Month: May 2021

Release – Ocugen (OCGN) – Provides Business Update and First Quarter 2021 Financial Results

Posted on by Admin


Ocugen Provides Business Update and First Quarter 2021 Financial Results

 

  • COVAXIN demonstrates 100% efficacy against severe COVID-19 disease (including hospitalization)
  • Master File submitted for U.S. Food and Drug Administration review prior to a planned Emergency Use Authorization application for COVAXIN
  • $100.0 million in gross proceeds raised through a registered direct offering of common stock
  • Key talent acquired representing an instrumental step to position Ocugen for future growth

MALVERN, Pa., May 07, 2021 (GLOBE NEWSWIRE) — Ocugen, Inc. (“Ocugen”) (Nasdaq: OCGN), a biopharmaceutical company focused on discovering, developing, and commercializing gene therapies to cure blindness diseases and developing a vaccine to save lives from COVID-19, today reported first quarter 2021 financial results along with a general business update.

“We continue our dedication to help save lives from COVID-19 by bringing COVAXIN to the U.S. market while simultaneously driving our ophthalmology gene therapy pipeline toward the clinic. We shared compelling second interim analysis results of Bharat Biotech’s Phase 3 clinical trial in India as well as positive data from in-vitro studies regarding COVAXIN’s ability to neutralize emerging variants. We continue to make progress toward Emergency Use Authorization for COVAXIN while also considering clinical development in special populations, such as children, as well as booster doses. We are delighted to have raised additional capital to fund our ongoing and future operations and to allow us to recruit key talent during this important stage of our growth,” said Dr. Shankar Musunuri, Chairman, Chief Executive Officer, and Co-Founder of Ocugen.

Business Highlights

  • COVAXIN Demonstrates Positive Efficacy and Variant Neutralization Results — In April 2021, Ocugen announced that its co-development partner, Bharat Biotech International Limited (“Bharat Biotech”), shared positive results from the second interim analysis of its Phase 3 clinical trial of COVAXIN showing 78% overall efficacy against COVID-19 disease, 100% efficacy against severe COVID-19 disease (including hospitalization), and 70% efficacy against asymptomatic COVID-19 infection, indicating the potential to significantly reduce virus transmission. COVAXIN has additionally demonstrated a remarkable safety profile with several million doses administered to date in India. Moreover, in-vitro studies conducted by the Indian Council of Medical Research-National Institute of Virology have provided data suggesting effectiveness in neutralizing the double mutant India variant, the U.K. variant, and the Brazil variant. Based on broad immunogenicity, Ocugen believes that COVAXIN has the potential to be effective against other emerging variants. COVAXIN is based on proven technology and Ocugen plans to consider clinical development in special populations, such as children, as well as booster doses.
  • Continued Progress Toward U.S. Emergency Use Authorization (“EUA”) — Ocugen is currently in discussions with the U.S. Food and Drug Administration (“FDA”) regarding the development of COVAXIN and has submitted key information and data to date as a Master File for FDA review prior to a planned EUA application once additional data is received from Bharat Biotech from the ongoing Phase 3 clinical trial. Ocugen is additionally in discussions with the Biomedical Advanced Research and Development Authority, commonly known as BARDA, regarding the U.S. government’s support of COVAXIN.
  • Capital Raised — In April 2021, Ocugen sold an aggregate of 10.0 million shares of its common stock priced at a premium to market at $10.00 per share in a registered direct offering. The registered direct offering generated net proceeds of $93.4 million, after deducting placement agent’s fees and other offering expenses payable by Ocugen, further strengthening Ocugen’s balance sheet and further extending its cash runway.
  • Attracted and Hired Significant Key Talent — Ocugen has increased its headcount to 26 full-time employees as of as of the date of this press release, including the addition of John Paul Gabriel as the Senior Vice President of Manufacturing and Supply Chain. Mr. Gabriel is an established biopharma and vaccines operations leader, who will be instrumental in the technology transfer from Bharat Biotech for the manufacturing of COVAXIN for the U.S. market. Ocugen will continue to expand its headcount this year as necessary for the development and commercialization of COVAXIN and the advancement of the ophthalmology pipeline into the clinic.
  • Continued Advancement of Ophthalmology Pipeline — Ocugen’s ophthalmology pipeline continues to advance toward the initiation of four Phase 1/2 clinical trials by the end of 2022 including OCU400, Ocugen’s lead gene therapy candidate, entering the clinic in the second half of this year. Ocugen has continued to make progress in preclinical development including sharing promising preclinical results for OCU200 at the Wet Age-Related Macular Degeneration Conference in April 2021.

First Quarter 2021 Financial Results

  • Ocugen’s cash, cash equivalents, and restricted cash totaled $44.9 million as of March 31, 2021, compared to $24.2 million as of December 31, 2020. Ocugen had 188.2 million shares of common stock outstanding as of March 31, 2021.
  • Research and development expenses for the three months ended March 31, 2021 were $2.9 million compared to $1.7 million for the three months ended March 31, 2020. General and administrative expenses for the three months ended March 31, 2021 were $4.2 million compared to $2.3 million for the three months ended March 31, 2020. Ocugen reported a $0.04 net loss per share for the three months ended March 31, 2021 compared to a $0.07 net loss per share for the three months ended March 31, 2020.

About Ocugen, Inc.
Ocugen, Inc. is a biopharmaceutical company focused on discovering, developing, and commercializing gene therapies to cure blindness diseases and developing a vaccine to save lives from COVID-19. Our breakthrough modifier gene therapy platform has the potential to treat multiple retinal diseases with one drug — “one to many,” and our novel biologic product candidate aims to offer better therapy to patients with underserved diseases such as wet age-related macular degeneration, diabetic macular edema, and diabetic retinopathy. We are co-developing Bharat Biotech’s COVAXIN vaccine candidate for COVID-19 in the U.S. market. For more information, please visit www.ocugen.com.

Cautionary Note on Forward-Looking Statements
This press release contains forward-looking statements within the meaning of The Private Securities Litigation Reform Act of 1995, which are subject to risks and uncertainties. We may, in some cases, use terms such as “predicts,” “believes,” “potential,” “proposed,” “continue,” “estimates,” “anticipates,” “expects,” “plans,” “intends,” “may,” “could,” “might,” “will,” “should” or other words that convey uncertainty of future events or outcomes to identify these forward-looking statements. Such forward-looking statements include information about qualitative assessments of available data, potential benefits, expectations for clinical trials, and anticipated timing of clinical trial readouts and regulatory submissions. This information involves risks and uncertainties that could cause actual results to differ materially from those expressed or implied by such statements. Risks and uncertainties include, among other things, the uncertainties inherent in research and development, including the ability to meet anticipated clinical endpoints, commencement and/or completion dates for clinical trials, regulatory submission dates, regulatory approval dates and/or launch dates, as well as risks associated with preliminary and interim data, including the possibility of unfavorable new clinical trial data and further analyses of existing clinical trial data; the risk that clinical trial data are subject to differing interpretations and assessments, including during the peer review/publication process, in the scientific community generally, and by regulatory authorities; whether and when data from Bharat Biotech’s clinical trials will be published in scientific journal publications and, if so, when and with what modifications; whether the FDA will be satisfied with the design of and results from preclinical and clinical studies of COVAXIN, which have been conducted by Bharat Biotech in India; whether and when any Biologics License and/or EUA applications may be filed in the United States for COVAXIN; whether and when any such applications may be approved by the FDA; decisions by the FDA impacting labeling, manufacturing processes, safety and/or other matters that could affect the availability or commercial potential of COVAXIN in the United States, including development of products or therapies by other companies. These and other risks and uncertainties are more fully described in our periodic filings with the Securities and Exchange Commission (“SEC”), including the risk factors described in the section entitled “Risk Factors” in the quarterly and annual reports that we file with the SEC. Any forward-looking statements that we make in this press release speak only as of the date of this press release. Except as required by law, we assume no obligation to update forward-looking statements contained in this press release whether as a result of new information, future events, or otherwise, after the date of this press release.

Corporate Contact:
Ocugen, Inc.
Sanjay Subramanian
CFO and Head of Corp. Dev.
IR@Ocugen.com

Media Contact:
LaVoieHealthScience
Lisa DeScenza
ldescenza@lavoiehealthscience.com
+1 978-395-5970


OCUGEN, INC.

CONSOLIDATED BALANCE SHEETS

(in thousands)

(Unaudited)

  March 31, 2021   December 31, 2020
Assets      
Current assets      
Cash and cash equivalents $ 44,792       $ 24,039    
Advance for COVAXIN supply 4,988       —    
Prepaid expenses and other current assets 1,576       1,839    
Total current assets 51,356       25,878    
Property and equipment, net 762       633    
Restricted cash 151       151    
Other assets 1,578       714    
Total assets $ 53,847       $ 27,376    
Liabilities and stockholders’ equity      
Current liabilities      
Accounts payable $ 1,040       $ 395    
Accrued expenses and other current liabilities 2,703       2,941    
Short-term debt, net 374       234    
Operating lease obligation 164       44    
Total current liabilities 4,281       3,614    
Non-current liabilities      
Operating lease obligation, less current portion 1,375       389    
Long term debt, net 1,702       1,823    
Total liabilities 7,358       5,826    
Stockholders’ equity      
Convertible preferred stock 1       —    
Common stock 1,883       1,841    
Treasury stock (48 )     (48 )  
Additional paid-in capital 125,032       93,059    
Accumulated deficit (80,379 )     (73,302 )  
Total stockholders’ equity 46,489       21,550    
Total liabilities and stockholders’ equity $ 53,847       $ 27,376    



OCUGEN, INC.

CONSOLIDATED STATEMENTS OF OPERATIONS

(in thousands, except share and per share amounts)

(Unaudited)

  Three months ended March 31,
  2021   2020
Operating expenses      
Research and development $ 2,872       $ 1,652    
General and administrative 4,185       2,277    
Total operating expenses 7,057       3,929    
Loss from operations (7,057 )     (3,929 )  
Other income (expense)      
Interest expense (20 )     (15 )  
Total other income (expense) (20 )     (15 )  
Net loss $ (7,077 )     $ (3,944 )  
Shares used in calculating net loss per common share — basic and diluted 186,298,122       52,627,228    
Net loss per share of common stock — basic and diluted $ (0.04 )     $ (0.07 )  

Release – Avivagen (VIVXF)(VIV:CA) – Terminates Exclusive U.S. Sales and Distribution Agreement

Posted on by Admin


Avivagen Terminates Exclusive U.S. Sales and Distribution Agreement

 

  • Agreement with CSA Animal Nutrition to be terminated effective immediately
  • Avivagen to explore new sales and distributions opportunities to capitalize on significant market opportunity in the United States

OTTAWA, Ontario — Avivagen Inc. (TSXV:VIV, OTCQB:VIVXF) (“Avivagen”), a life sciences corporation focused on developing and commercializing products for livestock, companion animal and human applications that safely enhances feed intake and supports immune function, thereby supporting general health and performance, has announced that it has terminated its sales and distribution agreement with CSA Animal Nutrition in the United States.

“We’ve seen demand for OxC-beta™ Livestock grow rapidly in key markets across Asia and throughout Mexico, and will be looking to replicate that same corporate strategy and success in the United States moving forward,” said Kym Anthony, Chief Executive Officer, Avivagen Inc. “We appreciate all of CSA’s efforts on Avivagen’s behalf over the past few years.”

With production of 215 million tonnes of livestock feed in 2020, the United States accounts for 18% of the world’s 1.19 Billion tonne global livestock feed market.i

About OxC-beta™ Technology and OxC-beta™ Livestock
Avivagen’s OxC-beta™ technology is derived from Avivagen discoveries about ?-carotene and other carotenoids, compounds that give certain fruits and vegetables their bright colours. Through support of immune function the technology provides a non-antibiotic means of promoting health and growth. OxC-beta™ Livestock is a proprietary product shown to be an effective and economic alternative to the antibiotics commonly added to livestock feeds. The product is currently available for sale in the United States, Philippines, Mexico, Taiwan, New Zealand, Thailand, Brazil, Australia and Malaysia.

Avivagen’s OxC-beta™ Livestock product is safe, effective and could fulfill the global mandate to remove all in-feed antibiotics as growth promoters. Numerous international livestock trials with poultry and swine using OxC-beta™ Livestock have proven that the product performs as well as, and, sometimes, in some aspects, better than in-feed antibiotics.

About Avivagen
Avivagen is a life sciences corporation focused on developing and commercializing products for livestock, companion animal and human applications that, by safely supporting immune function, promote general health and performance. It is a public corporation traded on the TSX Venture Exchange under the symbol VIV and is headquartered in Ottawa, Canada, based in partnership facilities of the National Research Council of Canada. For more information, visit www.avivagen.com. The contents of the website are expressly not incorporated by reference in this press release.

Forward Looking Statements
This news release includes certain forward-looking statements that are based upon the current expectations of management. Forward-looking statements involve risks and uncertainties associated with the business of Avivagen Inc. and the environment in which the business operates. Any statements contained herein that are not statements of historical facts may be deemed to be forward-looking, including those identified by the expressions “aim”, “anticipate”, “appear”, “believe”, “consider”, “could”, “estimate”, “expect”, “if”, “intend”, “goal”, “hope”, “likely”, “may”, “plan”, “possibly”, “potentially”, “pursue”, “seem”, “should”, “whether”, “will”, “would” and similar expressions. Statements set out in this news release relating to the future plans of Avivagen’s customers and the potential for additional and/or increased orders from such customers, Avivagen’s expectations as to growth of its branding in certain jurisdictions, continued distribution and acceptance of Avivagen’s technology, anticipated growth in demand for Avivagen’s products, the potential for Avivagen’s products to be commercialized in human applications, the anticipated date of fulfillment for the order described, the possibility for OxC-beta™ Livestock to replace antibiotics in livestock feeds as well as fill a critical need for health support in certain livestock applications where antibiotics are precluded and the size of market opportunities are all forward-looking statements. These forward-looking statements are subject to a number of risks and uncertainties that could cause actual results or events to differ materially from current expectations. For instance, the order described may not result in new orders for Avivagen’s products, the customer plans may change due to many reasons, demand for Avivagen’s products may not continue to grow and could decline, Avivagen’s brand recognition may not increase as anticipated or could be impacted by negative events, Avivagen’s products may not gain market acceptance or regulatory approval in new jurisdictions or for new applications, including human applications, and may not be widely accepted as a replacement for antibiotics in livestock feeds, new market access may not occur in the timeline or manner expected by Avivagen, timing of fulfillment of the order may be delayed beyond current expectation for a number of reasons which would push fulfillment and recognition of revenues for this order into a future quarter and the market opportunities may not be as large as Avivagen anticipates, in each case due to many factors, many of which are outside of Avivagen’s control. Readers are referred to the risk factors associated with the business of Avivagen set out in Avivagen’s most recent management’s discussion and analysis of financial condition available at www.SEDAR.com. Except as required by law, Avivagen assumes no obligation to update the forward-looking statements, or to update the reasons why actual results could differ from those reflected in the forward-looking statements.

Neither TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.

Copyright © 2021 Avivagen Inc. OxC-beta™ is a trademark of Avivagen Inc

https://www.world-grain.com/articles/14784-global-feed-output-rises-by-1-in-2020

Contacts

Avivagen Inc.
Drew Basek
Director of Investor Relations
100 Sussex Drive, Ottawa, Ontario, Canada K1A 0R6
Phone: 416-540-0733
E-mail: d.basek@avivagen.com

Kym Anthony
Chief Executive Officer
100 Sussex Drive, Ottawa, Ontario, Canada K1A 0R6
Head Office Phone: 613-949-8164
Website: www.avivagen.com

Kratos Defense and Security Solutions (KTOS) – Awarded Approximately $46 Million to Support Space Domain Awareness Efforts

Posted on by Admin


Kratos Awarded Approximately $46 Million to Support Space Domain Awareness Efforts

 

SAN DIEGO, 
May 06, 2021 (GLOBE NEWSWIRE) — 
Kratos Defense & Security Solutions, Inc. (Nasdaq: KTOS), a leading National Security Solutions provider, announced today that it has received multiple awards totaling more than 
$46 million to support Space Domain Awareness (SDA) efforts.

Space is becoming increasingly congested, contested, and competitive, driving the need for enhanced SDA, the ability to identify, locate, and track potential threats to on-orbit space systems through a more comprehensive view of the space environment.

“These awards demonstrate the increasing need for technologies that help provide greater SDA,” explained  Phil Carrai, President of Kratos’ Space, Training, and Cybersecurity Division. “We continue to support many global programs and initiatives to meet the requirement for more resilient and robust ground satellite communications.”

With the increasing volume and velocity of threats, Kratos is leveraging the technology behind its OpenSpace software platform to help satellite ground systems quickly adapt to changing conditions. The platform’s software-centric architecture used with Kratos’ global monitoring network enables assets to be reconfigured and redeployed virtually, delivering much faster responses to potential threats in space. The OpenSpace platform is designed to make ground stations more adaptable, resilient, and secure.

“In today’s space environment, you must be able to rapidly identify and immediately respond to threats,” stated  Frank Backes, Senior Vice President, Kratos Space Federal. “There has been a shift in SDA because the concern isn’t just where objects are, but also what adversaries are capable of doing in that area. Kratos’ advanced technologies provide a more complete operational picture of the space domain to help protect government and commercial satellites from hazards and threats.”

Kratos provides actionable insights to mitigate threats by monitoring, analyzing, and fusing relevant data across the space domain by using its extensive RF sensor ground network. The network consists of global RF monitoring sites, hosting fixed and steerable sensors and antennas in L, S, C, X, and Ku bands. Kratos’ 24/7/365 
Network Operations Center (NOC) is the central hub for monitoring and integrating raw RF data from this global network. Advanced technologies developed by, and exclusive to, Kratos have been integrated into all levels of this infrastructure, from custom algorithms employed in the sensor network, to industry-leading commercial applications used in the NOC for data monitoring, correlation and geolocation, as well as specially-developed analytics that provide the real meaning behind the raw data.

Due to competitive, customer-related and other considerations, no additional information will be provided.

About Kratos Defense & Security Solutions

Kratos Defense & Security Solutions, Inc. (NASDAQ:KTOS) develops and fields transformative, affordable technology, platforms and systems for United States National Security related customers, allies and commercial enterprises. Kratos is changing the way breakthrough technology for these industries are rapidly brought to market through proven commercial and venture capital backed approaches, including proactive research and streamlined development processes. At Kratos, affordability is a technology and we specialize in unmanned systems, satellite communications, cyber security/warfare, microwave electronics, missile defense, hypersonic systems, training, combat systems and next generation turbo jet and turbo fan engine development. For more information go to www.KratosDefense.com.

Notice Regarding Forward-Looking Statements

Certain statements in this press release may constitute “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. These forward-looking statements are made on the basis of the current beliefs, expectations and assumptions of the management of Kratos and are subject to significant risks and uncertainty. Investors are cautioned not to place undue reliance on any such forward-looking statements. All such forward-looking statements speak only as of the date they are made, and Kratos undertakes no obligation to update or revise these statements, whether as a result of new information, future events or otherwise. Although Kratos believes that the expectations reflected in these forward-looking statements are reasonable, these statements involve many risks and uncertainties that may cause actual results to differ materially from what may be expressed or implied in these forward-looking statements. For a further discussion of 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 Kratos in general, see the risk disclosures in the Annual Report on Form 10-K of Kratos for the year ended 
December 27, 2020, and in subsequent reports on Forms 10-Q and 8-K and other filings made with the 
SEC by Kratos.

Press Contact:
Yolanda White
858-812-7302 Direct

Investor Information:
877-934-4687
investor@kratosdefense.com

Source: Kratos Defense & Security Solutions, Inc.

 

Avivagen (VIVXF)(VIV:CA) – Continues Market Growth with New Customer Win in Western Mexico

Posted on by Admin


Avivagen Continues Market Growth with New Customer Win in Western Mexico

 

Order signifies important growth in key production territories in Mexico

Ottawa, ON / Business Wire/ May 6, 2021 / –Avivagen Inc.  (TSXV:VIV, OTCQB:VIVXF) (“Avivagen”), a life sciences corporation focused on developing and commercializing products for livestock, companion animal and human applications that safely enhances feed intake and supports immune function, thereby supporting general health and performance, is pleased to announce it has finalized an introductory order of OxC-beta™ Livestock for use in Western Mexico. The order, which was received by Meyenberg International Group, Avivagen’s consultant in Mexico, is with an entrepreneur based in the region who plans to work with Meyenberg International Group to distribute the product to the numerous dairy farms throughout the region.

The initial 200 kg order is similar in size to past introductory customer orders, many of whom later become repeat customers at larger quantities.

“We are making great strides in the Mexican feed production market, and today’s new customer order reflects the continued growth in demand for OxC-beta™> Livestock in new regions throughout the country,” said Kym Anthony, Chief Executive Officer, Avivagen Inc.  “We’re very excited about the growth potential with this customer, and by the fact that word is spreading across the country about the effectiveness of OxC-beta™ Livestock as a highly effective alternative to antibiotics for dairy producers.”

About OxC-beta™ Technology and OxC-beta™ Livestock
Avivagen’s OxC-beta™ technology is derived from Avivagen discoveries about beta-carotene and other carotenoids, compounds that give certain fruits and vegetables their bright colours. Through support of immune function the technology provides a non-antibiotic means of promoting health and growth. OxC-beta™ Livestock is a proprietary product shown to be an effective and economic alternative to the antibiotics commonly added to livestock feeds. The product is currently available for sale in the United States, Philippines, Mexico, Taiwan, New Zealand, Thailand, Brazil, Australia and Malaysia.

Avivagen’s OxC-beta™ Livestock product is safe, effective and could fulfill the global mandate to remove all in-feed antibiotics as growth promoters. Numerous international livestock trials with poultry and swine using OxC-beta™ Livestock have proven that the product performs as well as, and, sometimes, in some aspects, better than in-feed antibiotics.

About Avivagen
Avivagen is a life sciences corporation focused on developing and commercializing products for livestock, companion animal and human applications that, by safely supporting immune function, promote general health and performance.  It is a public corporation traded on the TSX Venture Exchange under the symbol VIV and is headquartered in Ottawa, Canada, based in partnership facilities of the National Research Council of Canada. For more information, visit www.avivagen.com. The contents of the website are expressly not incorporated by reference in this press release.

Forward Looking Statements
This news release includes certain forward-looking statements that are based upon the current expectations of management. Forward-looking statements involve risks and uncertainties associated with the business of Avivagen Inc. and the environment in which the business operates. Any statements contained herein that are not statements of historical facts may be deemed to be forward-looking, including those identified by the expressions “aim”, “anticipate”, “appear”, “believe”, “consider”, “could”, “estimate”, “expect”, “if”, “intend”, “goal”, “hope”, “likely”, “may”, “plan”, “possibly”, “potentially”, “pursue”, “seem”, “should”, “whether”, “will”, “would” and similar expressions. Statements set out in this news release relating to the planned distribution of the product to dairy farms in the region, future plans of Avivagen’s customers and the potential for additional and/or increased orders from such customers, Avivagen’s expectations as to growth in demand for Avivagen’s products,   the possibility for OxC-beta™ Livestock to replace antibiotics in livestock feeds as well as fill a critical need for health support in certain livestock applications where antibiotics are precluded and the size of market opportunities are all forward-looking statements. These forward-looking statements are subject to a number of risks and uncertainties that could cause actual results or events to differ materially from current expectations. For instance, Avivagen has no control over the planned distribution by such customer, the order described may not result in new orders for Avivagen’s products,  the customer plans may change due to many reasons, demand for Avivagen’s products may not continue to grow and could decline, Avivagen’s products may not gain market acceptance or regulatory approval in new jurisdictions or for new applications and may not be widely accepted as a replacement for antibiotics in livestock feeds, timing of fulfillment of the order may be delayed beyond current expectation for a number of reasons which would push fulfillment and recognition of revenues for this order into a future quarter and the market opportunities may not be as large as Avivagen anticipates, in each case due to many factors, many of which are outside of Avivagen’s control.  Readers are referred to the risk factors associated with the business of Avivagen set out in Avivagen’s most recent management’s discussion and analysis of financial condition available at www.SEDAR.com. Except as required by law, Avivagen assumes no obligation to update the forward-looking statements, or to update the reasons why actual results could differ from those reflected in the forward-looking statements.

Neither TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.

For more information:
Avivagen Inc.
Drew Basek
Director of Investor Relations
100 Sussex Drive, Ottawa, Ontario, Canada K1A 0R6
Phone: 416-540-0733
E-mail: d.basek@avivagen.com

Kym Anthony
Chief Executive Officer
100 Sussex Drive, Ottawa, Ontario, Canada K1A 0R6
Head Office Phone: 613-949-8164
Website: www.avivagen.com

 

CoreCivic (CXW) – Reports First Quarter 2021 Financial Results

Posted on by Admin


CoreCivic Reports First Quarter 2021 Financial Results

 

BRENTWOOD, Tenn., May 05, 2021 (GLOBE NEWSWIRE) — CoreCivic, Inc. (NYSE: CXW) (the Company) announced today its financial results for the first quarter of 2021.

Financial Highlights – First Quarter 2021

  • Total revenue of $454.7 million
    • CoreCivic Safety revenue of $409.8 million
    • CoreCivic Community revenue of $23.7 million
    • CoreCivic Properties revenue of $21.3 million
  • Special items include income tax expense of $114.2 million primarily associated with change in corporate tax structure and $51.7 million for a shareholder litigation settlement
  • Net loss attributable to common stockholders of $125.6 million
  • Diluted loss per share of $1.05
  • Adjusted diluted EPS of $0.24
  • Normalized FFO per diluted share of $0.44
  • Adjusted EBITDA of $96.3 million

Damon T. Hininger, CoreCivic’s President and Chief Executive Officer, said, “While our GAAP financial results were impacted by certain non-recurring charges related to our conversion from a REIT to a taxable C-corporation and a shareholder litigation settlement, we are pleased with the strong underlying performance of the business despite the challenges of operating during the COVID-19 pandemic. We continue to generate strong cash flows and remain focused on repaying debt to improve our credit profile. Following the revocation of our REIT status, in April we were able to successfully access the credit markets to extend our debt maturities by issuing unsecured senior notes.”

We are dedicated to helping those in our care be successful in their next step in life. Every day, our chaplains, counselors and instructors help nearly 1,500 inmates learn the life and vocational skills they need to find and keep employment once released. Every year, our dedicated teachers help more than 1,500 inmates earn a GED, which research shows makes them 30% less likely to return to prison after they’re released. We help our government partners solve some of their toughest challenges by providing flexibility to manage constantly changing needs and populations and delivering on proven reentry programs that fight recidivism and change lives.

First Quarter 2021 Financial Results Compared With First Quarter 2020

Net loss attributable to common stockholders in the first quarter of 2021 totaled $125.6 million, or $1.05 per diluted share, and was driven by $154.8 million, or $1.29 per share, of special items, compared with net income attributable to common stockholders generated in the first quarter of 2020 of $32.1 million, or $0.27 per diluted share. Adjusted for special items, net income in the first quarter of 2021 was $29.3 million, or $0.24 per diluted share (Adjusted Diluted EPS), compared with adjusted net income in the first quarter of 2020 of $37.2 million, or $0.30 per diluted share. Special items in the first quarter of 2021 included a non-recurring charge of $114.2 million in income taxes primarily associated with change in corporate tax structure, $51.7 million in shareholder litigation expense, $1.6 million in expenses associated with COVID-19, $1.3 million in asset impairments, less $14.1 million of income tax benefits for the aforementioned special items. Special items in the first quarter of 2020 included $3.1 million of deferred tax expenses related to our Kansas lease structure, $0.5 million in asset impairments, and $0.3 million of expenses associated with mergers and acquisitions.

Funds From Operations (FFO) was a loss of $100.9 million, or $0.83 per diluted share, in the first quarter of 2021, compared to $61.7 million, or $0.51 per diluted share, in the first quarter of 2020. Normalized FFO, which excludes the special items described above, was $53.0 million, or $0.44 per diluted share, in the first quarter of 2021, compared with $65.3 million, or $0.54 per diluted share, in the first quarter of 2020.

EBITDA was $41.6 million in the first quarter of 2021, compared with $99.5 million in the first quarter of 2020. Adjusted EBITDA, which excludes the special items described above, was $96.3 million in the first quarter of 2021, compared with $100.4 million in the first quarter of 2020, including a decrease of $2.3 million resulting from the sale of 42 properties sold in the fourth quarter of 2020.   

Adjusted financial results in the first quarter of 2021, compared with the first quarter of 2020, declined primarily because 2021 financial results reflect an income tax provision under our new corporate tax structure, compared with the prior year when we were entitled to a deduction for dividends paid as a real estate investment trust (REIT). As a REIT, therefore, we incurred very little income tax expense. Financial results in 2021 also reflected lower utilization under contracts with Immigration and Customs Enforcement (ICE) and modest occupancy declines across many of our state-level contracts due to the ongoing impact of COVID-19.

Issuance of Senior Unsecured Notes

On April 14, 2021, we completed the offering of $450.0 million aggregate principal amount of 8.25% senior unsecured notes, due April 2026 (the new notes). The new notes priced at 99% of face value and as a result have an effective yield to maturity of 8.5%. We used net proceeds from the offering of the new notes of approximately $435.1 million, after deducting the original issuance, underwriting discounts, and estimated offering expenses, to redeem all $250.0 million principal amount of our outstanding 5.0% senior unsecured notes due 2022, which have been called for redemption on May 14, 2021 by a redemption notice issued on April 14, 2021, including the payment of the applicable make-whole amount and accrued interest. We used additional net proceeds from the offering to repay $149.0 million of the $350.0 million principal amount of our outstanding 4.625% senior unsecured notes due 2023 (the 2023 notes) at an aggregate purchase price of $151.2 million in privately negotiated transactions, reducing the outstanding balance of the 2023 notes to $201.0 million. The remaining net proceeds from the offering were used to pay-down a portion of the amounts outstanding under our revolving credit facility and for general corporate purposes.

Business Development Update

Update on Contracts with the United States Marshals Service.
Pursuant to President Biden’s Executive Order on Reforming Our Incarceration System to Eliminate the Use of Privately Operated Criminal Detention Facilities, or the Private Prison EO, the U.S. Marshals Service (“USMS”) has indicated that it has been advised by the Office of the Deputy Attorney General not to renew existing contracts, or enter into new contracts for private detention facilities. We currently have four contracts with the USMS that expire in 2021. The USMS has notified the Company that it will not be renewing its contract for our Northeast Ohio Correctional Center, which expires May 30, 2021. We continue to explore opportunities with various government agencies, including the state of Ohio, the primary user of the Northeast Ohio facility, to replace the capacity currently used by the USMS.   

In addition to the contract with the USMS for our Northeast Ohio Correctional Center, the USMS has full access to our 600-bed West Tennessee Detention Facility and our 1,033-bed Leavenworth Detention Center under direct contracts with the USMS that expire in September 2021 and December 2021, respectively. The USMS also utilizes less than 100 of the 664 beds at our Crossroads Correctional Center under a contract that was scheduled to expire in April 2021, but was extended through June 30, 2021, and is not expected to be renewed thereafter. We currently expect the USMS to relocate detainees at the Crossroads Correctional Center. The state of Montana, which utilizes the remaining capacity at the Crossroads facility, has expressed a desire to utilize the beds used by the USMS at the facility, and we currently expect to incorporate their utilization into a contract renewal that begins July 1, 2021, negating the financial impact of the USMS vacancy. We do not yet know if the USMS will relocate the detainees at our West Tennessee and Leavenworth facilities. We continue to work with the USMS to enable it to fulfill its mission, including at the Northeast Ohio, West Tennessee, and Leavenworth facilities. However, we can provide no assurance that we will be able to provide a solution that is acceptable to all parties that would be involved in such a solution.

Financial Guidance

At this time we are not providing 2021 financial guidance because of uncertainties associated with COVID-19, as well as uncertainties associated with the application of the administration’s various executive actions and policies related to immigration and criminal justice. We do not expect to provide financial guidance until we have further clarity around these uncertainties. Our business is very durable, and continues to generate cash flow even during these unprecedented disruptions to the economy and criminal justice system. This resiliency is due to the essential nature of our facilities and services in our Safety and Community segments, further enhanced by the stability of our Properties segment, all supported by payments from highly rated federal, state, and local government agencies.  

Supplemental Financial Information and Investor Presentations

We have made available on our website supplemental financial information and other data for the first quarter of 2021.   Interested parties may access this information through our website at http://ir.corecivic.com/ under “Financial Information” of the Investors section.   We do not undertake any obligation, and disclaim any duties to update any of the information disclosed in this report.  

Management may meet with investors from time to time during the second quarter of 2021.  Written materials used in the investor presentations will also be available on our website beginning on or about May 17, 2021.  Interested parties may access this information through our website at http://ir.corecivic.com/ under “Events & Presentations” of the Investors section.

Conference Call, Webcast and Replay Information

We will host a webcast conference call at 10:00 a.m. central time (11:00 a.m. eastern time) on Thursday, May 6, 2021, and will be accessible through the Company’s website at www.corecivic.com under the “Events & Presentations” section of the “Investors” page. The live broadcast can also be accessed by dialing 800-367-2403 in the U.S. and Canada, including the confirmation passcode 7487376. An online replay of the call will be archived on our website promptly following the conference call. In addition, there will be a telephonic replay available beginning at 1:00 p.m. central time (2:00 p.m. eastern time) on May 6, 2021, through 1:00 p.m. central time (2:00 p.m. eastern time) on May 14, 2021. To access the telephonic replay, dial 888-203-1112 in the U.S. and Canada. International callers may dial +1 719-457-0820 and enter passcode 8097453.

About CoreCivic

CoreCivic is a diversified government solutions company with the scale and experience needed to solve tough government challenges in flexible, cost-effective ways. CoreCivic provides a broad range of solutions to government partners that serve the public good through corrections and detention management, a network of residential reentry centers to help address America’s recidivism crisis, and government real estate solutions. CoreCivic is the nation’s largest owner of partnership correctional, detention and residential reentry facilities, and believes it is the largest private owner of real estate used by government agencies in the U.S. CoreCivic has been a flexible and dependable partner for government for more than 35 years. CoreCivic’s employees are driven by a deep sense of service, high standards of professionalism and a responsibility to help government better the public good.

Forward-Looking Statements

This press release contains statements as to our beliefs and expectations of the outcome of future events that are “forward-looking” statements within the meaning of Section 21E of the Securities Exchange Act of 1934, as amended, and the Private Securities Litigation Reform Act of 1995. These forward-looking statements are subject to risks and uncertainties that could cause actual results to differ materially from the statements made. These include, but are not limited to, the risks and uncertainties associated with: (i) changes in government policy (including the United States Department of Justice, or DOJ, not renewing contracts as a result of the Private Prison EO) (two agencies of the DOJ, the United States Federal Bureau of Prisons and the USMS utilize our services), legislation and regulations that affect utilization of the private sector for corrections, detention, and residential reentry services, in general, or our business, in particular, including, but not limited to, the continued utilization of our correctional and detention facilities by the federal government, and the impact of any changes to immigration reform and sentencing laws (our company does not, under longstanding policy, lobby for or against policies or legislation that would determine the basis for, or duration of, an individual’s incarceration or detention); (ii) our ability to obtain and maintain correctional, detention, and residential reentry facility management contracts because of reasons including, but not limited to, sufficient governmental appropriations, contract compliance, negative publicity and effects of inmate disturbances; (iii) changes in the privatization of the corrections and detention industry, the acceptance of our services, the timing of the opening of new facilities and the commencement of new management contracts (including the extent and pace at which new contracts are utilized), as well as our ability to utilize available beds; (iv) general economic and market conditions, including, but not limited to, the impact governmental budgets can have on our contract renewals and renegotiations, per diem rates, and occupancy; (v) fluctuations in our operating results because of, among other things, changes in occupancy levels, competition, contract renegotiations or terminations, increases in costs of operations, fluctuations in interest rates and risks of operations; (vi) the duration of the federal government’s denial of entry at the United States southern border to asylum-seekers and anyone crossing the southern border without proper documentation or authority in an effort to contain the spread of COVID-19; (vii) government and staff responses to staff or residents testing positive for COVID-19 within public and private correctional, detention and reentry facilities, including the facilities we operate; (viii)  restrictions associated with COVID-19 that disrupt the criminal justice system, along with government policies on prosecutions and newly ordered legal restrictions that affect the number of people placed in correctional, detention, and reentry facilities; (ix) whether revoking our REIT election, effective January 1, 2021, and our revised capital allocation strategy can be implemented in a cost effective manner that provides the expected benefits, including facilitating our planned debt reduction initiative and planned return of capital to shareholders; (x) our ability to identify and consummate the sale of additional non-core assets at attractive prices; (xi) our ability to successfully identify and consummate future development and acquisition opportunities and our ability to successfully integrate the operations of our completed acquisitions and realize projected returns resulting therefrom; (xii) increases in costs to develop or expand real estate properties that exceed original estimates, or the inability to complete such projects on schedule as a result of various factors, many of which are beyond our control, such as the effects of, and delays caused by, COVID-19, weather, the availability of labor and materials, labor conditions, delays in obtaining legal approvals, unforeseen engineering, archeological or environmental problems, and cost inflation, resulting in increased construction costs; (xiii) our ability to identify and initiate service opportunities that were unavailable under our former REIT structure; (xiv) our ability to have met and maintained qualification for taxation as a REIT for the years we elected REIT status; and (xv) the availability of debt and equity financing on terms that are favorable to us, or at all, including financing we are pursuing on behalf of the state of Alabama for the construction of two correctional facilities. Other factors that could cause operating and financial results to differ are described in the filings we make from time to time with the Securities and Exchange Commission.

CoreCivic takes no responsibility for updating the information contained in this press release following the date hereof to reflect events or circumstances occurring after the date hereof or the occurrence of unanticipated events or for any changes or modifications made to this press release or the information contained herein by any third-parties, including, but not limited to, any wire or internet services.


CORECIVIC, INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
(UNAUDITED AND AMOUNTS IN THOUSANDS, EXCEPT PER SHARE AMOUNTS)

ASSETS   March 31,
2021		   December 31,
2020
         
Cash and cash equivalents   $ 168,141     $ 113,219  
Restricted cash     16,413       23,549  
Accounts receivable, net of credit loss reserve of $6,105 and $6,103, respectively     259,620       267,705  
Prepaid expenses and other current assets     27,681       33,243  
Assets held for sale     281,523       279,406  
Total current assets     753,378       717,122  
Real estate and related assets:        
Property and equipment, net of accumulated depreciation of $1,572,711 and $1,559,388, respectively     2,333,340       2,350,272  
Other real estate assets     225,341       228,243  
Goodwill     5,902       5,902  
Non-current deferred tax assets     –       11,113  
Other assets     395,843       396,663  
         
Total assets   $ 3,713,804     $ 3,709,315  
         
LIABILITIES AND STOCKHOLDERS’ EQUITY        
         
Accounts payable and accrued expenses   $ 346,494     $ 274,318  
Current portion of long-term debt     38,914       39,087  
Total current liabilities     385,408       313,405  
         
Long-term debt, net     1,719,115       1,747,664  
Deferred revenue     22,804       18,336  
Non-current deferred tax liabilities     85,356       –  
Other liabilities     210,886       216,468  
         
Total liabilities     2,423,569       2,295,873  
         
Commitments and contingencies        
         
Preferred stock ? $0.01 par value; 50,000 shares authorized; none issued and outstanding at March 31, 2021, and December 31, 2020, respectively     –       –  
Common stock ? $0.01 par value; 300,000 shares authorized; 120,277 and 119,638 shares issued and outstanding at March 31, 2021 and December 31, 2020, respectively     1,203       1,196  
Additional paid-in capital     1,838,066       1,835,494  
Accumulated deficit     (572,305 )     (446,519 )
Total stockholders’ equity     1,266,964       1,390,171  
Non-controlling interest – operating partnership     23,271       23,271  
Total equity     1,290,235       1,413,442  
         
Total liabilities and equity   $ 3,713,804     $ 3,709,315  
                 


CORECIVIC, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS
(UNAUDITED AND AMOUNTS IN THOUSANDS, EXCEPT PER SHARE AMOUNTS)

    For the Three Months Ended
March 31,
      2021       2020  
         
REVENUES:        
Safety   $ 409,769     $ 437,765  
Community     23,658       30,599  
Properties     21,255       22,679  
Other     36       58  
      454,718       491,101  
         
EXPENSES:        
Operating        
Safety     305,427       330,737  
Community     21,100       24,449  
Properties     6,274       6,954  
Other     83       175  
Total operating expenses     332,884       362,315  
General and administrative     29,530       31,279  
Depreciation and amortization     32,712       37,952  
Shareholder litigation expense     51,745       –  
Asset impairments     1,308       536  
      448,179       432,082  
         
OPERATING INCOME     6,539       59,019  
         
OTHER (INCOME) EXPENSE:        
Interest expense, net     18,428       22,538  
Other (income) expense     148       (533 )
      18,576       22,005  
         
INCOME (LOSS) BEFORE INCOME TAXES     (12,037 )     37,014  
         
Income tax expense     (113,531 )     (3,776 )

NET INCOME (LOSS)		  
$
(125,568
)		  
$
33,238		  
         
Net income attributable to non-controlling interest     –       (1,181 )
         

NET INCOME (LOSS) ATTRIBUTABLE TO COMMON STOCKHOLDERS		  
$
(125,568
)		  
$
32,057		  
         
BASIC EARNINGS (LOSS) PER SHARE   $ (1.05 )   $ 0.27  
         
DILUTED EARNINGS (LOSS) PER SHARE   $ (1.05 )   $ 0.27  
                 


CORECIVIC, INC. AND SUBSIDIARIES
SUPPLEMENTAL FINANCIAL INFORMATION
(UNAUDITED AND AMOUNTS IN THOUSANDS, EXCEPT PER SHARE AMOUNTS)

CALCULATION OF ADJUSTED NET INCOME AND ADJUSTED DILUTED EPS

  For the Three Months Ended
March 31,
    2021       2020  
         
Net income (loss) attributable to common stockholders $ (125,568 )   $ 32,057  
Non-controlling interest   –       1,181  
Diluted net income (loss) attributable to common stockholders $ (125,568 )   $ 33,238  
         
Special items:        
Expenses associated with mergers and acquisitions   –       338  
Expenses associated with COVID-19   1,598       –  
Income taxes associated with change in corporate tax structure and other special tax items   114,249       3,085  
Shareholder litigation expense   51,745       –  
Asset impairments   1,308       536  
Income tax benefit for special items   (14,060 )     –  
Adjusted net income $ 29,272     $ 37,197  
               
Weighted average common shares outstanding – basic   119,909       119,336  
Effect of dilutive securities:        
Stock options   –       –  
Restricted stock-based awards   115       47  
Non-controlling interest – operating partnership units   1,342       1,342  
               
Weighted average shares and assumed conversions – diluted   121,366       120,725  
               
Adjusted Earnings Per Diluted Share $ 0.24     $ 0.30  
               


CORECIVIC, INC. AND SUBSIDIARIES
SUPPLEMENTAL FINANCIAL INFORMATION
(UNAUDITED AND AMOUNTS IN THOUSANDS, EXCEPT PER SHARE AMOUNTS)

CALCULATION OF FUNDS FROM OPERATIONS AND NORMALIZED FUNDS FROM OPERATIONS

  For the Three Months Ended
March 31,
    2021       2020  
       
Net income (loss) $ (125,568 )   $ 33,238  
Depreciation and amortization of real estate assets   23,759       28,106  
Impairment of real estate assets   1,308       405  
Income tax benefit for special items   (350 )     –  
Funds From Operations $ (100,851 )   $ 61,749  
       
Expenses associated with mergers and acquisitions   –       338  
Expenses associated with COVID-19   1,598       –  
Income taxes associated with change in corporate tax structure and other special tax items   114,249       3,085  
Shareholder litigation expense   51,745       –  
Goodwill and other impairments   –       131  
Income tax benefit for special items   (13,710 )     –  
Normalized Funds From Operations $ 53,031     $ 65,303  
       
Funds From Operations Per Diluted Share $ (0.83 )   $ 0.51  
               
Normalized Funds From Operations Per Diluted Share $ 0.44     $ 0.54  
               


CORECIVIC, INC. AND SUBSIDIARIES
SUPPLEMENTAL FINANCIAL INFORMATION
(UNAUDITED AND AMOUNTS IN THOUSANDS, EXCEPT PER SHARE AMOUNTS)

CALCULATION OF EBITDA AND ADJUSTED EBITDA

  For the Three Months Ended
March 31,
    2021       2020  
       
Net income (loss) $ (125,568 )   $ 33,238  
Interest expense   20,925       24,555  
Depreciation and amortization   32,712       37,952  
Income tax expense   113,531       3,776  
EBITDA $ 41,600     $ 99,521  
               
Expenses associated with mergers and acquisitions   –       338  
Expenses associated with COVID-19   1,598       –  
Shareholder litigation expense   51,745       –  
Asset impairments   1,308       536  
Adjusted EBITDA $ 96,251     $ 100,395  
               

NOTE TO SUPPLEMENTAL FINANCIAL INFORMATION

Adjusted Net Income, EBITDA, Adjusted EBITDA, FFO, and Normalized FFO, and, where appropriate, their corresponding per share metrics are non-GAAP financial measures. The Company believes that these measures are important operating measures that supplement discussion and analysis of the Company’s results of operations and are used to review and assess operating performance of the Company and its properties and their management teams. The Company believes that it is useful to provide investors, lenders and security analysts disclosures of its results of operations on the same basis that is used by management.   FFO, in particular, is a widely accepted non-GAAP supplemental measure of performance of real estate companies, grounded in the standards for FFO established by the National Association of Real Estate Investment Trusts (NAREIT).

NAREIT defines FFO as net income computed in accordance with GAAP, excluding gains (or losses) from sales of property and extraordinary items, plus depreciation and amortization of real estate and impairment of depreciable real estate and after adjustments for unconsolidated partnerships and joint ventures calculated to reflect funds from operations on the same basis.   EBITDA, Adjusted EBITDA, and Normalized FFO are useful as supplemental measures of performance of the Company’s properties because such measures do not take into account depreciation and amortization, or with respect to EBITDA, the impact of the Company’s tax provisions and financing strategies. Because the historical cost accounting convention used for real estate assets requires depreciation (except on land), this accounting presentation assumes that the value of real estate assets diminishes at a level rate over time.   Because of the unique structure, design and use of the Company’s properties, management believes that assessing performance of the Company’s properties without the impact of depreciation or amortization is useful. The Company may make adjustments to FFO from time to time for certain other income and expenses that it considers non-recurring, infrequent or unusual, even though such items may require cash settlement, because such items do not reflect a necessary or ordinary component of the ongoing operations of the Company.   Normalized FFO excludes the effects of such items. The Company calculates Adjusted Net Income by adding to GAAP Net Income expenses associated with the Company’s debt refinancing, M&A activity, and certain impairments and other charges that the Company believes are unusual or non-recurring to provide an alternative measure of comparing operating performance for the periods presented. Even though expenses associated with mergers and acquisitions may be recurring, the magnitude and timing fluctuate based on the timing and scope of M&A activity, and therefore, such expenses, which are not a necessary component of the ongoing operations of the Company, may not be comparable from period to period.

Other companies may calculate Adjusted Net Income, EBITDA, Adjusted EBITDA, FFO, and Normalized FFO differently than the Company does, or adjust for other items, and therefore comparability may be limited.   Adjusted Net Income, EBITDA, Adjusted EBITDA, FFO, and Normalized FFO and, where appropriate, their corresponding per share measures are not measures of performance under GAAP, and should not be considered as an alternative to cash flows from operating activities, a measure of liquidity or an alternative to net income as indicators of the Company’s operating performance or any other measure of performance derived in accordance with GAAP.   This data should be read in conjunction with the Company’s consolidated financial statements and related notes included in its filings with the Securities and Exchange Commission.

Contact: Investors: Cameron Hopewell – Managing Director, Investor Relations – (615) 263-3024
  Financial Media: David Gutierrez, Dresner Corporate Services – (312) 780-7204

 

Kratos Defense and Security Solutions (KTOS) – Kratos Reports First Quarter Financial Results

Posted on by Admin


Kratos Reports First Quarter Financial Results

 

First Quarter Revenues of $194.2 Million, Increased 15.0
percent over First Quarter 2020

First Quarter Unmanned Systems Segment Revenues of $55.9
Million, Increased 33.1 percent over First Quarter 2020        

First Quarter Cash Flow from Operations of $22.7 Million 

First Quarter 2021 Book to Bill Ratio of 0.8 to 1
Last Twelve Months March 2021 Book to Bill Ratio of 1.3 to 1

SAN DIEGO, 
May 05, 2021 (GLOBE NEWSWIRE) — 
Kratos Defense & Security Solutions, Inc. (Nasdaq: KTOS), a leading National Security Solutions provider, today reported its first quarter 2021 financial results. For the first quarter of 2021, Kratos reported Revenues of 
$194.2 million, Operating Income of 
$4.9 million, Net Income of 
$1.9 million and Adjusted EBITDA of 
$18.1 million.  

First Quarter 2021 Revenues of 
$194.2 million increased 15.0 percent, as compared to Revenues of 
$168.9 million in the first quarter of 2020, reflecting organic growth in Kratos’ Unmanned Systems, Space and Satellite, C5ISR, Microwave Products, Rocket Support Systems and Turbine Technology businesses, offset partially by certain reductions, including in our Training Solutions business, primarily resulting from a previously disclosed reduction in scope of certain international training contracts. Excluding the impact of the 
ASC Signal, TDI and 5D acquisitions, revenue grew organically 8.9 percent in the first quarter of 2021 as compared to the first quarter of 2020. Revenue grew organically 11.6 percent in the first quarter of 2021 on a proforma basis, excluding the impact of the acquisitions and the reduction of the international training contracts.

Operating Income of 
$4.9 million in the first quarter of 2021 increased from 
$4.7 million in the first quarter of 2020, with first quarter 2021 Operating Income including increases in non-cash stock-based compensation expense of 
$1.5 million and R&D of 
$2.3 million over the first quarter of 2020. First Quarter 2021 Adjusted EBITDA of 
$18.1 million increased 11.0 percent, as compared to 
$16.3 million in the first quarter of 2020, primarily reflecting the increase in revenues.

First quarter 2021 Cash Flow generated from Operations was 
$22.7 million, and Free Cash Flow Generated from Operations was 
$13.1 million, after funding 
$9.6 million of capital expenditures. Cash on hand at 
March 28, 2021 was 
$383.6 million. Kratos reported first quarter 2021 Net income of 
$1.9 million, and GAAP EPS of 
$0.02 for the first quarter of 2021, compared to Net Loss of 
$0.2 million and GAAP EPS of 
$0.00 for the first quarter of 2020. Adjusted EPS was 
$0.06 for the first quarter of 2021 compared to 
$0.06 for the first quarter of 2020. The Company has approximately 
$280 million of net operating loss carryforwards, which are expected to substantially shield Kratos from paying future cash income taxes.  

For the first quarter of 2021, Kratos’ Unmanned Systems Segment (KUS) Revenues of 
$55.9 million increased 33.1 percent, as compared to 
$42.0 million in the first quarter of 2020, and KUS operating income increased by 740.0 percent, to 
$4.2 million in the first quarter of 2021 from 
$0.5 million in the first quarter of 2020. First quarter 2021 KUS Adjusted EBITDA of 
$6.4 million increased 178.3 percent, as compared to first quarter 2020 Adjusted EBITDA of 
$2.3 million, primarily reflecting increases in certain target drone programs and leverage achieved with the fixed manufacturing, overhead and general and administrative structure, offset by certain development programs, including tactical drone development programs, which typically generate lower margins.

KUS’s book-to-bill ratio for the first quarter of 2021 was 0.7 to 1.0 and 1.2 to 1.0 for the last twelve months ended 
March 28, 2021, with bookings of 
$247.4 million for the twelve months ended 
March 28, 2021.   Total backlog for KUS at the end of the first quarter of 2021 was 
$222.4 million, down from 
$237.9 million at the end of the fourth quarter of 2020, and up from 
$174.4 million at the end of the first quarter of 2020.      

For the first quarter of 2021, Kratos’ Government Solutions Segment (KGS) reported Revenues of 
$138.3 million, an increase of 9.0 percent, as compared to revenues of 
$126.9 million in the first quarter of 2020, and operating income of 
$7.1 million, down from operating income of 
$9.3 million in the first quarter of 2020, reflecting a less favorable revenue mix, including an increase in development-type programs and product-related revenues primarily resulting from the recent 
ASC Signal acquisition.   Revenues in the first quarter of 2021 include approximately 
$8.6 million from the 
ASC Signal acquisition, offset by reductions of approximately 
$5.0 million in our training solutions business resulting primarily from the previously disclosed scope reductions in certain international training programs. First quarter 2021 KGS Adjusted EBITDA of 
$11.7 million was down from first quarter 2020 Adjusted EBITDA of 
$14.0 million, primarily reflecting a less favorable mix of revenues and increased investments in R&D expenses of approximately 
$2.3 million which were incurred in the space and satellite business.

For the first quarter of 2021, KGS reported a book-to-bill ratio of 0.9 to 1.0, including a book-to-bill ratio of 1.3 to 1.0 in Kratos’ Space, Satellite and Training business. For the twelve months ended 
March 28, 2021, KGS reported a book to bill ratio of 1.3 to 1.0, with bookings of 
$735.2 million for the twelve months ended 
March 28, 2021. KGS total backlog at the end of the first quarter of 2021 was 
$670.5 million, down from 
$684.2 million at the end of the fourth quarter of 2020, and up from 
$472.5 million at the end of the first quarter of 2020.

For the first quarter of 2021, Kratos reported consolidated bookings of 
$164.9 million and a book-to-bill ratio of 0.8 to 1.0, with consolidated bookings of 
$982.6 million and a book-to-bill ratio of 1.3 to 1.0 for the last twelve months ended 
March 28, 2021. Backlog at 
March 28, 2021 was 
$892.9 million, down sequentially from 
$922.2 million at 
December 27, 2020 and up from 
$646.8 million at 
March 29, 2020, and Kratos’ bid and proposal pipeline was 
$9.0 billion at 
March 28, 2021.   Backlog at 
March 28, 2021 was comprised of funded backlog of 
$620.7 million and unfunded backlog of 
$272.2 million.

Eric DeMarco, Kratos’ President and CEO, said, “Since our last report to you, the Fiscal 2022 National Security Budget has been submitted at 
$753 billion, better than we expected and we believe a positive sign for our industry and Kratos.   Importantly, the 
Biden Administration has articulated its areas of focus includes retiring legacy systems and driving rapid innovation, affordability and technology into new and fielded systems, areas where Kratos is a clear industry leader.”  Mr. DeMarco continued, “Representative of this change, affordability and technology focus,  Michael Brown, Director of the Defense Innovation Unit (
DIU), a key strategic partner and customer of Kratos, has been selected to become the Pentagon’s Acquisition Chief, emphasizing Mr. Brown’s success as a disruptive 
DIU change agent and his previous 
Silicon Valley and commercial company experience.”

Mr. DeMarco concluded, “We believe Kratos’ focus on the rapid development and fielding of affordable, disruptive systems, products and solutions, including in unmanned drones, space and satellites, microwave electronics, missile defense, hypersonics, propulsion and lasers is uniquely aligned with today’s National Security requirements and we remain confident in an industry leading, up and to the right organic growth trajectory.”

Financial Guidance

We are providing our second quarter 2021 guidance and reaffirming our previously provided full year 2021 Revenue, Adjusted EBITDA and Cash Flow guidance as follows:



     
$M Q221 FY21
Revenues $195 – 
$205 		$810 – 
$850
R&D $8 – 
$9 		$31 – 
$33
Operating Income $0 – 
$3 		$30 – 
$34
Depreciation $5 – 
$6 		$20 – 
$21
Amortization $2 – 
$3 		$8
Stock Based Compensation $6 $23 – 
$24
Adjusted EBITDA $14 – 
$18 		$81 – 
$87
     
Operating Cash Flow   $20– 
$25
Capital Expenditures   $55 – 
$60
Free Cash Flow Use   (
$30 – 
$40)

The second quarter and full year 2021 estimated revenues and operating performance reflects the expected hardware, product and software mix based on current shipment and execution schedules. The second quarter and full year 2021 estimated revenues also include the impact of the recent loss of a large international training contract, which contributed approximately 
$34.5 million to the Company’s full year 2020 revenues. Our full year 2021 guidance range includes our current forecasted business mix, and our most recent assumptions of the expected impact of COVID-19, of which Kratos experienced increased employee cases at the end of 2020, which continued into 2021, including in 
California and at certain of our drone, space & satellite and C5ISR locations, and recent supplier delays. In addition, estimated second quarter and full year 2021 Operating Income and Adjusted EBITDA reflect the expected mix of development-type contracts and expected investments, primarily in our Space and Satellite, Unmanned, C5ISR and Engine businesses, where we have received or are pursuing a number of large opportunities, including Ground Based Strategic Deterrent (“GBSD”), Over Head Persistent Infrared (OPIR) and Skyborg.

The full year 2021 estimated Operating Cash Flow includes approximately 
$10 million of planned investments in our rocket system and engine businesses for new products, including in the Hypersonic area, and to increase Kratos’ market share, as well as approximately 
$5 million of the required payback of the 2020 deferred employer related payroll taxes. The 2021 capital expenditure forecast currently includes expected outlays of 
$20 to 
$25 million associated with the continued production of Valkyrie aircraft prior to receipt of expected customer award(s); therefore, these aircraft are currently reflected as Company-owned assets until receipt of the related customer award(s). Kratos will adjust the forecasted capital expenditure outlays and the ultimate balance sheet classification of these investments once expected customer orders and the nature of the contract terms can be determined. In addition, the capital expenditure forecast includes investments in the Company’s space and satellite business secure facilities and the Company-owned space domain awareness network, capital investments related to the recent GBSD award, and investments related to the Company’s turbine and rocket system businesses.

Management will discuss the Company’s first quarter 2021 financial results, as well as its second quarter and full year 2021 guidance on a conference call beginning at 
2:00 p.m. Pacific (
5:00 p.m. Eastern) today. Analysts and institutional investors may participate in the conference call by dialing (866) 393-0674, and referencing the call by ID number 5570066. The general public may access the conference call by dialing (877) 344-3935 or on the day of the event by visiting www.kratosdefense.com for a simultaneous webcast. A replay of the webcast will be available on the Kratos web site approximately two hours after the conclusion of the conference call.

About Kratos Defense & Security Solutions

Kratos Defense & Security Solutions, Inc. (NASDAQ:KTOS) develops and fields transformative, affordable technology, platforms, and systems for United States National Security related customers, allies, and commercial enterprises.  Kratos is changing the way breakthrough technologies for these industries are rapidly brought to market through proven commercial and venture capital backed approaches, including proactive research, and streamlined development processes.  At Kratos, affordability is a technology, and we specialize in unmanned systems, satellite communications, cyber security/warfare, microwave electronics, missile defense, hypersonic systems, training and combat systems and next generation turbo jet and turbo fan engine development. For more information go to www.kratosdefense.com.

Notice Regarding Forward–Looking Statements
This news release contains certain forward-looking statements that involve risks and uncertainties, including, without limitation, express or implied statements concerning the Company’s expectations regarding its future financial performance, including the Company’s expectations for its second quarter and full year 2021 revenue, R&D, operating income, depreciation, amortization, stock based compensation expense, and Adjusted EBITDA, and full year 2021 operating cash flow, capital expenditures and other investments, and free cash flow, the Company’s future growth trajectory and ability to achieve improved revenue mix and profit in certain of its business segments and the expected timing of such profit, the Company’s expectation of ramp on projects and that investments in its business will result in an increase in the Company’s market share and total addressable market and position the Company for significant future organic growth, profitability, cash flow and shareholder value, the Company’s bid and proposal pipeline, demand for its products and services, including the Company’s alignment with today’s National Security requirements, ability to successfully compete in the tactical unmanned aerial system area and expected new customer awards, including the magnitude and timing of funding and expected contract awards related to the Company’s Valkyrie program and other new tactical unmanned programs, performance of key contracts and programs, including the timing of production and demonstration related to certain of the Company’s contracts and product offerings, the impact of the Company’s restructuring efforts and cost reduction measures, including its ability to improve profitability and cash flow in certain business units as a result of these actions, benefits to be realized from the Company’s net operating loss carry forwards, the availability and timing of government funding for the Company’s offerings, including the strength of the future funding environment, the short-term delays that may occur as a result of Continuing Resolutions or delays in 
DoD budget approvals, timing of LRIP and full rate production related to the Company’s unmanned aerial target system offerings, as well as the level of recurring revenues expected to be generated by these programs once they achieve full rate production, market and industry developments, and the current estimated impact of COVID-19 on our financial projections, industry, business and operations, including projected growth. Such statements are only predictions, and the Company’s actual results may differ materially from the results expressed or implied by these statements. Investors are cautioned not to place undue reliance on any such forward-looking statements. All such forward-looking statements speak only as of the date they are made, and the Company undertakes no obligation to update or revise these statements, whether as a result of new information, future events or otherwise. Factors that may cause the Company’s results to differ include, but are not limited to: risks to our business and financial results related to the reductions and other spending constraints imposed on the 
U.S. Government and our other customers, including as a result of sequestration and extended continuing resolutions, the Federal budget deficit and Federal government shut-downs; risks of adverse regulatory action or litigation; risks associated with debt leverage and cost savings and cash flow improvements expected as a result of the refinancing of our Senior Notes; risks that our cost-cutting initiatives will not provide the anticipated benefits; risks that changes, cutbacks or delays in spending by the 
U.S. 
DoD may occur, which could cause delays or cancellations of key government contracts; risks of delays to or the cancellation of our projects as a result of protest actions submitted by our competitors; risks that changes may occur in Federal government (or other applicable) procurement laws, regulations, policies and budgets; risks of the availability of government funding for the Company’s products and services due to performance, cost growth, or other factors, changes in government and customer priorities and requirements (including cost-cutting initiatives, the potential deferral of awards, terminations or reduction of expenditures to respond to the priorities of 
Congress and the Administration, or budgetary cuts resulting from Congressional committee recommendations or automatic sequestration under the Budget Control Act of 2011, as amended); risks that the UAS and UGS markets do not experience significant growth; risks that we cannot expand our customer base or that our products do not achieve broad acceptance which could impact our ability to achieve our anticipated level of growth; risks of increases in the Federal government initiatives related to in-sourcing; risks related to security breaches, including cyber security attacks and threats or other significant disruptions of our information systems, facilities and infrastructures; risks related to our compliance with applicable contracting and procurement laws, regulations and standards; risks related to the new DoD Cybersecurity Maturity Model Certification (CMMC); risks relating to contract performance; risks related to failure of our products or services; risks associated with our subcontractors’ or suppliers’ failure to perform their contractual obligations, including the appearance of counterfeit or corrupt parts in our products; changes in the competitive environment (including as a result of bid protests); failure to successfully integrate acquired operations and competition in the marketplace, which could reduce revenues and profit margins; risks that potential future goodwill impairments will adversely affect our operating results; risks that anticipated tax benefits will not be realized in accordance with our expectations; risks that a change in ownership of our stock could cause further limitation to the future utilization of our net operating losses; risks that we may be required to record valuation allowances on our net operating losses which could adversely impact our profitability and financial condition; risks that the current economic environment will adversely impact our business; currently unforeseen risks associated with COVID-19 and risks related to natural disasters or severe weather. These and other risk factors are more fully discussed in the Company’s Annual Report on Form 10-K for the period ended 
December 27, 2020, and in our other filings made with the 
Securities and Exchange Commission.

Note Regarding Use of Non-GAAP Financial Measures and Other Performance Metrics

This news release contains non-GAAP financial measures, including Adjusted earnings per share (computed using income from continuing operations before income taxes, excluding income (loss) from discontinued operations, excluding income (loss) attributable to non-controlling interest, excluding depreciation, amortization of intangible assets, amortization of capitalized contract and development costs, stock-based compensation expense, acquisition and restructuring related items and other, which includes but is not limited to legal related items and foreign transaction gains and losses, less the estimated impact to income taxes) and including Adjusted EBITDA (which includes net income (loss) attributable to noncontrolling interest and excludes, among other things, losses and gains from discontinued operations, acquisition and restructuring related items, stock compensation expense, foreign transaction gains and losses, and the associated margin rates). Additional non-GAAP financial measures include Free Cash Flow from Operations computed as Cash Flow from Operations less Capital Expenditures and Adjusted EBITDA related to our KUS and KGS businesses. Kratos believes this information is useful to investors because it provides a basis for measuring the Company’s available capital resources, the actual and forecasted operating performance of the Company’s business and the Company’s cash flow, excluding non-recurring items and non-cash items that would normally be included in the most directly comparable measures calculated and presented in accordance with GAAP. The Company’s management uses these non-GAAP financial measures along with the most directly comparable GAAP financial measures in evaluating the Company’s actual and forecasted operating performance, capital resources and cash flow. Non-GAAP financial measures should not be considered in isolation from, or as a substitute for, financial information presented in compliance with GAAP, and investors should carefully evaluate the Company’s financial results calculated in accordance with GAAP and reconciliations to those financial statements. In addition, non-GAAP financial measures as reported by the Company may not be comparable to similarly titled amounts reported by other companies. As appropriate, the most directly comparable GAAP financial measures and information reconciling these non-GAAP financial measures to the Company’s financial results prepared in accordance with GAAP are included in this news release.

Another Performance Metric the Company believes is a key performance indicator in our industry is our Book to  Bill Ratio as it provides investors with a measure of the amount of bookings or contract awards as compared to the amount of revenues that have been recorded during the period, and provides an indicator of how much of the Company’s backlog is being burned or utilized in a certain period. The Book to  Bill Ratio is computed as the number of bookings or contract awards in the period divided by the revenues recorded for the same period. The Company believes that the rolling or last twelve months Book to  Bill Ratio is meaningful since the timing of quarter to quarter bookings can vary.

Press Contact:
Yolanda White
858-812-7302 Direct

Investor Information:
877-934-4687
investor@kratosdefense.com



Kratos Defense & Security Solutions, Inc.
Unaudited Condensed Consolidated Statements of Operations
(in millions, except per share data)
         
    Three Months Ended
    March 28,   March 29,
      2021       2020  
         
Service revenues   $ 57.3     $ 63.6  
Product sales     136.9       105.3  
Total revenues     194.2       168.9  
Cost of service revenues     42.5       45.2  
Cost of product sales     100.7       77.9  
Total costs     143.2       123.1  
Gross profit – service revenues     14.8       18.4  
Gross profit – product sales     36.2       27.4  
         
     Total gross profit     51.0       45.8  
         
Selling, general and administrative expenses     35.3       31.5  
Acquisition and restructuring related items     0.2       0.5  
Research and development expenses     8.0       5.7  
Depreciation     1.2       1.5  
Amortization of intangible assets     1.4       1.9  
     Operating income     4.9       4.7  
Interest expense, net     (5.9 )     (5.4 )
Other income (expense), net     0.2       (0.5 )
Loss from continuing operations before income taxes     (0.8 )     (1.2 )
Benefit for income taxes from continuing operations     (2.7 )     (1.4 )
Income from continuing operations     1.9       0.2  
Loss from discontinued operations, net of income taxes     –       (0.4 )
     Net income (loss)     1.9       (0.2 )
     Less: Net income attributable to noncontrolling interest     –       –  
     Net income (loss) attributable to Kratos   $ 1.9     $ (0.2 )
         
Basic income per common share attributable to Kratos:        
     Income from continuing operations   $ 0.02     $ –  
     Loss from discontinued operations     –       –  
     Net income   $ 0.02     $ –  
         
Diluted income per common share attributable to Kratos:        
     Income from continuing operations   $ 0.01     $ –  
     Loss from discontinued operations     –       –  
     Net income   $ 0.01     $ –  
         
Weighted average common shares outstanding:        
     Basic weighted average common shares outstanding     124.1       107.2  
     Diluted weighted average common shares outstanding     127.7       110.1  
         
Adjusted EBITDA (1)   $ 18.1     $ 16.3  
       
         
         
Unaudited Reconciliation of GAAP to Non-GAAP Measures        
         
Note: (1) Adjusted EBITDA is a non-GAAP measure defined as GAAP net income (loss) attributable to Kratos adjusted for net income (loss) attributable to noncontrolling interest, income (loss) from discontinued operations, net interest expense, provision for income taxes, depreciation and amortization expense of intangible assets, amortization of capitalized contract and development costs, stock-based compensation, acquisition and restructuring related items and other, and foreign transaction gain (loss).    
         
Adjusted EBITDA as calculated by us may be calculated differently than Adjusted EBITDA for other companies. We have provided Adjusted EBITDA because we believe it is a commonly used measure of financial performance in comparable companies and is provided to help investors evaluate companies on a consistent basis, as well as to enhance understanding of our operating results. Adjusted EBITDA should not be construed as either an alternative to net income or as an indicator of our operating performance or an alternative to cash flows as a measure of liquidity. The adjustments to calculate this non-GAAP financial measure and the basis for such adjustments are outlined below. Please refer to the following table below that reconciles GAAP net income (loss) to Adjusted EBITDA.     
         
The adjustments to calculate this non-GAAP financial measure, and the basis for such adjustments, are outlined below:
         
Interest income and interest expense, net. The Company receives interest income on investments and incurs interest expense on loans, capital leases and other financing arrangements, including the amortization of issue discounts and deferred financing costs. These amounts may vary from period to period due to changes in cash and debt balances.
         
Income taxes. The Company’s tax expense can fluctuate materially from period to period due to tax adjustments that may not be directly related to underlying operating performance or to the current period of operations and may not necessarily reflect the impact of utilization of our NOLs.  
         
Depreciation. The Company incurs depreciation expense (recorded in cost of revenues and in operating expenses) related to capital assets purchased, leased or constructed to support the ongoing operations of the business. The assets are recorded at cost or fair value and are depreciated over the estimated useful lives of individual assets.
         
Amortization of intangible assets. The Company incurs amortization of intangible expense related to acquisitions it has made. These intangible assets are valued at the time of acquisition and are amortized over the estimated useful lives.
         
Amortization of capitalized contract and development costs. The Company incurs amortization of previously capitalized software development and non-recurring engineering costs related to certain targets in its Unmanned Systems and ballistic missile target businesses as these units are sold.  
         
Stock-based compensation expense. The Company incurs expense related to stock-based compensation included in its GAAP presentation of selling, general and administrative expense. Although stock-based compensation is an expense of the Company and viewed as a form of compensation, these expenses vary in amount from period to period, and are affected by market forces that are difficult to predict and are not within the control of management, such as the market price and volatility of the Company’s shares, risk-free interest rates and the expected term and forfeiture rates of the awards. Management believes that exclusion of these expenses allows comparison of operating results to those of other companies that disclose non-GAAP financial measures that exclude stock-based compensation.
         
Foreign transaction (gain) loss. The Company incurs transaction gains and losses related to transactions with foreign customers in currencies other than the 
U.S. dollar. In addition, certain intercompany transactions can give rise to realized and unrealized foreign currency gains and losses.  
         
Acquisition and transaction related items. The Company incurs transaction related costs, such as legal and accounting fees and other expenses, related to acquisitions and divestiture activities. Management believes these items are outside the normal operations of the Company’s business and are not indicative of ongoing operating results.
         
Restructuring costs. The Company incurs restructuring costs for cost reduction actions which include employee termination costs, facility shut-down related costs and remaining lease commitment costs for excess or exited facilities. Management believes that these costs are not indicative of ongoing operating results as they are either non-recurring and/or not expected when full capacity and volumes are achieved.  
         
Legal related items. The Company incurs costs related to pending legal settlements and other legal related matters. Management believes these items are outside the normal operations of the Company’s business and are not indicative of ongoing operating results.  
         
Adjusted EBITDA is a non-GAAP financial measure and should not be considered in isolation or as a substitute for financial information provided in accordance with GAAP. This non-GAAP financial measure may not be computed in the same manner as similarly titled measures used by other companies. The Company expects to continue to incur expenses similar to the Adjusted EBITDA financial adjustments described above, and investors should not infer from the Company’s presentation of this non-GAAP financial measure that these costs are unusual, infrequent, or non-recurring.
         
Reconciliation of Net income attributable to Kratos to Adjusted EBITDA is as follows:        
         
    Three Months Ended
    March 28,   March 29,
      2021       2020  
         
Net income (loss) attributable to Kratos   $ 1.9     $ (0.2 )
Loss from discontinued operations, net of income taxes     –       0.4  
Interest expense, net     5.9       5.4  
Benefit for income taxes from continuing operations     (2.7 )     (1.4 )
Depreciation (including cost of service revenues and product sales)     4.9       4.4  
Stock-based compensation     6.2       4.7  
Foreign transaction loss     0.1       0.4  
Amortization of intangible assets     1.4       1.9  
Amortization of capitalized contract and development costs     0.2       0.2  
Acquisition and restructuring related items and other     0.2       0.5  
Plus: Net income attributable to noncontrolling interest     –       –  
         
Adjusted EBITDA   $ 18.1     $ 16.3  
         
         
         
Reconciliation of acquisition and restructuring related items and other included in Adjusted EBITDA:    
    Three Months Ended
    March 28,   March 29,
      2021       2020  
Acquisition and transaction related items   $ 0.2     $ 0.4  
Restructuring costs     –       0.1  
         
    $ 0.2     $ 0.5  
         
         
Kratos Defense & Security Solutions, Inc.
Unaudited Segment Data
(in millions)
         
    Three Months Ended
    March 28,   March 29,
      2021       2020  
Revenues:        
   Unmanned Systems   $ 55.9     $ 42.0  
   Kratos Government Solutions     138.3       126.9  
      Total revenues   $ 194.2     $ 168.9  
         
Operating income        
   Unmanned Systems   $ 4.2     $ 0.5  
   Kratos Government Solutions     7.1       9.3  
   Unallocated corporate expense, net     (6.4 )     (5.1 )
      Total operating income   $ 4.9     $ 4.7  
         
Note: Unallocated corporate expense, net includes costs for certain stock-based compensation programs (including stock-based compensation costs for stock options, employee stock purchase plan and restricted stock units), the effects of items not considered part of management’s evaluation of segment operating performance, and acquisition and restructuring related items, corporate costs not allocated to the segments, legal related items, and other miscellaneous corporate activities.
         
Reconciliation of Segment Operating Income to Adjusted EBITDA is as follows:        
         
    Three Months Ended
    March 28,   March 29,
      2021       2020  
Unmanned Systems        
   Operating income   $ 4.2     $ 0.5  
   Other income     0.1       –  
   Depreciation     1.6       1.6  
   Amortization of intangible assets     0.3       –  
   Amortization of capitalized contract and development costs     0.2       0.2  
   Acquisition and restructuring related items and other     –       –  
      Adjusted EBITDA   $ 6.4     $ 2.3  
  % of revenue     11.4%       5.5%  
         
Kratos Government Solutions        
   Operating income   $ 7.1     $ 9.3  
   Other income (expense)     0.2       (0.1 )
   Depreciation     3.3       2.8  
   Amortization of intangible assets     1.1       1.9  
   Amortization of capitalized contract and development costs     –       –  
   Acquisition and restructuring related items and other     –       0.1  
      Adjusted EBITDA   $ 11.7     $ 14.0  
  % of revenue     8.5%       11.0%  
         
     Total Adjusted EBITDA   $ 18.1     $ 16.3  
  % of revenue     9.3%       9.7%  
         
         
         
         
         
Kratos Defense & Security Solutions, Inc.
Unaudited Condensed Consolidated Balance Sheets
(in millions)
         
     
    March 28,   December 27,
      2021       2020  
Assets        
Current assets:        
Cash and cash equivalents   $ 383.6     $ 380.8  
Restricted cash     –       0.7  
Accounts receivable, net     264.6       272.3  
Inventoried costs     85.7       81.2  
Prepaid expenses     13.5       12.0  
Other current assets     21.2       17.8  
Total current assets     768.6       764.8  
Property, plant and equipment, net     146.9       143.8  
Operating lease right-of-use assets     40.8       42.9  
Goodwill     483.7       483.9  
Intangible assets, net     41.6       43.0  
Other assets     83.6       84.4  
Total assets   $ 1,565.2     $ 1,562.8  
Liabilities and Stockholders’ Equity        
Current liabilities:        
Accounts payable   $ 51.9     $ 55.4  
Accrued expenses     32.0       34.7  
Accrued compensation     54.2       48.1  
Accrued interest     6.4       1.5  
Billings in excess of costs and earnings on uncompleted contracts     41.1       34.0  
Current portion of operating lease liabilities     8.9       8.9  
Other current liabilities     13.0       11.9  
Other current liabilities of discontinued operations     2.7       3.1  
Total current liabilities     210.2       197.6  
Long-term debt     300.3       301.0  
Operating lease liabilities, net of current portion     36.4       38.6  
Other long-term liabilities     72.0       83.0  
Other long-term liabilities of discontinued operations     2.5       2.5  
Total liabilities     621.4       622.7  
Commitments and contingencies        
Redeemable noncontrolling interest     14.8       14.8  
Stockholders’ equity:        
Additional paid-in capital     1,557.9       1,556.3  
Accumulated other comprehensive loss     1.6       1.4  
Accumulated deficit     (630.5 )     (632.4 )
Total Kratos stockholders’ equity     929.0       925.3  
Total liabilities and stockholders’ equity   $ 1,565.2     $ 1,562.8  
         
         
         
Kratos Defense & Security Solutions, Inc.
Unaudited Condensed Consolidated Statements of Cash Flows
(in millions)
         
    Three Months Ended
    March 28,   March 29,
      2021       2020  
Operating activities:        
Net income (loss)   $ 1.9     $ (0.2 )
Less: loss from discontinued operations     –       (0.4 )
Income from continuing operations     1.9       0.2  
Adjustments to reconcile income from continuing operations to net cash provided by operating activities from continuing operations:        
Depreciation and amortization     6.3       6.3  
Amortization of lease right-of-use assets     2.2       2.9  
Deferred income taxes     0.1       (1.0 )
Stock-based compensation     6.2       4.7  
Amortization of deferred financing costs     0.2       0.2  
Provision for doubtful accounts     (0.1 )     0.3  
Changes in assets and liabilities, net of acquisitions:        
Accounts receivable     9.8       6.6  
Unbilled receivables     (1.8 )     (1.5 )
Inventoried costs     (4.2 )     (1.5 )
Prepaid expenses and other assets     (2.0 )     (6.8 )
Operating lease liabilities     (2.2 )     (3.4 )
Accounts payable     (2.0 )     (9.6 )
Accrued compensation     6.2       3.7  
Accrued expenses     (2.7 )     (4.4 )
Accrued interest     4.9       4.9  
Billings in excess of costs and earnings on uncompleted contracts     7.1       3.4  
Income tax receivable and payable     (2.2 )     (0.9 )
Other liabilities     (5.0 )     (0.1 )
  Net cash provided by operating activities from continuing operations     22.7       4.0  
Investing activities:        
Cash paid for acquisitions, net of cash acquired     (5.1 )     (14.2 )
Capital expenditures     (9.6 )     (6.4 )
  Net cash used in investing activities from continuing operations     (14.7 )     (20.6 )
Financing activities:        
Payment under finance leases     (0.2 )     (0.1 )
Payments of employee taxes withheld from share-based awards     (7.1 )     (1.2 )
Proceeds from shares issued under equity plans     2.5       2.6  
Net cash provided by (used in) financing activities from continuing operations     (4.8 )     1.3  
Net cash flows from continuing operations     3.2       (15.3 )
   Net operating cash flows of discontinued operations     (0.5 )     1.3  
Effect of exchange rate changes on cash and cash equivalents     (0.6 )     –  
Net increase (decrease) in cash, cash equivalents and restricted cash     2.1       (14.0 )
Cash, cash equivalents and restricted cash at beginning of period     381.5       172.6  
Cash, cash equivalents and restricted cash at end of period   $ 383.6     $ 158.6  
         
         
         
Kratos Defense & Security Solutions, Inc.
Unaudited Non-GAAP Measures
Computation of Adjusted Earnings Per Share
(in millions, except per share data)
         
Adjusted income from continuing operations and adjusted income from continuing operations per diluted common share (Adjusted EPS) are non-GAAP measures for reporting financial performance and exclude the impact of certain items and, therefore, have not been calculated in accordance with GAAP. Management believes that exclusion of these items assists in providing a more complete understanding of the Company’s underlying continuing operations results and trends and allows for comparability with our peer company index and industry. The Company uses these measures along with the corresponding GAAP financial measures to manage the Company’s business and to evaluate its performance compared to prior periods and the marketplace. The Company defines adjusted income from continuing operations before amortization of intangible assets, depreciation, stock-based compensation, foreign transaction gain/loss, and acquisition and restructuring related items and other. The estimated impact to income taxes includes the impact to the effective tax rate, current tax provision and deferred tax provision, and excludes the impact of discrete items, including transaction related expenses and release of valuation allowance, or benefit related to the add-backs.*
Adjusted EPS reflects adjusted income on a per share basis using weighted average diluted shares outstanding.     
         
The following table reconciles the most directly comparable GAAP financial measures to the non-GAAP financial measures.
         
    Three Months Ended
    March 28,   March 29,
      2021       2020  
Net income (loss) attributable to Kratos   $ 1.9     $ (0.2 )
Less: GAAP benefit for income taxes     (2.7 )     (1.4 )
Less: Net income attributable to noncontrolling interest     –       –  
Less: Loss from discontinued operations, net of income taxes     –       0.4  
Loss from continuing operations before taxes     (0.8 )     (1.2 )
Add: Amortization of intangible assets     1.4       1.9  
Add: Amortization of capitalized contract and development costs     0.2       0.2  
Add: Depreciation     4.9       4.4  
Add: Stock-based compensation     6.2       4.7  
Add: Foreign transaction loss     0.1       0.4  
Add: Acquisition and restructuring related items and other     0.2       0.5  
   Non-GAAP Adjusted income from continuing operations before income taxes     12.2       10.9  
Income taxes on Non-GAAP measure Adjusted income from continuing operations*     4.5       4.3  
   Non-GAAP Adjusted net income   $ 7.7     $ 6.6  
         
         
Diluted earnings per common share   $ 0.01     $ –  
Less: GAAP benefit for income taxes     (0.02 )     (0.01 )
Less: Net income attributable to noncontrolling interest     –       –  
Less: Loss from discontinued operations, net of income taxes     –       –  
Add: Amortization of intangible assets     0.01       0.02  
Add: Amortization of capitalized contract and development costs     –       –  
Add: Depreciation     0.04       0.04  
Add: Stock-based compensation     0.05       0.04  
Add: Foreign transaction loss     –       –  
Add: Acquisition and restructuring related items and other     –       0.01  
Income taxes on Non-GAAP measure Adjusted income from continuing operations*     (0.03 )     (0.04 )
Adjusted income from continuing operations per diluted common share   $ 0.06     $ 0.06  
         
Weighted average diluted common shares outstanding     127.7       110.1  
         
*The impact to income taxes is calculated by recasting income before income taxes to include the add-backs involved in determining Adjusted income from continuing operations before income taxes and recalculating the income tax provision (benefit), including current and deferred income taxes, using the Adjusted income from continuing operations before income taxes. The recalculation also adjusts for any discrete tax expense, including transaction related expenses and the release of valuation allowance, or benefit related to the add-backs.

Source: Kratos Defense & Security Solutions, Inc.

Ocugen (OCGN) – Presents New Preclinical OCU200 Data at ARVO 2021 Annual Meeting

Posted on by Admin


Ocugen Presents New Preclinical OCU200 Data at the Association for Research in Vision and Ophthalmology (ARVO) 2021 Annual Meeting

 

  • OCU200, a transferrin-tumstatin fusion protein, demonstrates potential to treat DME, DR, and Wet-AMD

  • OCU200 reduced neovascularization and damage to retina and demonstrated comparable/slightly improved activity to aflibercept in an animal disease model

MALVERN, Pa., May 06, 2021 (GLOBE NEWSWIRE) — Ocugen, Inc. (Nasdaq: OCGN), a biopharmaceutical company focused on discovering, developing, and commercializing gene therapies to cure blindness diseases and developing a vaccine to save lives from COVID-19, today announced the presentation of a pre-clinical study to evaluate efficacy of OCU200 in in-vitro and in-vivo models for ocular neovascular diseases. The data will be featured in a virtual poster presentation entitled “OCU200 (transferrin-tumstatin fusion protein): A potential therapeutic for DME, DR, and wet-AMD” at the Association for Research in Vision and Ophthalmology (ARVO) 2021 Annual Meeting, taking place May 1-7, 2021.

OCU200 is a biologic product candidate in preclinical development for treating severely sight-threatening diseases like Diabetic Macular Edema (DME), Diabetic Retinopathy (DR), and Wet Age-Related Macular Degeneration (Wet-AMD). The purpose of this study was to evaluate efficacy of OCU200 in in-vitro and in-vivo models for ocular neovascular diseases. Angiogenesis and neovascularization are hallmarks for DME, DR, and wet-AMD. Most approved therapeutics target vascular endothelial growth factor (VEGF), a pro-angiogenic factor with neurotrophic and neuroprotective effects. However, approximately 50% of Patients do not respond to anti-VEGF/Corticosteroids therapies.

OCU200 inhibited cell proliferation, cell invasion and tube formation by endothelial cells. In an oxygen induced retinopathy (OIR) mice model, OCU200 significantly reduced avascular areas at low dose (68% reduction, P < 0.05) and high dose (68% reduction, P < 0.05), and significantly reduced neovascular tufts (NVs) at low dose (59% reduction, P < 0.05) and high dose (58% reduction, P < 0.05) compared to vehicle-treated eyes. Aflibercept reduced NVs by 77% (P < 0.01). OCU200 (10 ug) showed comparable activity to aflibercept (20 ug). These findings suggest that OCU200 represents a potential therapeutic for the treatment of DME, DR, and wet-AMD.

“These data show that our novel biologic product candidate, OCU200, may offer potential benefits beyond anti-VEGF therapy and could benefit all patients who do not respond to current therapies,” said Dr. Shankar Musunuri, Chairman of the Board, Chief Executive Officer, and Co-founder of Ocugen. “We look forward to advancing our programs and are dedicated to making new treatment options available for patient populations affected by these diseases.”

Details for the ARVO 2021 presentation are as follows:
   
Title: OCU200 (transferrin-tumstatin fusion protein): A potential therapeutic for DME, DR, and wet-AMD
Presenter: Dr. Arun Upadhyay, VP and Head of R&D, Ocugen Inc.
Abstract No.: 3542029
Session Title:  Cytokines, growth factors, anti-inflammatory
Session Date/Time: May 6, 2021 from 11:15 AM to 12:45 PM EDT
URL:  https://arvo2021.arvo.org/meetings/virtual/75NdGrQYwty2WvX96


About Ocugen, Inc.
Ocugen, Inc. is a biopharmaceutical company focused on discovering, developing, and commercializing gene therapies to cure blindness diseases and developing a vaccine to save lives from COVID-19. Our breakthrough modifier gene therapy platform has the potential to treat multiple retinal diseases with one drug – “one to many” and our novel biologic product candidate aims to offer better therapy to patients with underserved diseases such as wet age-related macular degeneration, diabetic macular edema, and diabetic retinopathy. We are co-developing Bharat Biotech’s COVAXIN™ vaccine candidate for COVID-19 in the U.S. market. For more information, please visit www.ocugen.com.

Cautionary Note on Forward-Looking Statements
This press release contains forward-looking statements within the meaning of The Private Securities Litigation Reform Act of 1995, which are subject to risks and uncertainties. Such forward-looking statements within this press release include, without limitation, the intended use of net proceeds from the registered direct offering. We may, in some cases, use terms such as “predicts,” “believes,” “potential,” “proposed,” “continue,” “estimates,” “anticipates,” “expects,” “plans,” “intends,” “may,” “could,” “might,” “will,” “should” or other words that convey uncertainty of future events or outcomes to identify these forward-looking statements. Such statements are subject to numerous important factors, risks and uncertainties that may cause actual events or results to differ materially from our current expectations, such as market and other conditions. These and other risks and uncertainties are more fully described in our periodic filings with the Securities and Exchange Commission (the “SEC”), including the risk factors described in the section entitled “Risk Factors” in the quarterly and annual reports that we file with the SEC. Any forward-looking statements that we make in this press release speak only as of the date of this press release. Except as required by law, we assume no obligation to update forward-looking statements contained in this press release whether as a result of new information, future events or otherwise, after the date of this press release.

Ocugen Contact:
Ocugen, Inc.
Sanjay Subramanian
CFO and Head of Corp. Dev.
IR@Ocugen.com


Media Contact:
LaVoieHealthScience
Lisa DeScenza
ldescenza@lavoiehealthscience.com
+1 9783955970

Release – Ocugen (OCGN) – Presents New Preclinical OCU200 Data at ARVO 2021 Annual Meeting

Posted on by Admin


Ocugen Presents New Preclinical OCU200 Data at the Association for Research in Vision and Ophthalmology (ARVO) 2021 Annual Meeting

 

  • OCU200, a transferrin-tumstatin fusion protein, demonstrates potential to treat DME, DR, and Wet-AMD

  • OCU200 reduced neovascularization and damage to retina and demonstrated comparable/slightly improved activity to aflibercept in an animal disease model

MALVERN, Pa., May 06, 2021 (GLOBE NEWSWIRE) — Ocugen, Inc. (Nasdaq: OCGN), a biopharmaceutical company focused on discovering, developing, and commercializing gene therapies to cure blindness diseases and developing a vaccine to save lives from COVID-19, today announced the presentation of a pre-clinical study to evaluate efficacy of OCU200 in in-vitro and in-vivo models for ocular neovascular diseases. The data will be featured in a virtual poster presentation entitled “OCU200 (transferrin-tumstatin fusion protein): A potential therapeutic for DME, DR, and wet-AMD” at the Association for Research in Vision and Ophthalmology (ARVO) 2021 Annual Meeting, taking place May 1-7, 2021.

OCU200 is a biologic product candidate in preclinical development for treating severely sight-threatening diseases like Diabetic Macular Edema (DME), Diabetic Retinopathy (DR), and Wet Age-Related Macular Degeneration (Wet-AMD). The purpose of this study was to evaluate efficacy of OCU200 in in-vitro and in-vivo models for ocular neovascular diseases. Angiogenesis and neovascularization are hallmarks for DME, DR, and wet-AMD. Most approved therapeutics target vascular endothelial growth factor (VEGF), a pro-angiogenic factor with neurotrophic and neuroprotective effects. However, approximately 50% of Patients do not respond to anti-VEGF/Corticosteroids therapies.

OCU200 inhibited cell proliferation, cell invasion and tube formation by endothelial cells. In an oxygen induced retinopathy (OIR) mice model, OCU200 significantly reduced avascular areas at low dose (68% reduction, P < 0.05) and high dose (68% reduction, P < 0.05), and significantly reduced neovascular tufts (NVs) at low dose (59% reduction, P < 0.05) and high dose (58% reduction, P < 0.05) compared to vehicle-treated eyes. Aflibercept reduced NVs by 77% (P < 0.01). OCU200 (10 ug) showed comparable activity to aflibercept (20 ug). These findings suggest that OCU200 represents a potential therapeutic for the treatment of DME, DR, and wet-AMD.

“These data show that our novel biologic product candidate, OCU200, may offer potential benefits beyond anti-VEGF therapy and could benefit all patients who do not respond to current therapies,” said Dr. Shankar Musunuri, Chairman of the Board, Chief Executive Officer, and Co-founder of Ocugen. “We look forward to advancing our programs and are dedicated to making new treatment options available for patient populations affected by these diseases.”

Details for the ARVO 2021 presentation are as follows:
   
Title: OCU200 (transferrin-tumstatin fusion protein): A potential therapeutic for DME, DR, and wet-AMD
Presenter: Dr. Arun Upadhyay, VP and Head of R&D, Ocugen Inc.
Abstract No.: 3542029
Session Title:  Cytokines, growth factors, anti-inflammatory
Session Date/Time: May 6, 2021 from 11:15 AM to 12:45 PM EDT
URL:  https://arvo2021.arvo.org/meetings/virtual/75NdGrQYwty2WvX96


About Ocugen, Inc.
Ocugen, Inc. is a biopharmaceutical company focused on discovering, developing, and commercializing gene therapies to cure blindness diseases and developing a vaccine to save lives from COVID-19. Our breakthrough modifier gene therapy platform has the potential to treat multiple retinal diseases with one drug – “one to many” and our novel biologic product candidate aims to offer better therapy to patients with underserved diseases such as wet age-related macular degeneration, diabetic macular edema, and diabetic retinopathy. We are co-developing Bharat Biotech’s COVAXIN™ vaccine candidate for COVID-19 in the U.S. market. For more information, please visit www.ocugen.com.

Cautionary Note on Forward-Looking Statements
This press release contains forward-looking statements within the meaning of The Private Securities Litigation Reform Act of 1995, which are subject to risks and uncertainties. Such forward-looking statements within this press release include, without limitation, the intended use of net proceeds from the registered direct offering. We may, in some cases, use terms such as “predicts,” “believes,” “potential,” “proposed,” “continue,” “estimates,” “anticipates,” “expects,” “plans,” “intends,” “may,” “could,” “might,” “will,” “should” or other words that convey uncertainty of future events or outcomes to identify these forward-looking statements. Such statements are subject to numerous important factors, risks and uncertainties that may cause actual events or results to differ materially from our current expectations, such as market and other conditions. These and other risks and uncertainties are more fully described in our periodic filings with the Securities and Exchange Commission (the “SEC”), including the risk factors described in the section entitled “Risk Factors” in the quarterly and annual reports that we file with the SEC. Any forward-looking statements that we make in this press release speak only as of the date of this press release. Except as required by law, we assume no obligation to update forward-looking statements contained in this press release whether as a result of new information, future events or otherwise, after the date of this press release.

Ocugen Contact:
Ocugen, Inc.
Sanjay Subramanian
CFO and Head of Corp. Dev.
IR@Ocugen.com


Media Contact:
LaVoieHealthScience
Lisa DeScenza
ldescenza@lavoiehealthscience.com
+1 9783955970

InPlay Oil (IPOOF)(IPO:CA) – Now Is a Good Time to Look At InPlay

Posted on by Admin

Thursday, May 06, 2021

InPlay Oil (IPOOF)(IPO:CA)
Now Is a Good Time to Look At InPlay

As of April 24, 2020, Noble Capital Markets research on InPlay Oil is published under ticker symbols (IPOOF and IPO:CA). The price target is in USD and based on ticker symbol IPOOF. Research reports dated prior to April 24, 2020 may not follow these guidelines and could account for a variance in the price target. InPlay Oil is a junior oil and gas exploration and production company with operations in Alberta focused on light oil production. The company operates long-lived, low-decline properties with drilling development and enhanced oil recovery potential as well as undeveloped lands with exploration possibilities. The common shares of InPlay trade on the Toronto Stock Exchange under the symbol IPO and the OTCQZ Exchange under the symbol IPOOF.

Michael Heim, Senior Research Analyst, Noble Capital Markets, Inc.

Refer to the full report for the price target, fundamental analysis, and rating.

    Our price objective was increased 150% last March due to higher energy prices and improved company fundamentals. On March 24th, we raised our P.O. on the shares of IPOOF to $1.50 from $0.60 ($2.00 from $0.45 for the shares of IPO.TO). The increase reflected higher near-term oil prices, lower basin differentials, a better currency exchange rate, decreased operating cost assumptions, improved free cash flow generation and the ability to pay down debt, growth in the company’s proved reserve position, and a shift in valuation metrics with the passing of 2020.

    Since that time, energy prices have moved even higher.  WTI spot prices have risen to approximately $66.50/BBL from $58.56/BBL on March 24th. Western Canada Select (WCS) prices have also risen and now trade near $53/BBL (C$64.60). A $13 differential compares favorably to a differential near $17 at this time last year. Natural gas spot prices are also higher, reaching a current price near $2.95/mcf …



This Company Sponsored Research is provided by Noble Capital Markets, Inc., a FINRA and S.E.C. registered broker-dealer (B/D).

*Analyst certification and important disclosures included in the full report. NOTE: investment decisions should not be based upon the content of this research summary.  Proper due diligence is required before making any investment decision. 

Genco Shipping & Trading Limited (GNK) – In Line Quarter, But Strong Outlook Boosts FY2022E Dividend

Posted on by Admin

Thursday, May 06, 2021

Genco Shipping & Trading Limited (GNK)
In Line Quarter, But Strong Outlook Boosts FY2022E Dividend

Genco Shipping & Trading Limited, incorporated on September 27, 2004, transports iron ore, coal, grain, steel products and other drybulk cargoes along shipping routes through the ownership and operation of drybulk carrier vessels. The Company is engaged in the ocean transportation of drybulk cargoes around the world through the ownership and operation of drybulk carrier vessels. As of December 31, 2016, its fleet consisted of 61 drybulk carriers, including 13 Capesize, six Panamax, four Ultramax, 21 Supramax, two Handymax and 15 Handysize drybulk carriers, with an aggregate carrying capacity of approximately 4,735,000 deadweight tons (dwt). Of the vessels in its fleet, 15 are on spot market-related time charters, and 27 are on fixed-rate time charter contracts. As of December 31, 2016, additionally, 19 of the vessels in its fleet were operating in vessel pools.

Poe Fratt, Senior Research Analyst, Noble Capital Markets, Inc.

Refer to the full report for the price target, fundamental analysis, and rating.

    Call with management today at 9am EST. Number is 800-700-1722 and code is 4187387. Adjusted 1Q2021 EBITDA of $21.0 million in line with expectations. TCE rates averaged $12.2k/day down from $13.2k/day in 4Q2021, with Capes at $13.6k/day, Ultra/Supras at $11.7k/day and Handys at $7.9k/day. Costs were also in line with lower opex more than offsetting higher G&A expenses.

    Increasing 2021 EBITDA estimate to $186.2 million from $145.5 million.  Higher TCE rate assumptions of $19.3k/day, up from $16.4k/day, easily offset a smaller fleet. Forward cover is higher versus 1Q2021 and TCE rates are much higher with 74% of 2Q2021 days booked at $20.7k/day. By sector, forward cover is 72% booked at $24.9k/day for Capes and 76% booked at $17.8k/day for Ultra/Supramaxes. Also …



This research is provided by Noble Capital Markets, Inc., a FINRA and S.E.C. registered broker-dealer (B/D).

*Analyst certification and important disclosures included in the full report. NOTE: investment decisions should not be based upon the content of this research summary.  Proper due diligence is required before making any investment decision. 

DLH Holdings Corp. (DLHC) – A Solid Quarter

Posted on by Admin

Thursday, May 06, 2021

DLH Holdings Corp. (DLHC)
 A Solid Quarter

DLH Holdings Corp is a provider of technology-enabled business process outsourcing and program management solutions in the United States. The company offers services to several government agencies which include the Department of veteran affairs, Department of health and human services, Department of Defense and other government agencies. It operates primarily through prime contracts and also derives its revenue from agencies of the federal government, primarily as a prime contractor but also as a subcontractor to other Federal prime contractors.

Joe Gomes, Senior Research Analyst, Noble Capital Markets, Inc.

Refer to the full report for the price target, fundamental analysis, and rating.

    2QFY21 Results. Revenue totaled $61.5 million, up from $54.8 million in 2Q20. Irving Burton contributed $7.4 million to revenue, while organic revenue declined mostly due to the absence of travel-related program revenue. Earnings were $2.6 million, or $0.19 per share, compared to $2.1 million, or $0.16 per share, last year. We had projected revenue of $58 million and EPS of $0.14.

    Backlog.  Quarter-end backlog was $608.7 million, down from $688.4 million as of September 30, 2020, but the quarter-end number does not reflect the $202 million CMOP logistics contract that was awarded in April 2021. We would note, however, the contract award is under protest. The existing contract has been extended through August 2021 …



This Company Sponsored Research is provided by Noble Capital Markets, Inc., a FINRA and S.E.C. registered broker-dealer (B/D).

*Analyst certification and important disclosures included in the full report. NOTE: investment decisions should not be based upon the content of this research summary.  Proper due diligence is required before making any investment decision. 

Cumulus Media Inc. (CMLS) – An Ebullient Advertising Picture Emerges

Posted on by Admin

Thursday, May 06, 2021

Cumulus Media Inc. (CMLS)
An Ebullient Advertising Picture Emerges

CUMULUS MEDIA, Inc. (NASDAQ: CMLS) is a leading audio-first media and entertainment company delivering premium content to over a quarter billion people every month — wherever and whenever they want it. CUMULUS MEDIA engages listeners with high-quality local programming through 428 owned-and-operated stations across 87 markets; delivers nationally-syndicated sports, news, talk, and entertainment programming from iconic brands including the NFL, the NCAA, the Masters, the Olympics, the GRAMMYS, the American Country Music Awards, and many other world-class partners across nearly 8,000 affiliated stations through Westwood One, the largest audio network in America; and inspires listeners through its rapidly growing network of original podcasts that are smart, entertaining and thought-provoking. CUMULUS MEDIA provides advertisers with local impact and national reach through on-air, digital, mobile, and voice-activated media solutions, as well as access to integrated digital marketing services, powerful influencers, and live event experiences. CUMULUS MEDIA is the only audio media company to provide marketers with local and national advertising performance guarantees.

Michael Kupinski, Director of Research, Noble Capital Markets, Inc.

Refer to the full report for the price target, fundamental analysis, and rating.

    Q1 overachieves. Q1 revenues of $201.7 million exceed our $185.0 million estimate on stronger than expected Spot and Digital revenue. Cash flow, as measured by adj. EBITDA, was better than expected due to stronger revenues and expense reduction, $8.9 million versus our loss estimate of $650,000.

    Q2 pacings appear encouraging.  The tone of Radio advertising has significantly improved, with Q2 pacing up a strong 35%. We believe that pacings will further improve throughout the quarter and our 51% Q2 revenue growth estimate appears achievable. We are raising our Q2 adj. EBITDA estimate from $21.1 million to $24.6 million to reflect better cost savings …



This research is provided by Noble Capital Markets, Inc., a FINRA and S.E.C. registered broker-dealer (B/D).

*Analyst certification and important disclosures included in the full report. NOTE: investment decisions should not be based upon the content of this research summary.  Proper due diligence is required before making any investment decision. 

CoreCivic, Inc. (CXW) – A Solid Quarter, After Brushing Away the Noise

Posted on by Admin

Thursday, May 06, 2021

CoreCivic, Inc. (CXW)
A Solid Quarter, After Brushing Away the Noise

CoreCivic is a diversified government solutions company with the scale and experience needed to solve tough government challenges in flexible, cost-effective ways. We provide a broad range of solutions to government partners that serve the public good through corrections and detention management, a growing network of residential reentry centers to help address America’s recidivism crisis, and government real estate solutions. We are a publicly traded real estate investment trust and the nation’s largest owner of partnership correctional, detention and residential reentry facilities. We also believe we are the largest private owner of real estate used by U.S. government agencies. The Company has been a flexible and dependable partner for government for more than 35 years. Our employees are driven by a deep sense of service, high standards of professionalism and a responsibility to help government better the public good.

Joe Gomes, Senior Research Analyst, Noble Capital Markets, Inc.

Refer to the full report for the price target, fundamental analysis, and rating.

    1Q21 Results. CoreCivic posted revenue of $454.7 million in the first quarter of 2021, compared to $491.1 million in the same period last year. EBITDA was $41.6 million versus $99.5 million, with 1Q21 adjusted EBITDA of $96.3 million versus $100.4 million. CoreCivic reported a GAAP loss of $125.5 million or $1.05 per share. Adjusted EPS was $0.24 compared to $0.30 last year or $0.23 on a proforma basis to reflect the adoption of a C-corp structure. We had projected revenue of $470 million and EPS of $0.24.

    The Noise.  There was significant noise in the quarter that obscured a relatively solid quarter, in our view. For example, special items included a non-cash income tax expense of $114.2 million associated with the change in corporate tax structure and a $51.7 million charge to settle shareholder litigation. The Company also incurred some $1.6 million in COVID related expenses that were not in the …



This Company Sponsored Research is provided by Noble Capital Markets, Inc., a FINRA and S.E.C. registered broker-dealer (B/D).

*Analyst certification and important disclosures included in the full report. NOTE: investment decisions should not be based upon the content of this research summary.  Proper due diligence is required before making any investment decision.