ADMA Biologics(ADMA) - 2025 Q2 - Quarterly Report

PART I FINANCIAL INFORMATION Financial Statements The unaudited condensed consolidated financial statements for ADMA Biologics, Inc. as of June 30, 2025, show significant growth in revenues and net income compared to the same period in 2024, with total assets increasing to $558.4 million from $488.7 million at year-end 2024, driven by higher accounts receivable and inventories Condensed Consolidated Balance Sheets Presents the company's financial position, detailing assets, liabilities, and equity at specific dates Condensed Consolidated Balance Sheet Highlights (in thousands) | Account | June 30, 2025 (Unaudited) | December 31, 2024 | | :--- | :--- | :--- | | Current Assets | | | | Cash and cash equivalents | $90,285 | $103,147 | | Accounts receivable, net | $109,726 | $49,999 | | Inventories, net | $191,464 | $170,235 | | Total Assets | $558,380 | $488,678 | | Current Liabilities | $74,941 | $55,542 | | Total Liabilities | $160,055 | $139,660 | | Total Stockholders' Equity | $398,325 | $349,018 | - Total assets grew to $558.4 million as of June 30, 2025, from $488.7 million at the end of 2024, primarily due to a significant increase in accounts receivable and inventories[13] - The company initiated a treasury stock program, holding $15.1 million in treasury stock as of June 30, 2025, which was not present at the end of 2024[13] Unaudited Condensed Consolidated Statements of Operations Details the company's financial performance, including revenues, expenses, and net income over reporting periods Statement of Operations Summary (in thousands, except per share data) | Metric | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :--- | :--- | :--- | :--- | :--- | | Revenues | $121,984 | $107,191 | $236,786 | $189,066 | | Gross Profit | $67,227 | $57,453 | $128,323 | $96,561 | | Income from Operations | $42,798 | $39,201 | $77,678 | $61,022 | | Net Income | $34,219 | $32,062 | $61,122 | $49,868 | | Diluted EPS | $0.14 | $0.13 | $0.25 | $0.21 | - Revenues for the second quarter of 2025 increased to $122.0 million, a 13.8% increase from $107.2 million in the same period of 2024[14] - Net income for the six months ended June 30, 2025, rose to $61.1 million from $49.9 million in the prior-year period, representing a 22.6% increase[14] Unaudited Condensed Consolidated Statements of Cash Flows Summarizes cash inflows and outflows from operating, investing, and financing activities for the period Cash Flow Summary for Six Months Ended June 30 (in thousands) | Cash Flow Activity | 2025 | 2024 | | :--- | :--- | :--- | | Net cash provided by operating activities | $1,464 | $43,428 | | Net cash used in investing activities | ($7,247) | ($4,727) | | Net cash used in financing activities | ($7,079) | ($1,809) | | Net (decrease) increase in cash | ($12,862) | $36,892 | - Net cash from operating activities significantly decreased to $1.5 million in the first six months of 2025 from $43.4 million in the same period of 2024, primarily due to large increases in accounts receivable and inventories[18] - Cash used in financing activities increased, driven by $8.4 million in taxes paid on vested restricted stock units and a $30.0 million principal payment on a term loan, which was offset by a $30.0 million draw from a revolver[18] Notes to Unaudited Condensed Consolidated Financial Statements Provides essential disclosures and explanations supporting the condensed consolidated financial statements - In May 2025, the Board authorized a share repurchase program of up to $500.0 million During the quarter, the company repurchased 816,237 shares for $15.1 million[50][51] - In May 2025, the company repaid $30.0 million of its term loan using a draw from its revolving credit facility, resulting in a debt extinguishment loss of $1.2 million[47] - Subsequent to the quarter end, in August 2025, the company entered into a new $300 million credit agreement with JPMorgan, consisting of a $75 million term loan and a $225 million revolving facility, to refinance its existing debt[86] - In July 2025, the company acquired real estate in Boca Raton, FL for $12.6 million to expand production operations and storage capacity[85] Management's Discussion and Analysis of Financial Condition and Results of Operations (MD&A) Management attributes the strong financial performance in the first half of 2025 to the continued commercial success and growing market acceptance of its IVIG product, ASCENIV, with revenues for the second quarter and first six months of 2025 increasing by 14% and 25% year-over-year, respectively Overview Introduces ADMA's business, products, and key strategic developments, including recent FDA approvals and acquisitions - ADMA is an end-to-end commercial biopharmaceutical company with three FDA-approved products: ASCENIV, BIVIGAM, and Nabi-HB, manufactured at its Boca Raton facility[95][96] - The company operates ten FDA-licensed plasma collection centers, which supply plasma for its products and for sale to third parties[98] - In April 2025, the FDA approved an innovative yield enhancement production process for ASCENIV and BIVIGAM, which is expected to increase production yields by approximately 20% and contribute to revenue and earnings growth starting in the second half of 2025[101] - In July 2025, the company acquired real estate in Boca Raton for $12.6 million to expand production and storage capabilities[103] Results of Operations Analyzes the company's financial performance, highlighting revenue, gross profit, and net income trends and drivers Q2 2025 vs Q2 2024 Results (in thousands) | Metric | Q2 2025 | Q2 2024 | Change | | :--- | :--- | :--- | :--- | | Revenues | $121,984 | $107,191 | $14,793 | | Gross Profit | $67,227 | $57,453 | $9,774 | | Income from Operations | $42,798 | $39,201 | $3,597 | | Net Income | $34,219 | $32,062 | $2,157 | - Q2 2025 revenues increased 14% YoY, primarily due to higher sales volume of ASCENIV Excluding a $12.6 million Medicaid rebate accrual adjustment in Q2 2024, the underlying revenue growth was 29%[118] H1 2025 vs H1 2024 Results (in thousands) | Metric | H1 2025 | H1 2024 | Change | | :--- | :--- | :--- | :--- | | Revenues | $236,786 | $189,066 | $47,720 | | Gross Profit | $128,323 | $96,561 | $31,762 | | Income from Operations | $77,678 | $61,022 | $16,656 | | Net Income | $61,122 | $49,868 | $11,254 | - For the first six months of 2025, revenues grew 25% YoY A voluntary withdrawal of three BIVIGAM lots reduced revenue by $4.0 million during this period[130] - Gross margin for H1 2025 improved to 54.2% from 51.1% in H1 2024, driven by a better product mix and manufacturing efficiencies[132] Liquidity and Capital Resources Assesses the company's financial flexibility, cash position, debt structure, and future funding outlook - As of June 30, 2025, the company had working capital of $324.6 million, including $90.3 million in cash and cash equivalents[146] - Management anticipates that current cash, receivables, and projected operating cash flow will be sufficient to fund operations through the first half of 2026 and beyond, with no current need to raise additional capital[148] - On August 5, 2025, the company refinanced its debt by entering a new $300 million credit facility with JPMorgan, replacing the previous Ares facility The new facility includes a $75 million term loan and a $225 million revolving credit line[157][158] - Net cash from operations for the first six months of 2025 was $1.5 million, a significant decrease from $43.4 million in the prior year, mainly due to investments in inventory and an increase in accounts receivable[165] Quantitative and Qualitative Disclosures About Market Risk The company is exposed to interest rate risk due to its variable-rate senior credit facilities, with a hypothetical 100 basis point increase in interest rates resulting in an approximate $0.8 million negative impact on annualized earnings and cash flows - The company's primary market risk is from changes in interest rates on its senior credit facility[172] - As of June 30, 2025, a hypothetical 100 basis point (1%) increase in interest rates would have an approximate $0.8 million negative impact on annual earnings and cash flows based on the $75.0 million outstanding variable-rate debt[172] Controls and Procedures Management, including the CEO and CFO, evaluated the company's disclosure controls and procedures as of June 30, 2025, concluding they were effective in ensuring timely and accurate reporting, with no material changes to internal control over financial reporting during the quarter - The principal executive officer and principal financial officer concluded that the company's disclosure controls and procedures were effective as of June 30, 2025[174] - There were no changes in the company's internal control over financial reporting during the quarter ended June 30, 2025, that have materially affected, or are reasonably likely to materially affect, internal controls[176] PART II OTHER INFORMATION Legal Proceedings The company reports that it is not currently involved in any material pending legal proceedings that would have a material adverse effect on its financial position, results of operations, or cash flows - Management states that there are currently no material pending legal proceedings against the company[178] Risk Factors The company outlines several key risks to its business, including the potential inability to maintain profitability, reliance on third-party contractors for manufacturing and plasma supply, business interruptions, regulatory hurdles, customer concentration, stock price volatility, and limitations on the use of Net Operating Loss (NOL) carryforwards - The company may not be able to maintain profitability, despite achieving it for the first time in the year ended December 31, 2024[179][182] - A few customers account for a significant portion of revenue and accounts receivable, with two customers representing about 72% of consolidated revenues for the first six months of 2025[181][216] - The business relies on third parties for filling, packaging, testing, and sourcing plasma, which introduces risks related to performance, quality, and supply chain disruptions[179][185] - The company's new senior secured credit facility with JPMorgan contains covenants and is subject to acceleration in case of default, which could lead to the seizure of collateral[181][231][232] Unregistered Sales of Equity Securities and Use of Proceeds The company reports no unregistered sales of equity securities during the period, having repurchased 816,237 shares in June 2025 at an average price of $18.35 per share under its publicly announced share repurchase program, with approximately $485 million remaining available for future repurchases Share Repurchases in Q2 2025 | For the Month Ended | Total Number of Shares Purchased | Average Price Paid Per Share | Approximate Dollar Value of Shares that May Yet Be Purchased | | :--- | :--- | :--- | :--- | | April 30, 2025 | - | $- | $- | | May 31, 2025 | - | $- | $- | | June 30, 2025 | 816,237 | $18.35 | $485,002,210 | - The share repurchases were made pursuant to the program publicly announced on May 5, 2025, which has no expiration date[296][297] Other Information The company states that none of its directors or executive officers adopted or terminated any Rule 10b5-1 trading plans or other non-Rule 10b5-1 trading arrangements during the quarter ended June 30, 2025 - No directors or executive officers adopted or terminated any Rule 10b5-1 trading plans during the second quarter of 2025[300]