Rafael Holdings Reports Third Quarter Fiscal Year 2020 Results

NEWARK, N.J., June 9, 2020 /PRNewswire/ — Rafael Holdings, Inc., (NYSE: RFL), reported revenue of $1.2 million and a loss…

NEWARK, N.J., June 9, 2020 /PRNewswire/ — Rafael Holdings, Inc., (NYSE: RFL), reported revenue of $1.2 million and a loss per share of $0.14 for the fiscal quarter ended April 30, 2020.

Q3 FY 2020 Consolidated Highlights

  • Revenue of $1.2 million in Q3 FY2020, generated by Rafael Holdings’ real estate portfolio, decreased from $1.4 million in the year-ago quarter. The loss per share of $0.14 increased from $0.07 in the year ago quarter largely on increased R&D expense incurred by the Barer Institute.

Rafael Pharmaceuticals

  • On May 26, 2020, Rafael Pharma announced positive results of a single-arm, open-label, Phase 1 study of CPI-613®  (devimistat) with gemcitabine and nab-paclitaxel in patients with locally advanced or metastatic pancreatic cancer. The data was presented at the American Society of Clinical Oncology (ASCO) 2020 Virtual Scientific Program.
  • On April 28, 2020, Rafael Pharma announced the expansion of its Phase 2 clinical trial of CPI-613® (devimistat) for patients with relapsed or refractory Burkitt’s lymphoma/leukemia. The clinical trial began enrolling patients at MD Anderson Cancer Center, where Dr. Raphael Steiner serves as principal investigator.
  • On March 24, 2020, Rafael Pharma announced that it had enrolled more than 75% of the 500 patients needed for its pivotal Phase 3 clinical trial for metastatic pancreatic cancer (AVENGER 500).  The trial is evaluating the efficacy and safety of Rafael’s lead compound CPI-613®️ (devimistat) in combination with modified FOLFIRINOX (mFFX) as first-line therapy.

LipoMedix

At April 30, 2020, Rafael Holdings held 57.9% of the issued and outstanding ordinary shares of LipoMedix, a development-stage Israeli company focused on the development of an innovative, safe and effective cancer therapy based on liposome delivery.

  • Lipomedix was awarded a Seal of Excellence for its Promitil project by European Innovation Council of the European Union.
  • LipoMedix’s Phase IB study of Promitil in Israel continued to enroll patients with advanced cancer requiring palliative radiotherapy for inoperable tumors or metastatic disease.

Barer Institute

Rafael Holdings increased its investment in pharmaceutical development through its Barer Institute subsidiary.  The Barer Institute is currently testing indications for lead compounds targeting cancer metabolism and has initiated a preclinical in-licensing effort on selected compounds that target the unique mechanisms of cancer.

Remarks by Howard Jonas, Chairman and CEO of Rafael Holdings

“Rafael Holdings’ key pharmaceutical investments, Rafael Pharma and LipoMedix and our wholly owned Barer Institute, continue to execute on their development and clinical programs despite the challenges posed by the worldwide Covid-19 pandemic.  I am especially gratified that Rafael Pharma has surpassed the 80% enrollment milestone in its pivotal Phase 3 Avenger 500 study of patients with pancreatic cancer.  The Barer Institute is evaluating promising candidates for potential clinical development programs.  And finally, we continue to work to monetize our New Jersey real estate assets, while our asset in Israel is now fully leased.” 

About Rafael Holdings, Inc.:

Rafael Holdings is focused on development of novel cancer therapies.  The company is a significant investor in two clinical stage oncology companies, Rafael Pharmaceuticals, Inc. and LipoMedix Pharmaceuticals Ltd.  Through its wholly owned Barer Institute subsidiary, the company is developing a pipeline of compounds focused on the regulation of cancer metabolism.  The company also holds commercial real estate assets in New Jersey and Jerusalem. For more information, visit www.rafaelholdings.com.

 

RAFAEL HOLDINGS, INC.

CONSOLIDATED BALANCE SHEETS

(unaudited, in thousands, except share data) 

April 30,

July 31,

2020

2019

ASSETS

CURRENT ASSETS

Cash and cash equivalents

$

8,430

$

12,024

Trade accounts receivable, net of allowance for doubtful accounts of $143 
     and $122 at April 30, 2020 and July 31, 2019, respectively

261

450

Due from Rafael Pharmaceuticals

135

280

Prepaid expenses and other current assets

336

507

Total current assets

9,162

13,261

Property and equipment, net

47,811

48,733

Investments – Rafael Pharmaceuticals

70,018

70,018

Investments – Other Pharmaceuticals

1,705

2,000

Investments – Hedge Funds

5,617

5,125

Equity investment – RP Finance

53

Deferred income tax assets, net

6

19

In-process research and development and patents

1,575

1,575

Other assets

1,484

1,412

TOTAL ASSETS

$

137,431

$

142,143

LIABILITIES AND EQUITY

CURRENT LIABILITIES

Trade accounts payable

$

700

$

795

Accrued expenses

728

605

Other current liabilities

57

27

Total current liabilities

1,485

1,427

Due to Related Party

27

65

Convertible note, net of discount of $0 and $54 – Related Party

14,946

Other liabilities

92

292

Accrued interest on convertible note – Related Party

649

TOTAL LIABILITIES

1,604

17,379

COMMITMENTS AND CONTINGENCIES

EQUITY

Class A common stock, $0.01 par value; 50,000,000 shares authorized, 
     787,163 shares issued and outstanding as of April 30, 2020 and July 31, 
     2019

8

8

Class B common stock, $0.01 par value; 200,000,000 shares authorized, 
     15,034,931 issued and 15,028,869 outstanding as of April 30, 2020 and 
     13,142,502 shares issued and outstanding as of July 31, 2019

149

131

Additional paid-in capital

128,998

112,898

Accumulated deficit

(10,850)

(5,840)

Accumulated other comprehensive income related to foreign currency translation adjustment

3,752

3,784

Total equity attributable to Rafael Holdings, Inc.

122,057

110,981

Noncontrolling interests

13,770

13,783

TOTAL EQUITY

135,827

124,764

TOTAL LIABILITIES AND EQUITY

$

137,431

$

142,143

 

 

RAFAEL HOLDINGS, INC.

CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS

(unaudited, in thousands, except share and per share data)

Three Months Ended
April 30,

Nine Months Ended
April 30,

2020

2019

2020

2019

REVENUE:

Rental – Third Party

$

360

$

588

$

1,076

$

1,277

Rental – Related Party

523

521

1,570

1,564

Parking

221

268

664

688

Other – Related Party

120

360

Total Revenue

1,224

1,377

3,670

3,529

COSTS AND EXPENSES

Selling, general and administrative

2,081

2,059

6,343

5,228

Research and development

634

300

1,327

949

Depreciation and amortization

474

436

1,413

1,296

Loss from Operations

(1,965)

(1,418)

(5,413)

(3,944)

Interest (expense) income, net

(221)

(31)

647

Net gain (loss) resulting from foreign exchange transactions

19

(5)

19

Gain on sales of marketable securities, net

330

Impairment of investments – Other Pharmaceuticals

(295)

(295)

Unrealized (loss) gain on investments – Hedge Funds

(28)

466

492

414

Loss Before Income Taxes

(2,288)

(1,154)

(5,252)

(2,534)

(Provision for) benefit from income taxes

(8)

7

(24)

21

    Equity in earnings of RP Finance

53

53

Consolidated Net Loss

(2,243)

(1,147)

(5,223)

(2,513)

Net loss attributable to noncontrolling interests

(84)

(142)

(213)

(6)

Net Loss Attributable to Rafael Holdings, Inc.

$

(2,159)

$

(1,005)

$

(5,010)

$

(2,507)

OTHER COMPREHENSIVE LOSS

Net Loss

$

(2,243)

$

(1,147)

$

(5,223)

$

(2,513)

Foreign currency translation adjustments

(4)

(54)

(32)

(52)

Total Comprehensive Loss

(2,247)

(1,201)

(5,255)

(2,565)

Comprehensive (loss) income attributable to noncontrolling 
     interests

(3)

(18)

(19)

5

Total Comprehensive Loss attributable to Rafael Holdings, Inc.

$

(2,244)

$

(1,183)

$

(5,236)

$

(2,570)

Loss Per Share:

Basic and diluted

$

(0.14)

$

(0.07)

$

(0.32)

$

(0.19)

Weighted average number of shares used in calculation of 
     loss per share:

Basic and diluted

15,813,679

13,924,691

15,747,709

13,055,037

 

 

RAFAEL HOLDINGS, INC.

CONSOLIDATED STATEMENTS OF CASH FLOWS

(unaudited, in thousands)

Nine Months Ended
April 30,

2020

2019

Operating activities

Net loss

$

(5,223)

$

(2,513)

Adjustments to reconcile net loss to net cash used in operating activities:

Depreciation and amortization

1,413

1,296

Deferred income taxes

13

(24)

Interest income on Series D Convertible Note

(848)

Net gain on sales of marketable securities

(330)

Impairment of investments – Other Pharmaceuticals

295

Unrealized gain on investments – Hedge Funds

(492)

(414)

Equity in earnings of RP Finance

(53)

Provision for doubtful accounts

48

86

Non-cash compensation

546

269

Amortization of debt discount

54

11

Change in assets and liabilities:

Trade accounts receivable

141

(471)

Prepaid expenses and other current assets

171

(419)

Other assets

(72)

(180)

Accounts payable and accrued expenses

28

91

Due to/from related parties

107

473

Accrued interest – Related Party

19

418

Other current liabilities

(5)

Other liabilities

30

22

Net cash used in operating activities

(2,975)

(2,538)

Investing activities

Purchases of property and equipment

(491)

(364)

Proceeds from sale and maturity of marketable securities, net

25,031

Investment in Rafael Pharmaceuticals

(55,870)

Net cash used in investing activities

(491)

(31,203)

Financing activities

Contribution from noncontrolling interest of consolidated entity

4,587

Repayment of Loan from Rafael Pharmaceuticals

3,300

Proceeds from exercise of options

29

190

Proceed from sale of shares

7,777

Proceeds from convertible notes payable – Related Party

15,000

Payments for taxes related to shares withheld for employee taxes

(125)

Net cash (used in) provided by financing activities

(96)

30,854

Effect of exchange rate changes on cash and cash equivalents

(32)

53

Net decrease in cash and cash equivalents

(3,594)

(2,834)

Cash and cash equivalents at beginning of period

12,024

15,803

Cash and cash equivalents at end of period

$

8,430

$

12,969

Supplemental Schedule of Non-Cash Investing and Financing Activities

Adoption effect of ASU 2016-01

$

$

39

Beneficial conversion feature of convertible debt – Related Party

$

$

71

Debt and accrued interest converted to Series D Preferred Stock

$

$

10,848

Related Party deposit utilized to purchase Class B Common Stock

$

$

864

Conversion of LipoMedix Bridge Note

$

200

$

Conversions of Related Party convertible notes payable and accrued interest

$

15,668

$

 

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SOURCE Rafael Holdings, Inc.