Acacia(US:ACTG)2021-11-16 02:30Financial Data and Key Metrics Changes - Revenues for Q3 2021 were $1.6 million, a significant decrease from $19.5 million in the same quarter last year [14] - Operating loss for the quarter was $12.7 million, compared to a loss of $2.8 million a year ago [14] - Realized and unrealized gains totaled $104.2 million for the quarter [14] - GAAP book value at September 30, 2021, was $235.9 million or $4.82 per basic share, down from $292.5 million or $5.94 per basic share at December 31, 2020 [12] Business Line Data and Key Metrics Changes - The IP business generated $1.6 million in revenue, down from $19.5 million in Q3 2020 [9] - The company recognized nearly $120 million in realized and unrealized gains due to the IPO of Oxford Nanopore Technologies [6] - Acacia has recovered $256 million of its original $282 million investment in the life science portfolio [7] Market Data and Key Metrics Changes - The remaining position in Oxford Nanopore was valued at $267.8 million as of September 30, 2021 [6] - Acacia held positions in four public companies valued at $348.7 million as of September 30, 2021 [7] Company Strategy and Development Direction - The company is focused on acquiring businesses in mature technology, life sciences, healthcare, and industrials, particularly those with an equity market cap under $2 billion [7] - Ongoing partnership with Starboard Value LP is expected to yield a growing pipeline of acquisition opportunities [8] - The company aims to improve its underlying net asset value and execute its acquisition strategy [15] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the potential of their private life sciences companies and the overall acquisition strategy [7] - The completion of the first license related to the Wi-Fi 6 portfolio is seen as a significant step in monetizing IP assets [9] - Management indicated that the company is uniquely positioned as an acquirer of businesses and a compelling counterparty [15] Other Important Information - Acacia has substantial capital resources with $605 million in cash and public equity investments at the end of September 2021 [10] - The acquisition of Printronix closed in early October, which is expected to contribute positively to future results [12] Q&A Session Summary Question: Progress on Spok and Comtech - Management indicated that they have not been surprised by developments in either situation and that trading prices relative to offers are indicative of progress [18] Question: Increase in G&A Expenses - G&A expenses increased due to deal-related activities, and future expenses will vary based on acquisition pipeline activity [17] Question: Samsung Wi-Fi Patent License - The first license with Samsung is critical for monetizing the Wi-Fi 6 portfolio, with expectations to license to other companies in the future [20] Question: Printronix Revenue and Profitability - Printronix was acquired for approximately $33 million, with profitability expected to be under $10 million [22] Question: Impact of Realized Gains on NOL - Management clarified that the impact on net operating loss (NOL) relates only to realized gains, not unrealized [24] Question: Cash and Marketable Securities - The $605 million in cash includes both cash and marketable securities, with $387 million in publicly traded securities [27][28]