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Rafael Holdings Reports Second Quarter Fiscal Year 2019 Results

NEWARK, N.J., March 12, 2019 /PRNewswire/ -- Rafael Holdings, Inc., (NYSE American: RFL), reported revenue of $1.0 million and a loss per share of $0.08 for the second quarter of its 2019 fiscal year, the three months ended January 31, 2019. 

Rafael Holdings holds commercial real estate assets and interests in two clinical stage pharmaceutical companies. The pharmaceutical holdings consist of interests in Rafael Pharmaceuticals, Inc. and a majority stake in Lipomedix Pharmaceuticals Ltd., both of which are focused on development and commercialization of drugs in the oncology space. For more information, visit www.rafaelholdings.com (PRNewsfoto/Rafael Holdings, Inc.)

Highlights

  • Rafael Holdings exercised a warrant and now holds a majority of the outstanding equity of Rafael Pharmaceuticals, Inc., (Rafael Pharma), a clinical stage, metabolic oncology-therapeutics company;
  • Rafael Pharma announced that the European Medicines Agency has granted orphan drug designation to devimistat (CPI-613®) for the treatment of metastatic pancreatic cancer and relapsed or refractory acute myeloid leukemia (AML);
  • Rafael Pharma initiated the following clinical trials of devimistat:

Remarks by Howard Jonas, Chairman and CEO of Rafael Holdings

"This quarter, we significantly increased our investment in Rafael Pharmaceuticals, purchasing a majority of the shares outstanding inclusive of interests held by minority holders in our subsidiaries.

"Rafael Pharma made excellent progress on its clinical trial program for difficult to treat cancers including the initiation of pivotal phase 3 trials of devimistat for patients with advanced metastatic pancreatic cancer and AML.

"LipoMedix Pharmaceuticals has initiated a phase 1b trial to identify the optimal dose, safety and efficacy of its lead compound Promitil® in combination with external beam radiotherapy in patients with advanced cancer requiring radiotherapy for inoperable primary tumors or metastatic disease.

"On the real estate side of our business, we continued our effort to monetize our properties including our 20-story commercial property and associated garage in Newark, New Jersey."

About Rafael Holdings, Inc.:
Rafael Holdings holds commercial real estate assets and interests in two clinical stage, oncology focused pharmaceutical companies.  The real estate holdings include properties in Newark and Piscataway, New Jersey and Jerusalem, Israel.  The pharmaceutical holdings consist of interests in Rafael Pharmaceuticals, Inc. and a majority stake in Lipomedix Pharmaceuticals Ltd., both of which are focused on development and commercialization of drugs in the oncology space. 

RAFAEL HOLDINGS, INC.

CONSOLIDATED BALANCE SHEETS

(in thousands, except share data)




January 31,



July 31,




2019



2018




(unaudited)



(audited)


ASSETS







CURRENT ASSETS:







Cash and cash equivalents


$

14,769



$

15,803


Trade accounts receivable, net of allowance for doubtful accounts of $91 and $82 at January 31, 2019 and July 31, 2018, respectively



356




287


Marketable securities






24,701


Due from Rafael Pharmaceuticals






3,300


Prepaid expenses and other current assets



588




421


Total current assets



15,713




44,512











Property and equipment, net



49,378




50,113


Investments – Rafael Pharmaceuticals



70,018




13,300


Investments – Other Pharmaceuticals



2,000




2,000


Investments – Hedge Funds



4,166




4,218


Deferred income tax assets, net



15





Patents



324




324


In-process research and development



1,327




1,327


Other assets



1,225




1,126


TOTAL ASSETS


$

144,166



$

116,920











LIABILITIES AND STOCKHOLDERS' EQUITY









CURRENT LIABILITIES:









Trade accounts payable


$

535



$

367


Accrued expenses



650




500


Other current liabilities



20




24


Total current liabilities



1,205




891











Due to/from related parties






276


Convertible debt, net of discount - Related Party



14,934





Other liabilities



195




188











TOTAL LIABILITIES



16,334




1,355











COMMITMENTS AND CONTINGENCIES


















STOCKHOLDERS' EQUITY









Class A common stock, $0.01 par value; 35,000,000 shares authorized, 787,163 shares issued and outstanding as of January 31, 2019 and July 31, 2018



8




8


Class B common stock, $0.01 par value; 200,000,000 shares authorized, 13,133,069 and 11,762,346 shares issued and outstanding as of January 31, 2019 and July 31, 2018, respectively



119




118


Additional paid in capital



117,269




103,636


Accumulated deficit



(2,649)




(1,108)


Accumulated other comprehensive income



4,080




4,043


Total stockholders' equity



118,827




106,697


Noncontrolling interests



9,005




8,868


TOTAL EQUITY



127,832




115,565











TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY


$

144,166



$

116,920


 

RAFAEL HOLDINGS, INC.

CONSOLIDATED AND COMBINED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME

(unaudited, in thousands, except share data)




Three Months Ended
January 31,



Six Months Ended
January 31,




2019



2018



2019



2018















REVENUE:













Rental – Third Party


$

306



$

298



$

689



$

685


Rental – Related Party



522




489




1,043




994


Parking



189




169




420




384


Total Revenue



1,017




956




2,152




2,063



















COSTS AND EXPENSES

















Selling, general and administrative



1,716




1,343




3,169




3,079


Research and development



276







649





Depreciation and amortization



431




429




860




853


Loss from Operations



(1,406)




(816)




(2,526)




(1,869)


Interest income, net



767




2




868




4


Net gain resulting from foreign exchange transactions






107







118


Net loss on equity investments












(107)


Gains on sales of marketable securities, net



103







330





Unrealized loss on Investments – Hedge Funds



(148)







(52)





Gain on disposal of bonus shares












246


Loss Before Income Taxes



(684)




(707)




(1,380)




(1,608)


(Provision for) benefit from income taxes



(17)




(15)




14




(8,443)


Net Loss



(701)




(722)




(1,366)




(10,051)


Net income (loss) attributable to noncontrolling interests



320




(176)




136




(176)


Net Loss attributable to Rafael Holdings, Inc.


$

(1,021)



$

(546)



$

(1,502)



$

(9,875)



















OTHER COMPREHENSIVE INCOME

















Foreign currency translation adjustments


$

80



$

68



$

2



$

78


Total Comprehensive Loss



(621)




(654)




(1,364)




(9,973)


Comprehensive income attributable to noncontrolling interests



15




19




23




19


Total Comprehensive Loss attributable to Rafael Holdings, Inc.


$

(636)



$

(673)



$

(1,387)



$

(9,992)



















Loss Per Share:

















Basic and diluted


$

(0.08)



$

(0.04)



$

(0.12)



$

(0.79)



















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

















Basic and diluted



13,489,583




12,541,998




12,634,389




12,541,998


  

RAFAEL HOLDINGS, INC.

 CONSOLIDATED AND COMBINED STATEMENTS OF CASH FLOWS

(unaudited, in thousands, except share data)




Six Months Ended
January 31,




2019



2018






Operating activities







Net loss


$

(1,366)



$

(10,051)


Adjustments to reconcile net loss to net cash provided by (used in) operating activities:









Depreciation and amortization



860




853


Deferred income taxes



(15)




8,837


Interest income on Series D Convertible Note



(848)





Net gain on sale of marketable securities



(330)





Unrealized loss on investments – Hedge Funds



52





Provision for doubtful accounts



9





Realized gain on disposal of bonus shares






(246)


Non-cash compensation



172




606


Amortization of debt discount



5





Interest in the equity of investments






439


Change in assets and liabilities:









Trade accounts receivable



(78)




38


Other current assets and prepaid expenses



(186)




(60)


Other assets



(82)




(260)


Accounts payable and accrued expenses



296




77


Other current liabilities



39




(15)


Due to/from related parties



588




(202)


Other liabilities



(15)




25


Net cash (used in) provided by operating activities



(899)




41











Investing activities









Purchases of property and equipment



(58)




(728)


Proceeds from sale and maturity of marketable securities, net



25,031





Investment in Rafael Pharmaceuticals



(55,870)





Net cash used in investing activities



(30,897)




(728)











Financing activities









Contribution from noncontrolling interest of consolidated entity



4,587





Repayment of Loan from Rafael Pharmaceuticals



3,300





Proceeds from exercise of options



163





Proceed from sale of shares



7,777





Proceeds from convertible notes payable - Related Party



15,000





Cash advances from IDT Corporation, net of repayments






900


Net cash provided by financing activities



30,827




900


Effect of exchange rate changes on cash and cash equivalents



(65)




39


Net (decrease) increase in cash and cash equivalents



(1,034)




252


Cash and cash equivalents at beginning of period



15,803




11,756


Cash and cash equivalents at end of period


$

14,769



$

12,008











Supplemental Schedule of Non-Cash Financing and Investing 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





Cash payments made for interest & taxes







  

Cision

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