ANI Pharmaceuticals(ANIP) - 2023 Q4 - Annual Report

Employee and Workforce - As of January 2024, the company has 642 employees, an increase from 600 employees in January 2023, with 569 located in the U.S. and 72 in India[61] - Approximately 41% of the company's workforce identified as female, and 45% identified as a person of color or indigenous person as of the end of 2023[63] - The company has a health and safety program focused on continuous improvement and employee engagement, with training provided to new employees[67] Financial Performance - Net revenues for 2023 reached $486.8 million, a significant increase of 54% compared to $316.4 million in 2022[349] - Operating income for 2023 was $47.0 million, a turnaround from an operating loss of $35.3 million in 2022[349] - Net income for 2023 was $18.8 million, compared to a net loss of $47.9 million in 2022, marking a substantial improvement[351] - Basic income per share for 2023 was $0.86, compared to a loss of $3.05 per share in 2022[349] - The company reported a total comprehensive income of $15.5 million for 2023, compared to a comprehensive loss of $32.7 million in 2022[351] Assets and Liabilities - As of December 31, 2023, total assets increased to $904.4 million from $760.1 million in 2022, representing an increase of approximately 19%[345] - Total current assets reached $519.8 million, up from $344.3 million in 2022, reflecting a growth of approximately 51%[345] - The company's total liabilities increased to $446.8 million in 2023 from $421.5 million in 2022, a rise of about 6%[345] - Total stockholders' equity increased to $432.7 million in 2023, up from $313.7 million in 2022, representing a growth of around 38%[345] Cash Flow and Investments - Cash and cash equivalents rose significantly to $221.1 million in 2023, compared to $48.2 million in 2022, marking an increase of over 358%[345] - Operating cash flow for 2023 was $118,959 million, compared to a cash outflow of $31,203 million in 2022[358] - The company reported a net cash outflow of $18,511 million from investing activities in 2023, compared to an outflow of $15,738 million in 2022[358] Debt and Interest Rates - The company has a total net leverage ratio requirement not to exceed 4.75:1.00 under its Credit Agreement, with a stricter limit of 4.50:1.00 applicable until September 30, 2023[321] - The company amended its Credit Agreement in July 2023 to transition from LIBOR to SOFR, with specific credit spread adjustments for different interest periods[322] - The company is exposed to interest rate risk, with a 1% change in interest rates potentially impacting interest expense by approximately $1.6 million for the Term Facility[323] - The interest rate under the Term Facility was 11.46% at December 31, 2023[457] - Total interest expense related to the Term Facility for the year ended December 31, 2023, was $32.5 million, compared to $28.4 million in 2022[463] Research and Development - Research and development expenses increased to $34.3 million in 2023, up 54% from $22.3 million in 2022[349] - The company plans to continue expanding its product offerings and investing in research and development to drive future growth[349] Acquisitions and Strategic Initiatives - The company has made strategic acquisitions, including the acquisition of Novitium, which contributed to revenue growth[354] - The acquisition of Novitium was completed for a total consideration of approximately $206.5 million, including cash, restricted shares, and contingent consideration[440] - Novitium generated revenues of $149.9 million in 2023, up from $90.3 million in 2022, indicating significant growth post-acquisition[444] Environmental and Social Governance - The company is committed to environmental stewardship and has formed an ESG Steering Committee to oversee sustainability initiatives[68] - The company has formed the ANI Rare Disease Patient Assistance Program to provide free medicines to uninsured patients in the U.S.[65] Operational Changes - The company has ceased operations at the Oakville, Ontario manufacturing facility as of March 31, 2023, to streamline operations[363] - The company plans to sell the Oakville facility for approximately $14.2 million USD, with the sale expected to close in March 2024[363] Inventory and Revenue Recognition - The company’s inventory as of December 31, 2023, totaled $111.2 million, an increase from $105.4 million in 2022[470] - Revenue is recognized primarily from sales of generic, rare disease, and established brand pharmaceutical products, with control of products typically transferring to customers upon sale[370] - The company continually adjusts its Average Selling Prices (ASPs) based on chargeback activity and other market factors to reflect actual selling prices[423][432] Financial Controls and Reporting - The company maintained effective internal control over financial reporting as of December 31, 2023, according to the audit opinion[338] - The allowance for credit losses was immaterial as of December 31, 2023, and 2022, indicating a stable credit risk profile[379]