Market Newsdesk

November 12, 2020 7:18 am

TransDigm Group Reports Fiscal 2020 Fourth Quarter Results

PR Newswire

CLEVELAND, Nov. 12, 2020 /PRNewswire/ — TransDigm Group Incorporated (NYSE: TDG), a leading global designer, producer and supplier of highly engineered aircraft components, today reported results for the fourth quarter ended September 30, 2020, which were significantly impacted by the COVID-19 pandemic.

Fourth quarter highlights include:

Net sales of $1,173 million, down 23.9% from $1,541 million in the prior year’s quarter;
Income from continuing operations of $101 million;
Earnings per share from continuing operations of $1.76;
EBITDA As Defined margin of 42.4%;
EBITDA As Defined of $498 million is down 29.6% from $707 million in the prior year’s quarter;
Adjusted earnings per share of $2.89, down 48.6% from $5.62; and
Strong operating cash flow generation of $222 million.

Fiscal 2020 highlights include:

Net sales of $5,103 million, down 2.3% from $5,223 million in the prior year;
Income from continuing operations of $653 million;
Earnings per share from continuing operations of $8.14;
EBITDA As Defined margin of 44.6%;
EBITDA As Defined of $2,278 million is down 5.8% from $2,419 million in the prior year; and
Adjusted earnings per share of $14.47, down 20.8% from $18.27.

Fiscal 2021 financial guidance will not be issued at this time.

Quarter-to-Date Results

Net sales for the quarter declined 23.9%, or $368 million, to $1,173 million from $1,541 million in the comparable quarter a year ago. In the current quarter, all sales represent organic sales.

Income from continuing operations for the quarter was $101 million, a decrease of 68.1% compared to $317 million in the comparable quarter a year ago. The decrease in income from continuing operations primarily reflects the decline in net sales described above. This decline in income from continuing operations was partially offset by a lower effective tax rate.

Adjusted net income for the quarter decreased 47.5% to $166 million, or $2.89 per share, from $316 million, or $5.62 per share, in the comparable quarter a year ago.

EBITDA for the quarter decreased 40.9% to $414 million from $700 million for the comparable quarter a year ago. EBITDA As Defined for the period decreased 29.6% to $498 million compared with $707 million in the comparable quarter a year ago. EBITDA As Defined as a percentage of net sales for the quarter was 42.4%.

“Throughout our fourth fiscal quarter, both passenger demand and air traffic remained depressed due to the COVID-19 pandemic. The pandemic has resulted in governments around the world implementing measures to control the spread of the virus, including quarantines, travel restrictions and other measures. Certain markets have reopened, while others, particularly international markets, remained closed or are enforcing extended quarantines. Despite these headwinds, I am pleased that we were able to sequentially expand our EBITDA As Defined margin to about forty-two and a half percent as a result of careful management of our cost structure,” stated Kevin Stein, TransDigm Group’s President and Chief Executive Officer.

Year-to-Date Results

Fiscal 2020 net sales declined 2.3%, or $120 million, to $5,103 million from $5,223 million in the comparable period last year. Organic sales declined 13.8%. Acquisition sales growth was $603 million, all of which are attributable to Esterline.

Fiscal 2020 income from continuing operations declined 22.4% to $653 million compared to $841 million in the comparable period a year ago. This decrease in income from continuing operations primarily reflects the decline in net sales described above, along with higher interest expense, higher operating costs and amortization expense attributable to Esterline and COVID-19 restructuring costs. The decline in income from continuing operations was offset partially by lower acquisition related expenses and a lower effective tax rate. The effective tax rate for fiscal 2020 was positively impacted by a one-time provisional benefit from dividend and dividend equivalent payments made in the period, as well as the enactment of the CARES Act which included favorable modifications to the interest deduction limitation. The effective tax rate for full-year fiscal 2020 was 11.7% compared to 20.9% for fiscal 2019.

GAAP earnings per share were reduced in fiscal 2020 and 2019 by $3.22 per share and $1.97 per share, respectively, as a result of dividend and dividend equivalent payments made during each year.

Fiscal 2020 adjusted net income decreased 19.3% to $829 million, or $14.47 per share, from $1,028 million, or $18.27 per share, in the comparable period a year ago.

Fiscal 2020 EBITDA decreased 4.4% to $2,052 million from $2,148 million for the comparable period a year ago. EBITDA As Defined for the period decreased 5.8% to $2,278 million compared with $2,419 million in the comparable period a year ago. EBITDA As Defined as a percentage of net sales for the current period was 44.6%.

Mr. Stein continued, “Fiscal 2020 has been a challenging year given the unprecedented COVID-19 pandemic and ensuing disruption of the commercial aerospace industry. These circumstances required actions that were necessary, but difficult to implement. The purposeful management of our cost structure, along with tight management of our balance sheet, better positions us as a Company to emerge strongly from the ongoing weakness in our primary commercial end markets. With the recent uptick in global COVID-19 cases as well as renewed lockdowns in certain countries, much uncertainty remains about the duration of the pandemic and pace of recovery. We will continue to be focused in our management of the details and look forward to the opportunity to create value for our stakeholders in fiscal 2021.”

Please see the attached tables for a reconciliation of income from continuing operations to EBITDA, EBITDA As Defined, and adjusted net income; a reconciliation of net cash provided by operating activities to EBITDA and EBITDA As Defined, and a reconciliation of earnings per share to adjusted earnings per share for the periods discussed in this press release.

Fiscal 2021 Outlook

Given the considerable uncertainty around the extent and duration of business disruptions related to the COVID-19 pandemic, and how that will impact operations, the Company will not provide fiscal year 2021 guidance at this time.

Earnings Conference Call

TransDigm Group will host a conference call for investors and security analysts on November 12, 2020, beginning at 11:00 a.m., Eastern Time. To join the call, dial (833) 397-0943 and enter the passcode 8789968. International callers should dial (720) 405-3217 and use the same passcode. A live audio webcast can be accessed online at http://www.transdigm.com. A slide presentation will also be available for reference during the conference call; go to the investor relations page of our website and click on “Presentations.”

The call will be archived on the website and available for replay at approximately 2:00 p.m., Eastern Time. A telephone replay will be available for one week by dialing (855) 859-2056 and entering the passcode 8789968. International callers should dial (404) 537-3406 and use the same passcode.

About TransDigm Group

TransDigm Group, through its wholly-owned subsidiaries, is a leading global designer, producer and supplier of highly engineered aircraft components for use on nearly all commercial and military aircraft in service today. Major product offerings, substantially all of which are ultimately provided to end-users in the aerospace industry, include mechanical/electro-mechanical actuators and controls, ignition systems and engine technology, specialized pumps and valves, power conditioning devices, specialized AC/DC electric motors and generators, batteries and chargers, engineered latching and locking devices, engineered rods, engineered connectors and elastomer sealing solutions, databus and power controls, cockpit security components and systems, specialized and advanced cockpit displays, aircraft audio systems, specialized lavatory components, seat belts and safety restraints, engineered and customized interior surfaces and related components, advanced sensor products, switches and relay panels, thermal protection and insulation, lighting and control technology, parachutes, high performance hoists, winches and lifting devices, and cargo loading, handling and delivery systems.

Non-GAAP Supplemental Information

EBITDA, EBITDA As Defined, EBITDA As Defined Margin, adjusted net income and adjusted earnings per share are non-GAAP financial measures presented in this press release as supplemental disclosures to net income and reported results. TransDigm Group defines EBITDA as earnings before interest, taxes, depreciation and amortization and defines EBITDA As Defined as EBITDA plus certain non-operating items, refinancing costs, acquisition-related costs, transaction-related costs and non-cash charges incurred in connection with certain employee benefit plans. TransDigm Group defines adjusted net income as net income plus purchase accounting backlog amortization expense, effects from the sale on businesses, refinancing costs, acquisition-related costs, transaction-related costs and non-cash charges incurred in connection with certain employee benefit plans. EBITDA As Defined Margin represents EBITDA As Defined as a percentage of net sales. TransDigm Group defines adjusted diluted earnings per share as adjusted net income divided by the total shares for basic and diluted earnings per share. For more information regarding the computation of EBITDA, EBITDA As Defined and adjusted net income and adjusted earnings per share, please see the attached financial tables.

TransDigm Group presents these non-GAAP financial measures because it believes that they are useful indicators of its operating performance. TransDigm Group believes that EBITDA is useful to investors because it is frequently used by securities analysts, investors and other interested parties to measure operating performance among companies with different capital structures, effective tax rates and tax attributes, capitalized asset values and employee compensation structures, all of which can vary substantially from company to company. In addition, analysts, rating agencies and others use EBITDA to evaluate a company’s ability to incur and service debt. EBITDA As Defined is used to measure TransDigm Inc.’s compliance with the financial covenant contained in its credit facility. TransDigm Group’s management also uses EBITDA As Defined to review and assess its operating performance, to prepare its annual budget and financial projections and to review and evaluate its management team in connection with employee incentive programs. Moreover, TransDigm Group’s management uses EBITDA As Defined to evaluate acquisitions and as a liquidity measure. In addition, TransDigm Group’s management uses adjusted net income as a measure of comparable operating performance between time periods and among companies as it is reflective of changes in pricing decisions, cost controls and other factors that affect operating performance.

None of EBITDA, EBITDA As Defined, EBITDA As Defined Margin, adjusted net income or adjusted earnings per share is a measurement of financial performance under GAAP and such financial measures should not be considered as an alternative to net income, operating income, earnings per share, cash flows from operating activities or other measures of performance determined in accordance with GAAP. In addition, TransDigm Group’s calculation of these non-GAAP financial measures may not be comparable to the calculation of similarly titled measures reported by other companies.

Although we use EBITDA and EBITDA As Defined as measures to assess the performance of our business and for the other purposes set forth above, the use of these non-GAAP financial measures as analytical tools has limitations, and you should not consider any of them in isolation, or as a substitute for analysis of our results of operations as reported in accordance with GAAP. Some of these limitations are:

neither EBITDA nor EBITDA As Defined reflects the significant interest expense, or the cash requirements necessary to service interest payments, on our indebtedness;
although depreciation and amortization are non-cash charges, the assets being depreciated and amortized will often have to be replaced in the future, and neither EBITDA nor EBITDA As Defined reflects any cash requirements for such replacements;
the omission of the substantial amortization expense associated with our intangible assets further limits the usefulness of EBITDA and EBITDA As Defined;
neither EBITDA nor EBITDA As Defined includes the payment of taxes, which is a necessary element of our operations; and
EBITDA As Defined excludes the cash expense we have incurred to integrate acquired businesses into our operations, which is a necessary element of certain of our acquisitions.

Forward-Looking Statements

Statements in this press release that are not historical facts, including statements under the heading “Fiscal 2021 Outlook,” are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Words such as “believe,” “may,” “will,” “should,” “expect,” “intend,” “plan,” “predict,” “anticipate,” “estimate,” or “continue” and other words and terms of similar meaning may identify forward-looking statements.

All forward-looking statements involve risks and uncertainties that could cause TransDigm Group’s actual results to differ materially from those expressed or implied in any forward-looking statements made by, or on behalf of, TransDigm Group. These risks and uncertainties include but are not limited to: the impact that the COVID-19 pandemic has on the TransDigm Group’s business, results of operations, financial condition and liquidity; the sensitivity of TransDigm Group’s business to the number of flight hours that its customers’ planes spend aloft and its customers’ profitability, both of which are affected by general economic conditions; future geopolitical or other worldwide events; cyber-security threats and natural disasters; TransDigm Group’s reliance on certain customers; the U.S. defense budget and risks associated with being a government supplier including government audits and investigations; failure to maintain government or industry approvals; failure to complete or successfully integrate acquisitions, including TransDigm Group’s acquisition of Esterline; TransDigm Group’s indebtedness; potential environmental liabilities; liabilities arising in connection with litigation; increases in raw material costs, taxes and labor costs that cannot be recovered in product pricing; risks and costs associated with TransDigm Group’s international sales and operations; and other risk factors. Further information regarding the important factors that could cause actual results to differ materially from projected results can be found in TransDigm Group’s Annual Report on Form 10-K for the fiscal year ended September 30, 2020 and other reports that TransDigm Group or its subsidiaries have filed with the Securities and Exchange Commission. Except as required by law, TransDigm Group undertakes no obligation to revise or update the forward-looking statements contained in this press release.

Contact:		Investor Relations
		216-706-2945
		[email protected]

TRANSDIGM GROUP INCORPORATED
CONDENSED CONSOLIDATED STATEMENTS OF INCOME
FOR THE THIRTEEN WEEK PERIODS AND FISCAL YEARS ENDED							Table 1
SEPTEMBER 30, 2020 AND SEPTEMBER 30, 2019
(Amounts in millions, except per share amounts)
(Unaudited)
	Thirteen Week Periods Ended				Fiscal Year Ended
	September 30, 2020		September 30, 2019		September 30, 2020		September 30, 2019
NET SALES	$	1,173	$	1,541	$	5,103	$	5,223
COST OF SALES	637		659		2,456		2,414
GROSS PROFIT	536		882		2,647		2,809
SELLING AND ADMINISTRATIVE EXPENSES	182		212		727		748
AMORTIZATION OF INTANGIBLE ASSETS	41		55		169		135
INCOME FROM OPERATIONS	313		615		1,751		1,926
INTEREST EXPENSE – NET	267		245		1,029		859
REFINANCING COSTS	1		—		28		3
OTHER (INCOME) EXPENSE	(31)		3		(46)		1
INCOME FROM CONTINUING OPERATIONS BEFORE INCOME TAXES	76		367		740		1,063
INCOME TAX PROVISION	(25)		50		87		222
INCOME FROM CONTINUING OPERATIONS	101		317		653		841
(LOSS) INCOME FROM DISCONTINUED OPERATIONS, NET OF TAX	(19)		31		47		51
NET INCOME	82		348		700		892
LESS: NET INCOME ATTRIBUTABLE TO NONCONTROLLING INTERESTS	—		(1)		(1)		(2)
NET INCOME ATTRIBUTABLE TO TD GROUP	$	82	$	347	$	699	$	890
NET INCOME APPLICABLE TO TD GROUP COMMON STOCKHOLDERS	$	82	$	260	$	514	$	779
Earnings per share attributable to TD Group common stockholders:
Earnings per share from continuing operations – basic and diluted	$	1.76	$	4.08	$	8.14	$	12.94
(Loss) Earnings per share from discontinued operations – basic and diluted	(0.33)		0.55		0.82		0.90
Earnings per share	$	1.43	$	4.63	$	8.96	$	13.84
Cash dividends declared per common share	$	—	$	30.00	$	32.50	$	30.00
Weighted-average shares outstanding:
Basic and diluted	57.3		56.3		57.3		56.3

TRANSDIGM GROUP INCORPORATED
SUPPLEMENTAL INFORMATION – RECONCILIATION OF EBITDA,
EBITDA AS DEFINED TO INCOME FROM CONTINUING OPERATIONS
FOR THE THIRTEEN WEEK PERIODS AND FISCAL YEARS ENDED										Table 2
SEPTEMBER 30, 2020 AND SEPTEMBER 30, 2019
(Amounts in millions, except per share amounts)
(Unaudited)
	Thirteen Week Periods Ended						Fiscal Year Ended
	September 30, 2020			September 30, 2019			September 30, 2020			September 30, 2019
Income from continuing operations	$	101		$	317		$	653		$	841
Adjustments:
Depreciation and amortization expense	71			88			283			226
Interest expense, net	267			245			1,029			859
Income tax provision	(25)			50			87			222
EBITDA	414			700			2,052			2,148
Adjustments:
Acquisition-related expenses and adjustments ⁽¹⁾	13			(16)			31			169
Non-cash stock compensation expense ⁽²⁾	34			23			93			93
Refinancing costs ⁽³⁾	1			—			28			3
COVID-19 & 737 MAX restructuring costs ⁽⁴⁾	23			—			54			—
Other, net ⁽⁵⁾	13			—			20			6
Gross Adjustments to EBITDA	84			7			226			271
EBITDA As Defined	$	498		$	707		$	2,278		$	2,419
EBITDA As Defined, Margin ⁽⁶⁾	42.4		%	45.9		%	44.6		%	46.3		%

⁽¹⁾

Represents accounting adjustments to inventory associated with acquisitions of businesses and product lines that were charged to cost of sales when the inventory was sold; costs incurred to integrate acquired businesses and product lines into TD Group’s operations, facility relocation costs and other acquisition-related costs; transaction-related costs comprising deal fees; legal, financial and tax due diligence expenses; and valuation costs that are required to be expensed as incurred.

⁽²⁾

Represents the compensation expense recognized by TD Group under our stock incentive plans.

⁽³⁾

Represents costs expensed related to debt financing activities, including new issuances, extinguishments, refinancings and amendments to existing agreements.

⁽⁴⁾

Represents restructuring costs related to the Company’s cost reduction measures in response to the COVID-19 pandemic ($22 million and $46 million for the thirteen week period and fiscal year ended September 30, 2020, respectively) and the 737 MAX production rate changes ($3 million for the fiscal year ended September 30, 2020. None in the thirteen week period ended September 30, 2020). These were costs related to the Company’s actions to reduce its workforce to align with customer demand. This also includes $1 million and $5 million for the thirteen week period and fiscal year ended September 30, 2020, respectively, of incremental costs related to the pandemic that are not expected to recur once the pandemic has subsided and are clearly separable from normal operations (e.g., additional cleaning and disinfecting of facilities by contractors above and beyond normal requirements, personal protective equipment, etc.).

⁽⁵⁾

Primarily represents foreign currency transaction gains or losses, payroll withholding taxes related to special dividend and dividend equivalent payments and stock option exercises, non-service related pension costs, deferred compensation and gain or loss on sale of fixed assets.

⁽⁶⁾

The EBITDA As Defined margin represents the amount of EBITDA As Defined as a percentage of sales.

TRANSDIGM GROUP INCORPORATED
SUPPLEMENTAL INFORMATION – RECONCILIATION OF
REPORTED EARNINGS PER SHARE TO
ADJUSTED EARNINGS PER SHARE
FOR THE THIRTEEN WEEK PERIODS AND FISCAL YEARS ENDED							Table 3
SEPTEMBER 30, 2020 AND SEPTEMBER 30, 2019
(Amounts in millions, except per share amounts)
(Unaudited)
	Thirteen Week Periods Ended				Fiscal Year Ended
	September 30, 2020		September 30, 2019		September 30, 2020			September 30, 2019
Reported Earnings Per Share
Income from continuing operations	$	101	$	317	$	653		$	841
Less: Net income attributable to noncontrolling interests	—		(2)		(1)			(2)
Net income from continuing operations attributable to TD Group	101		315		652			839
Less: Special dividends declared or paid on participating securities, including dividend equivalent payments	—		(87)		(185)			(111)
	101		228		467			728
(Loss) Income from discontinued operations, net of tax	(19)		32		47			51
Net income applicable to TD Group common stockholders – basic and diluted	$	82	$	260	$	514		$	779
Weighted-average shares outstanding under the two-class method
Weighted-average common shares outstanding	54.3		53.4		53.9			53.1
Vested options deemed participating securities	3.0		2.9		3.4			3.2
Total shares for basic and diluted earnings per share	57.3		56.3		57.3			56.3
Earnings per share from continuing operations – basic and diluted	$	1.76	$	4.08	$	8.14		$	12.94
(Loss) Earnings per share from discontinued operations – basic and diluted	(0.33)		0.55		0.82			0.90
Earnings per share	$	1.43	$	4.63	$	8.96		$	13.84
Adjusted Earnings Per Share
Income from continuing operations	$	101	$	317	$	653		$	841
Gross adjustments to EBITDA	84		7		226			271
Purchase accounting backlog amortization	12		20		53			38
Tax adjustment ⁽¹⁾	(31)		(28)		(103)			(122)
Adjusted net income	$	166	$	316	$	829		$	1,028
Adjusted diluted earnings per share under the two-class method	$	2.89	$	5.62	$	14.47		$	18.27
Diluted Earnings Per Share to Adjusted Earnings Per Share
Diluted earnings per share from continuing operations	$	1.76	$	4.08	$	8.14		$	12.94
Adjustments to diluted earnings per share:
Inclusion of the dividend equivalent payments	—		1.54		3.22			1.97
Acquisition-related expenses	0.42		0.05		1.20			2.77
Non-cash stock compensation expense	0.57		0.33		1.32			1.24
Refinancing costs	0.02		—		0.40			0.04
Change in income tax provision due to excess tax benefits on stock compensation	(0.48)		(0.40)		(0.89)			(0.79)
COVID-19 & 737 MAX restructuring costs	0.39		—		0.76			—
Other, net	0.21		0.02		0.32			0.10
Adjusted earnings per share	$	2.89	$	5.62	$	14.47		$	18.27

⁽¹⁾

For the thirteen week periods and fiscal years ended September 30, 2020 and 2019, the Tax adjustment represents the tax effect of the adjustments at the applicable effective tax rate, as well as the impact on the effective tax rate when excluding the excess tax benefits on stock option exercises. Stock compensation expense is excluded from adjusted net income and therefore we have excluded the impact that the excess tax benefits on stock option exercises have on the effective tax rate for determining adjusted net income.

TRANSDIGM GROUP INCORPORATED
SUPPLEMENTAL INFORMATION – RECONCILIATION OF NET CASH			Table 4
PROVIDED BY OPERATING ACTIVITIES TO EBITDA,
EBITDA AS DEFINED
FOR THE FISCAL YEAR ENDED
SEPTEMBER 30, 2020 AND SEPTEMBER 30, 2019
(Amounts in millions)
(Unaudited)
	Fiscal Year Ended
	September 30, 2020		September 30, 2019
Net cash provided by operating activities	$	1,213	$	1,015

Adjustments:
Changes in assets and liabilities, net of effects from acquisitions of businesses	(99)		176
Interest expense, net ⁽¹⁾	996		831
Income tax provision – current	63		222
Non-cash stock compensation expense ⁽²⁾	(93)		(93)
Refinancing costs ⁽³⁾	(28)		(3)
EBITDA	2,052		2,148
Adjustments:
Acquisition-related expenses ⁽⁴⁾	31		169
Non-cash stock compensation expense ⁽²⁾	93		93
Refinancing costs ⁽³⁾	28		3
COVID-19 & 737 MAX restructuring costs ⁽⁵⁾	54		—
Other, net ⁽⁶⁾	20		6
EBITDA As Defined	$	2,278	$	2,419


⁽¹⁾	Represents interest expense excluding the amortization of debt issue costs and premium and discount on debt.

⁽²⁾	Represents the compensation expense recognized by TD Group under our stock incentive plans.

⁽³⁾	Represents costs expensed related to debt financing activities, including new issuances, extinguishments, refinancings and amendments to existing agreements.

⁽⁴⁾	Represents accounting adjustments to inventory associated with acquisitions of businesses and product lines that were charged to cost of sales when the inventory was sold; costs incurred to integrate acquired businesses and product lines into TD Group’s operations, facility relocation costs and other acquisition-related costs; transaction-related costs comprising deal fees; legal, financial and tax due diligence expenses and valuation costs that are required to be expensed as incurred.

⁽⁵⁾	Represents restructuring costs related to the Company’s cost reduction measures in response to the COVID-19 pandemic ($46 million) and the 737 MAX production rate changes ($3 million). These were costs related to the Company’s actions to reduce its workforce to align with customer demand. This also includes $5 million of incremental costs related to the pandemic that are not expected to recur once the pandemic has subsided and are clearly separable from normal operations (e.g., additional cleaning and disinfecting of facilities by contractors above and beyond normal requirements, personal protective equipment, etc.).

⁽⁶⁾	Primarily represents foreign currency transaction gain or loss, payroll withholding taxes related to special dividend and dividend equivalent payments and stock option exercises, non-service related pension costs, deferred compensation and gain or loss on sale of fixed assets.

TRANSDIGM GROUP INCORPORATED
SUPPLEMENTAL INFORMATION – BALANCE SHEET DATA			Table 5
(Amounts in millions)			Table 5
(Unaudited)
	September 30, 2020		September 30, 2019
Cash and cash equivalents	$	4,717	$	1,467
Trade accounts receivable – net	720		1,068
Inventories – net	1,283		1,233
Current portion of long-term debt	276		80
Short-term borrowings-trade receivable securitization facility	349		350
Accounts payable	218		276
Accrued current liabilities	773		675
Long-term debt	19,384		16,469
Total TD Group stockholders’ deficit	(3,972)		(2,894)

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SOURCE TransDigm Group Inc.

November 12, 2020 7:18 am

Carlyle Makes Strategic Growth Investment in Leading Ecommerce Marketplace Enablement Platform and Retail Seller Pharmapacks

PR Newswire

NEW YORK, Nov. 12, 2020 /PRNewswire/ — Pharmapacks, LLC (“Pharmapacks” or “Company”), a leading ecommerce enablement platform and retail seller for brands across major ecommerce marketplaces, today announced a strategic investment of more than $250 million from global investment firm The Carlyle Group (NASDAQ: CG) to accelerate the Company’s growth plans. The growth investment places Pharmapacks’ enterprise value at approximately $1.1 billion.

Pharmapacks was founded as a single brick and mortar pharmacy and has since evolved into a platform providing brands with best-in-class ecommerce capabilities. Since 2010, Pharmapacks has cultivated extensive partnerships with consumer brands across ecommerce marketplaces in North America, including Amazon, Walmart, eBay, Target, Google and Facebook.

Powered by its proprietary platform, Pharmapacks is trusted by millions of customers to provide for their daily needs. After reaching over $250 million in sales in 2019, Pharmapacks is on a current run rate to achieve approximately 60% year-over-year growth and, with the opening of an additional 230k square foot replenishment center this month, Pharmapacks is expected to fuel accelerated growth in Q4.

“Pharmapacks is experiencing unprecedented growth with massive market support and highly attractive industry dynamics,” said Andrew Vagenas, Chief Executive Officer of Pharmapacks. “We are thrilled that our partnership with Carlyle, a world-class investment firm with extensive connectivity, data and global resources, will provide us with an opportunity to take significant steps to enter the next phase of our growth plans.”

“We’re thrilled to partner with another founder-led growth company, leveraging the global resources of the Carlyle platform to support Pharmapacks’ acceleration,” said Jay Sammons, Carlyle’s Head of Global Consumer, Media & Retail. “We are focused on identifying companies that are growing significantly faster than the market and benefiting from strong secular tailwinds. As a company sitting at the cross section of a number of attractive trends, including the massive and rapid expansion of ecommerce, we have strong conviction in Pharmapacks’ ability to achieve sustainable growth.”

“We’re excited to partner with Andrew and the Pharmapacks management team to execute a multi-dimensional growth strategy for the Company,” said Yue Bonnet, a Principal specializing in Consumer, Media & Retail at Carlyle. “We believe there are significant opportunities to support the Company’s value creation plans by helping to rapidly increase the number of consumer brand partners, building out the data and analytics platform and increasing capacity through additional warehouse expansion.”

The investment in Pharmapacks is a continuation of Carlyle’s long-term global commitment to Consumer, Media & Retail in which it has invested more than $21.5 billion of equity since inception. Equity capital for the investment came from Carlyle Partners VII, an $18.5 billion fund that makes majority and strategic minority investments primarily in the U.S. in targeted industries, including Consumer, Media & Retail.

J.P. Morgan served as lender and advisor to the Company.

About The Carlyle Group

The Carlyle Group (NASDAQ: CG) is a global investment firm with deep industry expertise that deploys private capital across four business segments: Corporate Private Equity, Real Assets, Global Credit and Investment Solutions. With $230 billion of assets under management as of September 30, 2020, Carlyle’s purpose is to invest wisely and create value on behalf of its investors, portfolio companies and the communities in which we live and invest. Carlyle employs more than 1,800 people in 30 offices across six continents. Further information is available at www.carlyle.com. Follow Carlyle on Twitter @OneCarlyle.

About Pharmapacks

Pharmapacks, LLC is a leading ecommerce enablement platform and retail seller for brands across major ecommerce marketplaces with proprietary technology that empowers brands with a complete and cost-effective logistics, fulfillment, marketing and sales solution. Pharmapacks has a premier team of ecommerce experts with over 10 years’ experience and 850 employees connecting consumers to their favorite brands on online marketplaces such as Amazon, Walmart, Target, Google, eBay and Facebook, becoming one of the largest marketplace sellers in North America. Pharmapacks serves as a “launch pad” for emerging brands by giving a select amount of lesser-known brands access to the Pharmapacks’ e-commerce platform and consumer base. This enables brands to focus on product research and development, while Pharmapacks strategically sets competitive price points and builds a connection between the consumer and the brand.

Media Contacts:

Brittany Berliner

[email protected]

+1 (212) 813 4839

Jeremy Watkins

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+1 (212) 430 5050

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SOURCE Pharmapacks

November 12, 2020 7:18 am

InMode Reports Record Third Quarter 2020 Financial Results; Quarterly Revenues of $59.7 Million Represent 49% Year over Year Growth, GAAP and *Non-GAAP Diluted Earnings per Share of $0.57 and $0.63

PR Newswire

YOKNEAM, Israel, Nov. 12, 2020 /PRNewswire/ — InMode Ltd. (Nasdaq: INMD) (“InMode”), a leading global provider of innovative medical technologies, today announced consolidated financial results for its third quarter ended September 30, 2020.

Third Quarter 2020 Highlights:

Record quarterly revenues of $59.7 million, an increase of 49% compared to the third quarter of 2019; approximately 58% of quarterly revenues derived from InMode’s proprietary surgical technology platforms engaged in minimally invasive and subdermal ablative treatments, approximately 35% of quarterly revenues derived from InMode’s recently introduced hands-free platforms and approximately 7% derived from InMode’s traditional laser and non-invasive RF platforms
Record GAAP net income of $23.9 million, compared to $16.2 million in the third quarter of 2019; *non-GAAP net income of $26.6 million, compared to $16.5 million in the third quarter of 2019
Record GAAP diluted earnings per share of $0.57 compared to $0.42 in the third quarter of 2019; *non-GAAP diluted earnings per share of $0.63 compared to $0.42 in the third quarter of 2019
Total cash position of $234.3 million as of September 30, 2020, including cash and cash equivalents, marketable securities and short-term bank deposits

U.S. GAAP Results (U.S. dollars in thousands, except for per share data)
	Q3 2020	Q3 2019
Revenues	$59,714	$40,010
Gross Margins	84%	87%
Net Income Attributable to InMode Ltd.	$23,895	$16,186
Earnings per Diluted Share	$0.57	$0.42
*Non-GAAP Results (U.S. dollars in thousands, except for per share data)
	Q3 2020	Q3 2019
Gross Margins	85%	87%
Net Income Attributable to InMode Ltd.	$26,638	$16,512
Earnings per Diluted Share	$0.63	$0.42

*Please refer to “Use of Non-GAAP Financial Measures” below for important information about non-GAAP financial measures. A reconciliation between U.S. GAAP and non-GAAP Statement of Income is provided following the financial statements that are included in this release. Non-GAAP results exclude share-based compensation and related tax adjustments.

Management Comments

“Our record third quarter revenues were driven by the success of our minimally invasive and hands-free solutions in the United States and internationally, strengthening the leading market position of our harnessed electro-surgical technologies. The steadfast sales & marketing investments we made throughout the pandemic enabled our organization to quickly meet surging demand as restrictions loosened,” commented Moshe Mizrahy, InMode’s CEO.

“During the quarter, we continued to focus on research & development and were excited to announce the launch of the Morpheus8 Body handpiece and Morpheus8 Platform. We understand that the uncertainties of the COVID-19 pandemic are not behind us, and we will remain committed to the health of our employees and our organization,” commented Dr. Michael Kreindel, InMode’s CTO and co-founder.

“We believe the steps we took over the last several months were instrumental in building interest, increased awareness and demand for InMode technologies, which translated into record sales in the third quarter. We believe we are emerging as the standard of care for minimally invasive aesthetic surgeries, as we continue to innovate and deliver versatile offerings. We expect continued underlying demand for our differentiated products heading into the fourth quarter of 2020,” commented Shakil Lakhani, President of North America.

2020 Guidance

We expect that our revenues for the full year of 2020 will be between $192 million and $195 million, and we expect to maintain a *non-GAAP gross margin of 84%-86%.

This outlook is not a guarantee of future performance and stockholders should not rely on such forward-looking statements. See “Forward-Looking Statements” for additional information.

Third Quarter 2020 Financial Results

Total revenues for the third quarter of 2020 were $59.7 million, an increase of 49% as compared to the third quarter of 2019. The increase in revenues was driven primarily by the expansion of InMode’s direct sales organization in the United States and the continued momentum of InMode’s hands-free technology, as well as the recently introduced Morpheus8 Body fractional technology. Moreover, InMode continued to gain traction in international markets, with international revenues growing 109% year-over-year.

GAAP gross margin for the third quarter of 2020 was 84% compared to a gross margin of 87% in the third quarter of 2019. *Non-GAAP gross margin for the third quarter of 2020 was 85% compared to a gross margin of 87% in the third quarter of 2019. This decrease is primarily attributable to the increase of sales in international markets, mainly in countries where we operate through distributors.

GAAP operating margin for the third quarter of 2020 was 39%, compared to 40% in the third quarter of 2019. *Non-GAAP operating margin for the third quarter of 2020 was 43%, compared to 41% in the third quarter of 2019. This increase in *non-GAAP operating margin was primarily attributable to decreased marketing activities in the United States such as event and conference participation, due to restrictions caused by the COVID-19 pandemic.

InMode reported GAAP net income attributable to InMode Ltd. of $23.9 million, or $0.57 per diluted share in the third quarter of 2020 compared to $16.2 million, or $0.42 per diluted share, in the third quarter of 2019. On a *non-GAAP basis, InMode reported net income attributable to InMode Ltd. of $26.6 million, or $0.63 per diluted share in the third quarter of 2020 compared to $16.5 million, or $0.42 per diluted share, in the third quarter of 2019.

“We ended the third quarter with a strong balance sheet and record results. Our measured approach of investing for the future while maintaining flexibility during the COVID-19 pandemic has paid off this quarter,” noted Yair Malca, InMode’s CFO. “During the quarter, we announced a share repurchase program of up to one million of InMode’s shares, which reflects our unwavering faith in InMode’s success.”

Use of Non-GAAP Financial Measures

In addition to InMode’s operating results presented in accordance with GAAP, this release includes certain non-GAAP financial measures including non-GAAP net income, non-GAAP diluted earnings per share and non-GAAP operating margin. Because these measures are used in InMode’s internal analysis of financial and operating performance, management believes that they provide greater transparency to investors of management’s view of InMode’s economic performance. Management also believes the presentation of these measures, when analyzed in conjunction with InMode’s GAAP operating results, allows investors to more effectively evaluate and compare the performance of InMode to that of its peers, although InMode’s presentation of its non-GAAP measures may not be comparable to other similarly-titled measures of other companies. Schedules reconciling each of these non-GAAP financial measures are provided as a supplement to this release.

Conference Call Information

Mr. Moshe Mizrahy, Chairman and Chief Executive Officer, Dr. Michael Kreindel, co-founder and Chief Technology Officer, Mr. Yair Malca, Chief Financial Officer, Mr. Shakil Lakhani, President of North America, and Dr. Spero Theodorou, Chief Medical Officer, will host a conference call today, November 12, 2020, at 8:30 a.m. Eastern Time to discuss the third quarter 2020 financial results.

The Company encourages participants to pre-register for the conference call using the following link: https://dpregister.com/sreg/10148536/da3e5e2fe8. Callers will receive a unique dial-in upon registration, which enables immediate access to the call. Participants may pre-register at any time, including up to and after the call start time.

For callers that opt out of pre-registration, please dial one of the following teleconferencing numbers. Please begin by placing your call ten minutes before the conference call commences. If you are unable to connect using the toll-free number, please try the international dial-in number.

U.S. Toll-Free Dial-in Number: 1-866-777-2509

Israel Toll– Free Dial-in Number: 1-80-921-2373

International Dial-in Number: 1-412-317-5413

At:

8:30 a.m. Eastern Time

5:30 a.m. Pacific Time

3:30 p.m. Israel Time

The conference call will also be webcast live from a link on InMode’s website at https://inmodemd.com/investors/events-presentations/. A replay of the conference call will be available from November 12, 2020 at 12 p.m. Eastern Time to November 26, 2020 at 11:59 p.m. Eastern Time. To access the replay, please dial one of the following numbers:

Replay Dial-in U.S TOLL-FREE: 1-877-344-7529

Replay Dial-in Canada TOLL-FREE: 855-669-9658

Replay Dial-in TOLL/INTERNATIONAL: 1-412-317-0088

Replay Pin Number: 10148536

A replay will also be available for 90 days on InMode’s website at https://inmodemd.com/investors/.

About InMode

InMode is a leading global provider of innovative medical technologies. InMode develops, manufactures, and markets devices harnessing novel radio-frequency (“RF”) technology. InMode strives to enable new emerging surgical procedures as well as improve existing treatments. InMode has leveraged its medically-accepted minimally-invasive RF technologies to offer a comprehensive line of products across several categories for plastic surgery, gynecology, dermatology, otolaryngology, and ophthalmology. For more information about InMode, please visit www.inmodemd.com.

Forward-Looking Statements

The information in this press release includes forward-looking statements within the meaning of the federal securities laws. These statements generally relate to future events or InMode’s future financial or operating performance, including the future performance described above under the heading titled “2020 Guidance.” Actual outcomes and results may differ materially from what is expressed or forecast in such forward-looking statements. In some cases, you can identify these statements because they contain words such as “anticipate,” “believe,” “estimate,” “expect,” “intend,” “may,” “plan,” “predict,” “project,” “will,” “would” and similar expressions that concern our expectations, strategy plans or intentions. Forward-looking statements are based on management’s current expectations and assumptions, and are subject to inherent uncertainties, risks and changes in circumstances that are difficult to predict, including with respect to the impact of the COVID-19 global outbreak. As a result, actual results could differ materially from those indicated in these forward-looking statements. When considering these forward-looking statements, you should keep in mind the risk factors and other cautionary statements included in InMode’s Annual Report on Form F-20 filed with the Securities and Exchange Commission on February 18, 2020, risk factors relating to the COVID-19 global outbreak and our future public filings. InMode undertakes no obligation and does not intend to update these forward-looking statements to reflect events or circumstances occurring after this press release. You are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date of this press release.

Company Contact:

Yair Malca

Chief Financial Officer

Phone: (949) 305-0108

Email: [email protected]

Investor Relations Contact:

Miri Segal

MS-IR LLC

Phone: (917) 607-8654

Email: [email protected]

INMODE LTD.
CONDENSED CONSOLIDATED STATEMENTS OF INCOME
(U.S. dollars in thousands, except for per share data)
(Unaudited)

	Three months ended September 30,		Nine months ended September 30,
	2020	2019	2020	2019
REVENUES	59,714	40,010	130,920	109,359
COST OF REVENUES	9,395	5,047	20,274	14,193
GROSS PROFIT	50,319	34,963	110,646	95,166
OPERATING EXPENSES:
Research and development	1,959	1,329	7,207	4,112
Sales and marketing	23,758	16,726	61,293	46,721
General and administrative	1,309	927	4,745	2,693
TOTAL OPERATING EXPENSES	27,026	18,982	73,245	53,526
INCOME FROM OPERATIONS	23,293	15,981	37,401	41,640
Finance income, net	798	479	2,063	1,264
INCOME BEFORE TAXES	24,091	16,460	39,464	42,904
INCOME TAXES	207	267	509	718
NET INCOME	23,884	16,193	38,955	42,186
Add: Loss (net income) attributable to non-controlling interests	11	(7)	(39)	(79)
NET INCOME ATTRIBUTABLE TO INMODE LTD.	23,895	16,186	38,916	42,107

NET INCOME PER SHARE:
Basic	0.65	0.53	1.09	1.50
Diluted	0.57	0.42	0.93	1.15
WEIGHTED AVERAGE NUMBER OF SHARES OUTSTANDING USED IN COMPUTATION OF NET INCOME PER SHARE
Basic	36,697	30,297	35,542	28,031
Diluted	42,082	39,004	41,894	36,654

INMODE LTD.
CONDENSED CONSOLIDATED BALANCE SHEETS
(U.S. dollars in thousands, except for per share data)
(Unaudited)

	September 30, 2020	December 31, 2019
Assets
CURRENT ASSETS:
Cash and cash equivalents	68,835	44,727
Marketable securities	122,046	120,144
Short-term bank deposits	43,436	28,491
Accounts receivable, net of allowance for doubtful accounts	16,164	6,628
Other receivables	4,790	3,810
Inventories	14,871	9,408
TOTAL CURRENT ASSETS	270,142	213,208
NON-CURRENT ASSETS:
Accounts receivable	455	374
Deferred income taxes, net	606	1,899
Operating lease right-of-use assets	1,282	1,369
Property and equipment, net	1,056	935
Other investments	600	600
TOTAL NON-CURRENT ASSETS	3,999	5,177
TOTAL ASSETS	274,141	218,385

Liabilities and shareholders’ equity
CURRENT LIABILITIES:
Accounts payable	4,283	3,702
Contract liabilities	15,671	15,587
Other liabilities	17,572	13,205
TOTAL CURRENT LIABILITIES	37,526	32,494
NON-CURRENT LIABILITIES:
Contract liabilities	2,069	3,813
Other liabilities	1,969	1,494
Operating lease liabilities	519	744
Deferred income taxes, net	32	37
TOTAL NON-CURRENT LIABILITIES	4,589	6,088
TOTAL LIABILITIES	42,115	38,582

TOTAL SHAREHOLDERS’ EQUITY	232,026	179,803
TOTAL LIABILITIES AND SHAREHOLDERS’ EQUITY	274,141	218,385

INMODE LTD.
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(U.S. dollars in thousands, except for per share data)
(Unaudited)

	Three months ended September 30,		Nine months ended September 30,
	2020	2019	2020	2019
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income	23,884	16,193	38,955	42,186
Adjustments required to reconcile net income to net cash provided by operating activities:
Depreciation and amortization	108	77	307	214
Share-based compensation expenses	2,404	385	9,614	1,199
Allowance for doubtful accounts	–	55	466	133
Loss on marketable securities, net	11	–	2	–
Finance income, net	(279)	(86)	(11)	(395)
Deferred income taxes, net	347	(68)	1,173	(211)
Changes in operating assets and liabilities:
Increase in accounts receivable	(7,628)	(2,324)	(10,083)	(597)
Decrease (increase) in other receivables	537	(1,814)	(960)	(650)
Decrease (increase) in inventories	1,356	(879)	(5,463)	(1,532)
Increase in accounts payable	257	689	581	759
Increase in other liabilities	4,187	2,402	4,717	2,418
Increase (decrease) in contract liabilities	5,010	(1,115)	(1,660)	1,263
Decrease in accrued contingencies	–	–	–	(10,000)
Net cash provided by operating activities	30,194	13,515	37,638	34,787
CASH FLOWS FROM INVESTING ACTIVITIES:
Investment in short-term deposit	(18,090)	(17,220)	(49,699)	(34,310)
Proceeds from short-term deposit	6,720	8,500	34,810	18,500
Purchase of fixed assets	(103)	(54)	(428)	(518)
Purchase of marketable securities	(41,085)	(68,282)	(119,394)	(82,621)
Proceeds from sale of marketable securities	25,500	13,500	117,786	18,103
Net cash (used in) investing activities	(27,058)	(63,556)	(16,925)	(80,846)
CASH FLOWS FROM FINANCING ACTIVITIES:
Proceeds from initial public offering of ordinary shares, net of offering costs	–	69,784	–	69,784
Exercise of options	698	178	3,248	315
Net cash provided by financing activities	698	69,962	3,248	70,099
EFFECT OF EXCHANGE RATE CHANGES ON CASH	234	(93)	147	(56)
NET INCREASE IN CASH AND CASH EQUIVALENTS	4,068	19,828	24,108	23,984

CASH AND CASH EQUIVALENTS AT BEGINNING OF PERIOD	64,767	28,877	44,727	24,721
CASH AND CASH EQUIVALENTS AT END OF PERIOD	68,835	48,705	68,835	48,705

INMODE LTD.
CONDENSED CONSOLIDATED FINANCIAL HIGHLIGHTS
(U.S. dollars in thousands, except for per share data)
(Unaudited)

	Three months ended September 30,		Nine months ended September 30,
	2020	2019	2020	2019
Revenues by Geography:
United States	40,880	31,007	95,763	87,813
International	18,834	9,003	35,157	21,546
Total Net Revenue	59,714	40,010	130,920	109,359
U.S. as percentage of total revenue	68%	77%	73%	80%

INMODE LTD.
RECONCILIATION OF GAAP CONDENSED CONSOLIDATED STATEMENTS OF
INCOME TO NON-GAAP CONDENSED CONSOLIDATED STATEMENTS OF INCOME
(U.S. dollars in thousands, except for per share data)
(Unaudited)

	Three months ended September 30, 2020			Three months ended September 30, 2019

	GAAP	Share Based Compensation	Non-GAAP	GAAP	Share Based Compensation	Non-GAAP
REVENUES	59,714	–	59,714	40,010	–	40,010
COST OF REVENUES	9,395	(155)	9,240	5,047	(21)	5,026
GROSS PROFIT	50,319	155	50,474	34,963	21	34,984
OPERATING EXPENSES:
Research and development	1,959	(124)	1,835	1,329	(58)	1,271
Sales and marketing	23,758	(1,974)	21,784	16,726	(270)	16,456
General and administrative	1,309	(151)	1,158	927	(36)	891
TOTAL OPERATING EXPENSES	27,026	(2,249)	24,777	18,982	(364)	18,618
INCOME FROM OPERATIONS	23,293	2,404	25,697	15,981	385	16,366
Finance income, net	798	–	798	479	–	479
INCOME BEFORE TAXES	24,091	2,404	26,495	16,460	385	16,845
INCOME TAXES (TAX BENEFIT)	207	(339)	(132)	267	59	326
NET INCOME	23,884	2,743	26,627	16,193	326	16,519
Add: Loss (net income) attributable to non-controlling interests	11	–	11	(7)	–	(7)
NET INCOME ATTRIBUTABLE TO INMODE LTD.	23,895	2,743	26,638	16,186	326	16,512

NET INCOME PER SHARE:
Basic	0.65		0.73	0.53		0.55
Diluted	0.57		0.63	0.42		0.42
WEIGHTED AVERAGE NUMBER OF SHARES OUTSTANDING USED IN COMPUTATION OF NET INCOME PER SHARE
Basic	36,697		36,697	30,297		30,297
Diluted	42,082		42,289	39,004		39,047

INMODE LTD.
RECONCILIATION OF GAAP CONDENSED CONSOLIDATED STATEMENTS OF
INCOME TO NON-GAAP CONDENSED CONSOLIDATED STATEMENTS OF INCOME
(U.S. dollars in thousands, except for per share data)
(Unaudited)

	Nine months ended September 30, 2020			Nine months ended September 30, 2019
	GAAP	Share Based Compensation	Non-GAAP	GAAP	Share Based Compensation	Non-GAAP
REVENUES	130,920	–	130,920	109,359	–	109,359
COST OF REVENUES	20,274	(380)	19,894	14,193	(62)	14,131
GROSS PROFIT	110,646	380	111,026	95,166	62	95,228
OPERATING EXPENSES:
Research and development	7,207	(2,132)	5,075	4,112	(166)	3,946
Sales and marketing	61,293	(6,569)	54,724	46,721	(887)	45,834
General and administrative	4,745	(533)	4,212	2,693	(84)	2,609
TOTAL OPERATING EXPENSES	73,245	(9,234)	64,011	53,526	(1,137)	52,389
INCOME FROM OPERATIONS	37,401	9,614	47,015	41,640	1,199	42,839
Finance income, net	2,063	–	2,063	1,264	–	1,264
INCOME BEFORE TAXES	39,464	9,614	49,078	42,904	1,199	44,103
INCOME TAXES (TAX BENEFIT)	509	(763)	(254)	718	227	945
NET INCOME	38,955	10,377	49,332	42,186	972	43,158
Add: Loss (net income) attributable to non-controlling interests	(39)	–	(39)	(79)	–	(79)
NET INCOME ATTRIBUTABLE TO INMODE LTD.	38,916	10,377	49,293	42,107	972	43,079

NET INCOME PER SHARE:
Basic	1.09		1.39	1.50		1.53
Diluted	0.93		1.17	1.15		1.17
WEIGHTED AVERAGE NUMBER OF SHARES OUTSTANDING USED IN COMPUTATION OF NET INCOME PER SHARE
Basic	35,542		35,542	28,031		28,031
Diluted	41,894		42,061	36,654		36,707

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SOURCE InMode Ltd.

November 12, 2020 7:18 am

HOOKIPA Pharma Reports Third Quarter 2020 Financial Results and Provides a Corporate Update

NEW YORK and VIENNA, Austria, Nov. 12, 2020 (GLOBE NEWSWIRE) — HOOKIPA Pharma Inc. (NASDAQ: HOOK, ‘HOOKIPA’), a company developing a new class of immunotherapeutics based on its proprietary arenavirus platform, today reports its financial results for the third quarter ended September 30, 2020 and provides a corporate update.

“The third quarter saw continued advancement and validation of our clinical development programs, with a focus on our oncology pipeline of replicating arenavirus-based therapeutic candidates,” commented Joern Aldag, Chief Executive Officer of HOOKIPA. “We continue to gain momentum as we expanded our ongoing Phase 1/2 HPV trial to explore HB-202/HB-201 as an alternating vector therapy with the first patient dosed with HB-202. We are also pleased that preclinical immunogenicity data from HB-201, our lead oncology candidate, was recognized in OncoImmunology, further demonstrating the potential of our arenavirus-based therapies to combat cancer. Additionally, I am proud that Professor Jean-Charles Soria, a globally recognized scientist and oncologist, who is General Director of Gustave Roussy, the leading European Cancer Center, joined our Board of Directors. His expertise will enhance our efforts as we seek to advance new, much needed cancer therapies.”

R&D Pipeline Update and Clinical Progress

HB-101, lead product candidate in infectious diseases
HOOKIPA’s prophylactic Cytomegalovirus (CMV) vaccine candidate, HB‑101, is in a randomized, double‑blinded Phase 2 clinical trial in patients awaiting kidney transplantation who are at risk for CMV-associated complications post-transplant. In June 2020, HOOKIPA announced positive Phase 2 interim data on the trial’s primary endpoints: safety, and B cell and T cell immunogenicity. The interim data demonstrated that HB‑101 was well tolerated, with a lower rate of adverse events in patients with end-stage kidney disease than in the Phase 1 healthy volunteer trial. Patients who received the sponsor recommended three doses of HB‑101 showed comparable immunogenicity levels to those measured in the Phase 1 healthy volunteer trial. HOOKIPA continues to accrue patients and plans to report preliminary efficacy and updated safety and immunogenicity data by the end of 2020.

HB-201 and HB-202, lead programs in immuno-oncology treating Human Papillomavirus-positive cancers
HOOKIPA’s lead oncology product candidates, HB‑201 and HB‑202, are in development for the treatment of Human Papillomavirus 16‑positive (HPV16+) cancers. In December 2019, HOOKIPA initiated the Phase 1/2 clinical trial with endpoints of safety, immunogenicity and efficacy. The open label, dose escalating Phase 1/2 clinical trial in HPV16+ cancers is currently evaluating HB-201 alone and subsequently in combination with an approved checkpoint inhibitor. Accrual of patients for the first and the second dose levels at a three-week dosing frequency has been completed without safety concerns. Additional dose schedules and levels are being investigated to identify the recommended Phase 2 dose. HOOKIPA expects to report preliminary safety and efficacy data in late 2020 or early 2021.

A peer reviewed article in OncoImmunology issued in September 2020 recognized that HB-201 preclinical results demonstrated high immunogenicity. The paper verified that systemically administered HB-201 leads to dose-dependent induction of a robust, systemic cytotoxic T cell response directed against HPV16 proteins, tumor infiltration of HPV16 specific cytotoxic T cells, as well as significantly delayed tumor growth or complete tumor clearance accompanied with prolonged survival.

In October 2020, HOOKIPA announced the dosing of the first patient with HB-202. HB-202 is part of a sequential alternating vector regimen of HB-202/HB-201 for the treatment of HPV16⁺ cancers in the ongoing HB-201 Phase 1/2 trial. In pre-clinical studies, alternating administration of HB-202 and HB-201 resulted in a ten-fold increase in immune response and better disease control than either compound alone. The Company expects to provide interim safety, dose escalation, and efficacy data on the HB-202/HB-201 arm of the ongoing Phase 1/2 study in mid-2021.

Strategic Collaborations

Gilead Sciences Collaboration for HIV and HBV Therapeutic Vaccines
Since the start of the collaboration in 2018, HOOKIPA has received $21.0 million in upfront and milestone payments from Gilead for the delivery of research vectors and for advancing the programs towards clinical trials, including a milestone payment of $4.0 million, which the Company received in early 2020. Based on preclinical data generated to date, Gilead committed to advancing the HBV and HIV vectors toward development. To enable the development activities and expanded research programs, Gilead agreed to reserve manufacturing capacity and increase reimbursement planned for the Company’s expanded resources allocated to the Gilead collaboration.

Others

In October 2020, Professor Jean-Charles Soria, M.D., Ph.D., was appointed to HOOKIPA’s Board of Directors. Jean-Charles Soria is Professor of Medicine and Medical Oncology at the University of Paris-Saclay and currently serves as General Director of the Gustave Roussy Cancer Center, one of the world’s leading cancer research institutes.

COVID-19

HOOKIPA continues to monitor the COVID-19 pandemic closely and adapt to COVID-19 measures and recommendations issued by the U.S. and Austrian governments. For disclosures of risks and uncertainties resulting from the COVID-19 disease outbreak, including the impact on the enrollment of patients and timing of clinical results, see HOOKIPA’s quarterly reports on Form 10-Q for the quarters ended June 30, 2020 and September 30, 2020.

Third Quarter 2020 Financial Results

Cash Position:

HOOKIPA’s cash, cash equivalents and restricted cash as of September 30, 2020 was $82.3 million compared to $113.6 million as of December 31, 2019. The decrease was primarily attributable to cash used in operating activities.

Revenue was $4.0 million for the three months ended September 30, 2020 compared to $2.0 million for the three months ended September 30, 2019. The increase was primarily due to higher cost reimbursements received under the collaboration agreement with Gilead following the expansion of the collaboration in the first half of 2020 and the partial recognition of a milestone payment we received from Gilead in February 2020.

Research and Development Expenses:

HOOKIPA’s research and development expenses were $16.0 million for the three months ended September 30, 2020 compared to $11.0 million for the three months ended September 30, 2019. The primary drivers of the increase compared to 2019 were an increase in clinical trial expenses of $2.7 million and an increase in internal research and development expenses of $2.3 million.

General and Administrative Expenses:

General and administrative expenses amounted to $4.4 million for the three months ended September 30, 2020 compared to $4.6 million for the three months ended September 30, 2019. The decrease was primarily due to a decrease in personnel-related expenses of $0.1 million, a decrease in professional and consulting fees of $0.5 million, partially offset by an increase of other general and administrative expenses of $0.4 million.

Net Loss:

HOOKIPA’s net loss was $13.6 million for the three months ended September 30, 2020 compared to a net loss of $11.4 million for the three months ended September 30, 2019.

About HOOKIPA

HOOKIPA Pharma Inc. (NASDAQ: HOOK) is a clinical stage biopharmaceutical company developing a new class of immunotherapeutics based on its proprietary arenavirus platform that reprograms the body’s immune system.

HOOKIPA’s proprietary arenavirus-based technologies, non-replicating (VaxWave^®) and replicating (TheraT^®), induce robust antigen-specific CD8⁺ T cells and pathogen-neutralizing antibodies. HOOKIPA’s viral vectors target antigen presenting cells in vivo to activate the immune system. Both technologies enable repeat administration to augment and refresh immune responses. As a monotherapy, our replicating arenavirus technology has the potential to induce CD8⁺ T cell response levels previously not achieved by other immuno-therapy approaches.

HOOKIPA’s non-replicating prophylactic Cytomegalovirus (CMV) vaccine candidate is currently in a Phase 2 clinical trial for patients awaiting kidney transplantation. To expand its infectious disease portfolio, HOOKIPA entered into a collaboration and licensing agreement with Gilead Sciences, Inc. to research arenavirus-based functional cures for HIV and chronic Hepatitis B infections.

In addition, HOOKIPA is building a proprietary immuno-oncology pipeline by targeting virally mediated cancer antigens, self-antigens and next-generation antigens. The lead replicating arenavirus oncology product candidates, HB-201 and HB-202, are in development for the treatment of Human Papilloma Virus 16-positive cancers in a Phase 1/2 clinical trial.

Find out more about HOOKIPA online at www.hookipapharma.com.

HOOKIPA Forward Looking Statements

Certain statements set forth in this press release constitute “forward-looking” statements within the meaning of the Private Securities Litigation Reform Act of 1995, as amended. Forward-looking statements can be identified by terms such as “believes,” “expects,” “plans,” “potential,” “would” or similar expressions and the negative of those terms. Such forward-looking statements involve substantial risks and uncertainties that could cause HOOKIPA’s research and clinical development programs, future results, performance or achievements to differ significantly from those expressed or implied by the forward-looking statements. Such risks and uncertainties include, among others, the uncertainties inherent in the drug development process, including HOOKIPA’s programs’ early stage of development, the process of designing and conducting preclinical and clinical trials, the regulatory approval processes, the timing of regulatory filings, the challenges associated with manufacturing drug products, HOOKIPA’s ability to successfully establish, protect and defend its intellectual property, risks relating to business interruptions resulting from the coronavirus (COVID-19) disease outbreak or similar public health crises, the impact of COVID-19 on the enrollment of patients and timing of clinical results for HB-101 and other programs, and other matters that could affect the sufficiency of existing cash to fund operations and HOOKIPA’s ability to achieve the milestones under the agreement with Gilead. HOOKIPA undertakes no obligation to update or revise any forward-looking statements. For a further description of the risks and uncertainties that could cause actual results to differ from those expressed in these forward-looking statements, as well as risks relating to the business of the company in general, see HOOKIPA’s quarterly report on Form 10-Q for the quarter ended September 30, 2020 which is available on the Security and Exchange Commission’s website at www.sec.gov and HOOKIPA’s website at www.hookipapharma.com.

Investors and others should note that we announce material financial information to our investors using our investor relations website (https://ir.hookipapharma.com/), SEC filings, press releases, public conference calls and webcasts. We use these channels, as well as social media, to communicate with our members and the public about our company, our services and other issues. It is possible that the information we post on social media could be deemed to be material information. Therefore, we encourage investors, the media, and others interested in our company to review the information we post on the U.S. social media channels listed on our investor relations website.

HOOKIPA Pharma Inc.

Consolidated Statements of Operations (Unaudited)

(In thousands, except share and per share data)

	Three months ended September 30,						Nine months ended September 30,
	2020			2019			2020			2019
Revenue from collaboration and licensing	$	4,040		$	2,038		$	14,421		$	8,324
Operating expenses:
Research and development		(16,009	)		(11,025	)		(39,099	)		(35,133	)
General and administrative		(4,437	)		(4,589	)		(13,413	)		(11,051	)
Total operating expenses		(20,446	)		(15,614	)		(52,512	)		(46,184	)
Loss from operations		(16,406	)		(13,576	)		(38,091	)		(37,860	)
Total interest, other income and taxes, net		2,817			2,191			6,483			5,067
Net loss	$	(13,589	)	$	(11,385	)	$	(31,608	)	$	(32,793	)
Net loss per share — basic and diluted		(0.53	)		(0.45	)		(1.23	)		(2.14	)
Weighted average common shares outstanding — basic and diluted		25,659,504			25,408,488			25,645,827			15,308,071

Condensed Balance Sheets (Unaudited)

(In thousands)


	As of		As of
	September 30,		December 31,
	2020		2019
Cash, cash equivalents and restricted cash	$	82,259	$	113,575
Total assets		121,272		143,745
Total liabilities		29,092		25,846
Total stockholders’ equity		92,180		117,899

For further information, please contact:
Media	Investors
Nina Waibel	Matt Beck
Senior Director – Communications	Executive Director – Investor Relations
[email protected]	[email protected]

Media enquiries
Instinctif Partners
[email protected]
+44 (0)20 7457 2020

November 12, 2020 7:18 am

Protara Therapeutics Announces Third Quarter 2020 Financial Results and Business Overview

–
On
T
rack to
Complete GMP Batch Runs in Mid-2021 to C
onfirm
C
omparability
B
etween TARA-002 and OK-432
–

–
Expect to
I
nitiate Phase 1
T
rial for TARA-002 in
P
atients with
N
on-
M
uscle
I
nvasive
B
ladder
C
ancer in 2021
–

–
Requested
M
eeting with FDA to
D
iscuss
P
ath
F
orward for TARA-002 in Lymphatic Malformations
–

–
Strong
C
ash
P
osition of $166M as of September 30, 2020
–

NEW YORK, Nov. 12, 2020 (GLOBE NEWSWIRE) — Protara Therapeutics, Inc. (Nasdaq: TARA), a clinical-stage company developing transformative therapies for the treatment of cancer and rare diseases with significant unmet needs, today announced financial results for the third quarter ended September 30, 2020.

“The third quarter marked a highly productive time for the Company, notably with the Food and Drug Administration’s (FDA) confirmation of initial comparability between TARA-002 and OK-432, and separately the Company’s identification of an acceptable development path for TARA-002 in non-muscle invasive bladder cancer (NMIBC), an oncology indication with high unmet need,” said Jesse Shefferman, Chief Executive Officer of Protara Therapeutics. “We believe TARA-002 has the potential to serve as a much needed intervention for NMIBC patients lacking alternative therapeutic options, and we look forward to the expected commencement of our clinical program in NMIBC in 2021. Finally, we have requested a meeting with the FDA Division of Vaccines and Related Products, the review division which the Investigational New Drug (IND) application was initially opened by the University of Iowa, to discuss a potential Biological License Application (BLA) filing for TARA-002 in lymphatic malformations (LMs).”

Recent Highlights

TARA-002

In September 2020, Protara announced the following updates for the TARA-002 program:

FDA Confirmation of
Initial
Comparability
Between TARA-002 and OK-432. Following a pre-IND engagement with the Office of Tissues and Advanced Therapies (OTAT) division of the Center for Biologics Evaluation and Research (CBER), the FDA agreed that Protara has successfully demonstrated initial manufacturing comparability between TARA-002 and OK-432 and that the in-process and release protocols employed by Protara to demonstrate initial comparability are appropriate to utilize for GMP-Scale comparability testing. Good Manufacturing Practice (GMP) scale-up is currently in process and the Company expects to complete three such large-scale batch runs to confirm comparability in mid-2021.
Clinical Development Path in NMIBC. The Company reached alignment with the FDA on a proposed clinical development plan to evaluate TARA-002 in patients with NMIBC. Advancement into the clinic will be supported by existing and ongoing non-clinical studies as well as historical clinical safety and efficacy data for OK-432. Subject to the successful completion of select non-clinical studies to characterize local toxicity of intravesical administration of TARA-002, as well as acceptance of an IND filing, the Company plans to commence a Phase 1 study in 2021 to assess the safety and tolerability of TARA-002 in patients with NMIBC, including patients with carcinoma in situ (CIS), with results expected in 2022.
Regulatory Path in LMs. Protara has requested a meeting with the FDA Division of Vaccines and Related Products Applications to discuss the regulatory path for TARA-002 in LMs. The Company plans to utilize the robust dataset for OK-432 in LMs to support a BLA filing for TARA-002 in LMs.

IV Choline Chloride

Prevalence Study
Underway
to Assess
Incidence of Liver Disease in Patients Dependent on Parenteral Nutrition
(PN)
. The Company recently commenced a prevalence study to assess the incidence of liver disease in patients dependent on PN in the home care setting. The Company believes the study will enhance its understanding of the population of patients who may potentially benefit from IV Choline Chloride, its investigational phospholipid substrate replacement therapy currently in development for the treatment of patients receiving PN who have intestinal failure-associated liver disease (IFALD).

Corporate Update

Raised
$
1
5
1
Million
in Concurrent Public Offerings. Protara recently announced the closing of concurrent but separate underwritten public offerings of 4,600,000 shares of its common stock, at a public offering price of $16.87 per share, and 4,148 shares of non-voting Series 1 Convertible Preferred Stock, at a public offering price of $16,873.54 per share. In addition, the underwriters exercised their overallotment option in full to purchase an additional 690,000 shares of common stock at a public offering price of $16.87. Aggregate net proceeds to Protara were approximately $151 million, after deducting underwriting discounts and offering expenses.

Third
Quarter 2020 Results from Operatio
ns

As of September 30, 2020, cash and restricted cash were $166.0 million.
Protara reported a net loss of $8.0 million for the third quarter of 2020 as compared to a net loss of $2.4 million for the three months ended September 30, 2019. The third quarter of 2020 included approximately $2.8 million of stock-based compensation expense.
Research and Development expenses were $2.8 million for the third quarter of 2020, an increase of $1.7 million as compared to the three months ended September 30, 2019. The increase was primarily due to an increase of (i) $0.6 million in personnel and related costs, (ii) $0.8 million in chemistry manufacturing and controls (CMC) expenses and (iii) $0.3 million in regulatory expenses.
General and Administrative expenses were $5.3 million for the third quarter of 2020, which represented an increase of $4.0 million as compared to the three months ended September 30, 2019. The increase was primarily related to an increase of (i) $2.6 million in stock-based compensation expense, (ii) $0.6 million in insurance expense and (iii) $0.7 million in personnel and related costs.

A Form 10-Q containing the full financial statements was filed this morning and is available for viewing on Protara’s website at www.protaratx.com or www.sec.gov.

About TARA-002

TARA-002 is an investigational cell therapy in development for the treatment of lymphatic malformations (LMs) and non-muscle invasive bladder cancer (NMIBC). TARA-002 was developed from the same master cell bank of genetically distinct group A Streptococcus pyogenes as OK-432, a broad immunopotentiator marketed as Picibanil^® in Japan and Taiwan by Chugai Pharmaceutical Co., Ltd. Protara successfully demonstrated initial manufacturing comparability between TARA-002 and OK-432.

When TARA-002 is administered, it is hypothesized that innate and adaptive immune cells within the cyst or tumor are activated and produce a strong immune cascade. Neutrophils, monocytes and lymphocytes infiltrate the abnormal cells and various cytokines, including interleukins IL-6, IL-8, IL-12, interferon (IFN)-gamma, tumor necrosis factor (TNF)-alpha, and vascular endothelial growth factor (VEGF) are secreted by immune cells to induce a strong local inflammatory reaction and destroy the abnormal cells. TARA-002 has been granted Rare Pediatric Disease Designation by the U.S. Food and Drug Administration for the LMs indication.

About
Non-Muscle Invasive Bladder Cancer

Bladder cancer is the 6th most common cancer in the United States, with non-muscle invasive bladder cancer (NMIBC) representing approximately 80% of bladder cancer diagnoses. Approximately 65,000 patients are diagnosed with NMIBC in the United States each year. NMIBC is cancer found in the tissue that lines the inner surface of the bladder that has not spread into the bladder muscle. The current standard of care for high-grade NMIBC includes intravesical Bacillus Calmette-Guerin (BCG), which has been the subject of multiple global supply shortages in the past decade.

About
Lymphatic Malformations

Lymphatic malformations (LMs) are rare, congenital malformations of lymphatic vessels resulting in the failure of these structures to connect or drain into the venous system. Most LMs are present in the head and neck region and are diagnosed in early childhood during the period of active lymphatic growth, with more than 50% detected at birth and 90% diagnosed before the age of 2 years. The most common morbidities and serious manifestations of the disease include compression of the upper aerodigestive tract, including airway obstruction requiring intubation and possible tracheostomy dependence; intralesional bleeding; impingement on critical structures, including nerves, vessels, lymphatics; recurrent infection, and cosmetic and other functional disabilities.

About IV Choline Chloride and Intestinal Failure-associated Liver Disease (IFALD)

IV Choline Chloride is an investigational, intravenous (IV) phospholipid substrate replacement therapy initially in development for patients receiving parenteral nutrition (PN) who have IFALD. Choline is a known important substrate for phospholipids that are critical for healthy liver function. Because PN patients cannot sufficiently absorb adequate levels of choline and no available PN formulations contain sufficient amounts of choline to correct this deficiency, PN patients often experience a prolonged progression to hepatic failure and death, with the only known intervention being a dual small bowel/liver transplant. If approved, IV Choline Chloride would be the first approved therapy for IFALD. It has been granted Orphan Drug Designations (ODDs) by the FDA for the treatment of IFALD and the prevention of choline deficiency in PN patients.

About Protara

Therapeutics, Inc.

Protara is committed to identifying and advancing transformative therapies for people with cancer and rare diseases with limited treatment options. Protara’s portfolio includes its lead program, TARA-002, an investigational cell-based therapy being developed for the treatment of non-muscle invasive bladder cancer and lymphatic malformations, and IV Choline Chloride, an investigational phospholipid substrate replacement therapy for the treatment of intestinal failure-associated liver disease. For more information, visit www.protaratx.com.

Forward-Looking Statements

Statements contained in this press release regarding matters that are not historical facts are “forward looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. Protara may, in some cases, use terms such as “predicts,” “believes,” “potential,” “proposed,” “continue,” “designed,” “estimates,” “anticipates,” “expects,” “plans,” “intends,” “may,” “could,” “might,” “will,” “should” or other words or expressions referencing future events, conditions or circumstances that convey uncertainty of future events or outcomes to identify these forward-looking statements. Such forward-looking statements include but are not limited to, statements regarding Protara’s intentions, beliefs, projections, outlook, analyses or current expectations concerning, among other things: Protara’s business strategy, Protara’s development plans for its product candidates , including its plans regarding the timing or outcome of existing or future non-clinical studies and clinical trials, Protara’s expectations regarding interactions or upcoming filings with the FDA, statements regarding the anticipated safety or efficacy of Protara’s product candidates and, Protara’s financial footing. Because such statements are subject to risks and uncertainties, actual results may differ materially from those expressed or implied by such forward-looking statements. Factors that contribute to the uncertain nature of the forward-looking statements include: risks that Protara’s sales, revenue, expense and other financial guidance may not be as expected, as well as risks and uncertainties associated with: Protara’s development programs, including the initiation and completion of non-clinical studies and clinical trials and the timing of required filings with the FDA and other regulatory agencies; the impact of the COVID-19 pandemic on Protara’s business and the global economy; general market conditions; changes in the competitive landscape; changes in Protara’s strategic and commercial plans; Protara’s ability to obtain sufficient financing to fund its strategic plans and commercialization efforts; having to use cash in ways or on timing other than expected; the impact of market volatility on cash reserves; the loss of key members of management; and the risks and uncertainties associated with Protara’s business and financial condition in general, including the risks and uncertainties described more fully under the caption “Risk Factors” and elsewhere in Protara’s filings and reports with the United States Securities and Exchange Commission. All forward-looking statements contained in this press release speak only as of the date on which they were made and are based on management’s assumptions and estimates as of such date. Protara undertakes no obligation to update any forward-looking statements, whether as a result of the receipt of new information, the occurrence of future events or otherwise, except as required by law.

Company Contact:

Blaine Davis
Protara Therapeutics
[email protected]
646-844-0337

PROTARA THERAPEUTICS, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS

	As of
	September 30, 2020			December 31, 2019
	(unaudited)
Assets
Current assets:
Cash and cash equivalents	$	165,904,797		$	564,124
Restricted cash		50,000			–
Deferred offering costs		–			121,712
Prepaid expenses and other current assets		1,160,257			78,057
Total current assets		167,115,054			763,893

Non-current assets:
Property and equipment, net		760,548			458,591
Goodwill		29,367,213			–
Other assets		1,664,442			–
Total assets	$	198,907,257		$	1,222,484

Liabilities and Stockholders’ Equity (Deficit)
Current liabilities:
Accounts payable	$	1,912,553		$	715,653
Accrued expenses		1,569,348			2,634,790
Short-term debt		370,793			–
Right-of-use liability, current		34,079			–
Total current liabilities		3,886,773			3,350,443

Non-current liabilities:
Right-of-use liability, long-term		394,721			–
Total liabilities		4,281,494			3,350,443

Commitments and Contingencies (Note 6)

Stockholders’ Equity (Deficit)
Preferred Stock, $0.001 par value, authorized 10,000,000 shares:
Series 1 Convertible Preferred Stock, 8,028 and 0 shares authorized at September 30, 2020
and December 31, 2019, respectively, 8,027 and 0 shares issued and outstanding as of
September 30, 2020 and December 31, 2019, respectively.		8			–
Common Stock, $0.001 par value, authorized 100,000,000 shares:
Common Stock, 10,521,840 and 2,627,533 common shares issued and outstanding as of
September 30, 2020 and December 31, 2019, respectively.		10,522			2,628
Additional Paid in Capital		232,567,265			10,651,073
Accumulated Deficit		(37,952,032	)		(12,781,660	)
Total Stockholders’ Equity (Deficit)		194,625,763			(2,127,959	)
Total Liabilities and Stockholders’ Equity (Deficit)	$	198,907,257		$	1,222,484

PROTARA THERAPEUTICS, INC.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(unaudited)

	For the Three Months Ended September 30,						For the Nine Months Ended September 30,
		2020			2019			2020			2019

Operating expense:
Research & development	$	2,796,214		$	1,098,617		$	8,330,727		$	3,163,179
General & administrative		5,265,965			1,255,466			17,156,952			2,147,635
Total operating expenses		8,062,179			2,354,083			25,487,679			5,310,814

Operating loss		(8,062,179	)		(2,354,083	)		(25,487,679	)		(5,310,814	)

Other income, net
Interest income, net		(92,094	)		–			(317,307	)		–
Total other income, net		(92,094	)		–			(317,307	)		–

Net Loss	$	(7,970,085	)	$	(2,354,083	)	$	(25,170,372	)	$	(5,310,814	)

Weighted Average Shares Outstanding, basic and diluted		6,324,295			2,564,429			5,910,849			2,560,444

Net loss per share, basic and diluted	$	(1.26	)	$	(0.92	)	$	(4.26	)	$	(2.07	)

November 12, 2020 7:18 am

The Center for Global Africa (CGA) at Delaware State University Live On 360WiSE

The Center for Global Africa (CGA) at Delaware State University and the African Peer Review Mechanism (APRM) of the African Union (AU) will host our 2nd annual (virtual) Pan-African Development Conference, Live on 360WiSE November 12-14, 2020.

WILMINGTON, Del., Nov. 12, 2020 (GLOBE NEWSWIRE) — The Opening Address will be delivered by H.E. Julius Maada Bio, President of the Republic of Sierra Leone.

The Conference will convene high-level institutional dialogue among officials and stakeholders of Africa and the Diaspora, focused on executing joint initiatives in monetized and mutually beneficial ways, in conjunction with Historically Black Colleges and Universities (HBCUs) and the Thurgood Marshall College Fund.

Panelists will apply their expertise to address aspects of the following areas of African development:
1. Food and Seed Security and Agricultural Value Chains
2. Good Governance and Economic Productivity during COVID-19 Challenges
3. Reimaging Africa and Bridging the Africa-Diaspora Divide via Youth and Media Platforms

Speakers include H.E. Thomas Kwesi Quartey, Deputy Chairperson of the APR Panel of Eminent Persons, U.S. Ambassador to the African Union Jessica Lapenn, U.S. Senator Chris Coons, U.S. Rep. Lisa Blunt Rochester, Dusty Baker, Coach of the Houston Astros, Dr. Joyce Payne, Founder of the Thurgood Marshall College Fund and a host of others.

APRM CEO Professor Eddy Maloka stated, “We look forward to this second conference for Diaspora engagements to share knowledge of the APRM process and how we can work together as development partners and drivers of change that’s more reflective of our true collective skills and resource capabilities.”

Professor Aharone, Founding Director, CGA expressed, “Beyond necessary dialogue to bridge real and imagined divides, the conference is designed to create 2-way channels for Africa and Diaspora collaborations that are not only problem solving and revenue generating, but also provide HBCUs with expanded roles on the global stage.”

The Center for Global Africa (CGA) is an academic think tank housed at Delaware State University (DSU) that engages in research, consultancy, advocacy and enterprising practices for joint US-Africa development, with emphasis on promoting the intellectual capital of HBCUs and investment potential of U.S. industries.

APRM a specialized agency of the AU that conducts “Country Review Reports” to advance African governance and socioeconomic productivity through slated recommendations to accelerate political stability, sustainable development, and continental cooperation.

Action steps of the conference aim to operationalize official pathways to enterprisingly incorporate Diaspora research, resources, and expertise into African development as functional arms of Agenda 2063, which is the AU’s 50-year plan for a transformative African Renaissance.

To register for the conference visit, www.centerforglobalafrica.com.

About Delaware State University :
Led by President Dr. Tony Allen who is an active scholar and lecturer in the field of public policy and educational reform. In 2002, he began that career with the study Handgun Violence in Delaware for the Urban League and collaborated with Dr. Leland Ware on The Geography of Discrimination: Hyper-segregation, Isolation, and Fragmentation within the Black Community. In the ensuing years, he has contributed multiple articles on similar subjects, including “Much is Required” in the Urban League’s 2017 Report on the State of Black America.

Tony has maintained an active speaking schedule on behalf of Delaware State University and the overarching vision of educational access for all. He recently appeared at the Apple “Educause” Conference in Cupertino, California; keynoted the Ellucian Conference for Historically Black Colleges and Universities; appeared at the National Orientation Director’s Association (NODA) HBCU Summit; and addressed the Middle States Commission on Higher Education (MSCHE), among others. Among his many international appearances, Tony has given the Commencement address at Ningbo University of Technology in China, as well as keynoted the Convocation for Adunkele Ajasin University in Nigeria.

As Tony said in the video released on New Year’s Day 2020, “I am a first-generation college student. My father never completed 11th grade; my mom raised me as a single mother. They believed so strongly in education that it never occurred to me I had any other choice except to go forward as far as talent and opportunity would take me. Providing low-cost, high-quality education not only to the best and the brightest, but especially for those who are locked out or underserved, is not just Delaware State University’s history, it is WHO WE ARE. Our doors always have and will be open to everyone, regardless of skin color, national origin, the god they worship, who they choose to love, or how much money their family makes.”

Delaware State University is a public historically black university in Dover, Delaware. DSU also has two satellite campuses, one in Wilmington and one in Georgetown. The university encompasses four colleges and a diverse population of undergraduate and advanced-degree students.

ABOUT 360WiSE

360WiSE MEDiA is one of the largest major-market media operators in the United States and the undisputed leader in social media marketing, news, brand, and public figure advertisement.

The 360WiSE brand is licensed and registered with the United States Patent and Trademark Office specializing in marketing and advertising. Powered with the positive iconic advice of MC Hammer, 360WiSE MEDiA is in the top 1% of public relations, influence, branding, and marketing of celebrities, actors, public figures, recording artists, small businesses and major brands.

360WiSE MEDiA is known for its first of class, best use of social network platforms, local and national SEO, offline mobile marketing, geofencing, human behavior marketing, international press, and news access, Roku TV stream marketing, and content placement along with verified social media marketing to increase your engagement, positive visibility, and ROI.

At 360WiSE you will find creative, passionate celebrities, public figures and gifted individuals who specialize in different areas, ranging from the music industry, radio, television, web design to digital marketing, but they are not limited to a single skill set. Using an interactive approach, 360WiSE MEDiA adapts to any project or situation and always moves in leaps and bounds to create trends rather than follow them. We are a thought leadership, design, advertising, entertainment, public relations and consulting agency all rolled into one, and if the right person for the job isn’t already under our roof, we have the right partners in our network on hand to get the job done.

Partnering with our clients to create Big Ideas and Digital Experiences. We approach our projects with strategic and creative thinking. Spending each day doing so by sharpening the tools of valued relationships in the celebrity, digital, and marketing trade.

For more information visit :

Public Relations Department

1-844-360-WISE (9473)

360WiSE MEDiA

November 12, 2020 7:17 am

Endava Announces First Quarter Fiscal Year 2021 Results

Endava Announces First Quarter Fiscal Year 2021 Results

Q1 FY2021

15.5% Year on Year Revenue Growth to £95.1 million

16.9% Revenue Growth at Constant Currency

IFRS diluted EPS £0.12 compared to £0.26 in the prior year comparative period

Adjusted diluted EPS £0.26 compared to £0.24 in the prior year comparative period

LONDON–(BUSINESS WIRE)–
Endava plc(NYSE: DAVA) (“Endava” or the “Company”) a global provider of digital transformation, agile development and intelligent automation services, today announced results for the three months ended September 30, 2020, the first quarter of its 2021 fiscal year (“Q1 FY2021”).

“Endava delivered another strong quarter with revenue for Q1 FY2021 of £95.1 million, an increase of 15.5% Year on Year on a reported basis, and our pro-forma constant currency growth rate reflecting the sale of the Worldpay Captive was 20.1% Year on Year. The demand environment remains solid in all of our geographies and verticals,” said John Cotterell, Endava’s CEO.

FIRST QUARTER FISCAL YEAR 2021 FINANCIAL HIGHLIGHTS:

Revenue for Q1 FY2021 was £95.1 million, an increase of 15.5% compared to £82.4 million in the same period in the prior year.

Revenue growth rate at constant currency^{(a non-IFRS measure) was 16.9% for Q1 FY2021 compared to 21.5% in the same period in the prior year.}

Profit before tax for Q1 FY2021 was £8.7 million compared to profit before tax of £17.5 million in the same period in the prior year.

Adjusted profit before tax (a non-IFRS measure) for Q1 FY2021 was £18.2 million, compared to £16.9 million in the same period in the prior year, or 19.2% of revenue, compared to 20.5% of revenue in the same period in the prior year.

Profit for the period was £6.7 million in Q1 FY2021, resulting in a diluted EPS of £0.12, compared to profit for the period of £14.5 million and diluted EPS of £0.26 in the same period in the prior year.

Adjusted profit for the period (a non-IFRS measure) was £14.7 million in Q1 FY2021, resulting in adjusted diluted EPS (a non-IFRS measure) of £0.26 compared to adjusted profit for the period of £13.6 million and adjusted diluted EPS of £0.24 in the same period in the prior year.

CASH FLOW:

Net cash from operating activities was £21.5 million in Q1 FY2021 compared to £15.4 million in the same period in the prior year.

Adjusted free cash flow (a non-IFRS measure) was £21.2 million in Q1 FY2021 compared to £13.5 million in the same period in the prior year.

At September 30, 2020, Endava had cash and cash equivalents of £70.0 million, compared to £101.3 million at June 30, 2020.

OTHER METRICS FOR THE QUARTER ENDED SEPTEMBER 30, 2020:

Headcount (including directors) reached 7,199 at September 30, 2020, with 6,204 average operational employees in Q1 FY2021, compared to a headcount of 5,904 at September 30, 2019 and 5,339 average operational employees in the same quarter of the prior year.

Number of clients with over £1 million in revenue on a rolling twelve months basis was 66 at September 30, 2020, compared to 62 at September 30, 2019.

Top 10 clients accounted for 39% of revenue in Q1 FY2021, compared to 41% at September 30, 2019.

By geographic region, 29% of revenue was generated in North America, 25% was generated in Europe, 43% was generated in the United Kingdom and 3% was generated in the rest of the world in Q1 FY2021. This compares to 27% in North America, 26% in Europe, 45% in the United Kingdom and 2% in the rest of the world in the same period in the prior year.

By industry vertical, 50% of revenue was generated from Payments and Financial Services, 28% from TMT and 22% from Other. This compares to 53% from Payments and Financial Services, 25% from TMT and 22% from Other in the same period in the prior year.

OUTLOOK:

At this time, the general economic environment remains fluid and it continues to be challenging to anticipate the ultimate full scope and duration of the impact of the COVID-19 pandemic. Endava is providing guidance for the second quarter of its 2021 fiscal year and its full 2021 fiscal year based upon what it currently sees in its markets.

Second Quarter Fiscal Year 2021:

Endava expects revenues will be in the range £102.0 m to £104.0 m, representing constant currency revenue growth of between 17.5% and 18.0%. Endava expects adjusted diluted EPS to be in the range of £0.25 to £0.26 per share.

The constant currency growth figure above excludes the Worldpay Captive, which Endava sold in August 2019, and, starting in the second quarter of fiscal 2021, will not be included in quarterly comparative financial metrics. Endava does not intend to refer to Worldpay Captive in future quarterly guidance.

Full Fiscal Year 2021:

Endava expects revenues will be in the range £419.0m to £421.0m, representing constant currency growth of between 20.0% and 20.5%. Endava expects adjusted diluted EPS to be in the range of £1.04 to £1.08 per share.

The constant currency growth figure now quoted for the full fiscal year 2021 guidance will still include the proforma adjustment for the Worldpay Captive, as it remains in the full year comparative.

This above guidance for Q2 Fiscal Year 2021 and the Full Fiscal Year 2021 assumes the exchange rates at the end of October (when the exchange rate was 1 British Pound to 1.29 US Dollar and 1.11 Euro).

Endava is not able, at this time, to provide an outlook for IFRS diluted EPS for Q2 FY2021 or FY2021 because of the unreasonable effort of estimating on a forward-looking basis certain items that are excluded from adjusted diluted EPS, including, for example, share-based compensation expense, amortisation of acquired intangible assets and foreign currency exchange (gains)/losses, the effect of which may be significant. Endava is also not able, at this time, to reconcile to an outlook for revenue growth not at constant currency because of the unreasonable effort of estimating foreign currency exchange gains/losses, the effect of which may be significant, on a forward-looking basis.

The guidance provided above is forward-looking in nature. Actual results may differ materially. See the cautionary note regarding “Forward-Looking Statements” below.

CONFERENCE CALL DETAILS:

The Company will host a conference call at 8:00 am EST today, November 12, 2020, to review its Q1 FY2021 results. To participate in Endava’s Q1 FY2021 earnings conference call, please dial in at least five minutes prior to the scheduled start time (866) 324-3683 or (509) 844-0959 for international participants, Conference ID 3084871.

Investors may listen to the call on Endava’s Investor Relations website at http://investors.Endava.com. The webcast will be recorded and available for replay until Friday, November 27, 2020.

ABOUT ENDAVA PLC:

Endava is a leading next-generation technology services provider and helps accelerate disruption by delivering rapid evolution to enterprises. Using distributed enterprise agile at scale, Endava collaborates with its clients, seamlessly integrating with their teams, catalysing ideation and delivering robust solutions. Endava helps its clients become digital, experience-driven businesses by assisting them in their journey from idea generation to development and deployment of products, platforms and solutions. It services clients in the following industries: Payments and Financial Services, TMT and “Other,” which includes Consumer Products, Retail, Mobility and Healthcare. Endava had 7,199 employees (including directors) as of September 30, 2020 located in offices in North America and Western Europe and delivery centres in Romania, Moldova, Bulgaria, Serbia, North Macedonia, Slovenia, Bosnia & Herzegovina, Argentina, Uruguay, Venezuela, and Colombia.

NON-IFRS FINANCIAL INFORMATION:

To supplement Endava’s Consolidated Statements of Comprehensive Income, Consolidated Balance Sheets and Consolidated Statements of Cash Flow presented in accordance with IFRS, the Company uses non-IFRS measures of certain components of financial performance. These measures include: revenue growth rate at constant currency, revenue growth at constant currency adjusted for the sale of Endava Technology SRL, also referred to as “the Worldpay Captive” to Worldpay on August 31, 2019, adjusted profit before tax, adjusted profit for the period, adjusted diluted EPS and adjusted free cash flow.

Revenue growth rate at constant currency is calculated by translating revenue from entities reporting in foreign currencies into British Pounds using the comparable foreign currency exchange rates from the prior period. For example, the average rates in effect for the fiscal quarter ended September 30, 2019 were used to convert revenue for the fiscal quarter ended September 30, 2020 and the revenue for the comparable prior period.

Revenue growth at constant currency adjusted for the sale of the Worldpay Captive is revenue growth at constant currency adjusted to exclude the impact of the sale of the Worldpay Captive.

Adjusted profit before tax (“Adjusted PBT”) is defined as the Company’s profit before tax adjusted to exclude the impact of share-based compensation expense, amortisation of acquired intangible assets, realised and unrealised foreign currency exchange gains and losses, and net gain on disposal of subsidiary. Share-based compensation expense, amortisation of acquired intangible assets and unrealized foreign currency gains are non-cash expenses. Adjusted PBT margin is Adjusted PBT as a percentage of total revenue.

Adjusted profit for the period is defined as Adjusted PBT together with the tax impact of these adjustments.

Adjusted diluted EPS is defined as Adjusted profit for the period, divided by weighted average number of shares outstanding – diluted.

Adjusted free cash flow is the Company’s net cash from operating activities, plus grants received, less net purchases of non-current assets (tangible and intangible).

Management believes these measures help illustrate underlying trends in the Company’s business and uses the measures to establish budgets and operational goals, communicated internally and externally, for managing the Company’s business and evaluating its performance. Management also believes the presentation of its non-IFRS financial measures enhances an investor’s overall understanding of the Company’s historical financial performance. The presentation of the Company’s non-IFRS financial measures is not meant to be considered in isolation or as a substitute for the Company’s financial results prepared in accordance with IFRS, and its non-IFRS measures may be different from non-IFRS measures used by other companies. Investors should review the reconciliation of the Company’s non-IFRS financial measures to the comparable IFRS financial measures included below, and not rely on any single financial measure to evaluate the Company’s business.

This press release includes forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These forward-looking statements may be identified by the use of terms and phrases such as “believe,” “expect,” “outlook,” “may,” “will”, and other similar terms and phrases. Such forward-looking statements include, but are not limited to, the statements regarding Endava’s projected financial performance for the second fiscal quarter of fiscal year 2021 and the full fiscal year 2021 and the challenges presented by the ongoing COVID-19 pandemic and the associated global economic uncertainty. Forward-looking statements involve known and unknown risks, uncertainties and other factors that could cause actual results to differ materially from the results anticipated by these forward-looking statements, including, but not limited to: Endava’s business, results of operations and financial condition may be negatively impacted by the COVID-19 pandemic and the precautions taken in response to the pandemic or if general economic conditions in Europe, the United States or the global economy worsen; Endava’s ability to manage its rapid growth or achieve anticipated growth; Endava’s ability to retain existing clients and attract new clients, including its ability to increase revenue from existing clients and diversify its revenue concentration; Endava’s ability to attract and retain highly- skilled IT professionals at cost-effective rates; Endava’s ability to penetrate new industry verticals and geographies and grow its revenue in current industry verticals and geographies; Endava’s ability to maintain favourable pricing and utilisation rates; Endava’s ability to successfully identify acquisition targets, consummate acquisitions and successfully integrate acquired businesses and personnel; the effects of increased competition as well as innovations by new and existing competitors in its market; Endava’s ability to adapt to technological change and innovate solutions for its clients; Endava’s ability to collect on billed and unbilled receivables from clients; Endava’s ability to effectively manage its international operations, including Endava’s exposure to foreign currency exchange rate fluctuations; Endava’s ability to remediate the identified material weaknesses and maintain an effective system of disclosure controls and internal control over financial reporting, and Endava’s future financial performance, including trends in revenue, cost of sales, gross profit, selling, general and administrative expenses, finance income and expense and taxes, as well as other risks and uncertainties discussed in the “Risk Factors” section of our Annual Report on Form 20-F filed with the Securities and Exchange Commission (“SEC”) on September 15, 2020. In addition, the forward-looking statements included in this press release represent Endava’s views and expectations as of the date hereof and are based on information currently available to Endava. Endava anticipates that subsequent events and developments may cause its views to change. Endava specifically disclaims any obligation to update the forward- looking statements in this press release except as required by law. These forward-looking statements should not be relied upon as representing Endava’s views as of any date subsequent to the date hereof.

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

Three Months Ended

September 30

2020

2019

£’000

£’000

REVENUE

95,125

82,352

Cost of sales

Direct cost of sales

(57,476

)

(48,764

)

Allocated cost of sales

(4,732

)

(3,921

)

Total cost of sales

(62,208

)

(52,685

)

GROSS PROFIT

32,917

29,667

Selling, general and administrative expenses

(21,267

)

(17,340

)

OPERATING PROFIT

11,650

12,327

Net finance (expense) / income

(2,925

)

2,928

Gain on sale of subsidiary

—

2,215

PROFIT BEFORE TAX

8,725

17,470

Tax on profit on ordinary activities

(2,017

)

(2,958

)

PROFIT FOR THE PERIOD

6,708

14,512

OTHER COMPREHENSIVE INCOME

Items that may be reclassified subsequently to profit or loss:

Exchange differences on translating foreign operations

(847

)

(1,925

)

TOTAL COMPREHENSIVE INCOME FOR THE PERIOD ATTRIBUTABLE TO OWNERS OF THE PARENT

5,861

12,587

EARNINGS PER SHARE (EPS):

Weighted average number of shares outstanding – Basic

54,494,227

52,556,332

Weighted average number of shares outstanding – Diluted

56,639,638

55,422,182

Basic EPS (£)

0.12

0.28

Diluted EPS (£)

0.12

0.26

CONDENSED CONSOLIDATED BALANCE SHEETS

September 30, 2020

June 30, 2020

September 30, 2019

£’000

£’000

£’000

(Restated) ⁽¹⁾

ASSETS – NON-CURRENT

Goodwill

104,780

56,885

36,251

Intangible assets

36,953

38,751

29,063

Property, plant and equipment

12,157

12,747

10,828

Lease right-of-use assets

49,020

51,134

37,382

Financial assets

772

639

1,066

Deferred tax assets

15,797

13,340

9,841

TOTAL

219,479

173,496

124,431

ASSETS – CURRENT

Trade and other receivables

92,743

82,614

67,901

Corporation tax receivable

2,613

2,922

793

Financial assets

584

584

617

Cash and cash equivalents

70,039

101,327

83,628

TOTAL

165,979

187,447

152,939

TOTAL ASSETS

385,458

360,943

277,370

LIABILITIES – CURRENT

Lease liabilities

11,102

11,132

8,564

Trade and other payables

66,078

58,599

48,095

Corporation tax payable

2,885

1,449

4,970

Contingent consideration

1,392

1,442

1,285

Deferred consideration

3,783

3,764

—

TOTAL

85,240

76,386

62,914

LIABILITIES – NON CURRENT

Lease liabilities

40,563

42,233

29,603

Deferred tax liabilities

5,691

5,861

1,950

Deferred consideration

5,079

—

—

Other liabilities

133

136

118

TOTAL

51,466

48,230

31,671

EQUITY

Share capital

1,099

1,099

1,089

Share premium

229

221

137

Merger relief reserve

25,527

25,527

21,573

Retained earnings

227,398

214,638

165,314

Other reserves

(4,664

)

(3,817

)

(3,502

)

Investment in own shares

(837

)

(1,341

)

(1,826

)

TOTAL

248,752

236,327

182,785

TOTAL LIABILITIES AND EQUITY

385,458

360,943

277,370

1) The restatement refers to a reclassification of £17,143,000 from share premium to merger relief reserve.

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

Three Months Ended

September 30

2020

2019

£’000

£’000

OPERATING ACTIVITIES

Profit for the period

6,708

14,512

Income tax charge

2,017

2,958

Non-cash adjustments

12,417

1,956

Tax paid

152

(832

)

Net changes in working capital

176

(3,185

)

Net cash from operating activities

21,470

15,409

INVESTING ACTIVITIES

Purchase of non-current assets (tangible and intangible)

(641

)

(2,506

)

Proceeds from disposal of non-current assets

65

13

Acquisition of business / subsidiaries (net of cash acquired)

(50,790

)

(1,523

)

Proceeds from sale of subsidiary net of cash disposed of

—

2,578

Cash and cash equivalents acquired with subsidiaries

1,603

—

Interest received

27

199

Net cash used in investing activities

(49,736

)

(1,239

)

FINANCING ACTIVITIES

Proceeds from sublease

157

154

Repayment of borrowings

—

(9

)

Repayment of lease liabilities

(2,954

)

(2,156

)

Interest paid

(211

)

(166

)

Grant received

309

564

Issue of shares

8

9

Net cash from financing activities

(2,691

)

(1,604

)

Net change in cash and cash equivalents

(30,957

)

12,566

Cash and cash equivalents at the beginning of the period

101,327

70,172

Exchange differences on cash and cash equivalents

(331

)

890

Cash and cash equivalents at the end of the period

70,039

83,628

RECONCILIATION OF IFRS FINANCIAL MEASURES TO NON-IFRS FINANCIAL MEASURES

RECONCILIATION OF REVENUE GROWTH RATE AS REPORTED UNDER IFRS TO REVENUE GROWTH RATE AT CONSTANT CURRENCY:

Three Months ended

September 30

2020

2019

REVENUE GROWTH RATE AS REPORTED UNDER IFRS

15.5

%

24.0

%

Foreign exchange rates impact

1.4

%

(2.5

%)

REVENUE GROWTH RATE AT CONSTANT CURRENCY INCLUDING WORLDPAY CAPTIVE

16.9

%

21.5

%

Impact of Worldpay Captive

3.2

%

0.4

%

PRO-FORMA REVENUE GROWTH RATE AT CONSTANT CURRENCY ADJUSTED FOR THE SALE OF THE WORLDPAY CAPTIVE

20.1

%

21.9

%

RECONCILIATION OF ADJUSTED PROFIT BEFORE TAX AND ADJUSTED PROFIT FOR THE PERIOD:

Three Months Ended

September 30

2020

2019

£’000

£’000

PROFIT BEFORE TAX

8,725

17,470

Adjustments:

Share-based compensation expense

5,931

3,323

Amortisation of acquired intangible assets

1,166

896

Foreign currency exchange (gains)/losses, net

2,412

(2,553

)

Net gain on disposal of subsidiary

—

(2,215

)

Total adjustments

9,509

(549

)

ADJUSTED PROFIT BEFORE TAX

18,234

16,921

PROFIT FOR THE PERIOD

6,708

14,512

Adjustments:

Adjustments to profit before tax

9,509

(549

)

Tax impact of adjustments

(1,550

)

(393

)

ADJUSTED PROFIT FOR THE PERIOD

14,667

13,570

Diluted EPS (£)

0.12

0.26

Adjusted diluted EPS (£)

0.26

0.24

RECONCILIATION OF NET CASH FROM OPERATING ACTIVITIES TO ADJUSTED FREE CASH FLOW

Three Months Ended

September 30

2020

2019

£’000

£’000

Net cash from operating activities

21,470

15,409

Adjustments:

Grant received

309

564

Net purchases of non-current assets (tangible and intangible)

(576

)

(2,493

)

Adjusted Free cash flow

21,203

13,480

SUPPLEMENTARY INFORMATION

SHARE-BASED COMPENSATION EXPENSE

Three Months Ended

September 30

2020

2019

£’000

£’000

Direct cost of sales

3,498

1,697

Selling, general and administrative expenses

2,433

1,626

Total

5,931

3,323

DEPRECIATION AND AMORTISATION

Three Months Ended

September 30

2020

2019

£’000

£’000

Direct cost of sales

3,570

2,751

Selling, general and administrative expenses

1,773

1,376

Total

5,343

4,127

EMPLOYEES, TOP 10 CUSTOMERS AND REVENUE SPLIT

Three Months Ended

September 30

2020

2019

Closing number of total employees (including directors)

7,199

5,904

Average operational employees

6,204

5,339

Top 10 customers %

39

%

41

%

Number of clients with > £1m of revenue (rolling 12 months)

66

62

Geographic split of revenue %

North America

29

%

27

%

Europe

25

%

26

%

UK

43

%

45

%

Rest of World (RoW)

3

%

2

%

Industry vertical split of revenue %

Payments and Financial Services

50

%

53

%

TMT

28

%

25

%

Other

22

%

22

%

View source version on businesswire.com: https://www.businesswire.com/news/home/20201112005577/en/

INVESTOR CONTACT:

Endava Plc

Laurence Madsen, Investor Relations Manager

[email protected]

KEYWORDS: Europe United States United Kingdom North America New York

INDUSTRY KEYWORDS: Consulting Accounting Professional Services Finance

MEDIA:

Posted on November 12, 2020 7:13 am
Director/PDMR Shareholding

NOTIFICATION AND PUBLIC DISCLOSURE IN ACCORDANCE WITH THE REQUIREMENTS OF THE EU MARKET ABUSE REGULATION OF TRANSACTIONS BY PERSONS DISCHARGING MANAGERIAL RESPONSIBILITIES

November 12, 2020

This notification is made in accordance with Article 19 of the EU Market Abuse Regulation

1. Details of the person discharging managerial responsibilities/person closely associated

First Name(s) Martina

Last Name(s) Hund-Mejean

2. Reason for the notification

Position/status Non-executive Director

Initial notification/amendments Initial notification

3. Details of the issuer, emission allowance market participant, auction platform, auctioneer or auction monitor

Full name of the entity Royal Dutch Shell plc

Legal Entity Identifier code 21380068P1DRHMJ8KU70

4. Details of the transaction(s) section to be repeated for (i) each type of instrument, (ii) each type of transaction, (iii) each date, (iv) each place where transactions have been conducted

Description of the financial instrument B American Depositary Share (ADS)

Identification Code US7802591070

Nature of the transaction Purchase of shares

Currency US Dollars

Price (Average) $30.34

Volume 9,211

Total $279,485.65

Aggregated information
Shares were PURCHASED in batches

Batch 1 Batch 2 Batch 3 Batch 4

Volume 200 1200 1581 400

Price $30.28 $30.29 $30.30 $30.31

Total $6,056.00 $36,348.00 $47,904.30 $12,124.00

Batch 5 Batch 6 Batch 7 Batch 8

Volume 100 1161 100 1200

Price $30.32 $30.33 30.34 $30.36

Total $3,032.00 $35,213.13 $3,034.00 $36,432.00

Batch 9 Batch 10 Batch 11 Batch 12

Volume 500 769 900 900

Price $30.37 $30.38 $30.39 $30.40

Total $15,185.00 $23,362.22 $27,351.00 $27,360.00

Batch 13

Volume 200

Price $30.42

Total $6,084.00

Date of Transaction November 11, 2020

Place of Transaction New York

Anthony Clarke
Deputy Company Secretary

ENQUIRIES

Shell Media Relations
International, UK, European Press: +44 20 7934 5550

	Terence Wong	Ivy Lu
	General Manager	Vice President
Telephone	(852) 3150 6786	(86) 21 3397 8796
Email	[email protected]	[email protected]

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