On December 17, 2019 IMMUNOPRECISE ANTIBODIES LTD. (the "Company" or "IPA") (TSX VENTURE: IPA) (OTCQB: IPATF) reported that it has released its financial results for the second quarter ended October 31, 2019 (Press release, ImmunoPrecise Antibodies, DEC 17, 2019, View Source [SID1234552432]). The financial statements and related management’s discussion and analysis ("MD&A") can be viewed on SEDAR at www.sedar.com.
Schedule your 30 min Free 1stOncology Demo!
Discover why more than 1,500 members use 1stOncology™ to excel in:
Early/Late Stage Pipeline Development - Target Scouting - Clinical Biomarkers - Indication Selection & Expansion - BD&L Contacts - Conference Reports - Combinatorial Drug Settings - Companion Diagnostics - Drug Repositioning - First-in-class Analysis - Competitive Analysis - Deals & Licensing
Schedule Your 30 min Free Demo!
Financial Highlights:
Revenue. During the three months ended October 31, 2019, the company generated revenues of $3,162,365, compared to revenues of $2,716,791 in the 2018 fiscal period. This represents a 16% rise in revenue for the three-month period. The increasing revenue trend is due to growth in both the volume of contracts as well as an increase in the financial value of individual client programs resulting in a larger average value per program. Revenue outlook is positive for third quarter.
Gross Margin. During the three months ended October 31, 2019, the Company achieved a gross profit of $2,490,015 compared to $1,401,725 in the 2018 fiscal period. Gross profit increased by 78% over the same period last year. In percentage terms, the Company’s gross profit increased to 79% from 52% in 2018. The higher gross profit in 2019 was mostly attributable to the Company investing heavily in research and development initiatives, broadening the breadth and value of its intellectual property in both therapeutic oncology assets as well as advanced technologies in the discovery and analysis of human antibody sequences. Gross profit was positivity affected by an increase in the average value per program.
Net Loss. During the three months ended October 31, 2019, the Company recorded a net loss of $1,363,545 compared to net loss of $1,485,732 for the three months ended October 31, 2018. The net loss decreased in 2019 due to $1,088,290 higher gross profit and lower advertising and consulting expense, offset by higher non-cash expenses including amortization of acquired companies’ intangible assets, depreciation of leased assets as a result of implementing IFRS 16, Leases, and higher office expenses.
Non-IFRS Measures*. Non-IFRS Adjusted EBITDA was ($63,418) in the second quarter of 2019 compared to ($744,054) in the second quarter of 2018. The reduction in loss is due primarily to non-cash expenses reconciling IFRS Net Loss to Adjusted EBITDA. The reduction in EBITDA Loss for the quarter is due to higher gross profit ($1,088,290) offset by higher Adjusted Operating Expenses ($407,654) primarily due to the Company’s investment in research and development and information technology.
Reflecting on the calendar year of 2019, Dr. Jennifer Bath, CEO and President, added, "During 2019 we won an increased number of large pharma clients requiring more comprehensive therapeutic discovery and development outsourcing. These wins have been a core priority for ImmunoPrecise as we grow, which required substantive, strategic investments in our global infrastructure to attract, win and retain large pharma. Onboarding of these programs differs from our pipeline to date in terms of timing and workflow management. While it is a significant positive that we are winning larger programs, we have been cognizant that short-term revenue recognition can be affected by the timing of project activity. We have worked diligently to ensure that these are coupled with renewing, smaller projects to attain business continuity, thoughtful space and equipment utilization and therefore greater profitability going into 2020."