Exicure(US:XCUR)2025-06-27 20:43Financial Performance - The company reported no revenue for the three months ended March 31, 2025, down from $500,000 in the same period of 2024[21]. - Operating expenses for the first quarter of 2025 totaled $(2,949,000), compared to $1,336,000 in the first quarter of 2024, indicating a significant increase in expenses[21]. - Net income for the first quarter of 2025 was $3,010,000, a turnaround from a net loss of $(829,000) in the same period of 2024[21]. - Basic net income per common share was $0.49 for the first quarter of 2025, compared to a loss of $(0.48) per share in the first quarter of 2024[21]. - The Company achieved a segment net income of $3.01 million for the three months ended March 31, 2025, compared to a net loss of $829,000 in the same period of 2024[99]. - The Company incurred a pretax income for the three months ended March 31, 2025, but does not expect to end the fiscal year with pretax income[100]. Assets and Equity - Total assets increased to $20,680,000 as of March 31, 2025, compared to $15,056,000 on December 31, 2024, representing a 37.5% increase[19]. - Total stockholders' equity increased to $11,382,000 as of March 31, 2025, from $6,772,000 at the end of 2024, reflecting a 68.5% increase[19]. - Cash and cash equivalents decreased to $10,420,000 as of March 31, 2025, from $12,508,000 as of December 31, 2024, a decline of 16.7%[19]. - Cash and cash equivalents at the end of Q1 2025 were $10,420,000, down from $12,508,000 at the beginning of the period[30]. - As of March 31, 2025, the Company had cash equivalents totaling $5.03 million, measured using Level 1 inputs[107]. Acquisitions and Investments - The company acquired GPCR Therapeutics USA Inc. for $2,090,000, which is now a wholly owned subsidiary[37]. - The total purchase price for the acquisition of GPCR USA was $7.881 million, which includes $1.635 million in cash, $500,000 in equity consideration, and $5.246 million in fair value of contingent consideration[62]. - The assets acquired from GPCR USA totaled $9.291 million, including $3.784 million in intangible assets and $3.340 million in goodwill[65]. - The liabilities assumed in the acquisition amounted to $1.410 million, resulting in net assets acquired of $7.881 million[65]. - The Company recognized a right-of-use asset of $285,000 and a related lease liability of $712,000 on the date of the acquisition of GPCR USA[73]. Cash Flow and Expenses - Cash used in operating activities for Q1 2025 was $(1,598,000), compared to $(450,000) in Q1 2024[30]. - The company reported a net decrease in cash, cash equivalents, and restricted cash of $(2,088,000) for Q1 2025[30]. - Research and development expenses for the three months ended March 31, 2025, were $808,000, while general and administrative expenses were $2.2 million, up from $1.3 million in 2024[99]. - Operating lease costs for Q1 2025 were $146,000, compared to $143,000 in Q1 2024, indicating a slight increase[76]. - The company recorded cash payments for operating leases of $109,000 in Q1 2025, compared to $0 in Q1 2024[76]. Strategic Initiatives - The company is exploring strategic alternatives to maximize stockholder value, which may involve unexpected costs and liabilities[12]. - The company is exploring strategic alternatives, including private acquisitions and raising additional capital, to maximize stockholder value[36]. - The company plans to complete the administration of GPC-100 to 20 patients in a clinical trial by Q2 2025, with results expected in Q4 2025[39]. - The Company entered into a License and Collaboration Agreement with GPCR, which includes milestone payments and royalties based on clinical trial achievements[38]. - A new wholly-owned subsidiary, KC Creation Co., Ltd., was established in South Korea to explore growth strategies and collaborations[40]. Legal and Compliance - The company has substantial uncertainties regarding its ability to raise additional capital needed to fund operations and strategic alternatives[12]. - The company faces risks related to compliance with applicable laws and potential turnover of senior management, which could impact operations[16]. - The Company is involved in a securities class action settlement amounting to $5.625 million, which will be fully covered by insurance[111]. - The Company is currently engaged in settlement discussions regarding allegations of breaches of fiduciary duties and corporate waste, stemming from a Demand Letter sent on March 18, 2022[115]. - A former employee's complaint related to their separation from the Company is in the discovery phase, with a status conference held on February 11, 2025[116]. - The Company believes that the outcome of ordinary course litigation will not have a material adverse effect on its business, although litigation can incur defense and settlement costs[117]. Management and Compensation - The Company’s Chief Executive Officer, Andy Yoo, received a salary increase to $480, while Chief Financial Officer, Seung Ik Baik, saw an increase to $300, effective April 1, 2025[125]. - If terminated without cause, Mr. Yoo is entitled to 24 months' severance, while Mr. Baik is entitled to 12 months' severance[125]. Accounting and Reporting - The company plans to adopt the new accounting standard ASU 2024-03 for fiscal year 2027, which will require additional disclosures about specific expense categories[59]. - The company is currently evaluating the impact of ASU 2023-09 on its income tax disclosures, which will be effective for fiscal years beginning after December 15, 2024[61]. - The Company recorded a contingent consideration liability of $5.38 million as of March 31, 2025, reflecting a change in fair value of $136,000[109]. - The Company has agreed to pay liquidated damages of 0.5% of the aggregate amount invested by purchasers for any registration statement not filed within 90 days following the closing date[93]. - The Company is not required to provide certain market risk disclosures as a smaller reporting company[174].