EX-99.1 2 f8k031219ex99-1_rafaelhold.htm PRESS RELEASE, DATED MARCH 12, 2019, REPORTING THE RESULTS OF OPERATIONS FOR THE FISCAL QUARTER ENDED JANUARY 31, 2019.

Exhibit 99.1

 

Rafael-Holdings-Logo

 

Rafael Holdings Reports Second Quarter Fiscal Year 2019 Results

 

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

 

Highlights 

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

  o Phase 3 in combination with modified FOLFIRINOX (mFFX) as a first-line therapy for patients with metastatic adenocarcinoma of the pancreas;
  o Phase 3 in combination with high dose cytarabine and mitoxantrone for patients ≥ 60 years of age with relapsed or refractory AML;
  o Phase 2 for patients with relapsed or refractory Burkitt Lymphoma;
  o Phase 2 in combination with (mFFX) for patients with localized borderline and unresectable pancreatic cancer.

 

Remarks by Howard Jonas, Chairman and CEO of Rafael Holdings

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

 

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

 

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

 

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

 

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About Rafael Holdings, Inc.:

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

 

Contact:
Rafael Holdings

David Polinsky

Chief Financial Officer

P: (212) 658-1450

E: invest@rafaelholdings.com

 

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RAFAEL HOLDINGS, INC.

CONSOLIDATED BALANCE SHEETS

(in thousands, except share data)

 

   January 31,   July 31, 
   2019   2018 
   (unaudited)   (audited) 
ASSETS        
CURRENT ASSETS:          
Cash and cash equivalents  $14,769   $15,803 
Trade accounts receivable, net of allowance for doubtful accounts of $91 and $82 at January 31, 2019 and July 31, 2018, respectively   356    287 
Marketable securities   -      24,701 
Due from Rafael Pharmaceuticals   -      3,300 
Prepaid expenses and other current assets   588    421 
Total current assets   15,713    44,512 
           
Property and equipment, net   49,378    50,113 
Investments – Rafael Pharmaceuticals   70,018    13,300 
Investments – Other Pharmaceuticals   2,000    2,000 
Investments – Hedge Funds   4,166    4,218 
Deferred income tax assets, net   15    -   
Patents   324    324 
In-process research and development   1,327    1,327 
Other assets   1,225    1,126 
TOTAL ASSETS  $144,166   $116,920 
           
LIABILITIES AND STOCKHOLDERS’ EQUITY          
CURRENT LIABILITIES:          
Trade accounts payable  $535   $367 
Accrued expenses   650    500 
Other current liabilities   20    24 
Total current liabilities   1,205    891 
           
Due to/from related parties   -      276 
Convertible debt, net of discount - Related Party   14,934    -   
Other liabilities   195    188 
           
TOTAL LIABILITIES   16,334    1,355 
           
COMMITMENTS AND CONTINGENCIES          
           
STOCKHOLDERS’ EQUITY          
Class A common stock, $0.01 par value; 35,000,000 shares authorized, 787,163 shares issued and outstanding as of January 31, 2019 and July 31, 2018   8    8 
Class B common stock, $0.01 par value; 200,000,000 shares authorized, 13,133,069 and 11,762,346 shares issued and outstanding as of January 31, 2019 and July 31, 2018, respectively   119    118 
Additional paid in capital   117,269    103,636 
Accumulated deficit   (2,649)   (1,108)
Accumulated other comprehensive income   4,080    4,043 
Total stockholders’ equity   118,827    106,697 
Noncontrolling interests   9,005    8,868 
TOTAL EQUITY   127,832    115,565 
           
TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY  $144,166   $116,920 

 

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RAFAEL HOLDINGS, INC.

CONSOLIDATED AND COMBINED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME

(unaudited, in thousands, except share data)

 

   Three Months Ended
January 31,
   Six Months Ended
January 31,
 
   2019   2018   2019   2018 
                 
REVENUE:                    
Rental – Third Party  $306   $298   $689   $685 
Rental – Related Party   522    489    1,043    994 
Parking   189    169    420    384 
Total Revenue   1,017    956    2,152    2,063 
                     
COSTS AND EXPENSES                    
Selling, general and administrative   1,716    1,343    3,169    3,079 
Research and development   276    -      649    -   
Depreciation and amortization   431    429    860    853 
Loss from Operations   (1,406)   (816)   (2,526)   (1,869)
Interest income, net   767    2    868    4 
Net gain resulting from foreign exchange transactions   -      107    -      118 
Net loss on equity investments   -      -      -      (107)
Gains on sales of marketable securities, net   103    -      330    -   
Unrealized loss on Investments – Hedge Funds   (148)   -      (52)   -   
Gain on disposal of bonus shares   -      -      -      246 
Loss Before Income Taxes   (684)   (707)   (1,380)   (1,608)
(Provision for) benefit from income taxes   (17)   (15)   14    (8,443)
Net Loss   (701)   (722)   (1,366)   (10,051)
Net income (loss) attributable to noncontrolling interests   320    (176)   136    (176)
Net Loss attributable to Rafael Holdings, Inc.  $(1,021)  $(546)  $(1,502)  $(9,875)
                     
OTHER COMPREHENSIVE INCOME                    
Foreign currency translation adjustments  $80   $68   $2   $78 
Total Comprehensive Loss   (621)   (654)   (1,364)   (9,973)
Comprehensive income attributable to noncontrolling interests   15    19    23    19 
Total Comprehensive Loss attributable to Rafael Holdings, Inc.  $(636)  $(673)  $(1,387)  $(9,992)
                     
Loss Per Share:                    
Basic and diluted  $(0.08)  $(0.04)  $(0.12)  $(0.79)
                     
Weighted average number of shared used in calculation of loss per share:                    
Basic and diluted   13,489,583    12,541,998    12,634,389    12,541,998 

 

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RAFAEL HOLDINGS, INC.

 CONSOLIDATED AND COMBINED STATEMENTS OF CASH FLOWS

(unaudited, in thousands, except share data)

 

   Six Months Ended
January 31,
 
   2019   2018 
     
Operating activities          
Net loss  $(1,366)  $(10,051)
Adjustments to reconcile net loss to net cash provided by (used in) operating activities:          
Depreciation and amortization   860    853 
Deferred income taxes   (15)   8,837 
Interest income on Series D Convertible Note   (848)   -   
Net gain on sale of marketable securities   (330)   -   
Unrealized loss on investments – Hedge Funds   52    -   
Provision for doubtful accounts   9    -   
Realized gain on disposal of bonus shares   -      (246)
Non-cash compensation   172    606 
Amortization of debt discount   5    -   
Interest in the equity of investments   -      439 
Change in assets and liabilities:          
Trade accounts receivable   (78)   38 
Other current assets and prepaid expenses   (186)   (60)
Other assets   (82)   (260)
Accounts payable and accrued expenses   296    77 
Other current liabilities   39    (15)
Due to/from related parties   588    (202)
Other liabilities   (15)   25 
Net cash (used in) provided by operating activities   (899)   41 
           
Investing activities          
Purchases of property and equipment   (58)   (728)
Proceeds from sale and maturity of marketable securities, net   25,031    -   
Investment in Rafael Pharmaceuticals   (55,870)   -   
Net cash used in investing activities   (30,897)   (728)
           
Financing activities          
Contribution from noncontrolling interest of consolidated entity   4,587    -   
Repayment of Loan from Rafael Pharmaceuticals   3,300    -   
Proceeds from exercise of options   163    -   
Proceed from sale of shares   7,777    -   
Proceeds from convertible notes payable - Related Party   15,000    -   
Cash advances from IDT Corporation, net of repayments   -      900 
Net cash provided by financing activities   30,827    900 
Effect of exchange rate changes on cash and cash equivalents   (65)   39 
Net (decrease) increase in cash and cash equivalents   (1,034)   252 
Cash and cash equivalents at beginning of period   15,803    11,756 
Cash and cash equivalents at end of period  $14,769   $12,008 
           
Supplemental Schedule of Non-Cash Financing and Investing Activities          
Adoption effect of ASU 2016-01  $39    -   
Beneficial conversion feature of convertible debt – related party  $71    -   
Debt and accrued interest converted to Series D Preferred Stock  $10,848    -   
Related Party deposit utilized to purchase Class B Common Stock  $864    -   
Cash payments made for interest & taxes   -      -   

  

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