by a significant increase in cash and cash equivalents and in-process research and development. Total liabilities also increased substantially, while total equity saw a slight decrease Consolidated Balance Sheet Highlights (in thousands) | Metric | April 30, 2025 | July 31, 2024 | | :-------------------------------- | :------------- | :------------ | | ASSETS | | | | Cash and cash equivalents | $37,936 | $2,675 | | Total current assets | $42,443 | $72,502 | | Goodwill | $28,278 | $3,050 | | In-process research and development | $31,575 | $1,575 | | TOTAL ASSETS | $108,096 | $96,832 | | LIABILITIES | | | | Total current liabilities | $11,030 | $7,514 | | Deferred income tax liability | $9,002 | — | | TOTAL LIABILITIES | $23,578 | $10,574 | | EQUITY | | | | Total equity attributable to Rafael Holdings, Inc. | $80,578 | $82,185 | | TOTAL EQUITY | $84,518 | $86,258 | - Cash and cash equivalents increased significantly from $2,675 thousand at July 31, 2024, to $37,936 thousand at April 30, 202515 - Goodwill increased from $3,050 thousand to $28,278 thousand, and in-process research and development increased from $1,575 thousand to $31,575 thousand, reflecting recent acquisitions and mergers15 Consolidated Statements of Operations and Comprehensive Loss The consolidated statements of operations show a substantial reduction in net loss for both the three and nine months ended April 30, 2025, compared to the prior year. This improvement is largely due to the absence of a significant in-process R&D expense incurred in the prior year, despite increases in SG&A and R&D expenses Consolidated Statements of Operations Highlights (in thousands) | Metric | Three Months Ended April 30, 2025 | Three Months Ended April 30, 2024 | Nine Months Ended April 30, 2025 | Nine Months Ended April 30, 2024 | | :-------------------------------- | :-------------------------------- | :-------------------------------- | :------------------------------- | :------------------------------- | | Revenues | $362 | $336 | $567 | $472 | | SG&A Expenses | $3,170 | $1,923 | $8,284 | $6,524 | | R&D Expenses | $3,003 | $1,526 | $5,276 | $2,627 | | In-process R&D expense | — | $89,861 | — | $89,861 | | Operating Loss | $(5,913) | $(93,161) | $(16,396) | $(98,782) | | Net loss attributable to Rafael Holdings, Inc. | $(4,779) | $(32,351) | $(18,426) | $(29,942) | | Loss per share (Basic and diluted) | $(0.19) | $(1.36) | $(0.73) | $(1.26) | - Revenues increased slightly for both the three-month period (from $336k to $362k) and the nine-month period (from $472k to $567k) year-over-year17 - The significant reduction in operating loss and net loss is primarily due to the absence of the $89,861 thousand in-process R&D expense that was recorded in the prior year periods17 Additional Information This section provides forward-looking statement disclaimers and contact information for inquiries Forward-Looking Statements This section serves as a standard disclaimer, indicating that the press release contains forward-looking statements regarding the potential, safety, efficacy, and regulatory progress of product candidates. It highlights that these statements involve known and unknown risks and uncertainties that could cause actual results to differ materially from expectations, as detailed in the company's SEC filings - The press release contains forward-looking statements concerning product candidates' potential, safety, efficacy, and regulatory/clinical progress12 - These statements are subject to known and unknown risks, uncertainties, and other important factors that may cause actual results to differ materially from those expressed or implied12 - Readers are advised to refer to the 'Risk Factors' section in the company's Annual Report on Form 10-K and other SEC filings for more details on these factors12 Contact Information Contact details for media and investor inquiries are provided - Contact person for inquiries: Barbara Ryan, Barbara.ryan@rafaelholdings.com, (203) 274-282513