EXHIBIT 99.2
KAMADA LTD.
CONSOLIDATED FINANCIAL STATEMENTS
AS OF SEPTEMBER 30, 2014
TABLE OF CONTENTS
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F - 4 - F - 6 | |
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F - 9 - F - 13 |
KAMADA LTD. |
CONSOLIDATED BALANCE SHEETS
As of September 30, | As of December 31, | |||||||||||
2014 | 2013 | 2013 | ||||||||||
Unaudited | Audited | |||||||||||
In thousands | ||||||||||||
Current Assets | ||||||||||||
Cash and cash equivalents | $ | 18,071 | $ | 71,232 | $ | 59,110 | ||||||
Short-term investments | 42,207 | 4,707 | 15,067 | |||||||||
Trade receivables, net | 16,408 | 17,285 | 17,882 | |||||||||
Other accounts receivables | 2,078 | 2,532 | 3,694 | |||||||||
Inventories | 25,549 | 22,279 | 21,933 | |||||||||
104,313 | 118,035 | 117,686 | ||||||||||
Non-Current Assets | ||||||||||||
Long-term inventories | - | 165 | - | |||||||||
Property, plant and equipment, net | 21,780 | 20,951 | 21,443 | |||||||||
Other long-term assets | 143 | 177 | 250 | |||||||||
21,923 | 21,293 | 21,693 | ||||||||||
126,236 | 139,328 | 139,379 | ||||||||||
Current Liabilities | ||||||||||||
Short term credit and Current maturities of convertible debentures | 8,186 | 5,658 | 8,718 | |||||||||
Trade payables | 15,740 | 9,124 | 14,093 | |||||||||
Deferred revenues | 3,898 | 7,603 | 5,454 | |||||||||
Other accounts payables | 3,627 | 4,312 | 4,313 | |||||||||
31,451 | 26,697 | 32,578 | ||||||||||
Non-Current Liabilities | ||||||||||||
Convertible debentures | 7,711 | 20,653 | 7,498 | |||||||||
Deferred revenues | 7,590 | 9,489 | 8,506 | |||||||||
Employee benefit liabilities, net | 890 | 866 | 827 | |||||||||
16,191 | 31,008 | 16,831 | ||||||||||
Equity | ||||||||||||
Share capital | 9,206 | 9,010 | 9,201 | |||||||||
Share premium | 157,278 | 149,219 | 157,100 | |||||||||
Conversion option in convertible debentures | 2,217 | 3,789 | 2,218 | |||||||||
Capital reserve due to translation to presentation currency | (3,490 | ) | (3,490 | ) | (3,490 | ) | ||||||
Capital reserve from hedges | (55 | ) | 185 | 156 | ||||||||
Capital reserve from available for sale financial assets | 42 | - | (27 | ) | ||||||||
Capital reserve from share-based payments | 8,154 | 4,850 | 5,189 | |||||||||
Capital reserve from employee benefits | (129 | ) | (141 | ) | (129 | ) | ||||||
Accumulated deficit | (94,629 | ) | (81,799 | ) | (80,248 | ) | ||||||
78,594 | 81,623 | 89,970 | ||||||||||
$ | 126,236 | $ | 139,328 | $ | 139,379 |
The accompanying Notes are an integral part of the Consolidated Financial Statements.
F - 2
KAMADA LTD.
For the 9 months period ended September 30, | For the 3 months period ended September 30, | Year ended December 31 | ||||||||||||||||||
2014 | 2013 | 2014 | 2013 | 2013 | ||||||||||||||||
Unaudited | Audited | |||||||||||||||||||
Thousands of US dollar (Except for per-share income (loss) data) | ||||||||||||||||||||
Revenues from proprietary products | $ | 25,285 | $ | 32,023 | $ | 9,143 | $ | 12,066 | $ | 50,658 | ||||||||||
Revenues from distribution | 20,849 | 14,168 | 8,007 | 5,414 | 19,965 | |||||||||||||||
Total revenues | 46,134 | 46,191 | 17,150 | 17,480 | 70,623 | |||||||||||||||
Cost of revenues from proprietary products | 20,445 | 16,516 | 5,739 | 6,834 | 27,104 | |||||||||||||||
Cost of revenues from distribution | 18,118 | 12,133 | 7,036 | 4,721 | 17,112 | |||||||||||||||
Total cost of revenues | 38,563 | 28,649 | 12,775 | 11,555 | 44,216 | |||||||||||||||
Gross profit | 7,571 | 17,542 | 4,375 | 5,925 | 26,407 | |||||||||||||||
Research and development expenses | 12,613 | 9,167 | 4,180 | 2,833 | 12,745 | |||||||||||||||
Selling and marketing expenses | 2,041 | 1,554 | 675 | 591 | 2,100 | |||||||||||||||
General and administrative expenses | 6,011 | 5,514 | 2,017 | 1,543 | 7,862 | |||||||||||||||
Operating income (loss) | (13,094 | ) | 1,307 | (2,497 | ) | 958 | 3,700 | |||||||||||||
Financial income | 1,041 | 245 | 439 | 80 | 289 | |||||||||||||||
Income (expense) in respect of currency exchange and derivatives instruments, net | 92 | (166 | ) | (44 | ) | (96 | ) | (369 | ) | |||||||||||
Financial expense | (2,350 | ) | (2,479 | ) | (759 | ) | (926 | ) | (3,153 | ) | ||||||||||
Income (loss) before taxes on income | (14,311 | ) | (1,093 | ) | (2,861 | ) | 16 | 467 | ||||||||||||
Taxes on income | 70 | 15 | 36 | (21 | ) | 24 | ||||||||||||||
Net Income (loss) | (14,381 | ) | (1,108 | ) | (2,897 | ) | 37 | 443 | ||||||||||||
Other Comprehensive Income (loss): | ||||||||||||||||||||
Items that may be reclassified to profit or loss in subsequent periods: | ||||||||||||||||||||
Net gain (loss) on available for sale financial assets | 69 | (44 | ) | (51 | ) | 64 | (27 | ) | ||||||||||||
Net loss on cash flow hedge | (211 | ) | - | (109 | ) | - | (73 | ) | ||||||||||||
Items that will not be reclassified to profit or loss in subsequent periods: | ||||||||||||||||||||
Actuarial net gain of defined benefit plans | - | - | - | - | 12 | |||||||||||||||
Total comprehensive income (loss) | $ | (14,523 | ) | $ | (1,152 | ) | $ | (3,057 | ) | $ | 101 | $ | 355 | |||||||
- | ||||||||||||||||||||
Income (loss) per share attributable to equity holders of the Company: | ||||||||||||||||||||
Basic income (loss) per share | $ | (0.41 | ) | $ | (0.04 | ) | $ | (0.09 | ) | $ | 0.00 | $ | 0.01 | |||||||
Diluted income (loss) per share | $ | (0.41 | ) | $ | (0.04 | ) | $ | (0.09 | ) | $ | 0.00 | $ | 0.01 |
The accompanying Notes are an integral part of the Consolidated Financial Statements.
F - 3
KAMADA LTD.
CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY
Share Capital | Share premium | Conversion option in convertible debentures | Capital reserve from available for sale financial assets | Capital reserve due to translation to presentation currency | Capital reserve from hedges | Capital reserve from share-based payments | Capital reserve from employee benefits | Accumulated deficit | Total equity | |||||||||||||||||||||||||||||||
Unaudited | ||||||||||||||||||||||||||||||||||||||||
In thousands | ||||||||||||||||||||||||||||||||||||||||
Balance as of January 1, 2014 | $ | 9,201 | $ | 157,100 | $ | 2,218 | $ | (27 | ) | $ | (3,490 | ) | $ | 156 | $ | 5,189 | $ | (129 | ) | $ | (80,248 | ) | $ | 89,970 | ||||||||||||||||
Net loss | - | - | - | - | - | - | - | - | (14,381 | ) | (14,381 | ) | ||||||||||||||||||||||||||||
Other comprehensive income (loss) | - | - | - | 69 | - | (211 | ) | - | - | - | (142 | ) | ||||||||||||||||||||||||||||
Total comprehensive income (loss) | - | - | - | 69 | - | (211 | ) | - | - | (14,381 | ) | (14,523 | ) | |||||||||||||||||||||||||||
Exercise of options into shares, net | 5 | 170 | - | - | - | - | (110 | ) | - | - | 65 | |||||||||||||||||||||||||||||
Conversion of convertible debentures into shares | - | 8 | (1 | ) | - | - | - | - | - | 7 | ||||||||||||||||||||||||||||||
Cost of share-based payment | - | - | - | - | - | - | 3,075 | - | - | 3,075 | ||||||||||||||||||||||||||||||
Balance as of September 30, 2014 | $ | 9,206 | $ | 157,278 | $ | 2,217 | $ | 42 | $ | (3,490 | ) | $ | (55 | ) | $ | 8,154 | $ | (129 | ) | $ | (94,629 | ) | $ | 78,594 |
Share Capital | Share premium | Conversion option in convertible debentures | Capital reserve due to translation to presentation currency | Capital reserve from hedges | Capital reserve from share-based payments | Capital reserve from employee benefits | Accumulated deficit | Total equity | ||||||||||||||||||||||||||||
Unaudited | ||||||||||||||||||||||||||||||||||||
In thousands | ||||||||||||||||||||||||||||||||||||
Balance as of January 1, 2013 | $ | 7,204 | $ | 96,874 | $ | 3,794 | $ | (3,490 | ) | $ | 229 | $ | 4,614 | $ | (141 | ) | $ | (80,691 | ) | $ | 28,393 | |||||||||||||||
Net loss | - | - | - | - | - | - | - | (1,108 | ) | (1,108 | ) | |||||||||||||||||||||||||
Other comprehensive loss | - | - | - | - | (44 | ) | - | - | - | (44 | ) | |||||||||||||||||||||||||
Total comprehensive loss | - | - | - | - | (44 | ) | - | - | (1,108 | ) | (1,152 | ) | ||||||||||||||||||||||||
Issuance of ordinary shares, net of issuance costs | 1,749 | 51,115 | - | - | - | - | - | - | 52,864 | |||||||||||||||||||||||||||
Exercise of options into shares, net | 56 | 1,191 | - | - | - | (679 | ) | - | - | 568 | ||||||||||||||||||||||||||
Conversion of convertible debentures into shares | 1 | 39 | (5 | ) | - | - | - | - | - | 35 | ||||||||||||||||||||||||||
Cost of share-based payment | - | - | - | - | - | 915 | - | - | 915 | |||||||||||||||||||||||||||
Balance as of September 30, 2013 | $ | 9,010 | $ | 149,219 | $ | 3,789 | $ | (3,490 | ) | $ | 185 | $ | 4,850 | $ | (141 | ) | $ | (81,799 | ) | $ | 81,623 |
The accompanying Notes are an integral part of the Consolidated Financial Statements.
F - 4
KAMADA LTD.
CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY
Share Capital | Share premium | Conversion option in convertible debentures | Capital reserve from available for sale financial assets | Capital reserve due to translation to presentation currency | Capital reserve from hedges | Capital reserve from share-based payments | Capital reserve from employee benefits | Accumulated deficit | Total equity | |||||||||||||||||||||||||||||||
Unaudited | ||||||||||||||||||||||||||||||||||||||||
In thousands | ||||||||||||||||||||||||||||||||||||||||
Balance as of July 1, 2014 | $ | 9,203 | $ | 157,212 | $ | 2,217 | $ | 93 | $ | (3,490 | ) | $ | 54 | $ | 7,217 | $ | (129 | ) | $ | (91,732 | ) | $ | 80,645 | |||||||||||||||||
Net loss | - | - | - | - | - | - | - | - | (2,897 | ) | (2,897 | ) | ||||||||||||||||||||||||||||
Other comprehensive loss | - | - | - | (51 | ) | - | (109 | ) | - | - | - | (160 | ) | |||||||||||||||||||||||||||
Total comprehensive loss | - | - | - | (51 | ) | - | (109 | ) | - | - | (2,897 | ) | (3,057 | ) | ||||||||||||||||||||||||||
Exercise of options into shares, net | 3 | 66 | - | - | - | - | (43 | ) | - | - | 26 | |||||||||||||||||||||||||||||
Cost of share-based payment | - | - | - | - | - | - | 980 | - | - | 980 | ||||||||||||||||||||||||||||||
Balance as of September 30, 2014 | $ | 9,206 | $ | 157,278 | $ | 2,217 | $ | 42 | $ | (3,490 | ) | $ | (55 | ) | $ | 8,154 | $ | (129 | ) | $ | (94,629 | ) | $ | 78,594 |
Share Capital | Share premium | Conversion option in convertible debentures | Capital reserve due to translation to presentation currency | Capital reserve from hedges | Capital reserve from share-based payments | Capital reserve from employee benefits | Accumulated deficit | Total equity | ||||||||||||||||||||||||||||
Unaudited | ||||||||||||||||||||||||||||||||||||
In thousands | ||||||||||||||||||||||||||||||||||||
Balance as of July 1, 2013 | $ | 8,983 | $ | 148,655 | $ | 3,794 | $ | (3,490 | ) | $ | 121 | $ | 4,903 | $ | (141 | ) | $ | (81,636 | ) | $ | 80,989 | |||||||||||||||
Net income | - | - | - | - | - | - | - | 37 | 37 | |||||||||||||||||||||||||||
Other comprehensive income | - | - | - | - | 64 | - | - | - | 64 | |||||||||||||||||||||||||||
Total comprehensive income | - | - | - | - | 64 | - | - | 37 | 101 | |||||||||||||||||||||||||||
Exercise of options into shares, net | 26 | 529 | - | - | - | (319 | ) | - | - | 236 | ||||||||||||||||||||||||||
Conversion of convertible debentures into shares | 1 | 35 | (5 | ) | - | - | - | - | - | 31 | ||||||||||||||||||||||||||
Cost of share-based payment | - | - | - | - | - | 266 | - | - | 266 | |||||||||||||||||||||||||||
Balance as of September 30, 2013 | $ | 9,010 | $ | 149,219 | $ | 3,789 | $ | (3,490 | ) | $ | 185 | $ | 4,850 | $ | (141 | ) | $ | (81,799 | ) | $ | 81,623 |
The accompanying Notes are an integral part of the Consolidated Financial Statements.
F - 5
KAMADA LTD.
CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY
Share Capital | Share premium | Conversion option in convertible debentures | Capital reserve from available for sale financial assets | Capital reserve due to translation to presentation currency | Capital reserve from hedges | Capital reserve from share-based payments | Capital reserve from employee benefits | Accumulated deficit | Total equity | ||||||||||||||||||||||||||||||||
Audited | |||||||||||||||||||||||||||||||||||||||||
In thousands | |||||||||||||||||||||||||||||||||||||||||
Balance as of January 1, 2013 | $ | 7,204 | $ | 96,874 | $ | 3,794 | $ | - | $ | (3,490 | ) | $ | 229 | $ | 4,614 | $ | (141 | ) | $ | (80,691 | ) | $ | 28,393 | ||||||||||||||||||
Net income | - | - | - | - | - | - | - | - | 443 | 443 | |||||||||||||||||||||||||||||||
Other comprehensive income (loss) | - | - | - | (27 | ) | - | (73 | ) | - | 12 | - | (88 | ) | ||||||||||||||||||||||||||||
Total comprehensive income (loss) | - | - | - | (27 | ) | - | (73 | ) | - | 12 | 443 | 355 | |||||||||||||||||||||||||||||
Exercise of warrants and options into shares | 62 | 1,275 | - | - | - | - | (752 | ) | - | - | 585 | ||||||||||||||||||||||||||||||
Issuance of ordinary shares, net of issuance costs | 1,749 | 51,053 | - | - | - | - | - | - | - | 52,802 | |||||||||||||||||||||||||||||||
Conversion of convertible debentures into shares | 186 | 7,898 | (1,576 | ) | - | - | - | - | - | - | 6,508 | ||||||||||||||||||||||||||||||
Cost of share-based payment | - | - | - | - | - | - | 1,327 | - | - | 1,327 | |||||||||||||||||||||||||||||||
Balance as of December 31, 2013 | $ | 9,201 | $ | 157,100 | $ | 2,218 | $ | (27 | ) | $ | (3,490 | ) | $ | 156 | $ | 5,189 | $ | (129 | ) | $ | (80,248 | ) | $ | 89,970 |
The accompanying Notes are an integral part of the Consolidated Financial Statements.
F - 6
For the 9 months period Ended September 30, | For the 3 months period Ended September 30, | Year Ended December 31, | ||||||||||||||||||
2014 | 2013 | 2014 | 2013 | 2013 | ||||||||||||||||
Unaudited | Audited | |||||||||||||||||||
Thousands of US dollar | ||||||||||||||||||||
Cash Flows from Operating Activities | ||||||||||||||||||||
Net income (loss) | $ | (14,381 | ) | $ | (1,108 | ) | $ | (2,897 | ) | $ | 37 | $ | 443 | |||||||
Adjustments to reconcile loss to net cash used in operating activities: | ||||||||||||||||||||
Adjustments to the profit or loss items: | ||||||||||||||||||||
Depreciation and amortization | 2,041 | 2,267 | 726 | 752 | 3,001 | |||||||||||||||
Finance expenses, net | 1,217 | 2,400 | 364 | 942 | 3,233 | |||||||||||||||
Cost of share-based payment | 3,075 | 915 | 980 | 266 | 1,327 | |||||||||||||||
Loss from sale of fixed assets | - | 73 | - | 6 | 73 | |||||||||||||||
Taxes on income | 70 | 15 | 36 | (21 | ) | 24 | ||||||||||||||
Change in employee benefit liabilities, net | 63 | 148 | 56 | 96 | 121 | |||||||||||||||
6,466 | 5,818 | 2,162 | 2,045 | 7,779 | ||||||||||||||||
Changes in asset and liability items: | ||||||||||||||||||||
Decrease (increase) in trade receivables | 2,177 | (2,983 | ) | (587 | ) | (4,726 | ) | (3,445 | ) | |||||||||||
Decrease (increase) in other accounts receivables | 295 | (1,075 | ) | (235 | ) | (1,282 | ) | (444 | ) | |||||||||||
Decrease (increase) in inventories and long-term inventories | (3,616 | ) | (1,693 | ) | (1,678 | ) | 1,622 | (1,182 | ) | |||||||||||
Decrease (increase) in deferred expenses | 1,226 | 156 | 412 | 128 | (1,231 | ) | ||||||||||||||
Increase (decrease) in trade payables | 1,110 | (3,289 | ) | (788 | ) | (111 | ) | 1,579 | ||||||||||||
Increase (decrease) in other accounts payables | (686 | ) | 646 | (882 | ) | (314 | ) | 264 | ||||||||||||
Decrease in deferred revenues | (2,472 | ) | (3,138 | ) | (643 | ) | (1,653 | ) | (6,270 | ) | ||||||||||
(1,966 | ) | (11,376 | ) | (4,401 | ) | (6,336 | ) | (10,729 | ) | |||||||||||
Cash paid and received during the period for: | ||||||||||||||||||||
Interest paid | (963 | ) | (1,573 | ) | (361 | ) | (511 | ) | (1,968 | ) | ||||||||||
Interest received | 385 | 411 | 253 | 216 | 663 | |||||||||||||||
Taxes paid | (158 | ) | (97 | ) | (94 | ) | (43 | ) | (42 | ) | ||||||||||
(736 | ) | (1,259 | ) | (202 | ) | (338 | ) | (1,347 | ) | |||||||||||
Net cash used in operating activities | $ | (10,617 | ) | $ | (7,925 | ) | $ | (5,338 | ) | $ | (4,592 | ) | $ | (3,854 | ) |
F - 7
KAMADA LTD.
CONSOLIDATED STATEMENTS OF CASH FLOWS
For the 9 months period Ended September 30, | For the 3 months period Ended September 30, | Year Ended December 31, | ||||||||||||||||||
2014 | 2013 | 2014 | 2013 | 2013 | ||||||||||||||||
Unaudited | Audited | |||||||||||||||||||
Thousands of US dollar | ||||||||||||||||||||
Cash Flows from Investing Activities | ||||||||||||||||||||
Short-term investments | (26,624 | ) | 12,159 | 160 | 4,311 | $ | 1,732 | |||||||||||||
Purchase of property and equipment | (2,356 | ) | (4,425 | ) | (821 | ) | (1,678 | ) | (5,643 | ) | ||||||||||
Proceeds from sale of equipment | - | 3 | - | - | 8 | |||||||||||||||
Net cash provided by (used in) investing activities | (28,980 | ) | 7,737 | (661 | ) | 2,633 | (3,903 | ) | ||||||||||||
Cash Flows from Financing Activities | ||||||||||||||||||||
Exercise of options into shares | 65 | 545 | 26 | 277 | 562 | |||||||||||||||
Proceeds from issuance of ordinary shares, net | - | 53,099 | - | (859 | ) | 52,953 | ||||||||||||||
Short term credit from bank and others, net | - | (6 | ) | - | - | (12 | ) | |||||||||||||
Repayment of convertible debentures | - | - | - | - | (4,295 | ) | ||||||||||||||
Net cash provided by (used in) financing activities | 65 | 53,638 | 26 | (582 | ) | 49,208 | ||||||||||||||
Exchange differences on balances of cash and cash equivalent | (1,507 | ) | 916 | (1,039 | ) | 370 | 793 | |||||||||||||
Increase (decrease) in cash and cash equivalents | (41,039 | ) | 54,366 | (7,012 | ) | (2,171 | ) | 42,244 | ||||||||||||
Cash and cash equivalents at the beginning of the period | 59,110 | 16,866 | 25,083 | 73,403 | 16,866 | |||||||||||||||
Cash and cash equivalents at the end of the period | $ | 18,071 | $ | 71,232 | $ | 18,071 | $ | 71,232 | $ | 59,110 | ||||||||||
Significant non-cash transactions | ||||||||||||||||||||
Purchase of property, equipment and intangible assets on credit | $ | - | $ | - | $ | - | $ | - | $ | - | ||||||||||
Exercise of options presented as liability | $ | - | $ | 23 | $ | - | $ | - | $ | 23 | ||||||||||
Exercise of convertible debentures into shares | $ | 7 | $ | 35 | $ | - | $ | 35 | $ | 6,508 | ||||||||||
Issuance expenses accrued in other accounts payables | $ | - | $ | 235 | $ | - | $ | - | $ | 151 |
The accompanying Notes are an integral part of the Consolidated Financial Statements.
F - 8
KAMADA LTD.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
Note 1:- | General |
These Financial Statements have been prepared in a condensed format as of September 30, 2014 and for the nine months then ended ("interim consolidated financial statements").
These financial statements should be read in conjunction with the Company's annual financial statements as of December 31, 2013 and for the year then ended and the accompanying notes ("annual consolidated financial statements").
Note 2:- Significant Accounting Policies
Basis of preparation of the interim consolidated financial statements:
The interim consolidated financial statements have been prepared in accordance with generally accepted accounting principles for the preparation of financial statements for interim periods, as prescribed in IAS 34, "Interim Financial Reporting".
Note 3:- Disclosure of new standards in the period prior to their adoption
a. | IFRS 15 – Revenues from contracts with customers |
The standard outlines a single comprehensive model for entities to use in accounting for revenue arising from contracts with customers and supersedes most current revenue recognition guidance, including industry-specific guidance. The core principle of the new standard is for companies to recognize revenue to depict the transfer of goods or services to customers in amounts that reflect the consideration (that is, payment) to which the company expects to be entitled in exchange for those goods or services. The new standard also will result in enhanced disclosures about revenue, provide guidance for transactions that were not previously addressed comprehensively (for example, service revenue and contract modifications) and improve guidance for multiple-element arrangements.
b. | Amendments to IAS 16 and IAS 38 - Acceptable Methods of Depreciation and Amortisation |
In May 2014, the IASB issued “Amendments to IAS 16 and IAS 38”, clarifying that the use of methods based on revenue to calculate the depreciation is not appropriate because revenue generated by an activity that includes the use of an asset typically reflects factors that are not directly linked to the consumption of the economic benefits embodied in the asset. Revenue is generally presumed to be an inappropriate basis for measuring the consumption of the economic benefits embodied in an intangible asset. This presumption, however, can be rebutted in certain limited circumstances.
c. | IFRS 9 - Financial Instruments |
In July 2014, the IASB completed the final element of its comprehensive response to the financial crisis by issuing IFRS 9 Financial Instruments. The package of improvements introduced by IFRS 9 includes a logical model for classification and measurement, a single, forward-looking ‘expected loss’ impairment model and a substantially-reformed approach to hedge accounting. The new Standard will come into effect on January 1, 2018 with early application permitted.
F - 9
KAMADA LTD.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
Note 4:- Operating Segments
a. | General: The Company has two operating segments, as follows: |
Proprietary Products | - | Medicine development, manufacture and sale of plasma-derived therapeutics products. | |
Distribution | - | Distribution of drugs in Israel manufacture by other companies for clinical uses, most of which are produced from plasma or its derivatives products. |
b. | Reporting on operating segments: |
Proprietary Products | Distribution | Total | ||||||||||
Unaudited | ||||||||||||
Nine months period ended September 30, 2014 | ||||||||||||
Revenues | $ | 25,285 | $ | 20,849 | $ | 46,134 | ||||||
Gross profit | $ | 4,840 | $ | 2,731 | 7,571 | |||||||
Unallocated corporate expenses | (20,665 | ) | ||||||||||
Finance expenses, net | (1,217 | ) | ||||||||||
Loss before taxes on income | $ | (14,311 | ) |
Proprietary Products | Distribution | Total | ||||||||||
Unaudited | ||||||||||||
Nine months period ended September 30, 2013 | ||||||||||||
Revenues | $ | 32,023 | $ | 14,168 | $ | 46,191 | ||||||
Gross profit | $ | 15,507 | $ | 2,035 | 7,542 | |||||||
Unallocated corporate expenses | (16,235 | ) | ||||||||||
Finance expenses, net | (2,400 | ) | ||||||||||
Loss before taxes on income | $ | (1,093 | ) |
Proprietary Products | Distribution | Total | ||||||||||
Unaudited | ||||||||||||
Three months period ended September 30, 2014 | ||||||||||||
Revenues | $ | 9,143 | $ | 8,007 | $ | 17,150 | ||||||
Gross profit | $ | 3,404 | $ | 971 | 4,375 | |||||||
Unallocated corporate expenses | (6,916 | ) | ||||||||||
Finance expenses, net | (364 | ) | ||||||||||
Loss before taxes on income | $ | (2,861 | ) |
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KAMADA LTD.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
Note 4:- | Operating Segments (Cont.) |
Proprietary Products | Distribution | Total | ||||||||||
Unaudited | ||||||||||||
Three months period ended September 30, 2013 | ||||||||||||
Revenues | $ | 12,066 | $ | 5,414 | $ | 17,480 | ||||||
Gross profit | $ | 5,232 | $ | 693 | 5,925 | |||||||
Unallocated corporate expenses | (4,967 | ) | ||||||||||
Finance expenses, net | (942 | ) | ||||||||||
Income before taxes on income | $ | 16 |
Proprietary Products | Distribution | Total | ||||||||||
In thousands | ||||||||||||
Audited | ||||||||||||
Year Ended December 31, 2013 | ||||||||||||
Revenues | $ | 50,658 | $ | 19,965 | $ | 70,623 | ||||||
Gross profit | $ | 23,554 | $ | 2,853 | $ | 26,407 | ||||||
Unallocated corporate expenses | (22,707 | ) | ||||||||||
Finance expenses, net | (3,233 | ) | ||||||||||
Income before taxes on income | $ | 467 |
Note 5:- | Financial Instruments |
a. | Classification of financial instruments by fair value hierarchy |
Financial assets measured at fair value
Level 1 | Level 2 | |||||||
In thousands | ||||||||
September 30, 2014 | ||||||||
Derivatives instruments qualified for hedging | $ | - | $ | 44 | ||||
Marketable securities at fair value through profit or loss: | ||||||||
Equity shares | 850 | - | ||||||
Mutual funds | 2,228 | - | ||||||
Exchange traded notes | 76 | - | ||||||
Debt securities (corporate and government) | 10,265 | - | ||||||
Available for sale debt securities (corporate and government) | $ | - | $ | 28,789 | ||||
$ | 13,418 | $ | 28,833 |
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KAMADA LTD.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
Note 5:- Financial Instruments (Cont.)
Level 1 | Level 2 | |||||||
In thousands | ||||||||
September 30, 2013 | ||||||||
Derivatives instruments qualified for hedging | $ | - | $ | 259 | ||||
Marketable Securities (Mutual funds) at fair value through profit or loss | $ | 1,857 | - | |||||
$ | 1,857 | $ | 259 | |||||
December 31, 2013 | ||||||||
Derivatives instruments qualified for hedging | $ | - | $ | 208 | ||||
Marketable securities at fair value through profit or loss: | ||||||||
Equity shares | 237 | - | ||||||
Mutual funds | 469 | - | ||||||
Exchange traded notes | 308 | - | ||||||
Debt securities (corporate and government) | 4,678 | - | ||||||
5,692 | 208 | |||||||
Available for sale debt securities (corporate and government) | $ | - | $ | 9,375 | ||||
$ | 5,692 | $ | 9,583 |
Liabilities for which fair values are disclosed
Level 1 | ||||
In thousands | ||||
September 30, 2014 | ||||
Convertible debentures | $ | 16,863 | ||
September 30, 2013 | ||||
Convertible debentures | $ | 41,335 | ||
December 31, 2013 | ||||
Convertible debentures | $ | 24,690 |
b. | During the nine months ended on September 30, 2014 there was no transfer due to the fair value measurement of any financial instrument from Level 1 to Level 2, and furthermore, there were no transfers to or from Level 3 due to the fair value measurement of any financial instrument. |
F - 12
KAMADA LTD.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
Note 6:- Significant events during the period
a. | The Company has undertaken certain activities to increase the production capacity of its manufacturing facility in Beit Kama. A request for approval of these adjustments from the FDA was filed. In March 2013 the FDA responded to this request by requesting additional data prior to its approval of the new manufacturing process. The Company received the approval by the FDA on July 23, 2014 .During the second quarter of 2014 an inventory in the amount of $3.0 million, produced using the improved manufacturing process, was written off due to a short shelf life of the inventory and reevaluation by the Company of the fair value of such inventory. |
b. | On January 28, 2014, General Meeting of Shareholders of the Company approved the grant of 180,000 options to the Company’s directors and the grant of 150,000 options for the Company’s chief executive officer exercisable into 330,000 ordinary shares at an exercise price of NIS 56.94. The fair value of the options was estimated at $1.8 million. The Shareholders also approved an increase in CEO monthly fixed salary to NIS 93,000. |
c. | On January 29, 2014 the company incorporated a subsidiary registered under the laws of England and Wales named "Kamada Biopharma Limited". |
d. | In September 2014, the Company and Baxter amended the distribution agreement (see note 19(a) in the annual report) to extend the period of minimum purchases of Glassia to seven years until 2017 and to increase the minimum purchases under the distribution agreement to $191 million from $110 million over the first five years commencing with the signing of the distribution agreement and a minimum of $165 million contained in the May 2013 extension. In addition, the Company reports that the supply of Glassia to Baxter has been extended through 2017 and that the transition to royalty payments for Glassia produced by Baxter is not expected to begin before 2018. |
e. | In September 2014, the company reported final results from Phase 2/3 clinical trial of inhaled alpha-1 antitrypsin to treat alpha-1 antitrypsin deficiency which confirmed the study did not meet its primary or secondary endpoints, but did show positive lung function differences. |
F - 13