Release – InPlay Oil Corp. Announces Second Quarter 2022 Financial and Operating Results Highlighted by Record Quarterly Production and Financial Results, and a Fully Conforming and Increased Credit Facility

Posted on August 11, 2022 by Admin

InPlay Oil Corp. Announces Second Quarter 2022 Financial and Operating Results Highlighted by Record Quarterly Production and Financial Results, and a Fully Conforming and Increased Credit Facility

News and Market Data on InPlay Oil Corp

August 11, 2022 08:00 ET | Source: InPlay Oil Corp.

CALGARY, Alberta, Aug. 11, 2022 (GLOBE NEWSWIRE) — InPlay Oil Corp. (TSX: IPO) (OTCQX: IPOOF) (“InPlay” or the “Company”) announces its record setting financial and operating results for the three and six months ended June 30, 2022. InPlay’s condensed unaudited interim financial statements and notes, as well as Management’s Discussion and Analysis (“MD&A”) for the three and six months ended June 30, 2022 will be available at “www.sedar.com” and our website at “www.inplayoil.com”. Our updated corporate presentation will also soon be available on our website.

Second Quarter 2022 Financial & Operating Highlights

Achieved record average quarterly production of 9,063 boe/d⁽¹⁾ (57% light crude oil and NGLs), an increase of 68% from second quarter production in 2021 of 5,386 boe/d⁽¹⁾ (68% light crude oil and NGLs) and an increase of 10% compared to our previous record of 8,221 boe/d
⁽¹⁾ (59% light crude oil and NGLs) in the first quarter of 2022. Average production per weighted average basic share increased 32% compared to the second quarter of 2021 (43% on a debt adjusted⁽⁴⁾ basis) and 10% compared to the first quarter of 2022 (17% on a debt adjusted basis).
Generated record quarterly adjusted funds flow (“AFF”)⁽²⁾ of $40.9 million ($0.47 per weighted average basic share⁽³⁾), an increase of 398% compared to $8.2 million ($0.12 per weighted average basic share) in the second quarter of 2021 and an increase of 39% compared to $29.4 million ($0.34 per weighted average basic share) in the first quarter of 2022, our prior record quarter.
Increased operating netbacks⁽⁴⁾ by 84% to $61.02/boe from $33.09/boe in the second quarter of 2021 and by 32% compared to $46.06/boe in the first quarter of 2022, our prior record quarter.
Realized quarterly record operating income⁽⁴⁾ and operating income profit margin⁽⁴⁾ of $50.3 million and 71% respectively compared to $16.2 million and 64% in the second quarter of 2021; $34.1 million and 65% in the first quarter of 2022, our prior record quarter.
Reduced operating expenses to $12.28/boe compared to $12.51/boe in the second quarter of 2021 and $12.96/boe in the first quarter of 2022, despite rising costs of services in the industry.
Generated free adjusted funds flow (“FAFF”)
⁽⁴⁾ of $23.1 million, a quarterly record for the Company, resulting in a 31% reduction to net debt from March 31, 2022.
Achieved a quarterly annualized net debt⁽²⁾ to earnings before interest, taxes and depletion (“EBITDA”)⁽⁴⁾ ratio of 0.3x, compared to 1.9x in the second quarter of 2021 and 0.6x in first quarter of 2022 and a trailing twelve month net debt to EBITDA ratio of 0.5x to June 30, 2022.
Realized net income of $29.0 million ($0.33 per basic share; $0.32 per diluted share).

Financial and Operating Results:

(CDN) ($000’s)	Three months ended June 30				Six months ended June 30
	2022		2021		2022		2021
Financial
Oil and natural gas sales	71,287		25,267		123,444		45,268
Adjusted funds flow⁽²⁾	40,922		8,219		70,303		14,324
Per share – basic⁽³⁾	0.47		0.12		0.81		0.21
Per share – diluted⁽³⁾	0.45		0.12		0.77		0.21
Per boe⁽³⁾	49.62		16.77		44.93		15.29
Comprehensive income	29,032		59,127		47,808		51,591
Per share – basic	0.33		0.87		0.55		0.76
Per share –diluted	0.32		0.85		0.53		0.75
Capital expenditures – PP&E and E&E	17,850		4,744		39,413		16,954
Property acquisitions (dispositions)	–		(101	)	(1	)	(82	)
Corporate acquisitions	(20	)	–		411		–
Net debt⁽²⁾	(50,473	)	(76,113	)	(50,473	)	(76,113	)
Shares outstanding	87,138,301		68,288,616		87,138,301		68,288,616
Basic weighted-average shares	86,873,664		68,259,781		86,662,821		68,258,207
Diluted weighted-average shares	91,282,528		69,187,825		90,913,356		68,687,889

Operational
Daily production volumes
Light and medium crude oil (bbls/d)	3,865		2,942		3,719		2,804
Natural gas liquids (bbls/d)	1,333		730		1,320		765
Conventional natural gas (Mcf/d)	23,191		10,286		21,631		9,643
Total (boe/d)	9,063		5,386		8,644		5,177
Realized prices⁽³⁾
Light and medium crude oil & NGLs ($/bbls)	116.74		66.46		107.48		61.29
Conventional natural gas ($/Mcf)	7.61		3.27		6.49		3.25
Total ($/boe)	86.44		51.55		78.90		48.31
Operating netbacks ($/boe)⁽⁴⁾
Oil and natural gas sales	86.44		51.55		78.90		48.31
Royalties	(11.90	)	(4.83	)	(11.13	)	(3.85	)
Transportation expense	(1.24	)	(1.12	)	(1.22	)	(1.03	)
Operating costs	(12.28	)	(12.51	)	(12.60	)	(13.40	)
Operating netback	61.02		33.09		53.95		30.03
Realized (loss) on derivative contracts	(6.77	)	(9.39	)	(3.95	)	(8.16	)
Operating netback (including realized derivative contracts)	54.25		23.70		50.00		21.87

Second Quarter 2022 Financial & Operations Overview:

Production averaged 9,063 boe/d⁽¹⁾ (57% light crude oil & NGLs) of sales in the second quarter of 2022, not including over 5,000 bbls of light crude oil inventory build (equal to over 55 bbls/d during the quarter) that was not sold due to difficulty trucking oil as a result of wet weather at the end of June. NGL’s were slightly lower than expected in the quarter due to certain third party facilities having leaner liquids cuts in the quarter. Production increased by 68% compared to 5,386 boe/d⁽¹⁾ (68% light crude oil & NGLs) in the second quarter of 2021 and 10% compared to 8,221 boe/d⁽¹⁾ (59% light crude oil & NGLs) in the first quarter of 2022. This resulted in a quarterly record $40.9 million of AFF generated during the second quarter of 2022 and $23.1 million in FAFF which reduced net debt levels by 31% from March 31, 2022 to $50.5 million at June 30, 2022. Liquidity ratios to the end of the quarter improved significantly resulting in a quarterly annualized net debt to EBITDA ratio of 0.3x and a trailing twelve month net debt to EBITDA ratio of 0.5x to June 30, 2022.

InPlay’s capital program for the second quarter of 2022 consisted of $17.8 million of capital expenditures. During the quarter, InPlay drilled three (3.0 net) 1.5 mile Extended Reach Horizontal (“ERH”) wells in Pembina which were completed and tied in and came on production at the end of May. The Company also finished the drilling operations of an additional two (1.9 net) 2 mile ERH wells in Willesden Green. Completions of these wells was delayed due to the wet weather in June but have now been completed and are in the early cleanup phase. Construction of a modular multi-well facility in Willesden Green began during the quarter to accommodate current and future drilling in the area.

As a result of using a consistent drill crew since the beginning of the year and exceptional project execution, the two 2 mile ERH wells in Willesden Green were drilled in 10.3 and 10.7 days respectively, which were among the fastest drilling operations for 2 mile wells in the area. In comparison to the last 2 mile wells drilled by the Company in Willesden Green in 2018, drilling times improved by approximately 20% which is a positive result for the Company and is an example of InPlay’s continuous drive to achieve operational efficiencies.

Efficient field operations and increased production levels resulted in the Company achieving lower operating expenses of $12.28/boe compared to $12.51/boe in the second quarter of 2021 and $12.96/boe in the first quarter of 2022. This is a significant achievement given the inflationary pressures and supply chain disruptions facing our industry. The resulting operating income and operating income profit margin for the second quarter of 2022 were quarterly records for the Company at $50.3 million and 71% respectively.

Credit Facilities

InPlay is pleased to announce that it has entered into an amended credit facility with its first-lien and second-lien lenders resulting in a fully conforming revolving credit facility with an increased total lending capacity and borrowing base of $110 million. InPlay’s credit facility is now comprised of a $100 million revolving credit facility and a $10 million operating line of credit (together, the “Credit Facility”). The term out date of the Credit Facility has been extended to May 30, 2023 with a maturity date of May 30, 2024. As part of the renegotiated Credit Facility, the Company’s previously outstanding $25 million term facility with the Business Development Bank of Canada (“BDC”) and the remaining $14 million of its senior term facility have been repaid.

InPlay is also pleased to announce that Canadian Western Bank (“CWB”) and BDC have joined ATB Financial as members of the amended Credit Facility syndicate.

The outcome of the Credit Facility redetermination is an extremely positive result for the Company and is anticipated to reduce overall interest costs and provide InPlay with a stable liquidity position.

Outlook

The Company’s strategy has been focused on delivering measured but top-tier production growth amongst our light oil peers while seeking to maximize FAFF which has been used to reduce debt and leverage ratios. Results from our high quality asset base has allowed us to exceed our expectations with production growth per share of 32% (43% on a debt adjusted per share basis) in the past year. Strong and record setting operational and financial performance combined with continued commodity price strength has placed InPlay well ahead of schedule in the reduction of debt levels. The Company has achieved a 0.5x trailing twelve months net debt to EBITDA ratio in the second quarter of 2022 with expectations of leverage ratios continuing to drop throughout the balance of the year based on current commodity prices.

Although the world economic picture and energy prices remain volatile, the Company finds itself in the best operational and financial position in our history. We believe that a target of approximately 0.5x trailing twelve months net debt to EBITDA is a prudent leverage ratio in a higher commodity price environment and will provide the Company significant financial flexibility in a volatile pricing environment. Having achieved this target and with leverage continuing to drop, the Company is now evaluating a potential return of capital to shareholders, while continuing to pursue other accretive acquisition opportunities, with the ultimate goal of strong overall returns to shareholders.

Wet weather in late June delayed the start of our third quarter capital program. The program is now well underway with drilling operations ongoing on the third well of a three (2.9 net) ERH well pad in Willesden Green which is expected to be on production in late August. The drilling operations of an additional two (1.9 net) ERH wells in Willesden Green are planned for the third quarter which are expected to be on production late in September. The Company’s third quarter drilling program is in an area with anticipated higher oil weightings which is expected to result in increased liquids percentages into the second half of the year.

As a result of the strong operational results to date, the Company’s previously released 2022 guidance⁽⁵⁾ is reiterated with annual average production anticipated to be 8,900 to 9,400 boe/d⁽¹⁾.

InPlay plans on releasing our inaugural sustainability report in September. In addition, an operational update, a long range forecast, and an update on the evaluation of a potential return to shareholders is expected to be released in September.

Management would like to thank our employees, board members, lenders and shareholders for their support and we look forward to continuing our journey of deleveraging and delivering strong returns to shareholders in a sustainable, prudent and responsible manner.

For further information please contact:

Doug Bartole
President and Chief Executive Officer
InPlay Oil Corp.
Telephone: (587) 955-0632

Darren Dittmer
Chief Financial Officer
InPlay Oil Corp.
Telephone: (587) 955-0634

Notes:

See “Production Breakdown by
Product Type” at the end of this press release.
Capital management measure. See
“Non-GAAP and Other Financial Measures” contained within this press
release.
Supplementary financial measure.
See “Non-GAAP and Other Financial Measures” contained within this press
release.
Non-GAAP financial measure or ratio
that does not have a standardized meaning under International Financial
Reporting Standards (IFRS) and GAAP and therefore may not be comparable
with the calculations of similar measures for other companies. Please
refer to “Non-GAAP and Other Financial Measures” contained within this
press release.
See “Reader Advisories – Forward
Looking Information and Statements” and InPlay’s press release dated May
11, 2022 for full details and key budget and underlying assumptions
related to our 2022 capital program and associated guidance.

Reader Advisories

Non-GAAP and Other Financial Measures

Throughout this press release and other materials disclosed by the Company, InPlay uses certain measures to analyze financial performance, financial position and cash flow. These non-GAAP and other financial measures do not have any standardized meaning prescribed under GAAP and therefore may not be comparable to similar measures presented by other entities. The non-GAAP and other financial measures should not be considered alternatives to, or more meaningful than, financial measures that are determined in accordance with GAAP as indicators of the Company performance. Management believes that the presentation of these non-GAAP and other financial measures provides useful information to shareholders and investors in understanding and evaluating the Company’s ongoing operating performance, and the measures provide increased transparency and the ability to better analyze InPlay’s business performance against prior periods on a comparable basis.

Non-GAAP Financial Measures and Ratios

Included in this document are references to the terms “free adjusted funds flow (“FAFF”)”, “operating income”, “operating netback per boe”, “operating income profit margin”, “Net Debt to EBITDA” and “Debt adjusted production per share”. Management believes these measures and ratios are helpful supplementary measures of financial and operating performance and provide users with similar, but potentially not comparable, information that is commonly used by other oil and natural gas companies. These terms do not have any standardized meaning prescribed by GAAP and should not be considered an alternative to, or more meaningful than “profit (loss) before taxes”, “profit (loss) and comprehensive income (loss)”, “adjusted funds flow”, “capital expenditures”, “corporate acquisitions, net of cash acquired”, “net debt”, “weighted average number of common shares (basic)” or assets and liabilities as determined in accordance with GAAP as a measure of the Company’s performance and financial position.

Free Adjusted Funds Flow

Management considers free adjusted funds flow (“FAFF”) and FAFF per share important measures to identify the Company’s ability to improve its financial condition through debt repayment, which has become more important recently with the introduction of second lien lenders, on an absolute and weighted average per share basis. FAFF should not be considered as an alternative to or more meaningful than AFF as determined in accordance with GAAP as an indicator of the Company’s performance. FAFF is calculated by the Company as AFF less exploration and development capital expenditures and property dispositions (acquisitions) and is a measure of the cashflow remaining after capital expenditures before corporate acquisitions that can be used for additional capital activity, corporate acquisitions, repayment of debt or decommissioning expenditures or potentially return of capital to shareholders. FAFF per share is calculated by the Company as FAFF divided by weighted average outstanding shares. Refer below for a calculation of historical FAFF and to the “Forward Looking Information and Statements” section for a calculation of forecast FAFF.

(thousands of dollars)	Three Months Ended June 30				Six Months Ended June 30
	2022		2021		2022		2021
Adjusted funds flow	40,922		8,219		70,303		14,324
Exploration and dev. capital expenditures	(17,850	)	(4,744	)	(39,413	)	(16,954	)
Property dispositions (acquisitions)	–		101		1		82
Free adjusted funds flow	23,072		3,576		30,891		(2,548	)

Operating Income/Operating Netback per boe/Operating Income Profit Margin

InPlay uses “operating income”, “operating netback per boe” and “operating income profit margin” as key performance indicators. Operating income is calculated by the Company as oil and natural gas sales less royalties, operating expenses and transportation expenses and is a measure of the profitability of operations before administrative, share-based compensation, financing and other non-cash items. Management considers operating income an important measure to evaluate its operational performance as it demonstrates its field level profitability. Operating income should not be considered as an alternative to or more meaningful than net income as determined in accordance with GAAP as an indicator of the Company’s performance. Operating netback per boe is calculated by the Company as operating income divided by average production for the respective period. Management considers operating netback per boe an important measure to evaluate its operational performance as it demonstrates its field level profitability per unit of production. Operating income profit margin is calculated by the Company as operating income as a percentage of oil and natural gas sales. Management considers operating income profit margin an important measure to evaluate its operational performance as it demonstrates how efficiently the Company generates field level profits from its sales revenue. Refer below for a calculation of operating income, operating netback per boe and operating income profit margin.

(thousands of dollars)	Three Months Ended June 30				Six Months Ended June 30
	2022		2021		2022		2021
Revenue	71,287		25,267		123,444		45,268
Royalties	(9,811	)	(2,366	)	(17,410	)	(3,611	)
Operating expenses	(10,125	)	(6,129	)	(19,713	)	(12,551	)
Transportation expenses	(1,021	)	(547	)	(1,914	)	(965	)
Operating income⁽²⁾	50,330		16,225		84,407		28,141

Sales volume (Mboe)	824.7		490.1		1,564.6		937.0
Per boe
Revenue	86.44		51.55		78.90		48.31
Royalties	(11.90	)	(4.83	)	(11.13	)	(3.85	)
Operating expenses	(12.28	)	(12.51	)	(12.60	)	(13.40	)
Transportation expenses	(1.24	)	(1.12	)	(1.22	)	(1.03	)
Operating netback per boe	61.02		33.09		53.95		30.03
Operating income profit margin	71%		64%		68%		62%

Net Debt to EBITDA

Management considers Net Debt to EBITDA an important measure as it is a key metric to identify the Company’s ability to fund financing expenses, net debt reductions and other obligations. EBITDA is calculated by the Company as adjusted funds flow before interest expense. When this measure is presented quarterly, EBITDA is annualized by multiplying by four. When this measure is presented on a trailing twelve month basis, EBITDA for the twelve months preceding the net debt date is used in the calculation. This measure is consistent with the EBITDA formula prescribed under the Company’s Senior Credit Facility. Net Debt to EBITDA is calculated as Net Debt divided by EBITDA. Refer to the “Forward Looking Information and Statements” section for a calculation of forecast Net Debt to EBITDA.

Production per Debt Adjusted Share

InPlay uses “Production per debt adjusted share” as a key performance indicator. Debt adjusted shares should not be considered as an alternative to or more meaningful than common shares as determined in accordance with GAAP as an indicator of the Company’s performance. Debt adjusted shares is a non-GAAP measure used in the calculation of Production per debt adjusted share and is calculated by the Company as common shares outstanding plus the change in net debt divided by the Company’s current trading price on the TSX, converting net debt to equity. Debt adjusted shares should not be considered as an alternative to or more meaningful than weighted average number of common shares (basic) as determined in accordance with GAAP as an indicator of the Company’s performance. Management considers Debt adjusted share is a key performance indicator as it adjusts for the effects of capital structure in relation to the Company’s peers. Production per debt adjusted share is calculated by the Company as production divided by debt adjusted shares. Management considers Production per debt adjusted share is a key performance indicator as it adjusts for the effects of changes in annual production in relation to the Company’s capital structure. Refer below for a calculation of Production per debt adjusted share.

		Three Months Ended June 30
			2022		2021
Production	Boe/d		9,063		5,386
Net Debt	$ millions	$	50.5	$	76.1
Weighted average outstanding shares	# millions		86.9		68.3
Assumed Share price⁽²⁾	$		4.00
Production per debt adjusted share growth⁽²⁾			43%
		Three Months Ended
		June 30, 2022		March 31, 2022
Production	Boe/d		9,063		8,221
Net Debt	$ millions	$	50.5	$	73.4
Weighted average outstanding shares	# millions		86.9		86.4
Assumed Share price⁽²⁾	$		4.00
Production per debt adjusted share growth⁽²⁾			17%

⁽¹⁾	Production per debt adjusted share is calculated by the Company as production divided by debt adjusted shares. Debt adjusted shares is calculated by the Company as common shares outstanding plus the change in net debt divided by the Company’s current trading price on the TSX, converting net debt to equity.
⁽²⁾	Weighted average share price throughout the second quarter of 2022.

Capital Management Measures

Adjusted Funds Flow

Management considers adjusted funds flow to be an important measure of InPlay’s ability to generate the funds necessary to finance capital expenditures. Adjusted funds flow (“AFF”) is a GAAP measure and is disclosed in the notes to the Company’s consolidated financial statements for the year ending December 31, 2021 and the most recently filed quarterly financial statements. All references to AFF throughout this document are calculated as funds flow adjusting for decommissioning expenditures and transaction and integration costs. This item is adjusted from funds flow as decommissioning expenditures are incurred on a discretionary and irregular basis and are primarily incurred on previous operating assets and transaction costs are non-recurring costs for the purposes of an acquisition, making the exclusion of these items relevant in Management’s view to the reader in the evaluation of InPlay’s operating performance. The Company also presents AFF per share whereby per share amounts are calculated using weighted average shares outstanding consistent with the calculation of profit (loss) per common share.

Net Debt

Net debt is a GAAP measure and is disclosed in the notes to the Company’s consolidated financial statements for the year ending December 31, 2021 and the most recently filed quarterly financial statements. The Company closely monitors its capital structure with a goal of maintaining a strong balance sheet to fund the future growth of the Company. The Company monitors net debt as part of its capital structure. The Company uses net debt (bank debt plus accounts payable and accrued liabilities less accounts receivables and accrued receivables, prepaid expenses and deposits and inventory) as an alternative measure of outstanding debt. Management considers net debt an important measure to assist in assessing the liquidity of the Company.

Supplementary Measures

“Average realized crude oil price” is comprised of crude oil commodity sales from production, as determined in accordance with IFRS, divided by the Company’s crude oil production. Average prices are before deduction of transportation costs and do not include gains and losses on financial instruments.

“Average realized NGL price” is comprised of NGL commodity sales from production, as determined in accordance with IFRS, divided by the Company’s NGL production. Average prices are before deduction of transportation costs and do not include gains and losses on financial instruments.

“Average realized natural gas price” is comprised of natural gas commodity sales from production, as determined in accordance with IFRS, divided by the Company’s natural gas production. Average prices are before deduction of transportation costs and do not include gains and losses on financial instruments.

“Average realized commodity price” is comprised of commodity sales from production, as determined in accordance with IFRS, divided by the Company’s production. Average prices are before deduction of transportation costs and do not include gains and losses on financial instruments.

“AFF per weighted average basic share” is comprised of AFF divided by the basic weighted average common shares.

“AFF per weighted average diluted share” is comprised of AFF divided by the diluted weighted average common shares.

“AFF per boe” is comprised of AFF divided by total production.

Forward-Looking Information and Statements

This news release contains certain forward–looking information and statements within the meaning of applicable securities laws. The use of any of the words “expect”, “anticipate”, “continue”, “estimate”, “may”, “will”, “project”, “should”, “believe”, “plans”, “intends”, “forecast”, “targets”, “framework” and similar expressions are intended to identify forward-looking information or statements. In particular, but without limiting the foregoing, this news release contains forward looking information and statements pertaining to the following: the Company’s business strategy, milestones and objectives including, without limitation, the anticipated continuation of debt reduction the anticipated impact of the redetermined Credit Facility; improved leverage ratios and generation of FAFF; the Company’s targeted net debt to EBITDA ratio of 0.5 times; future intentions regarding the implementation of a return of capital program and the timing thereof; statements regarding the Company’s plans or expectations for the initiation of a potential dividend, the reaching of targets and satisfaction of conditions thereto and the amount and timing thereof; expectations regarding future commodity prices; future oil and natural gas prices; future liquidity and financial capacity; future results from operations and operating metrics; future costs, expenses and royalty rates; future interest costs; the exchange rate between the $US and $Cdn; future development, exploration, acquisition, development and infrastructure activities and related capital expenditures, including our planned 2022 capital program and associated guidance.

Without limitation of the foregoing, readers are cautioned that the Company’s return to shareholders framework including future dividend payments to shareholders of the Company, if any, and the level thereof remains uncertain and accordingly management’s expectations related thereto should not be unduly relied upon. The Company’s dividend policy and funds available for the payment of dividends, if any, from time to time, is dependent upon, among other things, levels of FAFF, leverage ratios, financial requirements for the Company’s operations and execution of its growth strategy, fluctuations in commodity prices and working capital, the timing and amount of capital expenditures, credit facility availability and limitations on distributions existing thereunder, and other factors beyond the Company’s control. Further, the ability of the Company to implement a return to shareholder program will be subject to applicable laws, including satisfaction of solvency tests under the ABCA, and satisfaction of certain applicable contractual restrictions contained in the agreements governing the Company’s outstanding indebtedness.

Forward-looking statements or information are based on a number of material factors, expectations or assumptions of InPlay which have been used to develop such statements and information but which may prove to be incorrect. Although InPlay believes that the expectations reflected in such forward looking statements or information are reasonable, undue reliance should not be placed on forward-looking statements because InPlay can give no assurance that such expectations will prove to be correct. In addition to other factors and assumptions which may be identified herein, assumptions have been made regarding, among other things: the impact of increasing competition; the general stability of the economic and political environment in which InPlay operates; the timely receipt of any required regulatory approvals; the ability of InPlay to obtain qualified staff, equipment and services in a timely and cost efficient manner; drilling results; the ability of the operator of the projects in which InPlay has an interest in to operate the field in a safe, efficient and effective manner; the ability of InPlay to obtain debt financing on acceptable terms and the anticipated lifting of certain restrictions on the payment of distributions to shareholders which currently exist thereunder; field production rates and decline rates; the ability to replace and expand oil and natural gas reserves through acquisition, development and exploration; the timing and cost of pipeline, storage and facility construction and the ability of InPlay to secure adequate product transportation; future commodity prices; that various conditions to a shareholder return strategy can be satisfied; expectations regarding the potential impact of COVID-19 and the Russia/Ukraine conflict; currency, exchange and interest rates; regulatory framework regarding royalties, taxes and environmental matters in the jurisdictions in which InPlay operates; and the ability of InPlay to successfully market its oil and natural gas products. The forward-looking information and statements included herein are not guarantees of future performance and should not be unduly relied upon. Such information and statements, including the assumptions made in respect thereof, involve known and unknown risks, uncertainties and other factors that may cause actual results or events to defer materially from those anticipated in such forward-looking information or statements including, without limitation: the continuing impact of the COVID-19 pandemic and the Russia/Ukraine conflict; changes in our planned 2022 capital program; changes in commodity prices and other assumptions outlined herein; the risk that the Company is unable to implement a return to shareholder strategy or, if implemented, the risk that dividend payments thereunder may be reduced, suspended or cancelled; the potential for variation in the quality of the reservoirs in which we operate; changes in the demand for or supply of our products; unanticipated operating results or production declines; changes in tax or environmental laws, royalty rates or other regulatory matters; changes in development plans or strategies of InPlay or by third party operators of our properties; changes in our credit structure, increased debt levels or debt service requirements; inaccurate estimation of our light crude oil and natural gas reserve and resource volumes; limited, unfavorable or a lack of access to capital markets; increased costs; a lack of adequate insurance coverage; the impact of competitors; and certain other risks detailed from time-to-time in InPlay’s continuous disclosure documents filed on SEDAR including our Annual Information Form and our MD&A.

This press release contains future-oriented financial information and financial outlook information (collectively, “FOFI”) about InPlay’s financial and leverage targets and objectives, and potential dividends and share buybacks, all of which are subject to the same assumptions, risk factors, limitations, and qualifications as set forth in the above paragraphs. The actual results of operations of InPlay and the resulting financial results will likely vary from the amounts set forth in this press release and such variation may be material. InPlay and its management believe that the FOFI has been prepared on a reasonable basis, reflecting management’s best estimates and judgments. However, because this information is subjective and subject to numerous risks, it should not be relied on as necessarily indicative of future results. Except as required by applicable securities laws, InPlay undertakes no obligation to update such FOFI. FOFI contained in this press release was made as of the date of this press release and was provided for the purpose of providing further information about InPlay’s anticipated future business operations and strategy. Readers are cautioned that the FOFI contained in this press release should not be used for purposes other than for which it is disclosed herein.

The forward-looking information and statements contained in this news release speak only as of the date hereof and InPlay does not assume any obligation to publicly update or revise any of the included forward-looking statements or information, whether as a result of new information, future events or otherwise, except as may be required by applicable securities laws.

The key budget and underlying material assumptions used by the Company in the development of its 2022 guidance including forecasted production, operating income, capital expenditures, AFF, FAFF, FAFF yield, Net Debt, Net Debt/EBITDA, EV/DAAFF, production per debt adjusted share growth are as follows:

		Actuals FY 2021	Guidance FY 2022⁽¹⁾
WTI	US$/bbl	$67.91	$95.40
NGL Price	$/boe	$37.79	$47.80
AECO	$/GJ	$3.44	$6.00
Foreign Exchange Rate	CDN$/US$	0.80	0.79
MSW Differential	US$/bbl	$3.88	$2.70
Production	Boe/d	5,768	8,900 – 9,400
Royalties	$/boe	5.51	11.50 – 13.00
Operating Expenses	$/boe	12.83	11.00 – 14.00
Transportation	$/boe	1.11	1.05 – 1.30
Interest	$/boe	2.67	0.85 – 1.25
General and Administrative	$/boe	2.83	2.40 – 2.95
Hedging loss	$/boe	6.20	1.85 – 2.15
Decommissioning Expenditures	$ millions	$1.4	$2.0 – $2.5
Adjusted Funds Flow	$ millions	$47.0	$147 – $156
Weighted average outstanding shares	# millions	69.8	86.5
Adjusted Funds Flow per share	$/share	0.67	1.70 – 1.80

		Actuals FY 2021	Guidance FY 2022⁽¹⁾
Adjusted Funds Flow	$ millions	$47.0	$147 – $156
Capital Expenditures	$ millions	$33.3	$64.0
Free Adjusted Funds Flow	$ millions	$13.6	$83 – $92
Shares outstanding, end of year	# millions	86.2	86.5
Assumed Share Price	$	2.18⁽³⁾	3.66
Market capitalization	$ millions	$188	$317
FAFF Yield	%	7%	26% – 29%

		Actuals FY 2021	Guidance FY 2022⁽¹⁾
Adjusted Funds Flow	$ millions	$47.0	$147 – $156
Interest	$/boe	2.67	0.85 – 1.25
EBITDA	$ millions	$52.6	$150 – $159
Net Debt/(Positive working capital)	$ millions	$80.2	($1) – ($10)
Net Debt/EBITDA		1.5	0.0 – 0.1

		Actuals Q2 2021	Guidance Q2 2022⁽¹⁾	Actuals Q2 2022
Adjusted Funds Flow	$ millions	$8.2	$37 – $40	$40.9
Interest	$/boe	3.27	1.00 – 1.25	1.56
EBITDA	$ millions	$9.8	$38 – $41	$42.2
Annualized EBITDA	$ millions	$39.2	$154 – $162	$168.8
Net Debt	$ millions	$76.1	$50 – $53	$50.5
Net Debt/EBITDA		1.9	0.3	0.3

		Actuals FY 2021	Guidance FY 2022⁽¹⁾
Production	Boe/d	5,768	8,900 – 9,400
Opening Net Debt	$ millions	$73.7	$80.2
Ending Net Debt/(Positive working capital)	$ millions	$80.2	($1) – ($10)
Weighted average outstanding shares	# millions	69.8	86.5
Assumed Share price	$	1.16⁽⁴⁾	3.66
Production per debt adjusted share growth⁽²⁾		31%	70% – 80%

		Actuals FY 2021	Guidance FY 2022⁽¹⁾
Share outstanding, end of year	# millions	86.2	86.5
Assumed Share price	$	2.18⁽³⁾	3.66
Market capitalization	$ millions	$188	$317
Net Debt/(Positive working capital)	$ millions	$80.2	($1) – ($10)
Enterprise value	$millions	$268.2	$307 – $316
Adjusted Funds Flow	$ millions	$44.1	$147 – $156
Interest	$/boe	2.67	0.85 – 1.25
Debt Adjusted AFF	$ millions	$49.7	$151 – $160
EV/DAAFF		5.4	1.9 – 2.1

⁽¹⁾	As previously released May 11, 2022.

⁽²⁾	Production per debt adjusted share is calculated by the Company as production divided by debt adjusted shares. Debt adjusted shares is calculated by the Company as common shares outstanding plus the change in net debt divided by the Company’s current trading price on the TSX, converting net debt to equity. Share price at December 31, 2022 is assumed to be consistent with the current share price.

⁽³⁾	Ending share price at December 31, 2021.

⁽⁴⁾	Weighted average share price throughout 2021.

See “Production Breakdown by Product Type” below
Quality and pipeline transmission adjustments may impact realized oil prices in addition to the MSW Differential provided above
Changes in working capital are not assumed to have a material impact between Dec 31, 2021 and Dec 31, 2022.

Test Results and Initial Production (“IP”) Rates
Test results and initial production rates disclosed herein, particularly those short in duration, may not necessarily be indicative of long term performance or of ultimate recovery. A pressure transient analysis or well-test interpretation has not been carried out and thus certain of the test results provided herein should be considered to be preliminary until such analysis or interpretation has been completed.

Production Breakdown by Product Type
Disclosure of production on a per boe basis in this press release consists of the constituent product types as defined in NI 51-101 and their respective quantities disclosed in the table below:

	Light and Medium Crude oil (bbls/d)	NGLS (boe/d)	Conventional Natural gas (Mcf/d)	Total (boe/d)
Q1 2021 Average Production	2,665	802	8,994	4,965
Q2 2021 Average Production	2,942	730	10,286	5,386
2021 Average Production	2,981	782	12,030	5,768
Q1 2022 Average Production	3,571	1,307	20,054	8,221
Q2 2022 Average Production	3,865	1,333	23,191	9,063
2022 Annual Guidance	4,320	1,311	21,114	9,150⁽¹⁾

Notes:

This reflects the mid-point of the
Company’s 2022 production guidance range of 8,900 to 9,400 boe/d.
With respect to forward-looking
production guidance, product type breakdown is based upon management’s
expectations based on reasonable assumptions but are subject to
variability based on actual well results.

References to crude oil, NGLs or natural gas production in this press release refer to the light and medium crude oil, natural gas liquids and conventional natural gas product types, respectively, as defined in National Instrument 51-101, Standards of Disclosure for Oil and Gas Activities (“Nl 51-101”).

BOE Equivalent
Barrel of oil equivalents or BOEs may be misleading, particularly if used in isolation. A BOE conversion ratio of 6 mcf: 1 bbl is based on an energy equivalency conversion method primarily applicable at the burner tip and does not represent a value equivalency at the wellhead. Given that the value ratio based on the current price of crude oil as compared to natural gas is significantly different than the energy equivalency of 6:1, utilizing a 6:1 conversion basis may be misleading as an indication of value.

Release – Avivagen Announces Receipt of Repeat Order from Asian Customer

Posted on August 11, 2022 by Admin

Avivagen Announces Receipt of Repeat Order from Asian Customer

Research, News, and Market Data on Avivagen

Ottawa, ON /Business
Wire/ August 11, 2022 /– 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 that one of its most important customers in Asia has placed a new order for four tonnes of OxC-Beta™ Livestock to be used in Asia, in line with previous shipments fulfilled in 2021.

“It’s encouraging to see one of our largest customers in Asia continue to place sizeable orders – which we view as a sign that they remain on target for economic recovery at a time where uncertainty is playing out elsewhere and also confirms the value of our product in economically challenging times,” says Kym Anthony, Chief Executive Officer of Avivagen Inc. “We are excited for the year ahead as we continue to build on existing and new relationships both in Asia and markets worldwide.”

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.

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, Vietnam 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.

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 Avivagen’s outlook, Avivagen’s expectation
that it will fulfill the order described above, the future growth and
prospects for Avivagen and the possibility for OxC-beta™ Livestock to
replace antibiotics in livestock feeds as growth promoters are
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,
worldwide demand for products sold by Avivagen may drop, orders may be
cancelled, 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 as growth promoters in livestock
feeds 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
Copyright © 2022 Avivagen Inc. OxC-beta™ is a trademark of Avivagen Inc.

Release – Kelly Reports Second-Quarter 2022 Earnings

Posted on August 11, 2022 by Admin

Kelly Reports Second-Quarter 2022 Earnings

Research, News, and Market Data on Kelly

Kelly Reports Second-Quarter
2022 Earnings

August 11, 2022

Q2 revenue up 0.7% from a
year ago; 2.7% in constant currency
Q2 operating earnings of $8.2
million and earnings per share of $0.06 down
from a year ago primarily due to a non-cash impairment charge related to
our operations in Russia
Adjusted operating earnings
of $22.3 million; up
63% from a year ago
Completed the acquisition
of Pediatric Therapeutic Services in May to extend our leading position in
K-12 education

TROY, Mich.,
Aug. 11, 2022 /PRNewswire/ —
Kelly (Nasdaq: KELYA, KELYB), a leading specialty talent solutions provider, today announced results for the second quarter of 2022.

Peter Quigley , president and chief executive officer, announced revenue for the second quarter of 2022 totaled
$1.3 billion, a 0.7% increase, or 2.7% in constant currency, compared to the corresponding quarter of 2021. Revenue improved year-over-year in the quarter reflecting increased customer demand compared to the COVID-19-impacted prior year period, as well as the impact of the recent acquisitions of RocketPower, a recruitment process outsourcing firm, and Pediatric Therapeutic Services, a specialty firm providing in-school therapy services.

Earnings from operations in the second quarter of 2022 totaled
$8.2 million
, compared to
$13.7 million
reported in the second quarter of 2021. Earnings in the second quarter of 2022 include an asset impairment charge related to our decision to transition our business in
Russia and a gain on sale of assets related to the disposition of under-utilized real property located in
the United States. Excluding those items, adjusted earnings from operations were
$22.3 million compared to
$13.7 million in the second quarter of 2021. Earnings improved as a result of revenue growth combined with structural improvement in gross profit rate and expense leverage.

Earnings per share in the second quarter of 2022 were
$0.06 compared to earnings per share of
$0.60 in the second quarter of 2021. Included in the earnings per share in the second quarter of 2022 is a
$0.48 per share asset impairment charge, net of tax, related to our decision to transition our business in
Russia and an
$0.08 per share gain on sale of assets, net of tax, related to the disposition of under-utilized real property located in
the United States. Included in the second quarter of 2021 is earnings per share of
$0.11 gain, net of tax, related to non-cash gains, net of tax, on
Persol Holding
common shares. On an adjusted basis, earnings per share were
$0.45 in the second quarter of 2022 compared to
$0.49 in the corresponding quarter of 2021. Adjusted earnings per share in the second quarter of 2022 declined as a result of higher 2022 tax expense compared to the same period in 2021.

“We saw solid demand for Kelly’s specialties in the second quarter and, importantly, we are successfully translating revenue into strong gross profit growth. We drove significant improvement in our gross profit rate year over year, due to our continued positive shift in business mix toward higher-margin products and specialties boosted by our specialty acquisitions,” said Quigley. “We have significant capital available to enable growth, and we are putting that capital to work to drive shareholder value. While there is some economic uncertainty in the second half of the year, we are confident that our focused and well-capitalized specialization strategy will continue to deliver value in 2022 and beyond.”

Kelly also reported that on
August 10, its board of directors declared a dividend of
$0.075 per share. The dividend is payable on
September 7, 2022 to stockholders of record as of the close of business on
August 24, 2022.

In conjunction with its second-quarter earnings release, Kelly has published a financial presentation on the Investor Relations page of its public website and will host a conference call at
9 a.m. ET on August 11 to review the results and answer questions. The call may be accessed in one of the following ways:

Via the Internet:
Kellyservices.com

Via the Telephone
(877) 692-8955 (toll free) or (234) 720-6979 (caller paid)
Enter access code 5728672
After the prompt, please enter “#”

A recording of the conference call will be available after
2:30 p.m. ET on
August 11, 2022
, at (866) 207-1041 (toll-free) and (402) 970-0847 (caller-paid). The access code is 8237932#. The recording will also be available at kellyservices.com during this period.

This release contains statements that are forward looking in nature and, accordingly, are subject to risks and uncertainties. These factors include, but are not limited to, changing market and economic conditions, the impact of the novel coronavirus (COVID-19) outbreak, competitive market pressures including pricing and technology introductions and disruptions, disruption in the labor market and weakened demand for human capital resulting from technological advances, competition law risks, the impact of changes in laws and regulations (including federal, state and international tax laws), unexpected changes in claim trends on workers’ compensation, unemployment, disability and medical benefit plans, or the risk of additional tax liabilities in excess of our estimates, our ability to achieve our business strategy, our ability to successfully develop new service offerings, material changes in demand from or loss of large corporate customers as well as changes in their buying practices, risks particular to doing business with government or government contractors, the risk of damage to our brand, our exposure to risks associated with services outside traditional staffing, including business process outsourcing, services of licensed professionals and services connecting talent to independent work, our increasing dependency on third parties for the execution of critical functions, our ability to effectively implement and manage our information technology strategy, the risks associated with past and future acquisitions, including risk of related impairment of goodwill and intangible assets, risks associated with conducting business in foreign countries, including foreign currency fluctuations, risks associated with violations of anti-corruption, trade protection and other laws and regulations, availability of qualified full-time employees, availability of temporary workers with appropriate skills required by customers, liabilities for employment-related claims and losses, including class action lawsuits and collective actions, our ability to sustain critical business applications through our key data centers, risks arising from failure to preserve the privacy of information entrusted to us or to meet our obligations under global privacy laws, the risk of cyberattacks or other breaches of network or information technology security, our ability to realize value from our tax credit and net operating loss carryforwards, our ability to maintain specified financial covenants in our bank facilities to continue to access credit markets, and other risks, uncertainties and factors discussed in this release and in the Company’s filings with the
Securities and Exchange Commission. Actual results may differ materially from any forward-looking statements contained herein, and we undertake no duty to update any forward-looking statement to conform the statement to actual results or changes in the Company’s expectations.

About Kelly®

Kelly Services, Inc.
(Nasdaq: KELYA, KELYB) connects talented people to companies in need of their skills in areas including Science, Engineering, Education, Office, Contact Center,
Light Industrial
, and more. We’re always thinking about what’s next in the evolving world of work, and we help people ditch the script on old ways of thinking and embrace the value of all workstyles in the workplace. We directly employ more than 350,000 people around the world, and we connect thousands more with work through our global network of talent suppliers and partners in our outsourcing and consulting practice. Revenue in 2021 was
$4.9 billion. Visit
kellyservices.com and let us help with what’s next for you.

KLYA-FIN

*MEDIA CONTACT:*			*ANALYST CONTACT:*
Jane Stehney			James Polehna
*(248) 765-6864*			*(248) 244-4586*
stehnja@kellyservices.com			james.polehna@kellyservices.com

KELLY SERVICES, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF EARNINGS
FOR THE 13 WEEKS ENDED JULY 3, 2022 AND JULY 4, 2021
(UNAUDITED)
(In millions of dollars except per share data)
								%		CC %
		2022		2021		Change		Change		Change

Revenue from services	$	1,267.3	$	1,258.1	$	9.2		0.7	%	2.7	%

Cost of services		1,004.9		1,027.1		(22.2)		(2.2)

Gross profit		262.4		231.0		31.4		13.6		15.6

Selling, general and administrative expenses		240.1		217.3		22.8		10.6		12.3

Impairment of assets held for sale		18.5		—		18.5		NM

Gain on sale of assets		(4.4)		—		(4.4)		NM

Earnings from operations		8.2		13.7		(5.5)		(40.6)

Gain on investment in Persol Holdings		—		6.3		(6.3)		NM

Other expense, net		(1.1)		(0.3)		(0.8)		(350.6)

Earnings before taxes and equity in net earnings (loss) of affiliate		7.1		19.7		(12.6)		(64.1)

Income tax expense (benefit)		4.9		(2.6)		7.5		282.9

Net earnings before equity in net earnings (loss) of affiliate		2.2		22.3		(20.1)		(90.1)

Equity in net earnings (loss) of affiliate		—		1.7		(1.7)		NM

Net earnings	$	2.2	$	24.0	$	(21.8)		(90.8)

Basic earnings per share	$	0.06	$	0.60	$	(0.54)		(90.0)
Diluted earnings per share	$	0.06	$	0.60	$	(0.54)		(90.0)


STATISTICS:

Permanent placement revenue (included in revenue from services)	$	24.8	$	18.6	$	6.2		33.2	%	36.3	%

Gross profit rate		20.7	%	18.4	%	2.3	pts.

Conversion rate		3.1	%	5.9	%	(2.8)	pts.

Adjusted EBITDA	$	31.7	$	22.2	$	9.5
Adjusted EBITDA margin		2.5	%	1.8	%	0.7	pts.

Effective income tax rate		68.8	%	(13.5)	%	82.3	pts.

Average number of shares outstanding (millions):
Basic		37.9		39.4
Diluted		38.2		39.5

KELLY SERVICES, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF EARNINGS
FOR THE 26 WEEKS ENDED JULY 3, 2022 AND JULY 4, 2021
(UNAUDITED)
(In millions of dollars except per share data)
								%		CC %
		2022		2021		Change		Change		Change

Revenue from services	$	2,563.7	$	2,464.0	$	99.7		4.0	%	5.8	%

Cost of services		2,042.7		2,019.7		23.0		1.1

Gross profit		521.0		444.3		76.7		17.3		19.0

Selling, general and administrative expenses		476.2		420.0		56.2		13.4		14.8

Impairment of assets held for sale		18.5		—		18.5		NM

Gain on sale of assets		(5.3)		—		(5.3)		NM

Earnings from operations		31.6		24.3		7.3		29.8

Gain (loss) on investment in Persol Holdings		(67.2)		36.3		(103.5)		NM

Loss on currency translation from liquidation of subsidiary⁽¹⁾		(20.4)		—		(20.4)		NM

Other income (expense), net		1.7		(3.7)		5.4		147.2

Earnings (loss) before taxes and equity in net earnings (loss) of affiliate		(54.3)		56.9		(111.2)		NM

Income tax expense (benefit)		(8.1)		7.9		(16.0)		(204.0)

Net earnings (loss) before equity in net earnings (loss) of affiliate		(46.2)		49.0		(95.2)		NM

Equity in net earnings (loss) of affiliate		0.8		0.6		0.2		35.7

Net earnings (loss)	$	(45.4)	$	49.6	$	(95.0)		NM

Basic earnings (loss) per share	$	(1.19)	$	1.25	$	(2.44)		NM
Diluted earnings (loss) per share	$	(1.19)	$	1.25	$	(2.44)		NM


STATISTICS:

Permanent placement revenue (included in revenue from services)	$	51.4	$	34.6	$	16.8		48.5	%	51.4	%

Gross profit rate		20.3	%	18.0	%	2.3	pts.

Conversion rate		6.1	%	5.5	%	0.6	pts.

Adjusted EBITDA	$	62.4	$	39.1	$	23.3
Adjusted EBITDA margin		2.4	%	1.6	%	0.8	pts.

Effective income tax rate		15.0	%	13.8	%	1.2	pts.

Average number of shares outstanding (millions):
Basic		38.3		39.4
Diluted		38.3		39.5

(1)

Subsequent to the sale of the Persol Holdings investment, the Company commenced the dissolution process of the Kelly Services Japan subsidiary, which was considered substantially liquidated as of the first quarter-end 2022, resulting in the recognition of the
$20.4 million
loss on currency translation from liquidation of this subsidiary in the first quarter of 2022.

KELLY SERVICES, INC. AND SUBSIDIARIES
RESULTS OF OPERATIONS BY SEGMENT
(UNAUDITED)
(In millions of dollars)

		Second Quarter

							%		CC %
		2022			2021		Change		Change
Professional & Industrial
Revenue from services	$	415.8		$	466.5		(10.9)	%	(10.6)	%
Gross profit		77.8			75.2		3.6		3.9
Total SG&A expenses		67.4			69.0		(2.2)		(2.0)
Earnings (loss) from operations		10.4			6.2		68.6

Gross profit rate		18.7	%		16.1	%	2.6	pts.

Science, Engineering & Technology
Revenue from services	$	324.3		$	298.2		8.7	%	9.0	%
Gross profit		75.2			66.5		13.1		13.3
Total SG&A expenses		54.8			46.9		16.9		17.1
Earnings (loss) from operations		20.4			19.6		3.8

Gross profit rate		23.2	%		22.3	%	0.9	pts.

Education
Revenue from services	$	155.5		$	105.9		46.8	%	46.8	%
Gross profit		26.0			16.8		55.0		55.0
Total SG&A expenses		20.4			15.3		33.4		33.4
Earnings (loss) from operations		5.6			1.5		278.6

Gross profit rate		16.7	%		15.8	%	0.9	pts.

Outsourcing & Consulting
Revenue from services	$	124.4		$	107.3		16.0	%	17.3	%
Gross profit		46.2			34.8		32.8		35.3
Total SG&A expenses		39.8			30.1		32.5		34.5
Earnings (loss) from operations		6.4			4.7		34.5

Gross profit rate		37.2	%		32.5	%	4.7	pts.

International
Revenue from services	$	247.6		$	280.4		(11.7)	%	(4.3)	%
Gross profit		37.2			37.7		(1.5)		7.3
Total SG&A expenses		34.6			34.6		(0.1)		8.2
Earnings (loss) from operations		2.6			3.1		(16.3)

Gross profit rate		15.0	%		13.4	%	1.6	pts.

KELLY SERVICES, INC. AND SUBSIDIARIES
RESULTS OF OPERATIONS BY SEGMENT
(UNAUDITED)
(In millions of dollars)

		June Year to Date

							%		CC %
		2022			2021		Change		Change
Professional & Industrial
Revenue from services	$	860.1		$	934.1		(7.9)	%	(7.8)	%
Gross profit		160.9			151.1		6.5		6.7
Total SG&A expenses		138.8			138.4		0.3		0.4
Earnings (loss) from operations		22.1			12.7		74.2

Gross profit rate		18.7	%		16.2	%	2.5	pts.

Science, Engineering & Technology
Revenue from services	$	641.4		$	552.9		16.0	%	16.2	%
Gross profit		149.0			119.7		24.5		24.7
Total SG&A expenses		108.0			82.6		30.8		30.9
Earnings (loss) from operations		41.0			37.1		10.5

Gross profit rate		23.2	%		21.6	%	1.6	pts.

Education
Revenue from services	$	328.9		$	217.5		51.2	%	51.2	%
Gross profit		52.6			34.0		54.9		54.9
Total SG&A expenses		39.0			29.5		32.4		32.4
Earnings (loss) from operations		13.6			4.5		203.1

Gross profit rate		16.0	%		15.6	%	0.4	pts.

Outsourcing & Consulting
Revenue from services	$	233.5		$	206.6		13.0	%	14.1	%
Gross profit		83.5			66.1		26.3		28.2
Total SG&A expenses		74.1			58.5		26.7		28.2
Earnings (loss) from operations		9.4			7.6		23.1

Gross profit rate		35.8	%		32.0	%	3.8	pts.

International
Revenue from services	$	500.4		$	553.3		(9.5)	%	(2.7)	%
Gross profit		75.0			73.4		2.1		10.0
Total SG&A expenses		67.8			67.7		0.2		7.4
Earnings (loss) from operations		7.2			5.7		25.7

Gross profit rate		15.0	%		13.3	%	1.7	pts.

KELLY SERVICES, INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
(UNAUDITED)
(In millions of dollars)

		July 3, 2022		January 2, 2022		July 4, 2021
Current Assets
Cash and equivalents	$	133.9	$	112.7	$	64.4
Trade accounts receivable, less allowances of
$12.0, $12.6, and $12.5, respectively		1,497.9		1,423.2		1,362.5
Prepaid expenses and other current assets		80.6		52.8		82.4
Assets held for sale		24.6		—		—
Total current assets		1,737.0		1,588.7		1,509.3

Noncurrent Assets
Property and equipment, net		25.4		35.3		37.7
Operating lease right-of-use assets		70.1		75.8		83.2
Deferred taxes		298.3		302.8		302.9
Goodwill, net		192.1		114.8		114.8
Investment in Persol Holdings		—		264.3		187.7
Investment in equity affiliate		—		123.4		120.0
Other assets		412.3		389.1		391.3
Total noncurrent assets		998.2		1,305.5		1,237.6

Total Assets	$	2,735.2	$	2,894.2	$	2,746.9

Current Liabilities
Short-term borrowings	$	—	$	—	$	0.1
Accounts payable and accrued liabilities		734.7		687.2		612.6
Operating lease liabilities		15.3		17.5		19.6
Accrued payroll and related taxes		322.4		318.4		337.0
Accrued workers’ compensation and other claims		24.4		20.8		22.0
Income and other taxes		50.5		51.3		62.6
Liabilities held for sale		13.7		—		—
Total current liabilities		1,161.0		1,095.2		1,053.9

Noncurrent Liabilities
Operating lease liabilities		57.7		61.4		67.1
Accrued payroll and related taxes		—		57.6		58.5
Accrued workers’ compensation and other claims		43.4		37.0		40.8
Accrued retirement benefits		180.2		220.0		214.6
Other long-term liabilities		16.0		86.8		68.2
Total noncurrent liabilities		297.3		462.8		449.2

Stockholders’ Equity
Common stock		38.5		40.1		40.1
Treasury stock		(12.5)		(15.1)		(15.3)
Paid-in capital		24.9		23.9		22.3
Earnings invested in the business		1,239.2		1,315.0		1,212.5
Accumulated other comprehensive income (loss)		(13.2)		(27.7)		(15.8)
Total stockholders’ equity		1,276.9		1,336.2		1,243.8

Total Liabilities and Stockholders’ Equity	$	2,735.2	$	2,894.2	$	2,746.9

STATISTICS:
Working Capital	$	576.0	$	493.5	$	455.4
Current Ratio		1.5		1.5		1.4
Debt-to-capital %		0.0	%	0.0	%	0.0	%
Global Days Sales Outstanding		63		60		60
Year-to-Date Free Cash Flow	$	(110.8)	$	73.8	$	42.7

KELLY SERVICES, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
FOR THE 26 WEEKS ENDED JULY 3, 2022 AND JULY 4, 2021
(UNAUDITED)
(In millions of dollars)
		2022		2021
Cash flows from operating activities:
Net earnings (loss)	$	(45.4)	$	49.6
Adjustments to reconcile net earnings (loss) to net cash from operating activities:
Impairment of assets held for sale		18.5		—
Depreciation and amortization		16.1		14.1
Operating lease asset amortization		9.8		10.7
Provision for credit losses and sales allowances		1.3		—
Stock-based compensation		3.8		2.8
(Gain) loss on investment in Persol Holdings		67.2		(36.3)
Loss on currency translation from liquidation of subsidiary		20.4		—
Gain on foreign currency remeasurement		(5.5)		—
Gain on sale of assets		(5.3)		—
Equity in net (earnings) loss of PersolKelly Pte. Ltd.		(0.8)		(0.6)
Other, net		2.9		2.2
Changes in operating assets and liabilities, net of acquisitions		(190.3)		5.1

Net cash (used in) from operating activities		(107.3)		47.6

Cash flows from investing activities:
Capital expenditures		(3.5)		(4.9)
Proceeds from sale of assets		4.5		—
Acquisition of companies, net of cash received		(143.1)		(219.0)
Proceeds from company-owned life insurance		1.5		10.4
Proceeds from sale of Persol Holdings investment		196.9		—
Proceeds from sale of equity method investment		119.5		—
Proceeds related to loans with equity affiliate		—		5.8
Proceeds from equity securities		—		5.0
Other investing activities		(0.2)		1.0

Net cash from (used in) investing activities		175.6		(201.7)

Cash flows from financing activities:
Net change in short-term borrowings		—		(0.1)
Financing lease payments		(0.4)		(0.3)
Dividend payments		(4.8)		—
Payments of tax withholding for stock awards		(0.8)		(0.6)
Buyback of common shares		(27.2)		—
Contingent consideration payments		(0.7)		—

Net cash used in financing activities		(33.9)		(1.0)

Effect of exchange rates on cash, cash equivalents and restricted cash		0.1		(2.3)

Net change in cash, cash equivalents and restricted cash		34.5		(157.4)
Cash, cash equivalents and restricted cash at beginning of period		119.5		228.1

Cash, cash equivalents and restricted cash at end of period	$	154.0	$	70.7

KELLY SERVICES, INC. AND SUBSIDIARIES
REVENUE FROM SERVICES BY GEOGRAPHY
(UNAUDITED)
(In millions of dollars)

		Second Quarter

					%		CC %
		2022		2021	Change		Change

Americas
United States	$	928.9	$	894.6	3.8	%	3.8	%
Canada		40.3		39.5	1.8		6.0
Puerto Rico		28.9		26.9	7.7		7.7
Mexico		11.2		33.1	(66.3)		(66.2)
Total Americas Region		1,009.3		994.1	1.5		1.7

Europe
Switzerland		55.3		54.0	2.4		8.7
France		50.4		57.5	(12.4)		(0.7)
Portugal		42.0		40.6	3.5		17.3
Russia		28.7		33.7	(14.6)		(24.6)
Italy		18.4		19.4	(5.4)		7.4
United Kingdom		16.0		17.7	(9.6)		1.0
Other		35.7		31.8	12.1		28.3
Total Europe Region		246.5		254.7	(3.2)		5.4

Total Asia-Pacific Region		11.5		9.3	24.2		32.1

Total Kelly Services, Inc.	$	1,267.3	$	1,258.1	0.7	%	2.7	%

KELLY SERVICES, INC. AND SUBSIDIARIES
REVENUE FROM SERVICES BY GEOGRAPHY
(UNAUDITED)
(In millions of dollars)

		June Year to Date

					%		CC %
		2022		2021	Change		Change

Americas
United States	$	1,885.5	$	1,753.1	7.6	%	7.6	%
Canada		79.4		73.6	7.8		10.1
Puerto Rico		56.5		51.1	10.7		10.7
Mexico		21.5		67.7	(68.3)		(68.1)
Total Americas Region		2,042.9		1,945.5	5.0		5.1

Europe
Switzerland		110.3		106.7	3.4		7.5
France		105.0		111.8	(6.1)		3.6
Portugal		83.9		84.3	(0.5)		9.9
Russia		58.4		66.3	(11.9)		(9.4)
Italy		37.9		37.5	0.8		11.3
United Kingdom		31.0		34.7	(10.7)		(4.0)
Other		72.0		59.6	20.8		33.9
Total Europe Region		498.5		500.9	(0.5)		7.4

Total Asia-Pacific Region		22.3		17.6	26.7		33.7

Total Kelly Services, Inc.	$	2,563.7	$	2,464.0	4.0	%	5.8	%

KELLY SERVICES, INC. AND SUBSIDIARIES
RECONCILIATION OF NON-GAAP MEASURES
SECOND QUARTER
(UNAUDITED)
(In millions of dollars)
	2022				2021
Earnings (loss) from Operations:	As Reported	Gain on sale of assets⁽³⁾	Impairment of assets held for sale⁽⁴⁾	Adjusted	As Reported
Professional & Industrial	$ 10.4	$ —	$ —	$ 10.4	$ 6.2
Science, Engineering & Technology	20.4	—	—	20.4	19.6
Education	5.6	—	—	5.6	1.5
Outsourcing & Consulting	6.4	—	—	6.4	4.7
International	2.6	—	—	2.6	3.1
Corporate	(23.1)	—	—	(23.1)	(21.4)
Impairment of assets held for sale	(18.5)	—	18.5	—	—
Gain on sale of assets	4.4	(4.4)	—	—	—
Total Company	$ 8.2	$ (4.4)	$ 18.5	$ 22.3	$ 13.7

KELLY SERVICES, INC. AND SUBSIDIARIES
RECONCILIATION OF NON-GAAP MEASURES
JUNE YEAR TO DATE
(UNAUDITED)
(In millions of dollars)
	2022				2021
Earnings (loss) from Operations:	As Reported	Gain on sale of assets⁽³⁾	Impairment of assets held for sale⁽⁴⁾	Adjusted	As Reported
Professional & Industrial	$ 22.1	$ —	$ —	$ 22.1	$ 12.7
Science, Engineering & Technology	41.0	—	—	41.0	37.1
Education	13.6	—	—	13.6	4.5
Outsourcing & Consulting	9.4	—	—	9.4	7.6
International	7.2	—	—	7.2	5.7
Corporate	(48.5)	—	—	(48.5)	(43.3)
Impairment of assets held for sale	(18.5)	—	18.5	—	—
Gain on sale of assets	5.3	(5.3)	—	—	—
Total Company	$ 31.6	$ (5.3)	$ 18.5	$ 44.8	$ 24.3

KELLY SERVICES, INC. AND SUBSIDIARIES
RECONCILIATION OF NON-GAAP MEASURES
(UNAUDITED)
(In millions of dollars except per share data)


	Second Quarter		June Year to Date
	2022	2021	2022	2021
Income tax expense (benefit)	$ 4.9	$ (2.6)	$ (8.1)	$ 7.9
Taxes on investment in Persol Holdings⁽¹⁾	—	(1.9)	18.4	(11.1)
Taxes on foreign currency matters⁽²⁾	—	—	(1.5)	—
Taxes on gain on sale of assets⁽³⁾	(1.1)	—	(1.3)	—
Taxes on impairment of assets held for sale⁽⁴⁾	—	—	—	—
Adjusted income tax expense (benefit)	$ 3.8	$ (4.5)	$ 7.5	$ (3.2)

	Second Quarter		June Year to Date
	2022	2021	2022	2021
Net earnings (loss)	$ 2.2	$ 24.0	$ (45.4)	$ 49.6
(Gain) loss on investment in Persol Holdings, net of taxes⁽¹⁾	—	(4.4)	48.8	(25.2)
Loss on foreign currency matters, net of taxes⁽²⁾	—	—	16.4	—
Gain on sale of assets, net of taxes⁽³⁾	(3.3)	—	(4.0)	—
Impairment of assets held for sale, net of taxes⁽⁴⁾	18.5	—	18.5	—
Adjusted net earnings	$ 17.4	$ 19.6	$ 34.3	$ 24.4

	Second Quarter		June Year to Date
	2022	2021	2022	2021
	Per Share		Per Share
Net earnings (loss)	$ 0.06	$ 0.60	$ (1.19)	$ 1.25
(Gain) loss on investment in Persol Holdings, net of taxes⁽¹⁾	—	(0.11)	1.27	(0.63)
Loss on foreign currency matters, net of taxes⁽²⁾	—	—	0.43	—
Gain on sale of assets, net of taxes⁽³⁾	(0.08)	—	(0.10)	—
Impairment of assets held for sale, net of taxes⁽⁴⁾	0.48	—	0.48	—
Adjusted net earnings	$ 0.45	$ 0.49	$ 0.90	$ 0.61

Note: Earnings per share amounts for each quarter are required to be computed independently and may not equal the amounts computed for the total year.

KELLY SERVICES, INC. AND SUBSIDIARIES
RECONCILIATION OF NON-GAAP MEASURES
(UNAUDITED)
(In millions of dollars)

	Second Quarter		June Year to Date
	2022	2021	2022	2021
Net earnings (loss)	$ 2.2	$ 24.0	$ (45.4)	$ 49.6
Other (income) expense, net⁽²⁾	1.1	0.3	(1.7)	3.7
Income tax expense (benefit)	4.9	(2.6)	(8.1)	7.9
Depreciation and amortization	9.4	8.5	17.6	14.8
EBITDA	17.6	30.2	(37.6)	76.0
Equity in net (earnings) loss of affiliate	—	(1.7)	(0.8)	(0.6)
(Gain) loss on investment in Persol Holdings⁽¹⁾	—	(6.3)	67.2	(36.3)
Loss on foreign currency matters⁽²⁾	—	—	20.4	—
Gain on sale of assets⁽³⁾	(4.4)	—	(5.3)	—
Held for sale impairment charge⁽⁴⁾	18.5	—	18.5	—
Adjusted EBITDA	$ 31.7	$ 22.2	$ 62.4	$ 39.1
Adjusted EBITDA margin	2.5 %	1.8 %	2.4 %	1.6 %

KELLY SERVICES,
INC. AND SUBSIDIARIES
RECONCILIATION OF NON-GAAP MEASURES
(UNAUDITED)

Management believes that the non-GAAP (Generally Accepted Accounting Principles) information excluding the 2022 sale of the Persol Holdings investment, the 2022 and 2021 gains and losses on the fair value changes of the investment in Persol Holdings, the 2022 losses on foreign currency matters, the 2022 gains on sale of assets and the impairment of assets held for sale, are useful to understand the Company’s fiscal 2022 financial performance and increases comparability. Specifically, Management believes that removing the impact of these items allows for a meaningful comparison of current period operating performance with the operating results of prior periods. Management also believes that such measures are used by those analyzing performance of companies in the staffing industry to compare current performance to prior periods and to assess future performance.

Management uses Adjusted EBITDA (adjusted earnings before interest, taxes, depreciation and amortization) and Adjusted EBITDA Margin (percent of total GAAP revenue) which Management believes is useful to compare operating performance compared to prior periods and uses it in conjunction with GAAP measures to assess performance. Our calculation of Adjusted EBITDA may not be consistent with similarly titled measures of other companies and should be used in conjunction with GAAP measurements.

These non-GAAP measures may have limitations as analytical tools because they exclude items which can have a material impact on cash flow and earnings per share. As a result, Management considers these measures, along with reported results, when it reviews and evaluates the Company’s financial performance. Management believes that these measures provide greater transparency to investors and provide insight into how Management is evaluating the Company’s financial performance. Non-GAAP measures should not be considered a substitute for, or superior to, measures of financial performance prepared in accordance with GAAP.

(1) In 2022, the loss on the investment in Persol Holdings represents the change in fair value up until the date of the sale of the investment on
February 15, 2022 as well as the loss on the sale of the investment during the period presented and the related tax benefit. In 2021, the gain on the investment in Persol Holdings represents the change in fair value of the investment during the period presented and the related tax expense.

(2) In 2022, the loss on foreign currency matters includes a
$20.4 million
loss on currency translation resulting from the substantially complete liquidation of the Company’s
Japan entity, partially offset by a
$5.5 million foreign exchange gain on the
Japan entity’s USD-denominated cash balance. The foreign exchange gain is included in other (income) expense, net in the EBITDA calculation.

(3) Gain on sale of assets in 2022 is related to the sale of under-utilized real property in the second quarter of 2022 and other real property sold in the first quarter of 2022.

(4) Impairment of assets held for sale represents the write-down of the net assets of the Russian operations that are classified as held for sale as of the second quarter of 2022.

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SOURCE
Kelly Services, Inc.

Release – Onconova Therapeutics Reports Second Quarter 2022 Financial Results and Provides Business Update

Posted on August 11, 2022 by Admin

Onconova Therapeutics Reports Second Quarter 2022 Financial Results and Provides Business Update

News and Market Data on Onconova Therapeutics

Conference call and live webcast at 4:30 p.m. ET today

NEWTOWN, Pa., Aug. 11, 2022 (GLOBE NEWSWIRE) — Onconova Therapeutics, Inc. (NASDAQ: ONTX), (“Onconova”), a clinical-stage biopharmaceutical company focused on discovering and developing novel products for patients with cancer, today announced financial results for the three months ended June 30, 2022, and provided a business update.

Highlights for the second quarter of 2022 and recent weeks include:

Safety data from the ongoing Phase 1 solid tumor trials of narazaciclib in the United States and China continue to be encouraging with the maximum tolerated dose not yet reached in either study. The trial in the United States is currently enrolling its fifth dose escalation cohort, with continuous dosing. The trial in China is also enrolling its fifth dose escalation cohort but once a day on days 1-21 of 28-day cycles. A protocol amendment to enable further dose escalation in the trial in China is being prepared.
Data from
in
vitro and cell-based assays that suggest narazaciclib’s inhibitory profile may provide safety and efficacy advantages over currently approved CDK4/6 inhibitors were featured in an abstract published at the American Society of Clinical Oncology (ASCO) Annual Meeting.
Each of rigosertib’s investigator-sponsored trials continues to progress. A Phase 2 trial evaluating rigosertib plus pembrolizumab in patients with checkpoint inhibitor refractory metastatic melanoma is on schedule to be initiated in the second half of 2022. The expansion cohort of the Phase 1/2a trial of rigosertib plus nivolumab in patients with KRAS-mutated non-small cell lung cancer continues to enroll patients, with additional data from the trial expected in Q3 2022. The Phase 2 trial of rigosertib monotherapy in advanced squamous cell carcinoma associated with recessive dystrophic epidermolysis bullosa also continues to enroll patients.
Mark Guerin was appointed Chief Operating Officer in addition to his role as Chief Financial Officer and Dr. Adar Makovski Silverstein was promoted to Senior Director and Head of Corporate Development.
Cash and cash equivalents at June 30, 2022 were $46.5 million, which the Company believes will be sufficient to fund ongoing clinical trials and business operations for at least eighteen months.

Management Commentary

“We saw sustained progress across our pipeline over the past months and are well positioned to complete our current Phase 1 trials as we move through the second half of the year,” said Steven M. Fruchtman, M.D., President and Chief Executive Officer of Onconova. “Narazaciclib continues to show a favorable safety profile in its Phase 1 studies, which will be key to informing the design of future trials seeking to address the unmet needs posed by the limitations of currently available CDK4/6 inhibitors. These limitations stem from issues related to safety, tolerability, and primary and acquired drug resistance, which we believe narazaciclib’s differentiated inhibitory profile may overcome. We were pleased to publish preclinical data supporting this hypothesis at the most recent ASCO meeting and look forward to continued efforts to translate these promising findings to the clinic.”

Dr. Fruchtman continued, “Alongside narazaciclib’s advancement, we also made key progress in rigosertib’s investigator-sponsored studies. This includes a Phase 2 trial evaluating rigosertib combined with a PD-1 checkpoint inhibitor in checkpoint inhibitor refractory metastatic melanoma which is on schedule to open for enrollment in the second half of 2022. This study seeks to leverage rigosertib’s immunomodulatory effects and is supported by initial data from the ongoing trial of rigosertib plus anti-PD-1 therapy in KRAS-mutated NSCLC. These data provided strong evidence of the studied doublet’s activity in patients who previously failed checkpoint inhibitor therapy, which is a finding we aim to build upon with the presentation of additional data at a medical meeting later this quarter. Data has been presented, which will be updated, demonstrating that responses seen with rigosertib in this setting are agnostic to the type of KRAS mutation present. This upcoming milestone highlights how rigosertib’s investigator-sponsored studies enable the capital efficient pursuit of value creating opportunities to complement our lead narazaciclib program.”

Second Quarter Financial Results

Cash and cash equivalents as of June 30, 2022, were $46.5 million, compared with $55.1 million as of December 31, 2021. The Company believes that its cash and cash equivalents will be sufficient to fund ongoing clinical trials and business operations for at least eighteen months.

Research and development expenses were $2.0 million for the second quarter of 2022, compared with $1.9 million for the second quarter of 2021.

General and administrative expenses were $2.1 million for the second quarter of 2022, compared with $2.9 million for the second quarter of 2021.

Net loss for the second quarter of 2022 was $4.0 million, or $0.19 per share on 20.9 million weighted shares outstanding, compared with a net loss of $4.2 million, or $0.27 per share for the second quarter of 2021 on 15.8 million weighted shares outstanding.

Conference Call and Webcast

Onconova will host an investment community conference call today beginning at 4:30 p.m. Eastern Time, during which management will discuss financial results for the second quarter of 2022, provide a business update, and answer questions. Interested parties can participate by dialing (800) 289-0571 (domestic callers) or (856) 344-9290 (international callers) and using conference ID 3600715.

A live webcast of the conference call will be available in the Investors & Media section of the Company’s website at www.onconova.com. A replay of the webcast will be available on the Onconova website for 90 days following the call.

About Onconova Therapeutics, Inc.

Onconova Therapeutics is a clinical-stage biopharmaceutical company focused on discovering and developing novel products for patients with cancer. The Company has proprietary targeted anti-cancer agents designed to disrupt specific cellular pathways that are important for cancer cell proliferation.

Onconova’s novel, proprietary multi-kinase inhibitor narazaciclib (formerly ON 123300) is being evaluated in two separate and complementary Phase 1 dose-escalation and expansion studies. These trials are currently underway in the United States and China.

Onconova’s product candidate rigosertib is being studied in an investigator-sponsored study program, including in a dose-escalation and expansion Phase 1/2a investigator-sponsored study with oral rigosertib in combination with nivolumab for patients with KRAS+ non-small cell lung cancer.

For more information, please visit www.onconova.com.

Forward-Looking Statements

Some of the statements in this release are forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, Section 21E of the Securities Exchange Act of 1934, as amended, and the Private Securities Litigation Reform Act of 1995, and involve risks and uncertainties. These statements relate to Onconova’s expectations regarding the timing of Onconova’s and investigator-initiated clinical development and data presentation plans, and the mechanisms and indications for Onconova’s product candidates. Onconova has attempted to identify forward-looking statements by terminology including “believes,” “estimates,” “anticipates,” “expects,” “plans,” “intends,” “may,” “could,” “might,” “will,” “should,” “preliminary,” “encouraging,” “approximately” or other words that convey uncertainty of future events or outcomes. Although Onconova believes that the expectations reflected in such forward-looking statements are reasonable as of the date made, expectations may prove to have been materially different from the results expressed or implied by such forward-looking statements. These statements are only predictions and involve known and unknown risks, uncertainties, and other factors, including the success and timing of Onconova’s clinical trials, investigator-initiated trials and regulatory agency and institutional review board approvals of protocols, Onconova’s collaborations, market conditions and those discussed under the heading “Risk Factors” in Onconova’s most recent Annual Report on Form 10-K and quarterly reports on Form 10-Q. Any forward-looking statements contained in this release speak only as of its date. Onconova undertakes no obligation to update any forward-looking statements contained in this release to reflect events or circumstances occurring after its date or to reflect the occurrence of unanticipated events.

Company Contact:
Mark Guerin
Onconova Therapeutics, Inc.
267-759-3680

ir@onconova.us
https://www.onconova.com/contact/

Investor Contact:
Bruce Mackle
LifeSci Advisors, LLC
646-889-1200

bmackle@lifesciadvisors.com

ONCONOVA
THERAPEUTICS, INC.

Condensed
Consolidated Balance Sheets

(in
thousands)

	*June 30*			*December 31,*
		*2022*			*2021*
*Assets*	(unaudited)
Current assets:
Cash and cash equivalents	$	46,533		$	55,070
Receivables		28			28
Prepaid expenses and other current assets		1,472			332
Total current assets		48,033			55,430
Property and equipment, net		31			38
Other non-current assets		10			10
Total assets	$	48,074		$	55,478

*Liabilities and stockholders’ equity*
Current liabilities:
Accounts payable	$	3,003		$	2,757
Accrued expenses and other current liabilities		3,231			3,132
Deferred revenue		226			226
Total current liabilities		6,460			6,115
Deferred revenue, non-current		3,130			3,243
Total liabilities		9,590			9,358

Stockholders’ equity:
Preferred stock		–			–
Common stock		209			209
Additional paid in capital		491,181			490,644
Accumulated other comprehensive loss		(41	)		(14	)
Accumulated deficit		(452,865	)		(444,719	)
Total stockholders’ equity		38,484			46,120
Total liabilities and stockholders’ equity	$	48,074		$	55,478

ONCONOVA
THERAPEUTICS, INC.

Condensed
Consolidated Statements of Operations

(in
thousands, except share and per share amounts)

	*Three Months Ended June 30,*						Six months months ended June 30,
		*2022*			*2021*			*2022*			*2021*

Revenue	$	57		$	57		$	113		$	113
Operating expenses:
General and administrative		2,139			2,850			4,325			5,067
Research and development		2,038			1,852			4,040			3,789
Total operating expenses		4,177			4,702			8,365			8,856
Loss from operations		(4,120	)		(4,645	)		(8,252	)		(8,743	)

Change in fair value of warrant liability		–			427			–			(209	)
Other income (loss,) net		96			(13	)		106			6
Net loss		(4,024	)		(4,231	)		(8,146	)		(8,946	)
Net loss per share of common stock, basic and diluted	$	(0.19	)	$	(0.27	)	$	(0.39	)	$	(0.59	)
Basic and diluted weighted average shares outstanding		20,904,085			15,780,863			20,904,085			15,201,719

Highlights and Outlook from OPEC’s August Report

Posted on August 11, 2022 by Admin




Image Credit: Kishjar (Flickr)

OPEC Sees a Better Balance of Supply and Demand in New Forecast

The Organization of Petroleum Exporting Nations (OPEC) released a 92-page report dated August 11, 2022, on the state of the global oil market. The topics include expected supply and demand balance shifts, global demand expectations, world economy expectations, and physical versus futures prices. The OPEC Monthly Oil Market Report suggests the cartel is not expecting to increase output.

Supply

The global oil supply has risen steadily over the past several months. This includes OPEC coordination with countries participating in the Declaration of Cooperation (DoC). However, ongoing low overall investment is limiting non-OPEC oil supply growth. Signs of slowing growth in the world economy and oil demand have been causing a better balance of output and consumption.

The oil market since the beginning of 2022 has been riddled with price volatility, this became much more pronounced after February 2022. The late winter imbalances were triggered by concerns in Eastern Europe. Sanctions on Russian oil by some major oil importing nations served to increase the premium that was built into crude prices. The sanctions led to significant changes to inter-regional trade flows. This raised supply concerns heading into the summer travel season.

The early summer was characterized by increased pressure on prices in most regions and soaring prices. This created a situation that resulted in crude differentials rising to record-high levels in 2Q22, along with steepening backwardation, a situation where physical oil is priced higher than futures contracts.

Demand

The OPEC report shows fundamentals in the physical oil market remain heightened, and volatility in the futures markets is reacting to expectations of lower GDP growth. Lower growth expectations are fed by rising worldwide inflation and the central banks’ reaction to slow economies.

Another factor impacting world demand is the US dollar’s value which strengthened further against major currencies. Oil is priced in US Dollars. Moreover, market price volatility contributed to reduced market liquidity, as seen in declining futures and options open interest in ICE Brent and NYMEX WTI dropped in July 2022 to the lowest since June 2015.

Source: OPEC Monthly Oil Market Report (August 2022)

Prices

Fuel prices surged in the first half of the year due to lower supplies amid refinery closures and a busy refinery turnaround season. The summer also ushered in stronger fuel consumption as pandemic-related travel restrictions were lifted in most regions. Adjustments to flow tied to the war in Eastern Europe further produced tightness. Combined, this all worked to push oil prices to record highs in June.

Jet fuel became the second strongest performer in the US product market. The product saw its price benefit from growing international air travel.

Prices peaked in June, with US gasoline reaching $193.06/b, up by $97.79/b, or 103%, y-o-y.

In July, rising refinery run rates reduced some of the tightness, mostly in US Gulf Coast (USGC), where product prices declined by $26.83/b, on average. In Europe, average prices declined the least, $20.24/b, m-o-m.

Looking Ahead

Refined product markets in the coming months are expected to experience seasonal support from transport fuels, while fuel sales could increase from the trend of moderating product prices.

Available refinery capacity will be helped by the operational ramp-up of at least two large capacity additions last year. These include the Middle East. The countries participating in the DoC will continue to monitor market developments and seek investment to help ensure adequate levels of capacity and bolster their efforts to maintain a stable oil market balance which is perceived to be in the interest of producers and consumers alike.

Paul Hoffman

Managing Editor, Channelchek

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Sources

https://momr.opec.org/pdf-download/

https://www.bloomberg.com/news/articles/2022-08-11/opec-sees-global-oil-market-tipping-into-surplus-this-quarter

https://www.investopedia.com/terms/b/backwardation.asp#:~:text=Key%20Takeaways,months%20through%20the%20futures%20market.

https://www.wsj.com/articles/opec-cuts-oil-demand-forecasts-as-economic-growth-slows-11660220861?mod=hp_lead_pos2

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RCI Hospitality Holdings (RICK) – Another Solid Quarter

Posted on August 11, 2022 by Admin

Thursday, August 11, 2022

RCI Hospitality Holdings (RICK)
Another Solid Quarter

With more than 60 units, RCI Hospitality Holdings, Inc., through its subsidiaries, is the country’s leading company in adult nightclubs and sports bars/restaurants. Clubs in New York City, Chicago, Dallas-Fort Worth, Houston, Miami, Minneapolis, Denver, St. Louis, Charlotte, Pittsburgh, Raleigh, Louisville, and other markets operate under brand names such as Rick’s Cabaret, XTC, Club Onyx, Vivid Cabaret, Jaguars Club, Tootsie’s Cabaret, Scarlett’s Cabaret, Diamond Cabaret, and PT’s Showclub. Sports bars/restaurants operate under the brand name Bombshells Restaurant & Bar.

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

Joshua Zoepfel, Research Associate, Noble Capital Markets, Inc.

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

3Q22 Results. Revenue hit a record $70.7 million, up 11% sequentially and up 22.2% y-o-y. We had projected $72 million of revenue. Net income was $13.9 million, or $1.48 per share, compared to $12.3 million, or $1.37 per share last year. Adjusted EPS was $1.60 compared to $1.36. We were at $12.5 million of net income, or $1.33 per share.

Quarterly Drivers. Quarterly results benefited from higher sales, partially due to the acquired clubs, a continued rebound in Nightclubs service revenue, and sequential improvement in Bombshells….

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.

Release – Harte Hanks Generates 180 Percent Increase in Operating income, Delivers $0.52 in EPS for the Second Quarter of 2022

Posted on August 11, 2022 by Admin

Harte Hanks Generates 180 Percent Increase in Operating income, Delivers $0.52 in EPS for the Second Quarter of 2022

Research, News, and Market Data on Harte Hanks

CHELMSFORD, MA / ACCESSWIRE / August 11, 2022 / Harte Hanks, Inc. (NASDAQ:HHS), a leading global customer experience company focused on bringing companies closer to customers for nearly 100 years, today announced financial results for the second quarter, the period ended June 30, 2022.

Harte Hanks CEO, Brian Linscott, commented: “Harte Hanks delivered solid improvements in EBITDA and Operating Income, even with the expected runoff of certain pandemic-related projects that concluded during the second quarter. Despite the macro-economic environment, demand for customer care and fulfillment and logistics services continues to grow, giving us increasing confidence that we can grow our top-line this year and drive significant improvements in operating income and cash generation for the full-year.”

“In addition to the significant improvement in our operating results, we took steps to streamline our capital structure, eliminating the dilutive impact to common shareholders,” continued Linscott. “We have agreed to repurchase all Preferred Stock currently outstanding, which will provide greater flexibility with our capital to further maximize shareholder value.”

Second Quarter Financial Highlights

Revenues decreased by 1.4% to $48.6 million, compared to $49.3 million in the same period in the prior year.
Fulfillment & Logistics Services grew 24.3%, partially offsetting declines in customer care and marketing services revenue related to sunsetting pandemic-related projects.
Operating income of $4.0 million, compared to operating income of $1.4 million in the same period in the prior year, an increase of 179.5%.
Net income of $4.5 million, compared to net income of $10.6 million, inclusive of a $10.0 million non-recurring gain for the extinguishment of the Company’s PPP loan, in the same period in the prior year.
Diluted EPS of $0.52 for the second quarter of 2022 vs. $1.27 for the same period in the prior year.
EBITDA improved to $4.6 million compared to $2.1 million in the same period in the prior year.[1]

Segment Highlights

Customer
Care, $15.4 million in revenue, 32% of total – Revenue decreased by 19.8%, or $3.8 million, from the prior year quarter, and year-over-year EBITDA decreased by 25.6% to $2.5 million from $3.4 million. New business wins for the quarter included:

An existing client that leveraged Harte Hanks for its back-office, ticket processing and ticket sharing capabilities has awarded Harte Hanks all of its customer facing functions including phone, email and chat. The growth with this client has been driven by consistent delivery, execution efficiency, and high customer satisfaction scores.

Harte Hanks was awarded a new business assignment by a leading employee screening services company to provide a wide scope of B2B sales and marketing support services. Harte Hanks was selected based on its strong track record of providing seamless support and integration with B2B sales operations seeking to accelerate their growth. As part of the program, Harte Hanks will provide our client’s sales team with a range of services to enhance their B2B sales efforts, including new lead generation, appointment setting, education and nurturing, and sales performance tracking.
Fulfillment
& Logistics Services, $19.7 million in revenue, 40% of total – Revenue increased by 24.3%, or $3.9 million, compared to the prior year quarter; and year-over-year EBITDA improved 91.7% to $3.2 million from $1.7 million. New business wins for the quarter included:
A leading branding company selected Harte Hanks Fulfillment to manage the mass production, kitting, and distribution of 600k+ holiday sample kits for a Fortune 50 retail partner. This new relationship has already led to multiple follow-on production runs across their kitting and fulfillment network, directly supporting additional retailers and national brands looking for innovative ways to get products into the hands of their consumers.
An existing Customer Care client leveraged our Fulfillment expertise to build and deliver thousands of promotional kits to ‘High Value Customers’, timed to coincide with and promote their major monthly televised events.
Marketing
Services, $13.5 million in revenue, 28% of total – Revenue decreased by 5.3% compared to the prior year quarter but year-over-year EBITDA improved 5.1% to $1.8 million from $1.7 million. New business wins for the quarter included:
A regional bank selected Harte Hanks to provide digital media planning and buying, creative, strategy and content development leveraging our strong expertise in this category, effective creative product, and ability to provide the full array of services needed.

Consolidated Second Quarter 2022 Results

Second quarter revenues were $48.6 million, down 1.4% from $49.3 million in the second quarter of 2021. The Company’s Fulfillment & Logistics Services segment grew, largely offsetting declines in Marketing Services and Customer Care.

Second quarter operating income was $4.0 million, compared to operating income of $1.4 million in the second quarter of 2021. The improvement resulted from margin expansion, the elimination of low-margin revenue, and cost-reduction initiatives.

Net income for the quarter was $4.5 million, compared to net income of $10.6 million in the second quarter last year. Last year’s second quarter included a non-recurring $10.0 million gain related to the extinguishment of its PPP loan. Absent this non-operational gain, net income would have been $0.6 million. Income attributable to common stockholders for the second quarter was $3.8 million, or $0.54 per basic share and $0.52 per fully diluted share, compared to net income attributable to common shareholders of $9.1 million, or $1.36 per basic share and $1.27 per fully diluted share during the prior year second quarter.

Consolidated Year-To-Date 2022 Results

Revenues for the first six months of 2022 were $97.6 million, up 5.0% from $93.0 million last year. Year-to-date operating income was $7.9 million, compared to operating income of $0.6 million last year. Net income for the first six months of 2022 was $7.8 million, compared to net income of $8.8 million (inclusive of the $10.0 million gain), last year. Income attributable to common stockholders for the first six months was $6.6 million, or $0.94 per basic share and $0.91 per fully diluted share, compared to net income attributable to common shareholders of $7.4 million, or $1.12 per basic share and $1.05 per fully diluted share.

Balance Sheet and Liquidity

Harte Hanks ended the quarter with $12.9 million in cash, cash equivalents and restricted cash, compared to $15.1 million at December 31, 2021. At June 30, 2022, the Company had no short-term debt, $10.0 million in long-term debt and $50.7 million in outstanding long-term pension liability. On December 31, 2021, the Company had no short-term debt, $5 million in long-term debt and $52.5 million in outstanding long-term pension liability.

The company anticipates receiving a Federal income tax refund related to a net operating loss (NOL) carryback claim of $7.6 million in 2022 which will further enhance liquidity.

On June 30, 2022, Harte Hanks entered into a share repurchase agreement with Wipro, LLC d/b/a Wipro US Branch IT Services, a Delaware limited liability company (“Wipro”), pursuant to which, Harte Hanks will repurchase all 9,926 shares of the Company’s Series A Convertible Preferred Stock currently outstanding (the “Preferred Stock”) in exchange for (i) a cash payment equal to their liquidation value, or total cash payment of $9.9 million and (ii) 100,000 shares of the Company’s common stock, par value $1.00 per share (the “Common Stock”). Harte Hanks will fund the cash portion of the repurchase consideration with a combination of cash and cash equivalents on hand and borrowings under the Company’s credit facility.

Conference Call Information

The Company will host a conference call and live webcast to discuss these results today at 4:30 p.m. EST. Interested parties may access the webcast at https://investors.hartehanks.com/events or may access the conference call by dialing in the United States (800) 445-7795 or internationally (785) 424-1699 and access code is HARTE.

A replay of the call can also be accessed via phone through August 25, 2022 by dialing (877) 481-4010 from the U.S., or (919) 882-2331 from outside the U.S. The conference call replay passcode is 46246.

About Harte Hanks:

Harte Hanks (NASDAQ:HHS) is a leading global customer experience company whose mission is to partner with clients to provide them with CX strategy, data-driven analytics and actionable insights combined with seamless program execution to better understand, attract and engage their customers.

Using its unparalleled resources and award-winning talent in the areas of Customer Care, Fulfillment and Logistics, and Marketing Services, Harte Hanks has a proven track record of driving results for some of the world’s premier brands, including Bank of America, GlaxoSmithKline, Unilever, Pfizer, HBOMax, Volvo, Ford, FedEx, Midea, Sony and IBM among others. Headquartered in Chelmsford, Massachusetts, Harte Hanks has over 2,500 employees in offices across the Americas, Europe, and Asia Pacific.

For more information, visit hartehanks.com

As used herein, “Harte Hanks” or “the Company” refers to Harte Hanks, Inc. and/or its applicable operating subsidiaries, as the context may require. Harte Hanks’ logo and name are trademarks of Harte Hanks.

Cautionary Note Regarding Forward-Looking Statements:

Our press release and related earnings conference call contain “forward-looking statements” within the meaning of U.S. federal securities laws. All such statements are qualified by this cautionary note, provided pursuant to the safe harbor provisions of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. Statements other than historical facts are forward-looking and may be identified by words such as “may,” “will,” “expects,” “believes,” “anticipates,” “plans,” “estimates,” “seeks,” “could,” “intends,” or words of similar meaning. These forward-looking statements are based on current information, expectations and estimates and involve risks, uncertainties, assumptions and other factors that are difficult to predict and that could cause actual results to vary materially from what is expressed in or indicated by the forward-looking statements. In that event, our business, financial condition, results of operations or liquidity could be materially adversely affected and investors in our securities could lose part or all of their investments. These risks, uncertainties, assumptions and other factors include: (a) local, national and international economic and business conditions, including (i) the outbreak of diseases, such as the COVID-19 coronavirus, which has curtailed travel to and from certain countries and geographic regions, created supply chain disruption and shortages, disrupted business operations and reduced consumer spending, (ii) market conditions that may adversely impact marketing expenditures, (iii) the impact of the Russia/Ukraine conflict on the global economy and our business, including impacts from related sanctions and export controls and (iv) the impact of economic environments and competitive pressures on the financial condition, marketing expenditures and activities of our clients and prospects; (b) the demand for our products and services by clients and prospective clients, including (i) the willingness of existing clients to maintain or increase their spending on products and services that are or remain profitable for us, and (ii) our ability to predict changes in client needs and preferences; (c) economic and other business factors that impact the industry verticals we serve, including competition and consolidation of current and prospective clients, vendors and partners in these verticals; (d) our ability to manage and timely adjust our facilities, capacity, workforce and cost structure to effectively serve our clients; (e) our ability to improve our processes and to provide new products and services in a timely and cost-effective manner though development, license, partnership or acquisition; (f) our ability to protect our facilities against security breaches and other interruptions and to protect sensitive personal information of our clients and their customers; (g) our ability to respond to increasing concern, regulation and legal action over consumer privacy issues, including changing requirements for collection, processing and use of information; (h) the impact of privacy and other regulations, including restrictions on unsolicited marketing communications and other consumer protection laws; (i) fluctuations in fuel prices, paper prices, postal rates and postal delivery schedules; (j) the number of shares, if any, that we may repurchase in connection with our repurchase program; (k) unanticipated developments regarding litigation or other contingent liabilities; (l) our ability to complete anticipated divestitures and reorganizations, including cost-saving initiatives; (m) our ability to realize the expected tax refunds; and (n) other factors discussed from time to time in our filings with the Securities and Exchange Commission, including under “Item 1A. Risk Factors” in our Annual Report on Form 10-K for the year ended December 31, 2021 which was filed on March 21, 2022. The forward-looking statements in this press release and our related earnings conference call are made only as of the date hereof, and we undertake no obligation to update publicly any forward-looking statement, even if new information becomes available or other events occur in the future.

Supplemental Non-GAAP Financial Measures:

The Company reports its financial results in accordance with generally accepted accounting principles (“GAAP”). However, the Company may use certain non-GAAP measures of financial performance in order to provide investors with a better understanding of operating results and underlying trends to assess the Company’s performance and liquidity in this press release and our related earnings conference call. We have presented herein a reconciliation of these measures to the most directly comparable GAAP financial measure.

The Company presents the non-GAAP financial measure “Adjusted Operating Income (Loss)” as a measure useful to both management and investors in their analysis of the Company’s financial results because it facilitates a period-to-period comparison of Operating Revenue and Operating Income (Loss) by excluding restructuring expense, impairment expense and stock-based compensation. The most directly comparable measure for this non-GAAP financial measure is Operating Income (Loss).

The Company presents the non-GAAP financial measure “EBITDA” as a supplemental measure of operating performance in order to provide an improved understanding of underlying performance trends. The Company defines “Adjusted EBITDA” as earnings before interest expense net, income tax expense (benefit) and depreciation expense. The most directly comparable measure for EBITDA is Net Income (Loss). We believe EBITDA is an important performance metric because it facilitates the analysis of our results, exclusive of certain non-cash items, including items which do not directly correlate to our business operations; however, we urge investors to review the reconciliation of non-GAAP EBITDA to the comparable GAAP Net Income (Loss), which is included in this press release, and not to rely on any single financial measure to evaluate the Company’s financial performance.

The use of non-GAAP measures do not serve as a substitute and should not be construed as a substitute for GAAP performance but should provide supplemental information concerning our performance that our investors and we find useful. The Company evaluates its operating performance based on several measures, including this non-GAAP financial measures. The Company believes that the presentation of this non-GAAP financial measures in this press release and earnings conference call presentations are useful supplemental financial measures of operating performance for investors because they facilitate investors’ ability to evaluate the operational strength of the Company’s business. However, there are limitations to the use of this non-GAAP measures, including that they may not be calculated the same by other companies in our industry limiting their use as a tool to compare results. Any supplemental non-GAAP financial measures referred to herein are not calculated in accordance with GAAP and they should not be considered in isolation or as substitutes for the most comparable GAAP financial measures.

EBITDA is the Company’s measure of segment profitability.

Investor Relations Contact:

Rob Fink

FNK IR
HHS@fnkir.com
646-809-4048

SOURCE: Harte Hanks, Inc.

View source version on accesswire.com:
https://www.accesswire.com/711580/Harte-Hanks-Generates-180-Increase-in-Operating-income-Delivers-052-in-EPS-for-the-Second-Quarter-of-2022

Motorsport Games (MSGM) – Time to Refill the Tank

Posted on August 11, 2022 by Admin

Thursday, August 11, 2022

Motorsport Games (MSGM)
Time to Refill the Tank

Motorsport Games, a Motorsport Network company, combines innovative and engaging video games with exciting esports competitions and content for racing fans and gamers around the globe. The Company is the officially licensed video game developer and publisher for iconic motorsport racing series across PC, PlayStation, Xbox, Nintendo Switch and mobile, including NASCAR, INDYCAR, 24 Hours of Le Mans and the British Touring Car Championship (“BTCC”). Motorsport Games is an award-winning esports partner of choice for 24 Hours of Le Mans, Formula E, BTCC, the FIA World Rallycross Championship and the eNASCAR Heat Pro League, among others.

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

Patrick McCann, Research Associate, Noble Capital Markets, Inc.

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

Q2 misses expectations. The company reported Q2 revenue of $2 million, missing our estimate of $4.2 million by 52%. Adj. EBITDA loss of $4.95 million was below our expectation of a loss of $3.74 million. Product releases are key to improved financial performance, which is expected in the second half this year.

Product roadmap remains intact. Management noted that the company’s scheduled title releases remain largely on schedule. The next release will be of the newest NASCAR game for Nintendo Switch, in Q4 of this year.

…

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

Release – Baudax Bio Reports Second Quarter 2022 Financial Results and Business Highlights

Posted on August 11, 2022 by Admin

Baudax Bio Reports Second Quarter 2022 Financial Results and Business Highlights

Research, News, and Market Data on Baudax Bio

August 11, 2022 7:00am EDT

ANJESO^® Net Product Revenue Up 49% Year-Over-Year;
Vials Sold to End-Users Up 67% Year-Over-Year

Dosing Complete in the First Cohort of the Phase I BX2000 Study;
On Track to Complete Enrollment in Remaining Cohorts by Early 2023

MALVERN, Pa., Aug. 11, 2022 (GLOBE NEWSWIRE) — Baudax Bio, Inc. (NASDAQ:BXRX) (the “Company”), a pharmaceutical company focused on innovative products for acute care settings, today reported financial results for the three and six months ended June 30, 2022, provided key metrics around the ongoing commercialization of ANJESO (meloxicam) injection, updated status of the neuromuscular blocking (NMB) agent development program, and provided an overview of other corporate and financial developments.

“ANJESO continued its solid sales performance during the second quarter of 2022 with 49% growth year-over-year,” said Gerri Henwood, President and CEO of Baudax Bio. “The development programs for our neuromuscular blocking (NMB) agents continue to advance with the commencement of a Phase I clinical study evaluating BX2000, our ultra-short acting NMB, in healthy volunteers. We are on track to progress through the remaining dosing cohorts and expect to complete enrollment of the study by early 2023. We are also working toward initiation of a Phase II study evaluating our intermediate-acting NMB, BX1000, in surgical patients and we look forward to keeping you updated on our progress.”

Second Quarter 2022 and
Recent Business Highlights

ANJESO

ANJESO
U.S. Commercialization. ANJESO is indicated for the management of moderate to severe pain in adults, alone or in combination with other non-NSAID analgesics. For the second quarter of 2022, ANJESO achieved net product revenue of $0.3 million, reflecting 49% growth year-over-year. Vials sold to end-users increased by approximately 67% compared to the same prior year period. In terms of site of care usage of ANJESO, there was a 12% increase in vials sold to hospitals in the second quarter of 2022 compared to the first quarter of 2022. In the second quarter of 2022 the re-order rate from existing accounts was 72%.
Impacts
from COVID-19. The newer Omicron variants of COVID-19 as well as hospital and ambulatory surgical center staffing issues, although beginning to stabilize, continued to impact the number of elective surgeries performed during the quarter. Cancellations of elective surgeries were primarily due to patients or ASC and hospital staff testing positive for COVID-19, as well as reduced availability of staff at ambulatory surgical centers and hospitals.

NMBs

BX1000
(IV Intermediate-action). A dose-escalation Phase I study evaluating BX1000 in 58 healthy volunteers was completed and results showed that BX1000 was generally well tolerated through the dosing range tested. Muscle paralysis was rapidly achieved along with complete spontaneous recovery. Baudax Bio is preparing the clinical study report for this dose-escalation study and expects to submit it to the U.S. Food and Drug Administration (FDA) in 2022. Additionally, the Company expects to begin enrollment in a Phase II study in surgical patients during 2022.
BX2000
(IV Ultra-short action). Dosing was completed for the first cohort of the Phase I dose escalation study evaluating the safety, tolerability and pharmacokinetics of BX2000 in healthy volunteers. This study is comprised of up to 10 dosing cohorts and each cohort is planned to enroll 8 patients. The Company expects to complete enrollment of the remaining cohorts in the study by early 2023.
BX3000
(Reversal agent). Additional work to enhance the formulation of the BX3000 reversal agent is complete and the Company believes this data, along with certain non-clinical data, which will be submitted to FDA by early 2023, will support and IND filing for a Phase I study in healthy volunteers the first half of 2023.

Corporate and Financial

Secured
$2.0 Million in Financing. In May, Baudax Bio completed a registered direct offering with institutional investors securing approximately $2.0 million, before deducting placement agent fees and other offering expenses. The financing was priced at-the-market and the Company issued and sold approximately 1.6 million shares of its common stock, at a purchase price of $1.215 per share. The Company also agreed to issue to the investors, in a concurrent private placement, unregistered warrants to purchase up to 1.6 million shares of its common stock.

Second Quarter 2022
Financial Results

As of June 30, 2022, Baudax Bio had cash and cash equivalents of $5.2 million.

Net product revenue related to sales of ANJESO in the U.S., recognized according to U.S. GAAP, for the three months ended June 30, 2022 was $0.3 million. This compares to $0.2 million for the three months ended June 30, 2021, an increase of $0.1 million, or 49%, despite a decrease of approximately 80% of the field staff in the current year. While utilizing the title model of distribution, product revenue is recognized as shipments are made to the Company’s third-party logistics provider. The increase in net product revenue was attributable to increased demand at existing accounts as well as securing additional formulary approvals.

Cost of sales for the three months ended June 30, 2022 was $0.4 million, compared to $0.6 million for the three months ended June 30, 2021, a decrease of $0.2 million, and consisted of product costs, royalty expense and certain fixed costs associated with the manufacturing of ANJESO, including supply chain and quality costs. The decrease of $0.2 million was primarily a result of the reduction in manufacturing costs, including production and storage costs, in the current year compared to the prior year. Certain product costs of ANJESO units recognized as revenue during the three months ended June 30, 2022 and 2021 were expensed prior to the FDA approval of ANJESO in February 2020, and therefore are not included in cost of sales during the related periods. Baudax Bio expects that over time, product costs in cost of sales will modestly increase as sales increase and inventory associated with the units manufactured prior to FDA approval have been sold.

Research and development expenses for the three months ended June 30, 2022 and 2021 were $0.9 million.

Selling, general and administrative expenses for the three months ended June 30, 2022 were $4.0 million, of which $1.1 million was attributable to selling expense and $2.9 million was attributable to general and administrative expense. This compares to $10.6 million for the same prior year period, of which $5.0 million was attributable to selling expense and $5.6 million was attributable to general and administrative expense. Selling expenses decreased $3.9 million, primarily as a result of a reduction in personnel costs of $2.4 million and a decrease in marketing costs of $1.4 million. The decrease of $2.7 million in general and administrative costs was primarily a result of a decrease in personnel costs of $1.4 million, a decrease in public company costs of $0.9 million and a decrease in consulting costs of $0.3 million.

Baudax Bio reported a net loss of $7.5 million, or $(1.05) per share, including non-cash charges of $2.6 million, for the three months ended June 30, 2022. Adjusted net loss* was $4.9 million.

Six Months Ended June
30, 2022 Financial Results

Net product revenue related to sales of ANJESO in the U.S., recognized according to U.S. GAAP, for the six months ended June 30, 2022 was $0.7 million. This compares to $0.4 million for the six months ended June 30, 2021, an increase of $0.3 million. While utilizing the title model of distribution, product revenue is recognized as shipments are made to the Company’s third-party logistics provider. The increase in net product revenue was attributable to increased demand at existing accounts as well as securing additional formulary approvals.

Cost of sales for the six months ended June 30, 2022 was $1.0 million, compared to $1.4 million for the six months ended June 30, 2021, a decrease of $0.4 million, and consisted of product costs, royalty expense and certain fixed costs associated with the manufacturing of ANJESO, including supply chain and quality costs. The decrease of $0.4 million was primarily a result of the reduction in scrap expense recorded in the current year compared to the prior year of $0.2 million and a decrease in manufacturing costs, including reductions in production and storage costs, of $0.2 million. Certain product costs of ANJESO units recognized as revenue during the six months ended June 30, 2022 and 2021 were expensed prior to the FDA approval of ANJESO in February 2020, and therefore are not included in cost of sales during the related periods. Baudax Bio expects that over time, product costs in cost of sales will modestly increase as sales increase and inventory associated with the units manufactured prior to FDA approval have been sold.

Research and development expenses for the six months ended June 30, 2022 were $2.2 million compared to $2.0 million for the six months ended June 30, 2021. The increase of $0.2 million was primarily due to the initiation of the pediatric trial for ANJESO of $0.2 million.

Selling, general and administrative expenses for the six months ended June 30, 2022 were $18.2 million, of which $8.3 million was attributable to selling expense and $9.9 million was attributable to general and administrative expense. This compares to $22.7 million for the same prior year period, of which $10.1 million was attributable to selling expense and $12.6 million was attributable to general and administrative expense. Selling expenses decreased $1.8 million, primarily as a result of a decrease in marketing costs of $1.1 million and a reduction in personnel costs of $0.7 million. The decrease of $2.7 million in general and administrative was primarily a result of a decrease in public company costs of $1.4 million, a decrease in personnel costs of $0.9 million and a decrease in consulting costs of $0.4 million.

Baudax Bio reported net loss of $20.3 million, or $(3.63) per share, including net non-cash charges of $0.2 million, for the six months ended June 30, 2022. Adjusted net loss* was $20.1 million.

* Non-GAAP Financial
Measures

To supplement the Company’s financial results determined by U.S. generally accepted accounting principles (“GAAP”), the Company is reporting certain non-GAAP information for its business, including adjusted net loss. Adjusted net loss is net loss as determined under GAAP, excluding the changes in fair values of contingent consideration and warrant valuations, gain on extinguishment of debt, interest, depreciation, amortization, and stock-based compensation. The Company believes this non-GAAP financial measure is helpful in understanding its business as it is useful to investors in allowing for greater transparency of supplemental information used by management. This measure is used by investors, as well as management in assessing the Company’s performance. Non-GAAP financial measures should be considered in addition to, but not as a substitute for, reported GAAP results. Further, Non-GAAP financial measures, even if similarly titled, may not be calculated in the same manner by all companies, and therefore should not be compared. Please see the section of this press release titled “Reconciliation of GAAP to Non-GAAP Financial Measures” for a reconciliation of non-GAAP adjusted net loss to its most directly comparable GAAP measure.

About ANJESO^®

ANJESO (meloxicam) injection is a proprietary, long-acting, preferential COX-2 inhibitor that possesses analgesic, anti-inflammatory and antipyretic activities, which are believed to be related to the inhibition of cyclooxygenase type 2 pathway (COX-2) and subsequent reduction in prostaglandin biosynthesis. ANJESO is indicated for the management of moderate to severe pain, alone or in combination with other non-NSAID analgesics. As a non-opioid, Baudax Bio believes ANJESO has the potential to overcome many of the issues associated with commonly prescribed opioid therapeutics, including respiratory depression, constipation, excessive nausea and vomiting, as well as having no addictive potential, while maintaining meaningful analgesic effects for relief of pain. ANJESO was designed using the NanoCrystal® platform, a technology that enables enhanced bioavailability of poorly water-soluble drug compounds. NanoCrystal® is a registered trademark of Alkermes Pharma Ireland Limited (APIL).

About Baudax Bio

Baudax Bio is a pharmaceutical company focused on innovative products for acute care settings. Baudax Bio markets ANJESO^®, the first and only 24-hour, intravenous (IV) COX-2 preferential non-steroidal anti-inflammatory (NSAID) for the management of moderate to severe pain. In addition to ANJESO, the Company has a pipeline of other innovative pharmaceutical assets including two clinical-stage, novel neuromuscular blocking (NMBs) agents and a proprietary chemical reversal agent specific to these NMBs. For more information, please visit www.baudaxbio.com.

Forward Looking
Statements

This press release contains forward-looking statements that involve risks and uncertainties. Such forward-looking statements reflect Baudax Bio’s expectations about its future performance and opportunities that involve substantial risks and uncertainties. When used herein, the words “anticipate,” “believe,” “estimate,” “may,” “upcoming,” “plan,” “target,” “goal,” “intend,” and “expect,” and similar expressions, as they relate to Baudax Bio or its management, are intended to identify such forward-looking statements. These forward-looking statements are based on information available to Baudax Bio as of the date of publication on this internet site, including statements relating to future expenses, product costs, and the development of each of BX1000, BX2000, and BX3000, and are subject to a number of risks, uncertainties, and other factors that could cause Baudax Bio’s performance to differ materially from those expressed in, or implied by, these forward-looking statements. These risks and uncertainties include, among other things, risks related to market, economic and other conditions, the ongoing economic and social consequences of the COVID-19 pandemic, Baudax Bio’s ability to advance its current product candidate pipeline through pre-clinical studies and clinical trials, Baudax Bio’s ability to raise future financing for continued development of its product candidates such as BX1000, BX2000 and BX3000, Baudax Bio’s ability to pay its debt and satisfy conditions necessary to access future tranches of debt, Baudax Bio’s ability to comply with the financial and other covenants under its credit facility, Baudax Bio’s ability to manage costs and execute on its operational and budget plans, Baudax Bio’s ability to achieve its financial goals; Baudax Bio’s ability to maintain listing on the Nasdaq Capital Market; and Baudax Bio’s ability to obtain, maintain and successfully enforce adequate patent and other intellectual property protection. These forward-looking statements should be considered together with the risks and uncertainties that may affect Baudax Bio’s business and future results included in Baudax Bio’s filings with the Securities and Exchange Commission at www.sec.gov. These forward-looking statements are based on information currently available to Baudax Bio, and Baudax Bio assumes no obligation to update any forward-looking statements except as required by applicable law.

CONTACTS:

Investor Relations
Contact:

Argot Partners
Sam Martin / Kaela Ilami
(212) 600-1902
baudaxbio@argotpartners.com

Media Contact:

Argot Partners
David Rosen
(212) 600-1902
david.rosen@argotpartners.com



BAUDAX BIO, INC.
Consolidated Balance Sheets
(Unaudited)

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

Assets					June 30, 2022			December 31, 2021
Current assets:
	Cash and cash equivalents			$	5,210		$	15,891
	Accounts receivable, net				616			542
	Inventory				5,255			5,002
	Prepaid expenses and other current assets				1,398			2,059
			Total current assets	$	12,479		$	23,494

	Property, plant and equipment, net				4,941			5,015
	Intangible assets, net				20,390			21,678
	Goodwill				2,127			2,127
	Other long-term assets				897			963
			Total assets	$	40,834		$	53,277
Liabilities and Shareholders’ Equity
Current liabilities:
	Accounts payable				3,064			1,468
	Accrued expenses and other current liabilities				3,812			5,540
	Current portion of long-term debt, net				3,611			2,222
	Current portion of contingent consideration				7,694			6,416
			Total current liabilities		18,181			15,646
	Long-term debt, net				5,099			6,309
	Long-term portion of contingent consideration				12,692			17,446
	Other long-term liabilities				632			650
			Total liabilities		36,604			40,051
Shareholders’ equity:
	Preferred stock, $0.01 par value. Authorized, 10,000,000 shares;
		none issued and outstanding.			—			—
	Common stock, $0.01 par value. Authorized, 190,000,000 shares; issued and outstanding, 8,068,853 shares at June 30, 2022 and 2,807,239 shares at December 31, 2021				81			28
	Additional paid in-capital				156,578			145,287
	Accumulated deficit				(152,429	)		(132,089	)
			Total shareholders’ equity		4,230			13,226
			Total liabilities and shareholders’ equity	$	40,834		$	53,277

BAUDAX BIO, INC.
Consolidated Statements of Operations and Comprehensive Loss
(Unaudited)

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

				Three Months Ended						Six Months Ended
				June 30,						June 30,
				2022			2021			2022			2021
Revenue, net			$	300		$	201		$	722		$	399

Operating expenses:
	Cost of sales (excluding amortization of intangible assets)			361			586			1,009			1,407
	Research and development			912			857			2,205			1,965
	Selling, general and administrative			4,029			10,608			18,219			22,696
	Amortization of intangible assets			644			644			1,288			1,288
	Change in warrant valuation			(1	)		(59	)		(6	)		(41	)
	Change in contingent consideration valuation			1,327			3,881			(2,476	)		5,722
		Total operating expenses		7,272			16,517			20,239			33,037
		Operating loss		(6,972	)		(16,316	)		(19,517	)		(32,638	)
Other expense:
	Other (expense) income, net			(559	)		987			(823	)		397
	Net loss		$	(7,531	)	$	(15,329	)	$	(20,340	)	$	(32,241	)

Per share information:
Net loss per share of common stock, basic			$	(1.05	)	$	(7.17	)	$	(3.63	)	$	(16.43	)
Net loss per share of common stock, diluted			$	(1.05	)	$	(7.18	)	$	(3.63	)	$	(16.43	)

Weighted average common shares outstanding, basic				7,181,640			2,137,191			5,610,037			1,962,655
Weighted average common shares outstanding, diluted				7,181,640			2,138,100			5,610,037			1,962,655

BAUDAX BIO, INC.
Reconciliation of GAAP to Non-GAAP Measures
(Unaudited)

	For the Three Months Ended June 30,						For the Six Months Ended June 30,
(amounts in thousands)		2022			2021			2022			2021
Net loss (GAAP)	$	(7,531	)	$	(15,329	)	$	(20,340	)	$	(32,241	)

Stock-based compensation		337			903			858			3,207
Non-cash interest expense		223			229			449			458
Gain on extinguishment of debt		—			(1,553	)		—			(1,553	)
Depreciation expense		43			63			86			149
Amortization expense		644			644			1,288			1,288
Non-cash loss on retirement of fixed assets		8			—			8			—
Change in warrant valuation		(1	)		(59	)		(6	)		(41	)
Change in contingent consideration valuation		1,327			3,881			(2,476	)		5,722

Adjusted net loss (non-GAAP)	$	(4,950	)	$	(11,221	)	$	(20,133	)	$	(23,011	)

To supplement the Company’s financial results determined by U.S. generally accepted accounting principles (“GAAP”), the Company has disclosed in the tables below the following non-GAAP information about adjusted net loss.

Adjusted net loss is net loss as determined under GAAP, excluding the changes in fair values of contingent consideration and warrant valuations, gain on extinguishment of debt, interest, depreciation, amortization, and stock-based compensation.

The Company believes that non-GAAP financial measures are helpful in understanding its business as it is useful to investors in allowing for greater transparency of supplemental information used by management. Adjusted net loss is used by investors, as well as management in assessing the Company’s performance. Non-GAAP financial measures should be considered in addition to, but not as a substitute for, reported GAAP results. Further, Non-GAAP financial measures, even if similarly titled, may not be calculated in the same manner by all companies, and therefore should not be compared.

Source: Baudax Bio, Inc.

Released August 11, 2022

The Tax Credits in IRA Bill May Not Help U.S. Electric Vehicle Manufacturers

Posted on August 10, 2022 by Admin


Source: kandiamerica.com

The Climate Bill Could Short-Circuit EV Tax Credits, Making Qualifying for Them Nearly Impossible

The U.S. Senate passed a far-reaching climate, energy and health care bill on Aug. 7, 2022, that invests an unprecedented US$370 billion in energy and climate programs over the next 10 years – including incentives to expand renewable energy and electric vehicles.

Rapid and widespread adoption of electric vehicles will be essential for the United States to meet its climate goals. And the new bill, which includes a host of other health and tax-related provisions, aims to encourage people to trade their gasoline-fueled cars for electrics by offering a tax credit of up to $7,500 for new electric vehicles and up to $4,000 for used electric vehicles through 2032.

But there’s a catch, and it could end up making it difficult for most EVs to qualify for the new incentive.

The bill, which needs House approval, requires that new electric vehicles meet stringent sourcing requirements for critical materials, the components of the battery, and final assembly to qualify for the tax credits. While some automakers, like Tesla and GM, have well-developed domestic supply chains, no electric vehicle manufacturer currently meets all the bill’s requirements.

This article was republished with permission from The Conversation, a news site dedicated to
sharing ideas from academic experts. It was written by and represents the
research-based opinions of James Morton Turner, Professor
of Environmental Studies, Wellesley College.

Building a Domestic EV Supply Chain

At first glance, the revised EV tax credits seem like a smart move.

Existing U.S. policy allows credits for the first 200,000 electric vehicles a manufacturer sells. Those credits helped jump-start demand for EVs. But industry leaders, including Tesla and GM, have already hit that cap, while most foreign automakers’ vehicles are still eligible. The bill would eliminate the cap for individual automakers and extend the tax credits through 2032 – for any vehicle that meets the sourcing requirements.

Right now, China dominates the global supply chain for materials and lithium-ion batteries used in electric vehicles. This is no accident. Since the early 2000s, Chinese policymakers have adopted aggressive policies that have supported advanced battery technologies, including investments in mines, materials processing and manufacturing. I discuss how China got a head start in the race toward a clean energy future in my new book, Charged: A History of Batteries and Lessons for a Clean Energy Future.

Sen. Joe Manchin, the West Virginia Democrat who stalled earlier efforts to get these measures through the sharply divided Senate, said he hopes the requirements will help scale up the U.S. domestic critical minerals supply chain.

The EV incentives would complement other U.S. policies aimed at jump-starting domestic EV manufacturing capacity. Those include $7 billion in grants to accelerate the development of the battery supply chain allocated in the Infrastructure Investment and Jobs Act of 2021 and a $3 billion expansion of the Advanced Vehicle Manufacturing Loan Program included in the current bill, formally known as the Inflation Reduction Act.

The problem is that the Inflation Reduction Act’s sourcing requirements come online so quickly, starting in 2023, and ratchet upward so rapidly, that the plan could backfire. Instead of expanding electric vehicle adoption, the policy could make almost all electric vehicles ineligible for the tax incentives.

Even Tesla’s Gigafactory Relies on China

The bill excludes incentives for any new vehicle which contains battery materials or components extracted, processed, manufactured or assembled by a “foreign entity of concern” – a category which includes China.

According to Benchmark Intelligence, a market research firm that tracks the battery industry, China currently controls 81% of global cathode manufacturing capacity, 91% of global anode capacity, and 79% of global lithium-ion battery manufacturing capacity. By comparison, the United States has 0.16% of cathode manufacturing capacity, 0.27% of anode manufacturing capacity, and 5.5% of lithium-ion battery manufacturing capacity.

Even the U.S.’s most advanced battery factories, such as Tesla’s Nevada Gigafactory, currently rely on materials processed in China. Despite Ford’s plans to expand its domestic supply chain, its most recent deals are for sourcing batteries from Chinese manufacturer CATL.

In addition to excluding materials and components sourced from China starting in 2023, the bill also requires that a minimum percentage of the materials and components in batteries be sourced domestically or from countries the U.S. has a fair trade agreement with, such as Australia and Chile. The threshold starts at 40% of the value of critical minerals in 2023 and ramps up to 80% in 2027, with similar requirements for battery components.

If a manufacturer doesn’t meet these requirements, its vehicle would be ineligible for the tax credit. Whether the Treasury Department would come up with exemptions remains to be seen.

Although EV manufacturers are already pursuing plans to develop supply chains that meet these sourcing requirements, proposals for mines and processing facilities often face challenges. Indigenous and environmental concerns have slowed a proposed lithium mine in Nevada. In some cases, key materials, such as cobalt and graphite, are not readily sourced domestically or from fair-trade allies.

Proposed recycling projects could help meet demand. Redwood Materials projects its recycling facility, currently under construction in Nevada, will supply cathode and anode materials to support one million electric vehicles per year by 2025. Despite such optimistic projections, experts anticipate that recycling can only play a small role in offsetting the demand for raw materials needed to scale up electric vehicle adoption in the coming decade.

How Much Can the Bill do to Cut Emissions?

Clean energy supporters called the bill historic. In addition to a massive investment in renewable energy and electric vehicles, it provides support for technologies such as carbon capture and storage and zero-carbon fuels, and includes a fee to curtail methane emissions, as well as some trade-offs that boost fossil fuels.

Forecasters have projected that the climate package as a whole could help put the U.S. on track to reduce greenhouse gas emissions by about 40% by 2030 compared to 2005 levels – still short of the Biden administration’s goal of a 50% reduction, but closer.

But for the U.S. to hit those goals, electric vehicles will have to replace fossil-fueled vehicles by the millions. A realistic EV tax credit that allows time for manufacturers to diversify their supply chains and makes these vehicles more affordable for all Americans will be crucial. The proposed policy risks short-circuiting EV tax credits just when they are needed most.

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Do Rising Prices Pump Up Stock Market Levels?

Posted on August 10, 2022 by Admin




Image Credit: Alexandra Maria

Are Consumer Price Increases Negatively Correlated to Stock Market Price Levels?

Does inflation lift stock prices? It has been long thought that stocks are a better hedge against inflation than cash, which loses purchasing power with rising prices, or even bonds, which lose value when inflation leads to higher interest rates. Excessive consumer price increases (defined as over 2% CPI YoY) come from either hypergrowth where demand outstrips supply or reduced supply while demand has changed little. The current inflation spike appears to be a mix of both supply issues from disruptions during the pandemic and demand issues from a dramatic increase in the money supply.

What Does Inflation Do to the Stock Market?

The answer is not straightforward as it depends on all of the contributing factors. If those factors can be easily modified, the markets are likely to react, in advance, to what it will be that changes them. If monetary policy is expected to be tightened, this can slow economic growth and weigh on equity prices as capital will not be as free-flowing. If it is because there is a shortage of supply, the market is likely to react to how quickly the condition will resolve itself. A shortage of supply could come from short-duration events like weather that impacts agriculture, or shipping, which is usually short-lived – also resource shortages result from a supplier not being available. This could be related to embargos, logistics, etc. Price increases from an imposition of tariffs are one-time additions to prices and don’t lead to prolonged inflation.

Stock market participants are forward-looking. On an ongoing basis, they monitor current and expected conditions and react to how they will impact company earnings. The sweet spot is when inflation has no risk of dropping below zero and is stable within a percentage point of 2%.

Sources: NYU.edu (Stocks), BLS.gov (Consumer Prices)

The markets clearly dislike deflation or negative price growth. The chart above demonstrates that each time inflation went negative that same year or the following year, stocks dropped. So deflation has a positive correlation to stock index levels (decreasing inflation = decreasing stocks). From the chart, we also see when inflation approached or breached 10%, the markets also gave up ground that year or the following year.

A healthy market comes from a healthy economy; a healthy economy is one where supply is meeting demand. This makes growth more predictable, and the markets enjoy predictability. A lack of being able to assess what the future is likely to bring issues in periods of volatility where bulls and bears are most at odds. The 40-plus year high in CPI has ushered-in the kind of whipsaw volatility that can hurt active investors and traders.

Some investors may seek stock ownership as a hedge against inflation. Companies that own assets that are rising in value help offset the erosion of the native currency. Alternatively, some investors may also find that fixed return investments like those that pay a known interest rate compete much better than the uncertain returns in stocks. Dividend stocks like utilities are often held by income investors like retirees. These stocks are particularly vulnerable should lower-risk bonds offer the same or higher yield than the expected dividends.

Take Away

Markets react to future earnings expectations. If the demand for a company’s product is little changed as prices increase, its earnings should stay relatively stable (food, medicine, government contractors, other non-discretionary). If the product or service will see reduced demand as prices increase, the company is likely to see reduced earnings and lower stock valuations.

Markets also react to expectations of future conditions. If it is expected that whatever the cause of inflation is, is transitory, market participants may look past current conditions. If instead, the expectations are that an aggressive and prolonged tightening stance will shrink the entire economy, then the markets are likely to respond negatively.

The high inflation the U.S. has experienced over the past year has resulted from both supply and demand-related factors. The supply issues are out of the Fed’s control, but it is presumed that these are transitory and related to the pandemic and war in Europe. Current price increases are also the result of trillions of dollars pumped into the economy over a short period of time. The Fed does have more control over this. If they act with aggressive monetary policy, the markets may initially pull back, if it appears the Fed is winning the battle, markets may become more bullish.

Paul Hoffman

Managing Editor, Channelchek

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Sources

https://pages.stern.nyu.edu/~adamodar/New_Home_Page/datafile/histretSP.html

https://www.usinflationcalculator.com/inflation/historical-inflation-rates/

https://investorplace.com/2022/06/what-does-inflation-do-to-the-stock-market/?utm_source=Nasdaq&utm_medium=referral

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New Proposal to Monitor Cryptocurrency in Large Hedge Funds

Posted on August 10, 2022 by Admin




Image Credit: Global Commodities Forum (Flickr)

Private Funds May Soon be Mandated to Disclose Digital Asset Holdings and Performance

The Securities and Exchange Commission (SEC) and Commodity Futures Trade Commission (CFTC) have issued a joint proposal to better “assess systemic risk” of private fund advisors. The proposal includes language that would require reporting of cryptocurrency positions and performance measures of large hedge funds.

What is Form PF?

The form is a jointly adopted requirement used by both the SEC and CFTC. It’s a regulatory filing that mandates private fund advisers report regulatory assets under management to the Financial Stability Oversight Council (FSOC). The purpose is to monitor risks to the US financial system. Form PF affects SEC-registered managers of private equity funds, real estate funds, hedge funds, and liquidity funds with at least US$150 million in private fund assets.

The Proposal

Both Commissions settled on the proposed inclusion after consulting with the Treasury Department and Federal Reserve on potential financial-stability risks in the private-funds industry. SEC Chairman Gary Gensler noted that private funds’ total assets are nearing the size of the banking sector’s assets. “In the decade since the SEC and CFTC jointly adopted Form PF, regulators have gained vital insight with respect to private funds. Since then, though, the private fund industry has grown in gross asset value by nearly 150 percent and evolved in terms of its business practices, complexity, and investment strategies,” said SEC Chair Gary Gensler.

The SEC/CFTC Proposed Amendments to Form PF include a number of amendments designed to enhance the FSOC’s ability to monitor systemic risk and bolster regulatory oversight of private fund advisors. Beyond crypto, the proposal would require hedge funds with more than $500 million of net assets to report more information on Form PF about their investment exposures, portfolio concentrations, and borrowing arrangements.

Image: Selection from

The proposal on Wednesday (August 10) would add “digital assets” for the first time on Form PF. It also defines what a digital asset is in the eye of the regulators. It has opened a 60-day comment period on whether funds should report detailed information about the cryptocurrencies they hold. This includes identifying specifically or describing their characteristics.

The proposal notes that many hedge funds have been formed recently to invest in crypto, while some other existing funds have added the asset class to portfolios.

Expected Benefit

The recent drop in the prices of digital tokens like bitcoin and Ether has not spread to other asset classes. But the implosion of a crypto-focused hedge fund earlier this summer created a chain reaction that dragged a number of its creditors into bankruptcy.

Regulators want to get ahead of any chain reaction that could extend into traditional markets if mainstream financial institutions increase their adoption of cryptocurrencies before additional guardrails are put in place. “Gathering such information would help the commissions and [financial-stability regulators] better to observe how large hedge funds interconnect with the broader financial services industry,” Mr. Gensler said.

Paul Hoffman

Managing Editor, Channelchek

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Sources

https://www.sec.gov/rules/proposed/2022/ia-6083.pdf

https://www.sec.gov/files/formpf.pdf

https://www.wsj.com/articles/regulators-weigh-asking-hedge-funds-to-report-crypto-exposure-11660140000?mod=djemalertNEWS

https://www.wsj.com/articles/mainstream-hedge-funds-pour-billions-of-dollars-into-crypto-11646808223?mod=article_inline

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Release – PsyBio Therapeutics Expands International Patent Applications

Posted on August 10, 2022 by Admin

PsyBio Therapeutics Expands International Patent Applications

Research, News, and Market Data on PsyBio

PsyBio is continuing to increase its psycho-targeted patent
portfolio, executing on its strategic priorities of innovation, development,
and technology optimization

PsyBio now has twenty patent applications in total

OXFORD, Ohio and DENVER, Aug. 8, 2022 /CNW/ – PsyBio Therapeutics Corp. (TSXV: PSYB) (OTCQB: PSYBF) (“PsyBio” or the “Company“), an intellectual property driven biotechnology company focused upon discovery and development of novel, bespoke, psycho-targeted therapeutics to potentially improve mental and neurological health, today is announcing the filing of additional international patent applications in Europe, Africa, and Asia. This brings PsyBio’s total number of patent application submissions to twenty, making it one of the most robust portfolios in the sector.PsyBio Logo (CNW Group/PsyBio Therapeutics Corp.)

“Biosynthetic tryptamine production allows the development of psycho-targeted molecules as novel therapeutic candidates, with the goal to potentially help improve human health,” stated Michael Spigarelli, MD, PhD, MBA, PsyBio’s Chief Medical Officer. “Our IP strategy fosters the developmental processes and will allow us to develop these molecules as smoothly and rapidly as possible. Global patent submissions further expand PsyBio’s IP portfolio and support our ongoing plans for growth.”

The patent applications submitted comprise advancements concerning production methodology, host strains and processes of production that support and allow PsyBio’s novel production methodology to be globally protected. These filings demonstrate the Company’s commitment to value creation, while also promoting scientific and methodologic advancements in the field.

“PsyBio is dedicated to leading the development of psycho-targeted therapeutic candidates in our vision to potentially improve mental and neurological health,” stated Evan Levine, PsyBio’s Chief Executive Officer. “With these additional patent submissions, PsyBio continues to demonstrate its leadership in the biosynthetic development field by prioritizing intellectual property protection, which is necessary for us to achieve our business objectives and important for our current and future investors.”

About PsyBio Therapeutics Corp.

PsyBio Therapeutics is an intellectual property driven biotechnology company developing new, bespoke, psycho-targeted therapeutics to potentially improve mental and neurological health. The team has extensive experience in drug discovery based on synthetic biology and metabolic engineering as well as clinical and regulatory expertise progressing drugs through human studies and regulatory protocols. Research and development is currently ongoing for naturally occurring psychoactive tryptamines originally discovered in different varieties of hallucinogenic mushrooms, other tryptamines and phenethylamines and combinations thereof. The Company utilizes a bio-medicinal chemistry approach to therapeutic development, in which psychoactive compounds can be utilized as a template upon which to develop precursors and analogs, both naturally and non-naturally occurring.

Cautionary Note Regarding Forward-Looking Statements

This press release contains statements that constitute “forward-looking information” (“forward-looking information“) within the meaning of applicable Canadian securities legislation. All statements, other than statements of historical fact, are forward-looking information and are based on expectations, estimates and projections as at the date of this news release. Any statement that discusses predictions, expectations, beliefs, plans, projections, objectives, assumptions, future events or performance (often but not always using phrases such as “expects”, or “does not expect”, “is expected”, “anticipates” or “does not anticipate”, “plans”, “budget”, “scheduled”, “forecasts”, “estimates”, “believes” or “intends” or variations of such words and phrases or stating that certain actions, events or results “may” or “could”, “would”, “might” or “will” be taken to occur or be achieved) are not statements of historical fact and may be forward-looking information. Forward looking-statements in this press release include statements regarding: the ability of PsyBio to develop novel formulations to potentially treat neurologic and psychologic conditions and other disorders; the ability of PsyBio to build and protect its intellectual property portfolio of novel drug candidates; the ability of PsyBio to launch clinical trials; the ability to achieve cost competitive synthesis with reduced environmental impact over current production methods; and the ability of PsyBio to move target candidates into scaled commercial manufacturing and regulatory application.

In disclosing the forward-looking information contained in this press release, the Company has made certain assumptions, including that: PsyBio will be successful in protecting its intellectual property; PsyBio will be successful in discovering new valuable target molecules; PsyBio will file one or more investigational new drug applications with the United States Food and Drug Administration (“FDA“); PsyBio will be successful in obtaining all necessary approvals for clinical trials; PsyBio will be successful in launching clinical trials; the results of preclinical safety and efficacy testing will be favourable; PsyBio’s technology will be safe and effective; a confirmed signal will be identified in PsyBio’s selected indications; and that drug development involves long lead times, is very expensive and involves many variables of uncertainty. Although the Company believes that the expectations reflected in such forward-looking information are reasonable, it can give no assurance that the expectations of any forward-looking information will prove to be correct. Known and unknown risks, uncertainties, and other factors which may cause the actual results and future events to differ materially from those expressed or implied by such forward-looking information. Such factors include, but are not limited to: compliance with extensive government regulations; domestic and foreign laws and regulations adversely affecting PsyBio’s business and results of operations; decreases in the prevailing process for psilocybin and nutraceutical products in the markets in which PsyBio operates; the impact of COVID-19; and general business, economic, competitive, political and social uncertainties. Accordingly, readers should not place undue reliance on the forward-looking information contained in this press release. Except as required by law, the Company disclaims any intention and assumes no obligation to update or revise any forward-looking information to reflect actual results, whether as a result of new information, future events, changes in assumptions, changes in factors affecting such forward-looking information or otherwise.

PsyBio makes no medical, treatment or health benefit claims about PsyBio’s proposed products. The FDA or other similar regulatory authorities have not evaluated claims regarding psilocybin and other next generation psychoactive compounds. The efficacy of such products has not been confirmed by FDA-approved research. There is no assurance that the use of psilocybin and other psychoactive compounds can diagnose, treat, cure, or prevent any disease or condition. Vigorous scientific research and clinical trials are needed. PsyBio has not conducted clinical trials for the use of its intellectual property. Any references to quality, consistency, efficacy and safety of potential products do not imply that PsyBio verified such in clinical trials or that PsyBio will complete such trials. If PsyBio cannot obtain the approvals or research necessary to commercialize its business, it may have a material adverse effect on the PsyBio’s performance and operations.

The TSX Venture Exchange (the “TSXV“) has
neither approved nor disapproved the contents of this news release. Neither the
TSXV nor its Regulation Services Provider (as that term is defined in the
policies of the TSXV) accepts responsibility for the adequacy or accuracy of
this release.

SOURCE PsyBio Therapeutics Corp.

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