Rafael(RFL) - 2024 Q3 - Quarterly Report

Financial Performance - The Company reported a loss from operations of $92.8 million for the three months ended April 30, 2024, compared to a loss of $3.0 million for the same period in 2023, representing an increase of 2,943%[336] - Loss from operations for the nine months ended April 30, 2024, was $98.8 million, a significant increase of $86.4 million compared to the same period in 2023[350] - The Company has not generated any revenues from its Healthcare segment to date, with all expenses related to its investment companies[336] Research and Development - Research and development expenses for the three months ended April 30, 2024, were $1.2 million, a 64% increase from $740,000 in the same period in 2023[336] - Research and development expenses increased by $314 thousand for the nine months ended April 30, 2024, also due to the acquisition of Day Three[347] Acquisitions and Investments - The Company acquired 70 million ordinary shares of LipoMedix for approximately $2.1 million, increasing its ownership to 95%[327] - The Company raised $925,000 from third parties for a 31.62% ownership stake in Rafael Medical Devices as of August 2023[333] - The Company invested approximately $133.7 million in available-for-sale securities during the nine months ended April 30, 2024[363] - The total aggregate fair value of the investment in Cyclo Therapeutics Inc. was $15.2 million as of April 30, 2024[371] Revenue and Expenses - The Company recorded an IPR&D expense of $89.9 million for the three months ended April 30, 2024, compared to no such expense in the same period in 2023, marking a 100% increase[342] - Infusion Technology Revenue increased by $262 thousand for the nine months ended April 30, 2024, compared to the same period in 2023, attributed to the acquisition of Day Three[344] - Cost of Infusion Technology revenue rose by $85 thousand during the nine months ended April 30, 2024, due to the acquisition of Day Three, primarily related to supplies and production labor[345] - General and administrative expenses increased by $225 thousand for the nine months ended April 30, 2024, mainly due to the acquisition of Day Three[346] Cash Flow and Liquidity - As of April 30, 2024, the company held cash and cash equivalents of approximately $7.4 million, a decrease of 65% from $21.5 million as of July 31, 2023[360] - Working capital decreased by 18% from $80.8 million to $66.3 million during the same period[360] - Cash used in operating activities decreased by 44%, from $8.8 million for the nine months ended April 30, 2023, to $4.9 million for the same period in 2024[362] - Cash used in investing activities for the nine months ended April 30, 2024, was approximately $8.9 million, significantly lower than $34.4 million in the prior year, representing a 74% decrease[363] - The company does not anticipate paying dividends until achieving sustainable profitability and retaining certain minimum cash reserves[366] - The company expects its cash and available-for-sale securities to be sufficient to meet obligations for at least the next 12 months[361] Other Financial Metrics - Interest income decreased to $1.8 million for the nine months ended April 30, 2024, down from $2.3 million in the same period in 2023, primarily due to changes in market rates[350] - Recovery of receivables from Cornerstone Pharmaceuticals increased by approximately $31.3 million for the nine months ended April 30, 2024[355] - The company recorded a realized gain of approximately $1.5 million on available-for-sale securities for the nine months ended April 30, 2024, compared to $0.2 million in the same period in 2023[352] - The company recognized a loss of approximately $422 thousand from its ownership interest in Day Three for the nine months ended April 30, 2024[357] - The benefit from income taxes included approximately $2.6 million received from the sale of unused net operating loss carryforwards for the nine months ended April 30, 2024[356] Corporate Actions - The Company terminated its merger agreement with Cornerstone on February 2, 2022, following the failure of clinical trials for its lead product candidate[322]