Market Newsdesk

March 11, 2021 4:17 pm

ChargePoint Reports Fourth Quarter and Fiscal 2021 Financial Results

ChargePoint Reports Fourth Quarter and Fiscal 2021 Financial Results

Fiscal Year 2021 revenue of $146 million, exceeding forecast
Completed business combination with Switchback Energy Acquisition Corporation; began trading on the NYSE on March 1, 2021
Increased total cash balance to $615 million at the close of the business combination to fund growth initiatives

CAMPBELL, Calif.–(BUSINESS WIRE)–ChargePoint Holdings, Inc. (NYSE:CHPT) (the “Company” or “ChargePoint”), a world-leading electric vehicle (EV) charging network, today announced fourth quarter and full-year fiscal 2021 financial results.

“Last year the global EV sector continued to show strength as EV sales grew despite a slow overall vehicle market, bolstered by policy trends that continued to accelerate the shift to electric in North America and Europe,” said Pasquale Romano, President and CEO of ChargePoint. “In 2020, we continued to strengthen our market leadership position and expect our growth to be fueled by dozens of new EV models anticipated in 2021 across a wide range of segments and price points. With a strong balance sheet and a capital light business model, ChargePoint is well positioned to create shareholder value through broad attachment to the electrification of mobility for fleet and consumer vehicle markets.”

Financial Highlights

Revenue. For the fourth quarter that ended January 31, 2021, revenue was $42.4 million compared to $43.2 million in the fourth quarter of the prior year period. For the fiscal year that ended January 31, 2021, revenue was $146.5 million, up from $144.5 million in the prior year period.
Gross Margin. Fourth quarter GAAP (as defined below) gross margin was 21.0%, up from 20.4% in the prior year’s fourth quarter. Fourth quarter non-GAAP gross margin was 21.6% compared to 20.5% in the prior year’s fourth quarter. Fiscal year 2021 GAAP gross margin was 22.5%, a 10 percentage point improvement over gross margin of 12.5% in the prior year period. Non-GAAP gross margin for fiscal 2021 was 22.6%, compared to 12.5% in the prior year period.
Net Loss. Fourth quarter GAAP net loss was $90.7 million compared to $33.8 million in the fourth quarter of the prior year, primarily due to a change in fair value of the company’s redeemable convertible preferred stock warrant liability. Fourth quarter non-GAAP net loss was $33.6 million compared to $32.5 million in the prior year’s fourth quarter. Fiscal year 2021 GAAP net loss was $197.0 million compared to $134.3 million in the prior year period, primarily reflecting the fiscal fourth quarter warrant charge. Non-GAAP net loss for fiscal 2021 was $117.8 million compared to $129.9 million in the prior year period.
Liquidity. As of January 31, 2021, cash on the balance sheet was $145 million. At the close of the business combination on February 26, 2021, cash on the balance sheet was $615 million.
Shares Outstanding. At the close of the business combination on February 26, 2021, there were 277.8 million shares of common stock outstanding.

For a reconciliation of our GAAP to non-GAAP results, please see the tables below.

Fiscal 2022 Guidance

ChargePoint provides guidance based on current market conditions and expectations. For the first quarter ending April 30, 2021, which typically experiences seasonally lower networked station sales compared to the fourth quarter, ChargePoint expects revenue of $35 – $40 million. The Company expects revenue for fiscal 2022 of $195 – $205 million, consistent with its previously published estimates, and representing 37% year-over-year growth at the midpoint.

Conference Call Information

ChargePoint will host a webcast today at 1:30 p.m. PST/4:30 p.m. EST to review its fourth quarter and fiscal 2021 financial results and its outlook for the first quarter of fiscal 2022 and fiscal 2022. A question and answer session will follow prepared remarks.

Investors may access the webcast, supplemental financial information and investor presentation at ChargePoint’s investor relations website (investors.chargepoint.com) under the “Events and Presentations” section. A replay will be available three hours after the conclusion of the webcast and archived for one year.

About ChargePoint

ChargePoint is creating the new fueling network to move all people and goods on electricity. Since 2007, ChargePoint has been committed to making it easy for businesses and drivers to go electric with one of the largest EV charging networks and most complete portfolio of charging solutions available today. ChargePoint’s cloud subscription platform and software-defined charging hardware are designed to include options for a wide range of charging scenarios from home and multifamily to workplace, parking, hospitality, retail and fleets. Today, one ChargePoint account provides access to hundreds-of-thousands of places to charge in North America and Europe. To date, more than 89 million charging sessions have been delivered, with drivers plugging into the ChargePoint network approximately every two seconds. For more information, visit the ChargePoint pressroom, the ChargePoint Investor Relations site, or contact ChargePoint’s North American or European press offices or the Investor Relations team.

Forward-Looking Statements

This press release contains forward-looking statements that involve risks, uncertainties, and assumptions including statements regarding our financial outlook for the first fiscal quarter of 2022 and fiscal 2022. There are a significant number of factors that could cause actual results to differ materially from the statements made in this press release, including: developments and changes in the general market, the continuing impact of COVID-19, political, economic, and business conditions; our limited operating history as a public company; our dependence on widespread acceptance and adoption of EVs and increased installation of charging stations; our current dependence on sales of charging stations for most of our revenues; overall demand for EV charging and the potential for reduced demand for EVs if governmental rebates, tax credits and other financial incentives are reduced, modified or eliminated or governmental mandates to increase the use of EVs or decrease the use of vehicles powered by fossil fuels, either directly or indirectly through mandated limits on carbon emissions, are reduced, modified or eliminated; supply chain interruptions; our ability to expand in Europe; the need to attract additional fleet operators as customers; potential adverse effects on our revenue and gross margins if customers increasingly claim clean energy credits and, as a result, they are no longer available to be claimed by us; the effects of competition; risks related to our dependence on our intellectual property and the risk that our technology could have undetected defects or errors. Additional risks and uncertainties that could affect our financial results are included under the captions “Risk Factors” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in our Form 8-K filed with the Securities and Exchange Commission (the “SEC”) on March 1, 2021, which is available on our website at investors.chargepoint.com and on the SEC’s website at www.sec.gov. Additional information will also be set forth in other filings that we make with the SEC from time to time. All forward-looking statements in this press release are based on information available to us as of the date hereof, and we do not assume any obligation to update the forward-looking statements provided to reflect events that occur or circumstances that exist after the date on which they were made, except as required by applicable law.

Use of Non-GAAP Financial Measures

ChargePoint has provided in this press release financial information that has not been prepared in accordance with generally accepted accounting principles in the United States (“GAAP”). The Company uses these non-GAAP financial measures internally in analyzing its financial results and believes that the use of these non-GAAP financial measures is useful to investors to evaluate ongoing operating results and trends, and in comparing the Company’s financial results with other companies in its industry as well other technology companies, many of which present similar non-GAAP financial measures.

The presentation of these non-GAAP financial measures is not meant to be considered in isolation or as a substitute for comparable GAAP financial measures and should be read only in conjunction with the Company’s consolidated financial statements prepared in accordance with GAAP. A reconciliation of the company’s historical non-GAAP financial measures to their most directly comparable GAAP measures has been provided in the financial statement tables included in this press release, and investors are encouraged to review these reconciliations.

Non-GAAP Gross Margin. ChargePoint defines non-GAAP gross margin as gross margin excluding amortization expense of acquired intangible assets, share-based compensation expense, and non-recurring costs associated with a restructuring.

Non-GAAP Net Loss. ChargePoint defines non-GAAP net loss as net loss, excluding amortization expense of acquired intangible assets, share-based compensation-expense and the associated share-based payroll tax expense, non-recurring costs associated with restructuring, acquisitions and litigation settlements, and non-cash charges related to the revaluation of warrants and other financial instruments. These amounts do not reflect the impact of any related tax effects.

Investors are cautioned that there are a number of limitations associated with the use of non-GAAP financial measures to analyze financial results and trends. In particular, many of the adjustments to ChargePoint’s GAAP financial measures reflect the exclusion of items that are recurring and will be reflected in its financial results for the foreseeable future, such as share-based compensation, which is an important part of ChargePoint’s employees’ compensation and impacts hiring, retention and performance. Furthermore, these non-GAAP financial measures are not based on any standardized methodology prescribed by GAAP, and the components that ChargePoint excludes in its calculation of non-GAAP financial measures may differ from the components that other companies exclude when they report their non-GAAP results. ChargePoint compensates for these limitations by providing specific information regarding the GAAP amounts excluded from these non-GAAP financial measures. In the future, ChargePoint may also exclude other expenses it determines do not reflect the performance of the Company’s operating results.

CHPT-IR

ChargePoint, Inc.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(In thousands, except per share amounts; unaudited)

			Three Months Ended							Twelve Months Ended
			January 31,							January 31,
			2021			2020			2021			2020
Revenue
	Networked charging systems		$	28,303		$	29,873		$	91,893		$	101,012
	Subscriptions			10,965			7,865			40,563			28,930
	Other			3,123			5,506			14,034			14,573
		Total revenue		42,391			43,244			146,490			144,515
Cost of revenue
	Networked charging systems			25,677			28,056			87,083			105,940
	Subscriptions			5,838			4,725			20,385			16,244
	Other			1,973			1,626			6,073			4,289
		Total cost of revenue		33,488			34,407			113,541			126,473
Gross profit				8,903			8,837			32,949			18,042

Operating expenses
	Research and development			20,946			19,233			75,017			69,464
	Sales and marketing			15,700			15,766			53,002			56,997
	General and administrative			7,577			6,294			25,922			23,945
		Total operating expenses		44,223			41,293			153,941			150,406
Loss from operations				(35,320	)		(32,456	)		(120,992	)		(132,364	)
Interest income				17			508			315			3,245
Interest expense				(810	)		(863	)		(3,253	)		(3,544	)
Change in fair value of redeemable convertible preferred stock warrant liability				(54,824	)		(219	)		(73,125	)		(875	)
Other income (expense), net				185			(655	)		229			(565	)
Net loss before income taxes				(90,752	)		(33,685	)		(196,826	)		(134,103	)
Provision for income taxes				(5	)		126			198			224
Net loss			$	(90,747	)	$	(33,811	)	$	(197,024	)	$	(134,327	)

	Accretion of beneficial conversion feature of redeemable convertible preferred stock			–			–			(60,377	)		–
	Cumulative undeclared dividends on redeemable convertible preferred stock			(12,839	)		–			(16,799	)		–
Net loss attributable to common stockholders			$	(103,586	)	$	(33,811	)	$	(274,200	)	$	(134,327	)
Net loss per share attributable to
common stockholders, basic and diluted			$	(5.29	)	$	(3.05	)	$	(18.08	)	$	(15.05	)
Weighted-average shares used in computing net loss per
share attributable to common stockholders, basic and diluted				19,563,550			11,085,077			15,168,335			8,924,129


ChargePoint, Inc.
CONDENSED CONSOLIDATED BALANCE SHEETS
(In thousands, unaudited)

					January 31,			January 31,
					2021			2020
Assets
Current assets:
	Cash and cash equivalents			$	145,491		$	72,753
	Restricted cash				400			400
	Short-term investments				–			47,037
	Accounts receivable, net				35,075			38,488
	Inventories				33,592			25,419
	Prepaid expenses and other current assets				12,074			7,221
			Total current assets		226,632			191,318
Property and equipment, net					29,988			27,941
Operating lease right-of-use assets					21,817			10,269
Goodwill					1,215			1,215
Other assets					10,468			3,448
			Total assets	$	290,120		$	234,191

Liabilities, Redeemable Convertible Preferred Stock, and Stockholders’ Deficit
Current liabilities:
	Accounts payable			$	19,784		$	19,631
	Accrued and other current liabilities				47,162			37,659
	Deferred revenue				40,934			39,408
	Debt, current				10,208			–
			Total current liabilities		118,088			96,698
	Deferred revenue, noncurrent				48,896			33,266
	Debt, noncurrent				24,686			34,261
	Operating lease liabilities				22,459			8,230
	Redeemable convertible preferred stock warrant liability				75,843			2,718
	Other long-term liabilities				972			798
			Total liabilities		290,944			175,971

Redeemable convertible preferred stock					615,697			520,241
Stockholders’ deficit:
	Common stock				2			1
	Additional paid-in capital				62,736			20,331
	Accumulated other comprehensive income (loss)				155			37
	Accumulated deficit				(679,414	)		(482,390	)
		Total stockholders’ deficit			(616,521	)		(462,021	)
			Total liabilities, redeemable convertible preferred stock, and stockholders’ deficit	$	290,120		$	234,191

ChargePoint, Inc.
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(In thousands, unaudited)

				Year Ended January 31,
				2021			2020

Cash flows from operating activities
Net loss				$	(197,024	)	$	(134,327	)
Adjustments to reconcile net loss to net cash
used in operating activities:
	Depreciation and amortization				10,083			7,698
	Non-cash operating lease cost				3,762			3,121
	Stock-based compensation				4,947			2,937
	Amortization of deferred contract acquisition costs				1,206			675
	Change in fair value of redeemable convertible preferred stock warrant liability				73,125			875
	Inventory reserves				1,412			1,425
	Other				446			589
	Changes in operating assets and liabilities, net of effect of acquisitions:
		Accounts receivable, net			3,292			(8,702	)
		Inventories			(9,585	)		(1,472	)
		Prepaid expenses and other assets			(8,914	)		(2,961	)
		Operating lease liabilities			(2,815	)		(1,181	)
		Accounts payable			(493	)		15,704
		Accrued and other liabilities			11,556			93
		Deferred revenue			17,156			27,590
			Net cash used in operating activities		(91,846	)		(87,936	)
Cash flows from investing activities
Purchases of property and equipment					(11,484	)		(14,885	)
Purchases of investments					–			(179,514	)
Maturities of investments					47,014			132,500
			Net cash provided by (used in) investing activities		35,530			(61,899	)
Cash flows from financing activities
Proceeds from issuance of redeemable convertible preferred stock, net of issuance costs					95,456			14,756
Proceeds from issuance of common stock warrants, net of issuance costs					31,547			185
Payments made toward deferred offering costs					(4,003	)		–
Proceeds from exercises of vested and unvested stock options					5,913			2,217
			Net cash provided by financing activities		128,913			17,158

Effect of exchange rate changes on cash, cash equivalents, and restricted cash					141			132
	Net increase (decrease) in cash, cash equivalents, and restricted cash				72,738			(132,545	)
Cash, cash equivalents, and restricted cash at beginning of period					73,153			205,698
Cash, cash equivalents, and restricted cash at end of period				$	145,891		$	73,153

ChargePoint, Inc.
RECONCILIATION OF GAAP TO NON-GAAP FINANCIAL MEASURES
(In thousands, except per share amounts; unaudited)

	Three Months Ended					Three Months Ended					Twelve Months Ended					Twelve Months Ended
	January 31, 2021					January 31, 2020					January 31, 2021					January 31, 2020
Reconciliation of GAAP gross profit (margin) to Non-GAAP gross profit (margin):
GAAP gross profit	$	8,903				$	8,837				$	32,949				$	18,042
Stock-based compensation expense		22					10					115					39
Restructuring costs (1)		214					–					114					–
Non-GAAP gross profit (margin)	$	9,139		22	%	$	8,847		20	%	$	33,178		23	%	$	18,081		13	%



Reconciliation of GAAP Net Loss to Non-GAAP Net Loss:
GAAP net loss	$	(90,747	)			$	(33,811	)			$	(197,024	)			$	(134,327	)
Amortization of acquired intangible assets		–					351					–					568
Stock-based compensation expense		1,639					780					4,947					2,937
Restructuring costs (1)		674					–					1,149					–
Change in fair value of preferred stock warrant liability		54,824					219					73,125					875
Non-GAAP net loss (as a percentage of revenue)	$	(33,610	)	-79	%	$	(32,461	)	-75	%	$	(117,803	)	-80	%	$	(129,947	)	-90	%

(1) Consists of restructuring costs for severances and related termination costs

View source version on businesswire.com: https://www.businesswire.com/news/home/20210311006013/en/

Press

Darryll Harrison

Senior Director, Global Communications and Social Media

669-237-3380

[email protected]

Investor Relations

Dan Oppenheim, Financial Profiles, Inc.

310-622-8235

Megan McGrath, Financial Profiles, Inc.

310-622-8248

[email protected]

KEYWORDS: United States North America California

INDUSTRY KEYWORDS: Automotive General Automotive Technology Software Alternative Vehicles/Fuels Internet Hardware

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March 11, 2021 4:17 pm

EOG Resources to Present at Upcoming Conference

PR Newswire

HOUSTON, March 11, 2021 /PRNewswire/ — EOG Resources, Inc. (EOG) is scheduled to present at the Evercore ISI Elite Energy Summit at 9:45 a.m. Central time (10:45 a.m. Eastern time) on Wednesday, March 17. William R. “Bill” Thomas, Chairman and Chief Executive Officer, will present on behalf of EOG.

Please visit the Investors/Events & Presentations page on the EOG website to access the live webcast. If you are unable to listen live, a replay will be available for ninety days.

About EOG
EOG Resources, Inc. (NYSE: EOG) is one of the largest crude oil and natural gas exploration and production companies in the United States with proved reserves in the United States, Trinidad and China. To learn more visit www.eogresources.com .

Investor Contacts

David Streit 713-571-4902
Neel Panchal 713-571-4884

Media and Investor Contact

Kimberly Ehmer 713-571-4676

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SOURCE EOG Resources, Inc.

March 11, 2021 4:15 pm

SHAREHOLDER ALERT: WeissLaw LLP Reminds CLGX, VGAC, SNCA, and RNET Shareholders About Its Ongoing Investigations

PR Newswire

NEW YORK, March 11, 2021 /PRNewswire/ —

If you own shares in any of the companies listed above and
would like to discuss our investigations or have any questions concerning
this notice or your rights or interests, please contact:

Joshua Rubin, Esq.

WeissLaw LLP
1500 Broadway, 16^th Floor
New York, NY 10036
(212) 682-3025
(888) 593-4771
[email protected]

CoreLogic, Inc. (NYSE: CLGX)

WeissLaw LLP is investigating possible breaches of fiduciary duty and other violations of law by the board of directors of CoreLogic, Inc. (NYSE: CLGX) in connection with the proposed acquisition of the company by funds managed by Stone Point Capital and Insight Partners. Under the terms of the agreement, CLGX shareholders will receive $80.00 in cash for each share of CLGX common stock that they own. If you own CLGX shares and wish to discuss this investigation or your rights, please call us at one of the numbers listed above or visit our website: https://www.weisslawllp.com/clgx/

VG Acquisition Corp. (NYSE: VGAC)

WeissLaw LLP is investigating possible breaches of fiduciary duty and other violations of law by the board of directors of VG Acquisition Corp. (NYSE: VGAC) in connection with the company’s proposed merger with 23andMe, Inc. (“23andMe”). Under the terms of the merger agreement, VGAC will acquire 23andMe through a reverse merger that will result in 23andMe becoming a public company traded on the NYSE. If you own VGAC shares and wish to discuss this investigation or your rights, please call us at one of the numbers listed above or visit our website: https://www.weisslawllp.com/vgac/

Seneca Biopharma, Inc. (NASDAQ: SNCA)

WeissLaw LLP is investigating possible breaches of fiduciary duty and other violations of law by the board of directors of Seneca Biopharma, Inc. (NASDAQ: SNCA) in connection with the company’s proposed merger with Leading BioSciences, Inc. (“LBS”). Under the terms of the agreement, LBS shareholders will receive shares of SNCA, resulting in LBS stockholders owning a majority of the combined company, with SNCA shareholders owning just 26.2% of the surviving combined entity. If you own SNCA shares and wish to discuss this investigation or your rights, please call us or visit our website: https://www.weisslawllp.com/snca/

RigNet, Inc. (NASDAQ: RNET)

WeissLaw LLP is investigating possible breaches of fiduciary duty and other violations of law by the board of directors of RigNet, Inc. (NASDAQ: RNET) in connection with RNET’s proposed merger with Viasat, Inc. (“Viasat”). Under the terms of the agreement, RNET shareholders will receive 0.1845 shares of Viasat stock per RNET share they hold, representing implied per-share merger consideration of approximately $9.91 based upon Viasat’s March 10, 2021 closing stock price of $53.71. If you own RNET shares and wish to discuss this investigation or your rights, please call us at one of the numbers listed above or visit our website: https://www.weisslawllp.com/RNET/

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SOURCE WeissLaw LLP

March 11, 2021 4:13 pm

Marker Therapeutics, Inc. Announces Proposed Public Offering of Common Stock

PR Newswire

HOUSTON, March 11, 2021 /PRNewswire/ — Marker Therapeutics, Inc. (Nasdaq: MRKR), a clinical-stage immuno-oncology company specializing in the development of next-generation T cell-based immunotherapies for the treatment of hematological malignancies and solid tumor indications, today announced that it has commenced an underwritten public offering of shares of its common stock. In addition, Marker expects to grant the underwriters a 30-day option to purchase additional shares of its common stock. All of the shares to be sold in the offering are to be sold by Marker. The offering is subject to market and other conditions, and there can be no assurance as to whether or when the offering may be completed, or the actual size or terms of the offering.

Piper Sandler & Co. is acting as the sole active book-running manager for the offering.

The proposed offering is being made pursuant to a shelf registration statement, including a base prospectus, filed by Marker that was declared effective by the Securities and Exchange Commission (“SEC”) on June 25, 2019. The offering will be made only by means of a written prospectus and prospectus supplement that form a part of the registration statement. An electronic copy of the preliminary prospectus supplement and accompanying prospectus relating to the offering will be available on the website of the SEC at www.sec.gov. Copies of the preliminary prospectus supplement, when available, and the accompanying prospectus relating to the offering may be obtained by contacting Piper Sandler & Co., Attention: Prospectus Department, 800 Nicollet Mall, J12S03, Minneapolis, Minnesota 55402, by telephone at (800) 747-3924 or by email at [email protected]. The final terms of the offering will be disclosed in a final prospectus supplement to be filed with the SEC.

This press release shall not constitute an offer to sell or the solicitation of an offer to buy these securities, nor shall there be any sale of these securities in any state or other jurisdiction in which such offer, solicitation or sale would be unlawful prior to the registration or qualification under the securities laws of any such state or other jurisdiction.

Forward-Looking Statements

This release contains forward-looking statements for purposes of the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Statements in this news release concerning the Company’s expectations, plans, business outlook or future performance, and any other statements concerning assumptions made or expectations as to any future events, conditions, performance or other matters, are “forward-looking statements.” Forward-looking statements include statements regarding the timing, size and completion of the proposed public offering. Forward-looking statements are by their nature subject to risks, uncertainties and other factors that could cause actual results to differ materially from those stated in such statements. Such risks, uncertainties and factors include, but are not limited to the risks set forth in the Company’s most recent Annual Report on Form 10-K and other SEC filings that are available through EDGAR at www.sec.gov. Such risks and uncertainties may be amplified by the COVID-19 pandemic and its impact on our business and the global economy. The Company assumes no obligation to update our forward-looking statements whether as a result of new information, future events or otherwise, after the date of this press release.

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SOURCE Marker Therapeutics, Inc.

March 11, 2021 4:13 pm

Zumiez Inc. Announces Fiscal 2020 Fourth Quarter Results

Fourth Quarter 2020 Net Sales Increased 0.8% to $331.5 Million

Fourth Quarter 2020 Diluted Earnings Per Share Increased 13.9% to $1.68

Cash and Current Marketable Securities Increased 49.5% to $375.5 Million

LYNNWOOD, Wash., March 11, 2021 (GLOBE NEWSWIRE) — Zumiez Inc. (NASDAQ: ZUMZ) today reported results for the fourth quarter and year ended January 30, 2021.

Total net sales for the fourth quarter ended January 30, 2021 (13 weeks) increased 0.8% to $331.5 million from $328.8 million in the quarter ended February 1, 2020 (13 weeks). Comparable sales for the thirteen weeks ended January 30, 2021 increased 4.7% compared to a comparable sales increase of 6.4% for the thirteen weeks ended February 1, 2020. Net income for the fourth quarter of fiscal 2020 was $42.8 million, or $1.68 per diluted share, compared to net income of $37.9 million, or $1.48 per diluted share in the fourth quarter of the prior fiscal year.

Total net sales for fiscal 2020 (52 weeks) ended January 30, 2021 decreased 4.2% to $990.7 million from $1.034 billion in fiscal 2019 (52 weeks) ended February 1, 2020. Comparable sales for the fifty-two week period ended January 30, 2021 increased 13.6% compared the same fifty-two week period ended February 1, 2020. Net income in fiscal 2020 increased 14.0% to $76.2 million, or $3.00 per diluted share, compared to net income in the prior fiscal year of $66.9 million, or $2.62 per diluted share.

At January 30, 2021, the Company had cash and current marketable securities of $375.5 million compared to cash and current marketable securities of $251.2 million at February 1, 2020. The increase in cash and current marketable securities was driven by cash generated through operations including cash deferment of $30.1 million composed of lower inventory levels, landlord payments, extended vendor terms and payroll tax payments as well as net income improvements related to abatements, credits and expense reductions. This increase was partially offset by $13.4 million of share repurchases through the Company’s stock buyback program prior to our stores closing in March due to COVID-19 and other planned capital expenditures.

Rick Brooks, Chief Executive Officer of Zumiez Inc., stated, “We are extremely proud of how our organization executed during a year of significant and unfamiliar challenges. Our one channel approach to retail and relentless focus on serving the consumer allowed to us to achieve annual sales close to fiscal 2019 levels and record profitability despite our stores around the world being closed for approximately 22% of the possible operating days. Our recent performance, including during the holiday season, has strengthened our operation and financial foundation and enhanced our competitive advantages. While the near-term environment is likely to remain volatile due to uncertainty surrounding the virus, we believe we are well positioned with a strong balance sheet and differentiated strategies to further expand our global market share and continue generating meaningful value for our shareholders in the years ahead.”

Fiscal First Quarter-to-Date Sales

Total first quarter-to-date sales for the 35 days ended March 6, 2021 were down approximately 3.8%, compared with the same 35 day time period in the prior year ended March 7, 2020. Comparable sales for the 35 days ended March 6, 2021 decreased 0.4%. By channel, open store comparable sales decreased 6.9% and e-commerce sales increased 29.5%. During this timeframe, we had roughly 7% fewer open store days than last year due to governmental orders and potential safety concerns. We also experienced significant metering of traffic and reduced hours where required by local governments. We expect that the store closures and various other operating restrictions will fluctuate as we move through the quarter.

Outlook

Due to the continued fast-moving nature of this situation and the uncertainty of impacts on revenue and costs, the Company is not providing an outlook at this time for the first quarter or the year.

Conference call Information

A conference call will be held today to discuss fourth quarter fiscal 2020 results and will be webcast at 5:00 p.m. ET on http://ir.zumiez.com. Participants may also dial (574) 990-9934 followed by the conference identification code of 1986667.

About Zumiez Inc.

Zumiez is a leading specialty retailer of apparel, footwear, accessories and hardgoods for young men and women who want to express their individuality through the fashion, music, art and culture of action sports, streetwear, and other unique lifestyles. As of March 6, 2021, we operated 722 stores, including 602 in the United States, 52 in Canada, 54 in Europe and 14 in Australia. We operate under the names Zumiez, Blue Tomato and Fast Times. Additionally, we operate ecommerce web sites at zumiez.com, blue-tomato.com and fasttimes.com.au.

Safe Harbor Statement

Certain statements in this press release and oral statements relating thereto made from time to time by representatives of the Company may constitute forward-looking statements for purposes of the safe harbor provisions under the Private Securities Litigation Reform Act of 1995. These statements include, without limitation, predictions and guidance relating to the Company’s future financial performance, brand and product category diversity, ability to adjust product mix, integration of acquired businesses, growing customer demand for our products and new store openings. In some cases, you can identify forward-looking statements by terminology such as, “may,” “should,” “expects,” “plans,” “anticipates,” “believes,” “estimates,” “predicts,” “potential,” “continue,” or the negative of these terms or other comparable terminology. These forward-looking statements are based on management’s current expectations but they involve a number of risks and uncertainties. Actual results and the timing of events could differ materially from those anticipated in the forward-looking statements as a result of risks and uncertainties, which include, without limitation, those described in the Company’s annual report on Form 10-K for the fiscal year ended February 1, 2020 as filed with the Securities and Exchange Commission and available at www.sec.gov. You are urged to consider these factors carefully in evaluating the forward-looking statements herein and are cautioned not to place undue reliance on such forward-looking statements, which are qualified in their entirety by this cautionary statement. The forward-looking statements speak only as of the date on which they are made and the Company undertakes no obligation to publicly update such forward-looking statements to reflect subsequent events or circumstances.

ZUMIEZ INC.

CONDENSED CONSOLIDATED STATEMENTS OF INCOME

(In thousands, except per share amounts)

(Unaudited)

		Three Months Ended
		January 30,	% of		February 1,		% of
		2021	Sales		2020		Sales
		(Unaudited)			(Unaudited)
Net sales	$	331,536	100.0	%		328,754	100.0	%
Cost of goods sold		201,913	60.9	%		200,427	61.0	%
Gross profit		129,623	39.1	%		128,327	39.0	%
Selling, general and administrative expenses		75,814	22.9	%		79,471	24.1	%
Operating profit		53,809	16.2	%		48,856	14.9	%
Interest income, net		881	0.3	%		1,002	0.3	%
Other expense, net		1,417	0.4	%		545	0.1	%
Earnings before income taxes		56,107	16.9	%		50,403	15.3	%
Provision for income taxes		13,310	4.0	%		12,518	3.8	%
Net income	$	42,797	12.9	%	$	37,885	11.5	%
Basic earnings per share	$	1.71			$	1.50
Diluted earnings per share	$	1.68			$	1.48
Weighted average shares used in computation of Earnings per share:
Basic		25,024				25,281
Diluted		25,462				25,662


ZUMIEZ INC. CONDENSED CONSOLIDATED STATEMENTS OF INCOME (In thousands, except per share amounts)

		Fiscal Year Ended
		January 30,	% of		February 1,		% of
		2021	Sales		2020		Sales
		(Unaudited)
Net sales	$	990,652	100.0	%	$	1,034,129	100.0	%
Cost of goods sold		640,637	64.7	%		667,566	64.6	%
Gross profit		350,015	35.3	%		366,563	35.4	%
Selling, general and administrative expenses		253,077	25.5	%		280,756	27.1	%
Operating profit		96,938	9.8	%		85,807	8.3	%
Interest income, net		3,518	0.3	%		3,654	0.4	%
Other expense, net		2,001	0.2	%		1,532	0.1	%
Earnings before income taxes		102,457	10.3	%		90,993	8.8	%
Provision for income taxes		26,230	2.6	%		24,112	2.3	%
Net income	$	76,227	7.7	%	$	66,881	6.5	%
Basic earnings per share	$	3.06			$	2.65
Diluted earnings per share	$	3.00			$	2.62
Weighted average shares used in computation of Earnings per share:
Basic		24,942				25,200
Diluted		25,398				25,535

ZUMIEZ INC.

CONDENSED CONSOLIDATED BALANCE SHEETS

(In thousands)

	January 30, 2021		February 1, 2020
	(Unaudited)
Assets
Current assets
Cash and cash equivalents	$	73,622	$	52,428
Marketable securities		301,920		198,768
Receivables		16,558		16,841
Inventories		134,354		135,095
Prepaid expenses and other current assets		8,823		9,456
Total current assets		535,277		412,588
Fixed assets, net		98,352		113,051
Operating lease right-of-use assets		267,152		301,784
Goodwill		61,470		57,099
Intangible assets, net		16,029		14,564
Deferred tax assets, net		9,927		6,303
Other long-term assets		10,157		8,869
Total long-term assets		463,087		501,670
Total assets	$	998,364	$	914,258

Liabilities and Shareholders’ Equity
Current liabilities
Trade accounts payable	$	69,751	$	47,787
Accrued payroll and payroll taxes		27,911		23,653
Income taxes payable		6,317		4,686
Operating lease liabilities		66,993		61,800
Other liabilities		24,480		21,784
Total current liabilities		195,452		159,710
Long-term operating lease liabilities		246,123		284,717
Other long-term liabilities		4,193		3,745
Total long-term liabilities		250,316		288,462
Total liabilities		445,768		448,172

Shareholders’ equity
Preferred stock, no par value, 20,000 shares authorized; none issued and outstanding		—		—
Common stock, no par value, 50,000 shares authorized; 25,599 shares issued and outstanding at January 30, 2021 and 25,828 shares issued and outstanding at February 1, 2020		171,628		161,458
Accumulated other comprehensive income (loss)		939		(12,591	)
Retained earnings		380,029		317,219
Total shareholders’ equity		552,596		466,086
Total liabilities and shareholders’ equity	$	998,364	$	914,258

ZUMIEZ INC.

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(In thousands)

	Fiscal Year Ended
	January 30, 2020			February 1, 2020
	(Unaudited)
Cash flows from operating activities:
Net income	$	76,227		$	66,881
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation, amortization and accretion		24,059			25,449
Noncash lease expense		61,694			58,223
Deferred taxes		(3,890	)		899
Stock-based compensation expense		6,448			6,382
Impairment of long-lived assets		4,803			215
Other		(570	)		(656	)
Changes in operating assets and liabilities:
Receivables		928			3,396
Inventories		3,946			(6,825	)
Prepaid expenses and other current assets		1,010			861
Trade accounts payable		20,797			12,756
Accrued payroll and payroll taxes		3,841			2,735
Income taxes payable		1,602			(1,127	)
Operating lease liabilities		(65,479	)		(62,217	)
Other liabilities		2,996			(902	)
Net cash provided by operating activities		138,412			106,070
Cash flows from investing activities:
Additions to fixed assets		(9,057	)		(18,818	)
Purchases of marketable securities and other investments		(222,785	)		(236,838	)
Sales and maturities of marketable securities and other investments		121,301			152,725
Net cash used in investing activities		(110,541	)		(102,931	)
Cash flows from financing activities:
Proceeds from issuance and exercise of stock-based awards		3,877			2,332
Payments for tax withholdings on equity awards		(154	)		(322	)
Common stock repurchased		(13,417	)		—
Net cash (used in) provided by financing activities		(9,694	)		2,010
Effect of exchange rate changes on cash and cash equivalents		3,522			(429	)
Net increase in cash and cash equivalents		21,699			4,720
Cash and cash equivalents, beginning of period		58,991			54,271
Cash and cash equivalents, end of period	$	80,690		$	58,991
Supplemental disclosure on cash flow information:
Cash paid during the period for income taxes	$	27,598		$	24,138
Accrual for purchases of fixed assets		231			1,152

Company Contact:

Darin White
Director of Finance &
Investor Relations
Zumiez Inc.
(425) 551-1500, ext. 1337

Investor Contact:

ICR
Brendon Frey
(203) 682-8200

March 11, 2021 4:13 pm

Brooge Energy Subsidiary, BPGIC, Wins International Award for Best Terminals of the Year in the Middle East for the Year 2021

NEW YORK, March 11, 2021 (GLOBE NEWSWIRE) — Brooge Energy Ltd. (“Brooge Energy” or the “Company”) (NASDAQ: BROG), a midstream oil storage and service provider strategically located outside the Strait of Hormuz, adjacent to the Port of Fujairah in the United Arab Emirates (“UAE”), today announced its wholly-owned subsidiary Brooge Petroleum and Gas Investment FZE (“BPGIC”) has won the Global Ports Forum Award (the “Forum”) for the best terminals of the year in the Middle East for the year 2021. BPGIC received this award – for the third time in a row – in recognition of its efforts and contribution to the field of oil and fuel storage in the port of Fujairah. The Global Ports Forum was launched in 2008 in Singapore, to foster cooperation between ports around the world. The forum is committed to improving global ports and promoting port interests, and provides an overview of emerging trends in the port industry at the global level.

The selection of BPGIC was based on the nominations that reached the Forum from international organizations, and the strong performance of the Company during the last year. BPGIC is proceeding with its Phase II project to expand its capacity in Fujairah, one of the largest oil storage locations in the world. Through its wholly-owned subsidiary Brooge Petroleum and Gas Investment Company Phase III FZE (“BPGIC III”), the Company is also planning construction for its Phase III facility which will include crude oil tanks, in addition to increasing capacity for fuel oil and clean products.

Nicolaas L. Paardenkooper, CEO of Brooge Energy and BPGIC, said, “If one thing has become clear over the past year, it is the strategic importance of the midstream sector in supporting the infrastructure and storage needs of the oil industry and enabling the market to work efficiently. We are proud to have won this award for the best terminals of the year in the Middle East for the third year running, which is a testament to our strong performance over the past year. Even throughout the volatility of 2020 – including lockdowns and other severe restrictions – our Phase I facility continued to operate seamlessly and provide a reliable and much-needed service to our customers at a time when oil storage was in extremely high demand. Buoyed by this success, we are looking forward to launching our Phase II storage facility in the near future, and are simultaneously making headway with our plans to build out a Phase III facility.”

BPGIC is a key independent storage provider in Fujairah, UAE, conveniently situated in the East-coast port of Fujairah on the Gulf of Oman, which owns capacity to store clean petroleum products and fuel oil using some of the latest technology to maximize company performance and efficiency, while reducing operating costs. Through the development of its Phase II and Phase III facilities, it is also building capacity to store crude oil using similar technology.

About Brooge Energy Limited

Brooge Energy conducts all of its business and operations through its wholly-owned subsidiaries, Brooge Petroleum and Gas Investment Company FZE (“BPGIC”) and Brooge Petroleum and Gas Investment Company Phase III FZE (“BPGIC III”), Fujairah Free Zone Entities. Brooge Energy is a midstream oil storage and service provider strategically located outside the Strait of Hormuz adjacent to the Port of Fujairah in the United Arab Emirates. Its oil storage business differentiates itself from competitors by providing customers with fast order processing times, excellent customer service and high accuracy blending services with low oil losses. For more information please visit at www.broogeenergy.com

Forward-Looking Statements

This press release contains “forward-looking statements” within the meaning of the safe harbor provisions of the U.S. Private Securities Litigation Reform Act of 1995, that involve risks and uncertainties concerning BPGIC’s, BPGIC III’s and Brooge Energy’s expected financial performance, as well as their strategic and operational plans. The actual results may differ materially from expectations, estimates and projections due to a number of risks and uncertainties and, consequently, you should not rely on these forward looking statements as predictions of future events. Words such as “expect,” “estimate,” “project,” “budget,” “forecast,” “anticipate,” “intend,” “plan,” “may,” “will,” “would,” “could,” “should,” “believes,” “predicts,” “potential,” “continue,” and similar expressions are intended to identify such forward-looking statements. These risks and uncertainties include, but are not limited to: (1) the ultimate geographic spread, duration and severity of the coronavirus outbreak and the effectiveness of actions taken, or actions that may be taken, by governmental authorities to contain the outbreak or ameliorate its effects; (2) Brooge Energy’s and its subsidiaries’ ability to obtain financing for Phase III on commercially reasonable terms; (3) Brooge Energy’s and its subsidiaries’ ability to negotiate and enter into development and offtake agreements on commercially reasonable terms; (4) the results of technical and design feasibility studies, including the Soil Investigation and the Environmental Impact Assessment report for Phase III; (5) the loss of any end-users; (6) changes in customer demand with respect to ancillary services provided by Brooge Energy and its subsidiaries including throughput, blending, heating, and intertank transfers; (7) Brooge Energy’s and its subsidiaries’ ability to effectively manage the risks and expenses associated with the construction of Phase II, Phase III and other growth and expansion projects; and (8) other risks and uncertainties indicated from time to time in filings with or submissions to the SEC by Brooge Energy. Readers are referred to the most recent reports filed with or furnished to the SEC by Brooge Energy. Readers are cautioned not to place undue reliance upon any forward-looking statements, which speak only as of the date made, and we undertake no obligation to update or revise the forward-looking statements, whether as a result of new information, future events or otherwise.

Investor Contact

KCSA Strategic Communications
Valter Pinto / Elizabeth Barker
+1 212-896-1254 or +1 212-896-1203
[email protected]

March 11, 2021 4:13 pm

Asure Announces Fourth Quarter and Full Year 2020 Results

AUSTIN, Texas, March 11, 2021 (GLOBE NEWSWIRE) — Asure (NASDAQ: ASUR), a leading provider of cloud-based Human Capital Management (HCM) software solutions, reported results for the fourth quarter and full year ended December 31, 2020.

“Our increased focus on small business is paying off as new customer additions exceeded losses with broader adoption of multiple solutions, driving revenue growth in the fourth quarter. Although the COVID-19 pandemic continues to impact our top line, resulting in unfavorable year-over-year comparisons, revenue, non-GAAP HCM EBITDA, and non-GAAP HCM EPS all increased from third-quarter 2020. The high-caliber sales representatives we added in the second half of 2020 helped us achieve encouraging results during a difficult economic landscape. We are particularly pleased with the growth in number of customers added and are cautiously optimistic that gradually improving unemployment rates will serve as a tailwind, leading to increased revenue over time. Furthermore, we hope to generate positive organic growth in 2021 and have not changed our strategic goal of targeting 10% organic and 10% acquired growth. As an essential small business, Asure remains committed to helping our more than 70,000 indirect and 10,000 direct small-business customers grow in this challenging environment,” said Chairman and CEO Pat Goepel.

Fourth Quarter 2020 Key HCM Highlights

HCM revenue of $16.4 Million, up 3% sequentially from third-quarter 2020
Non-GAAP HCM EBITDA of $1.1 Million, up 13% sequentially from third-quarter 2020
Non-GAAP HCM EPS of $0.00, up three cents sequentially from third-quarter 2020
Small-business HCM bookings increased more than 100% year-over-year
Total HCM bookings increased 13% year-over-year
COVID-19 Resource Center and webinars continues to benefit tens of thousands of small-businesses

Fourth Quarter and Full Year 2020 Financial Summary

	For the three months ended December 31						For the year ended December 31
In thousands, except per share data	2020		2019		Change (%)		2020		2019		Change (%)
REVENUE
GAAP Revenue (HCM)	16,430		17,612		(6.7	)%	65,507		73,150		(10.4	)%

GROSS PROFIT
GAAP Gross Profit (HCM)	9,806		8,175		20.0	%	38,093		43,314		(12.1	)%
GAAP Gross Margin (HCM)	59.7	%	46.4	%	28.6	%	58.2	%	59.2	%	(1.8	)%

Non-GAAP HCM Gross Profit	10,911		9,642		13.2	%	42,477		47,389		(10.4	)%
Non-GAAP HCM Gross Margin	66.4	%	54.7	%	21.3	%	64.8	%	64.8	%	0.1	%

EARNINGS
GAAP Net Income (Loss)	(5,842	)	(26,932	)	NM		(16,311	)	(42,291	)	NM
Non-GAAP HCM Net Income (Loss)	(69	)	(2,534	)	NM		3,260		392		NM
GAAP Net Income (Loss) per share	(0.36	)	(1.72	)	NM		(1.03	)	(2.73	)	NM
Non-GAAP HCM Net Income (Loss) per share	0.00		(0.16	)	NM		0.20		0.03		NM

EBITDA
Non-GAAP HCM EBITDA	1,143		(335	)	NM		7,850		12,976		(39.5	)%
Non-GAAP HCM EBITDA Margin	7.0	%	(1.9	)%	NM		12.0	%	17.7	%	(32.4	)%

_________
Notes:

Loss from continuing operations. With the sale of the Workspace Management division on December 2, 2019, Asure has classified this business line as discontinued operations for the fiscal year 2019. As a result, Workspace Management is not included in GAAP revenue, GAAP gross profit, GAAP gross margin, and GAAP net income from continuing operations for the periods presented above. While discontinued operations are included in GAAP net income, it is not included in GAAP net income from continuing operations.
Non-GAAP financial measures are reconciled to GAAP in the tables set forth in this release.
Historical non-GAAP HCM Net Earnings Per Share from Continuing Operations adjusted for 0% effective tax rate for comparison purposes.
NM indicates Not Meaningful Information

Financial Commentary

“While our view on the overall U.S. economy’s impact on small business remains tempered, fourth quarter’s sequential improvements in financial results were encouraging. Asure has a clear strategy for growth and we are focused on its execution. Prior to filing today’s earnings release, we filed S-3 and S-4 registrations, which are not yet effective. While we have no immediate plans to raise capital under the universal shelf or to utilize the acquisition shelf for any particular transaction, these registration statements, once effective, will benefit the company and our stockholders by allowing us to quickly and opportunistically consummate strategic acquisitions,” said CFO John Pence.

Asure delivered the following results (HCM only) for its fourth quarter ended December 31, 2020:

Revenue: Total revenue for the fourth quarter of 2020 was $16.4 million, a decrease of 7% from $17.6 million in the year-ago quarter. Revenue mix for the quarter was comprised primarily of recurring revenue, which represented 97% of total revenue with professional services, hardware and other revenue representing the remaining 3%.

Gross Profit: GAAP gross profit for the fourth quarter of 2020 was $9.8 million (59.7% margin), an increase from $8.2 million (46.4% margin) in the year-ago period. Non-GAAP HCM gross profit for the third quarter of 2020 was $10.9 million (66.4% margin), an increase from $9.6 million (54.7% margin) in the year-ago period.

Earnings (Loss) per Share: GAAP loss per share were $(0.36), compared with $(1.72) in the year-ago period. Non-GAAP HCM earnings per share were $0.00, compared with $(0.16) in the year-ago period.

Non-GAAP HCM EBITDA: Non-GAAP HCM EBITDA was $1.1 million (7.0% margin), representing an increase from $(0.3) million (-1.9% margin) in the year-ago period.

Fourth-Quarter Highlights

Closed Reseller Acquisition. On December 31, 2020, Asure purchased a small reseller focused on the northeast market.

Key Leadership Additions. Chief of Staff Todd Waletzki and Senior Vice President and General Manager, Tax & Compliance Yasmine Rodriguez each come to Asure with impressive track records and HCM expertise.

Public Offering of Common Stock. In December 2020, we received gross proceeds of approximately $21.7 million before deducting underwriting discounts and offering expenses from the sale of approximately 3.0 million shares of common stock.

Recent Business Events

S-3 and S-4 Registrations. Prior to filing today’s earnings release, Asure filed a universal shelf Registration Statement on Form S-3 and an acquisition shelf Registration Statement on Form S-4 with the Securities and Exchange Commission, neither of which have yet been declared effective by the Securities and Exchange Commission. The Company has no immediate plans to raise capital under the shelf Form S-3 or to utilize the shelf Form S-4 for an acquisition transaction and we cannot sell any securities or accept any offer to buy securities under these registration statements until they become effective.

Once declared effective, the universal shelf on Form S-3 will permit Asure to sell, in one or more public offerings, shares of newly issued common stock, shares of newly issued preferred stock, warrants or debt securities, or any combination of such securities, for proceeds in an aggregate amount of up to $150 million.

The acquisition shelf registration statement on Form S-4, once declared effective, will enable Asure to issue up to 12.5 million shares of its common stock in one or more acquisition transactions that the Company may make from time to time. These transactions may include the acquisition of assets, businesses or securities, whether by purchase, merger or any other form of business combination.

Special Note from Chairman and CEO

“It is with a heavy heart that we learned about the recent passing of our former board member and friend Charlie Lathrop. Our thoughts and prayers are with Charlie’s family,” said Mr. Goepel.

Conference Call Details

Asure management will host a conference call today, Thursday, March 11, at 4:30pm Eastern time (3:30pm Central time). Asure CEO Pat Goepel and CFO John Pence will host the conference call, followed by a question and answer session.

U.S. dial-in: (877) 853-5636
International dial-in: (631) 291-4544
Conference ID: 2037337

The conference call will be broadcast live and available for replay via the investor relations section of the company’s website.

*Non-GAAP Financial Measures. This press release includes information about non-GAAP HCM Net Earnings (Loss), non-GAAP HCM Net Earnings (Loss) per share, non-GAAP EPS, non-GAAP tax rates, non-GAAP HCM gross profit, and non-GAAP HCM EBITDA (collectively the “non-GAAP financial measures”). These non-GAAP financial measures are measurements of financial performance that are not prepared in accordance with U.S. generally accepted accounting principles and computational methods may differ from those used by other companies. Non-GAAP financial measures are not meant to be considered in isolation or as a substitute for comparable GAAP measures and should be read only in conjunction with the company’s consolidated financial statements prepared in accordance with GAAP.

Non-GAAP HCM EBITDA differs from GAAP net loss excludes items such as interest, tax, depreciation, amortization, stock compensation, and one-time expenses. Asure is unable to predict with reasonable certainty the ultimate outcome of these exclusions without unreasonable effort.

Non-GAAP HCM earnings (loss) per share differs from GAAP earnings per share in that it assumes a 0% non-GAAP tax rate, uses diluted share counts, and excludes items such as amortization, stock compensation, and one-time expenses.

Non-GAAP HCM gross profit differs from GAAP gross profit in that it excludes amortization, stock compensation, and one-time items.

Management uses both GAAP and non-GAAP measures when planning, monitoring, and evaluating the company’s performance.

The primary purpose of using non-GAAP measures is to provide supplemental information that may prove useful to investors and to enable investors to evaluate the company’s results in the same way management does.

Management believes that supplementing GAAP disclosure with non-GAAP disclosure provides investors with a more complete view of the company’s operational performance and allows for meaningful period-to-period comparisons and analysis of trends in the company’s business. Further, to the extent that other companies use similar methods in calculating non-GAAP measures, the provision of supplemental non-GAAP information can allow for a comparison of the company’s relative performance against other companies that also report non-GAAP operating results.

Specifically, management is excluding the following items from its non-GAAP earnings per share, as applicable, for the periods presented in the fourth quarter 2020 financial statements:

Quarterly and annual GAAP income statements for 2019 were recast as if the Workspace Management business, which was sold on December 2, 2019. Further, the Workspace Management GAAP income statements were recast into income from discontinued operations.

Stock-Based Compensation Expenses. The company’s compensation strategy includes the use of stock-based compensation to attract and retain employees and executives. It is principally aimed at aligning their interests with those of our stockholders and at long-term employee retention, rather than to motivate or reward operational performance for any particular period. Thus, stock-based compensation expense varies for reasons that are generally unrelated to operational decisions and performance in any particular period.

Amortization of Purchased Intangibles. The company views amortization of acquisition-related intangible assets, such as the amortization of the cost associated with an acquired company’s research and development efforts, trade names, customer lists and customer relationships, and acquired lease intangibles, as items arising from pre-acquisition activities determined at the time of an acquisition. While these intangible assets are continually evaluated for impairment, amortization of the cost of purchased intangibles is a static expense, one that is not typically affected by operations during any particular period.

Income Tax Effects and Adjustments. Beginning in first quarter 2018, the company started using a fixed projected non-GAAP tax rate in order to provide better consistency across the interim reporting periods by eliminating the effects of items such as changes in the tax valuation allowance and non-cash tax effects of acquired goodwill and amortization, since each of these can vary in size and frequency. This tax rate could be subject to change for a variety of reasons, such as significant changes in the acquisition activity or fundamental tax law changes in major jurisdictions where the company operates. The company re-evaluates this tax rate on an annual basis or when any significant events that may materially affect this rate occur. The non-GAAP tax rate is currently projected to be approximately zero (0.0) percent.

Amortization of Capitalized Internal-Use Software, Acquisition-Related, and One-Time Expenses. The company’s non-GAAP financial measures exclude amortization of internal-use capitalized software costs and acquisition-related expenses as well as one-time expenses, such as material tax credits, material interest-expense credits, severance, recruitment, proforma adjustments of the impact of post-sale HCM restructuring, and relocation.

About Asure

Asure (NASDAQ: ASUR) sees Human Capital Management (HCM) through the lens of entrepreneurs and executives with an owner’s mentality. We help more than 80,000 small and mid-sized businesses develop their “Human Capital” to get to the next level, stay compliant, and allocate their time, money and technology toward growth. Asure HCM solution includes Asure Payroll & Tax, Asure HR, and Asure Time & Attendance. Our Asure HR Services offering ranges from online compliance tools to a fully outsourced HR department. Visit us at asuresoftware.com.

“Safe harbor” statement under the Private Securities Litigation Reform Act of 1995: This press release contains forward-looking statements about our financial results, which may include expected GAAP and non-GAAP financial and other operating and non-operating results, including revenue, net income, diluted earnings per share, operating cash flow growth, operating margin improvement, deferred revenue growth, expected revenue run rate, expected tax rates, stock-based compensation expenses, amortization of purchased intangibles, amortization of debt discount and shares outstanding. The achievement or success of the matters covered by such forward-looking statements involves risks, uncertainties and assumptions. If any such risks or uncertainties materialize or if any of the assumptions prove incorrect, the company’s results could differ materially from the results expressed or implied by the forward-looking statements we make.

This press release contains forward-looking statements about our financial results, which may include expected GAAP and non-GAAP financial and other operating and non-operating results, including revenue, net income, diluted earnings per share, operating cash flow growth, operating margin improvement, deferred revenue growth, expected revenue run rate, expected tax rates, stock-based compensation expenses, amortization of purchased intangibles, amortization of debt discount and shares outstanding. The achievement or success of the matters covered by such forward-looking statements involves risks, uncertainties and assumptions. If any such risks or uncertainties materialize or if any of the assumptions prove incorrect, the company’s results could differ materially from the results expressed or implied by the forward-looking statements we make. The risks and uncertainties referred to above include — but are not limited to — risks associated with possible fluctuations in the company’s financial and operating results; the company’s rate of growth and anticipated revenue run rate, including impact of the current environment, the spread of major epidemics (including Coronavirus) and other related uncertainties such as government-imposed travel restrictions, interruptions to supply chains and extended shut down of businesses, reductions in employment and an increase in business failures, specifically among our clients, the company’s ability to convert deferred revenue and unbilled deferred revenue into revenue and cash flow, and ability to maintain continued growth of deferred revenue and unbilled deferred revenue; foreign currency exchange rates; errors, interruptions or delays in the company’s services or the company’s Web hosting; breaches of the company’s security measures; changes in the forgiveness provisions for loans under the Paycheck Protection Program; domestic and international regulatory developments, including changes to or applicability to our business of privacy and data securities laws, money transmitter laws and anti-money laundering laws; the financial and other impact of any previous and future acquisitions; the nature of the company’s business model, including risks related to government contracts; the company’s ability to continue to release, gain customer acceptance of and provide support for new and improved versions of the company’s services; successful customer deployment and utilization of the company’s existing and future services; changes in the company’s sales cycle; competition; various financial aspects of the company’s subscription model; unexpected increases in attrition or decreases in new business; the company’s ability to realize benefits from strategic partnerships and strategic investments; the emerging markets in which the company operates; unique aspects of entering or expanding in international markets, including the compliance with United States export control laws, the company’s ability to hire, retain and motivate employees and manage the company’s growth; changes in the company’s customer base; technological developments; litigation and any related claims, negotiations and settlements, including with respect to intellectual property matters or industry-specific regulations; unanticipated changes in the company’s effective tax rate; factors affecting the company’s outstanding convertible notes, term loan, and revolving credit facility; fluctuations in the number of company shares outstanding and the price of such shares; collection of receivables; interest rates; factors affecting the company’s deferred tax assets and ability to value and utilize them; the potential negative impact of indirect tax exposure; the risks and expenses associated with the company’s real estate and office facilities space; and general developments in the economy, financial markets, credit markets and the impact of current and future accounting pronouncements and other financial reporting standards. Further information on these and other factors that could affect the company’s financial results is included in the reports on Forms 10-K, 10-Q and 8-K, and in other filings we make with the Securities and Exchange Commission from time to time. These documents are available on the SEC Filings section of the Investor Information section of the company’s website at investor.asuresoftware.com. Asure Software assumes no obligation and does not intend to update these forward-looking statements, except as required by law.

Further information on these and other factors that could affect the company’s financial results is included in the reports on Forms 10-K, 10-Q and 8-K and in other filings we make with the Securities and Exchange Commission from time to time. These documents are available on the SEC Filings section of the Investor Information section of the company’s website at investor.asuresoftware.com

Asure Software assumes no obligation and does not intend to update these forward-looking statements, except as required by law.

This press release refers to registration statements on Form S-3 and Form S-4 that have been filed with the Securities and Exchange Commission but have not yet become effective. Securities may not be sold nor may offers to buy be accepted prior the time the registration statements become effective.

ASURE SOFTWARE, INC.

CONSOLIDATED BALANCE SHEETS

(Amounts in thousands)

	December 31, 2020			December 31, 2019
Assets
Current assets:
Cash and cash equivalents	$	28,577		$	28,826
Accounts and note receivable, net of allowance for doubtful accounts of $771 and $904 at December 31, 2020 and December 31, 2019, respectively	4,852			4,808
Inventory	449			656
Prepaid expenses and other current assets	3,284			8,551
Total current assets before funds held for clients	37,162			42,841
Funds held for clients	321,069			126,625
Total current assets	358,231			169,466
Property and equipment, net	8,281			7,867
Goodwill	73,958			68,697
Intangible assets, net	64,552			63,850
Operating lease assets, net	6,450			6,963
Other assets	3,951			3,224
Total assets	$	515,423		$	320,067
Liabilities and stockholders’ equity
Current liabilities:
Current portion of notes payable	$	12,310		$	2,571
Accounts payable	1,288			1,736
Accrued compensation and benefits	2,916			3,424
Operating lease liabilities, current	1,833			1,575
Other accrued liabilities	1,380			6,556
Contingent purchase obligation	3,880			—
Deferred revenue	5,838			5,500
Total current liabilities before client fund obligations	29,445			21,362
Client fund obligations	320,578			130,250
Total current liabilities	350,023			151,612
Long-term liabilities:
Deferred revenue	111			322
Deferred tax liability	888			336
Notes payable, net of current portion and debt issuance cost	12,225			24,142
Operating lease liabilities, noncurrent	5,366			5,937
Other liabilities	1,157			139
Total long-term liabilities	19,747			30,876
Total liabilities	369,770			182,488
Commitments and Contingencies (Notes 2 and 15)
Stockholders’ equity:
Preferred stock, $.01 par value; 1,500 shares authorized; none issued or outstanding	—			—
Common stock, $.01 par value; 44,000 and 22,000 shares authorized; 19,354 and 16,098 shares issued, 18,970 and 15,714 shares outstanding at December 31, 2020 and December 31, 2019, respectively	193			161
Treasury stock at cost, 384 shares at December 31, 2020 and December 31, 2019	(5,017		)	(5,017		)
Additional paid-in capital	419,827			396,102
Accumulated deficit	(269,954		)	(253,642		)
Accumulated other comprehensive loss	604			(25		)
Total stockholders’ equity	145,653			137,579
Total liabilities and stockholders’ equity	$	515,423		$	320,067

ASURE SOFTWARE, INC.

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS)

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

	Years Ended December 31
	2020			2019
Revenue:
Recurring	$	63,315		$	70,066
Professional services, hardware and other	2,192			3,084
Total revenue	65,507			73,150
Cost of sales	27,414			29,836
Gross profit	38,093			43,314
Operating expenses
Selling, general and administrative	36,340			41,535
Research and development	5,959			5,351
Amortization of intangible assets	9,547			11,765
Impairment of goodwill	—			35,060
Total operating expenses	51,846			93,711
Loss from operations	(13,753		)	(50,397		)
Interest expense and other, net	(2,221		)	(16,005		)
Loss from continuing operations before income taxes	(15,974		)	(66,402		)
Income tax expense (benefit)	337			(24,111		)
Loss from continuing operations	(16,311		)	(42,291		)
Discontinued operations (Note 12)
Gain on disposal of discontinued operations	—			94,293
Income from operations of discontinued operations	—			3,498
Income tax expense	—			(25,499		)
Gain on discontinued operations, net of taxes	—			72,292
Net income (loss)	(16,311		)	30,001
Other comprehensive income (loss):
Change in unrealized gain on available for sale securities	629			6
Foreign currency translation loss	—			(597		)
Comprehensive income (loss)	$	(15,682	)	$	29,410

Basic and diluted loss per share from continuing operations
Basic	$	(1.03	)	$	(2.73	)
Diluted	$	(1.03	)	$	(2.73	)
Basic and diluted net income (loss) per share
Basic	$	(1.03	)	$	1.93
Diluted	$	(1.03	)	$	1.93
Weighted average basic and diluted shares
Basic	15,910,000			15,511,000
Diluted	15,910,000			15,511,000

ASURE SOFTWARE, INC.

CONSOLIDATED STATEMENTS OF CASH FLOWS

(Amounts in thousands)

	Years Ended December 31
	2020			2019
Cash flows from operating activities:
Net income (loss)	$	(16,311	)	$	30,001
Adjustments to reconcile net income (loss) to net cash used in operations:
Depreciation and amortization	16,169			18,165
Impairment of goodwill	—			35,060
Amortization of debt financing costs and discount	395			1,462
Provision for doubtful accounts	372			446
Provision (benefit) from deferred income taxes	551			(1,193		)
Loss (gain) on extinguishment of debt	(138		)	2,808
Gain on sale of discontinued operations	—			(94,293		)
Share-based compensation	2,365			2,268
Loss on disposals of fixed assets	59			62
Changes in operating assets and liabilities:
Accounts receivable	1,118			(1,446		)
Inventory	11			(1,581		)
Prepaid expenses and other assets	(911		)	(3,113		)
Accounts payable	(448		)	(3,174		)
Accrued expenses and other long-term obligations	(4,596		)	5,649
Operating lease liabilities	(1,606		)	(900		)
Deferred revenue	128			5,662
Net cash used in operating activities	(1,707		)	(4,117		)
Cash flows from investing activities:
Proceeds from sale of discontinued operations	—			118,206
Acquisitions, net of cash acquired	(13,141		)	(7,443		)
Purchases of property and equipment	(857		)	(1,017		)
Software capitalization costs	(2,780		)	(3,824		)
Net change in funds held for clients	(184,356		)	(20,290		)
Net cash provided by (used in) investing activities	(201,134		)	85,632
Cash flows from financing activities:
Proceeds from notes payable	8,856			28,636
Payments of notes payable	(12,234		)	(118,421		)
Proceeds from revolving line of credit	—			10,231
Payments of revolving line of credit	—			(10,312		)
Debt financing fees	(245		)	(1,539		)
Payments of finance leases	—			(102		)
Net proceeds from issuance of common stock	21,392			820
Net change in client fund obligations	184,823			22,669
Net cash provided by (used in) financing activities	202,592			(68,018		)
Effect of foreign exchange rates	—			(115		)
Net increase (decrease) in cash and cash equivalents	(249		)	13,382
Cash and cash equivalents at beginning of period	28,826			15,444
Cash and cash equivalents at end of period	$	28,577		$	28,826

Reconciliation of GAAP to Non-GAAP

(In thousands, except for per shared data)

	Q1			Q2			Q3			Q4			Total			Q1			Q2			Q3			Q4			Total
		2019			2019			2019			2019			2019			2020			2020			2020			2020			2020
Total Revenue*	$	20,410		$	17,274		$	17,854		$	17,612		$	73,150		$	18,947		$	14,115		$	16,015		$	16,430		$	65,507

GAAP to Non-GAAP HCM Gross Profit
GAAP HCM Gross Profit	$	14,156		$	10,215		$	10,768		$	8,175		$	43,314		$	11,107		$	8,107		$	9,073		$	9,806		$	38,093
GAAP HCM Gross Margin		69.4	%		59.1	%		60.3	%		46.4	%		59.2	%		58.6	%		57.4	%		56.7	%		59.7	%		58.2	%
Stock Compensation		12			8			13			18			51			22			21			33			24			100
Depreciation		315			310			268			142			1,035			495			537			787			703			2,522
Amortization – intangibles		360			360			417			857			1,994			431			397			397			379			1,604
One Time HW Reserve / Other		0			0			0			321			321			0			0			0			0			0
One Time Product Royalties		189			188			168			129			674			91			67			0			0			158
Non-GAAP HCM Gross Profit	$	15,032		$	11,081		$	11,634		$	9,642		$	47,389		$	12,146		$	9,130		$	10,290		$	10,911		$	42,477
Non-GAAP HCM Gross Margin		73.7	%		64.1	%		65.2	%		54.7	%		64.8	%		64.1	%		64.7	%		64.3	%		66.4	%		64.8	%

GAAP NI to Non-GAAP HCM EBITDA
GAAP Net Income (Loss)	$	(3,437	)	$	(6,298	)	$	(5,624	)	$	(26,932	)	$	(42,291	)	$	(1,767	)	$	(3,944	)	$	(4,759	)	$	(5,842	)	$	(16,311	)
Interest Expense & Other, Net		2,714			3,069			2,712			7,510			16,005			235			164			408			279			1,086
Taxes based on a 0% tax rate		255			396			(130	)		(24,632	)		(24,111	)		19			377			(325	)		266			337
Depreciation		1,215			376			385			394			2,370			735			793			1,043			934			3,504
Amortization – intangibles		2,778			2,763			2,739			5,479			13,759			2,780			2,746			2,821			2,804			11,151
EBITDA	$	3,525		$	306		$	82		$	(38,181	)	$	(34,268	)	$	2,002		$	136		$	(812	)	$	(1,559	)	$	(232	)
EBITDA Margin		17.3	%		1.8	%		0.5	%		-216.8	%		-46.8	%		10.6	%		1.0	%		-5.1	%		-9.5	%		-0.4	%
Stock compensation		611			392			577			688			2,268			438			588			707			631			2,365
Acquisition costs/other 1x expenses		1,942			1,903			1,510			1,277			6,632			1,845			685			1,117			2,071			5,718
Impairment		0			0			0			35,060			35,060			0			0			0			0			0
Restructuring lookback		821			821			821			821			3,284			0			0			0			0			0
Non-GAAP HCM EBITDA	$	6,899		$	3,422		$	2,990		$	(335	)	$	12,976		$	4,285		$	1,409		$	1,012		$	1,143		$	7,850
Non-GAAP HCM EBITDA Margin		33.8	%		19.8	%		16.7	%		-1.9	%		17.7	%		22.6	%		10.0	%		6.3	%		7.0	%		12.0	%

GAAP NI to Non-GAAP HCM NI
GAAP Net Income (Loss)	$	(3,437	)	$	(6,298	)	$	(5,624	)	$	(26,932	)	$	(42,291	)	$	(1,767	)	$	(3,944	)	$	(4,759	)	$	(5,842	)	$	(16,311	)
Share Count		15,405			15,444			15,565			15,627			15,511			15,727			15,779			15,873			16,258			15,910
GAAP EPS	$	(0.22	)	$	(0.41	)	$	(0.36	)	$	(1.72	)	$	(2.73	)	$	(0.11	)	$	(0.25	)	$	(0.30	)	$	(0.36	)	$	(1.03	)
Stock compensation		611			392			577			688			2,268			438			588			707			631			2,365
Amortization – intangibles		2,778			2,763			2,739			5,479			13,759			2,780			2,746			2,821			2,804			11,151
Acquisition costs/other 1x expenses		1,942			1,903			1,510			1,277			6,632			1,845			685			1,117			2,071			5,718
Taxes based on a 0% tax rate		255			396			(130	)		(24,632	)		(24,111	)		19			377			(325	)		266			337
Impairment		0			0			0			35,060			35,060			0			0			0			0			0
Loss on extinguishment of debt		0			0			0			5,705			5,705			0			0			0			0			0
Restructuring lookback		821			821			821			821			3,284			0			0			0			0			0
1x Tax Penalty related to Prior periods		0			86			0			0			86			0			0			0			0			0
Non-GAAP HCM Net Income (Loss)	$	2,970		$	63		$	(107	)	$	(2,534	)	$	392		$	3,315		$	452		$	(439	)	$	(69	)	$	3,260
Share Count		15,436			15,502			15,565			15,627			15,567			15,914			15,899			15,873			16,258			16,013
Non-GAAP EPS	$	0.19		$	0.00		$	(0.01	)	$	(0.16	)	$	0.03		$	0.21		$	0.03		$	(0.03	)	$	0.00		$	0.20

*For comparison purposes, excluding non-strategic customer contracts, revenue would have been $19,258 in 1Q19, $16,245 in 2Q19, $16,830 in 3Q19, and $16,628 in 4Q19, totaling $68,961 for the full year 2019.

Investor Relations Contact:

Jeff Houston
Corporate Development
(512) 437-2349
[email protected]

March 11, 2021 4:13 pm

Bimini Capital Management Announces Fourth Quarter 2020 Results

Bimini Capital Management Announces Fourth Quarter 2020 Results

VERO BEACH, Fla.–(BUSINESS WIRE)–
Bimini Capital Management, Inc. (OTCBB:BMNM), (“Bimini Capital,” “Bimini,” or the “Company”) today announced results of operations for the three month period ended December 31, 2020.

Fourth Quarter 2020 Highlights

Net income of $12.1 million, or $1.04 per common share
Income tax benefit of $10.7 million, or $0.92 per common share
Book value per share of $2.97
Company to discuss results on Friday, March 12, 2021, at 10:00 AM ET

Management Commentary

Commenting on the fourth quarter results, Robert E. Cauley, Chairman and Chief Executive Officer, said, “As we sit here today, it is very sobering when we reflect on how much has transpired between March of 2020 and March of 2021. The month that seemed like it would never end finally did, and there were many dark days in between, but we clearly seem to be emerging from this dark episode that none of us will ever forget. The immediate impact of the turmoil in the financial markets last March was negative for Bimini and all levered MBS investors. We shrank our portfolio and reduced our hedges to preserve liquidity. We downsized maybe more than was needed but in doing so we were left with some dry powder to take advantage of the many very attractive investment opportunities that were available at the time. We slowly rebuilt our portfolio, acquiring securities with mid to high teen ROE expected returns, but also materially increased our holdings of Orchid Island Capital since the stock was trading at a yield in excess of 20%. The Agency MBS market recovered quickly, with the help of asset purchases by the Federal Reserve. The investment strategy of both Royal Palm and Orchid Island Capital have always been exclusively Agency RMBS and this proved very beneficial in 2020. We believe we had an effective strategy that was executed well. In spite of the fact the Royal Palm portfolio shrank by 70% during the year Bimini had higher net revenues in 2020 versus 2019.

“While the effect of the market turmoil last March led us to reduce the Royal Palm portfolio drastically, resulting in a 52% reduction in interest income for the year, it also led to a significant reduction in our borrowing cost as the Federal Reserve reduced short term interest rates to near zero. The net effect was a modest 9% reduction in net interest income of the portfolio, inclusive of the interest expense on our trust preferred debt. Because Orchid Island performed well over the course of the year and its stock traded at or above book value for much of the balance of the year, Orchid was able to raise additional capital and ended the year with a larger equity base than it began the year with. Advisory service revenues were only down 2% for the year. Finally, because we added to our ORC share holdings from approximately 1.5 million shares to approximately 2.6 million shares, dividend income increased 20%. As a result of the strong recovery in revenues and the equity base at Orchid we revised our deferred tax asset valuation allowance, reducing the allowance such that deferred tax asset is approximately 2% higher than year-end 2019.

“As we enter 2021 the market remains favorable for our Agency RMBS strategy. Interest rates are rising, applying modest pressure on our book value, but this should also place modest downward pressure on prepayments. Since year-end Orchid Island has executed two secondary capital raises, increasing its equity base by nearly 25%. We anticipate increased advisory service revenue for the first quarter of 2021. In the end, Bimini remains focused on maximizing the utilization of our NOL’s and growing Royal Palm’s portfolio. While 2020 was a challenging year, it did not prevent us from making progress on our long-term goal.”

Details of Fourth Quarter 2020 Results of Operations

The Company reported net income of $12.1 million, or $1.04 per common share, for the three-month period ended December 31, 2020. As Orchid was able to grow its capital base during the quarter advisory service revenues increased 12%. Interest income was down very modestly by 1% and repurchase agreement interest expense was essentially unchanged. Net revenues increased 8%. We recorded a $0.55 million mark to market gain on our shares in ORC, on top of the $0.79 million gain in the third quarter. The income tax benefit of $10.7 million was a result of the reassessment of our deferred tax asset valuation allowance and did not impact cash flows as it is a non-cash GAAP accounting adjustment. The results for the quarter also included operating expenses of $1.66 million versus $1.62 million in the third quarter, a 3% increase.

Management of Orchid Island Capital, Inc.

Orchid Island Capital, Inc. (“Orchid”) is managed and advised by Bimini. As manager, Bimini is responsible for administering Orchid’s business activities and day-to-day operations. Pursuant to the terms of the management agreement, Bimini Advisors provides Orchid with its management team, including its officers, along with appropriate support personnel.

Bimini also maintains a common stock investment in Orchid which is accounted for under the fair value option, with changes in fair value recorded in the statement of operations for the current period. For the three months ended December 31, 2020, Bimini’s statement of operations included a fair value adjustment of $0.5 million and dividends of $0.5 million from its investment in Orchid common stock. Also during the three months ended December 31, 2020, Bimini recorded $1.8 million in advisory services revenue for managing Orchid’s portfolio consisting of $1.4 million of management fees and $0.4 million in overhead reimbursement.

Capital Allocation and Return on Invested Capital

The Company allocates capital between two MBS sub-portfolios, the pass-through MBS portfolio (“PT MBS”) and the structured MBS portfolio, consisting of interest only (“IO”) and inverse interest-only (“IIO”) securities. The table below details the changes to the respective sub-portfolios during the quarter.

Portfolio Activity for the Quarter
				Structured Security Portfolio
	Pass-Through			Interest-Only			Inverse Interest
	Portfolio			Securities			Only Securities			Sub-total			Total
Market Value – September 30, 2020	$	72,782,213		$	333,761		$	28,555		$	362,316		$	73,144,529
Securities Sold		(5,094,462	)		–			–			–			(5,094,462	)
Losses on Sales		60,067			–			–			–			60,067
Return of Investment		n/a			(51,091	)		(2,371	)		(53,462	)		(53,462	)
Pay-downs		(2,686,403	)		n/a			n/a			n/a			(2,686,403	)
Premium Lost Due to Pay-downs		(334,727	)		n/a			n/a			n/a			(334,727	)
Mark to Market (Losses) Gains		175,356			(31,438	)		(1,227	)		(32,665	)		142,691
Market Value – December 31, 2020	$	64,902,044		$	251,232		$	24,957		$	276,189		$	65,178,233

The tables below present the allocation of capital between the respective portfolios at December 31, 2020 and September 30, 2020, and the return on invested capital for each sub-portfolio for the three month period ended December 31, 2020. Capital allocation is defined as the sum of the market value of securities held, less associated repurchase agreement borrowings, plus cash and cash equivalents and restricted cash associated with repurchase agreements. Capital allocated to non-portfolio assets is not included in the calculation.

The returns on invested capital in the PT MBS and structured MBS portfolios were approximately 5.0% and (9.3)%, respectively, for the fourth quarter of 2020. The combined portfolio generated a return on invested capital of approximately 4.4%.

Capital Allocation
				Structured Security Portfolio
	Pass-Through			Interest-Only			Inverse Interest
	Portfolio			Securities			Only Securities			Sub-total			Total
December 31, 2020
Market Value	$	64,902,044		$	251,232		$	24,957		$	276,189		$	65,178,233
Cash equivalents and restricted cash⁽¹⁾		10,910,342			–			–			–			10,910,342
Repurchase Agreement Obligations		(65,071,113	)		–			–			–			(65,071,113	)
Total⁽²⁾	$	10,741,273		$	251,232		$	24,957		$	276,189		$	11,017,462
% of Total		97.5	%		2.3	%		0.2	%		2.5	%		100.0	%
September 30, 2020
Market Value	$	72,782,213		$	333,761		$	28,555		$	362,316		$	73,144,529
Cash equivalents and restricted cash⁽¹⁾		7,089,067			–			–			–			7,089,067
Repurchase Agreement Obligations		(70,685,172	)		–			–			–			(70,685,172	)
Total⁽²⁾	$	9,186,108		$	333,761		$	28,555		$	362,316		$	9,548,424
% of Total		96.2	%		3.5	%		0.3	%		3.8	%		100.0	%

(1)	Amount excludes restricted cash of $1,015 and $1,075 at December 31, 2020 and September 30, 2020, respectively, related to trust preferred debt funding hedges.
(2)	Invested capital includes the value of the MBS portfolio and cash equivalents and restricted cash, reduced by repurchase agreement borrowings.

Returns for the Quarter Ended December 31, 2020
				Structured Security Portfolio
	Pass-Through			Interest-Only			Inverse Interest
	Portfolio			Securities			Only Securities			Sub-total			Total
Income (net of repo cost)	$	554,363		$	(2,601	)	$	1,642		$	(959	)	$	553,404
Realized and unrealized (losses) gains		(99,304	)		(31,438	)		(1,227	)		(32,665	)		(131,969	)
	$	455,059		$	(34,039	)	$	415		$	(33,624	)	$	421,435
Beginning Capital Allocation		9,186,108			333,761			28,555			362,316			9,548,424
Return on Invested Capital for the Quarter⁽¹⁾		5.0	%		(10.2	)%		1.5	%		(9.3	)%		4.4	%

(1)	Calculated by dividing the Total Return by the Beginning Capital Allocation, expressed as a percentage.

Prepayments

For the fourth quarter of 2020, the Company received approximately $2.7 million in scheduled and unscheduled principal repayments and prepayments, which equated to a constant prepayment rate (“CPR”) of approximately 14.4% for the fourth quarter of 2020. Prepayment rates on the two MBS sub-portfolios were as follows (in CPR):

	PT	Structured
	MBS Sub-	MBS Sub-	Total
Three Months Ended	Portfolio	Portfolio	Portfolio
December 31, 2020	12.8	24.5	14.4
September 30, 2020	13.0	32.0	15.8
June 30, 2020	12.4	25.0	15.3
March 31, 2020	11.6	18.1	13.7
December 31, 2019	15.6	15.6	15.6
September 30, 2019	9.5	16.2	10.5
June 30, 2019	9.9	14.6	10.5
March 31, 2019	5.7	13.4	6.8

Portfolio

The following tables summarize the MBS portfolio as of December 31, 2020 and 2019.

($ in thousands)
							Weighted
			Percentage				Average
			of		Weighted		Maturity
	Fair		Entire		Average		in	Longest
Asset Category	Value		Portfolio		Coupon		Months	Maturity
December 31, 2020
Fixed Rate MBS	$	64,902	99.6	%	3.89	%	333	1-Aug-50
Interest-Only Securities		251	0.4	%	3.56	%	299	15-Jul-48
Inverse Interest-Only Securities		25	0.0	%	5.84	%	221	15-May-39
Total Mortgage Assets	$	65,178	100.0	%	3.89	%	333	1-Aug-50
December 31, 2019
Fixed Rate MBS		216,231	99.3	%	4.25	%	316	1-Nov-49
Interest-Only Securities		1,024	0.4	%	3.65	%	281	15-Jul-48
Inverse Interest-Only Securities		586	0.3	%	4.77	%	254	25-Apr-41
Total Mortgage Assets	$	217,841	100.0	%	4.25	%	316	1-Nov-49



($ in thousands)
	December 31, 2020				December 31, 2019
			Percentage of				Percentage of
Agency	Fair Value		Entire Portfolio		Fair Value		Entire Portfolio
Fannie Mae	$	38,946	59.8	%	$	203,321	93.3	%
Freddie Mac		26,232	40.2	%		14,499	6.7	%
Ginnie Mae		–	0.0	%		21	0.0	%
Total Portfolio	$	65,178	100.0	%	$	217,841	100.0	%



Entire Portfolio	December 31, 2020		December 31, 2019
Weighted Average Pass Through Purchase Price	$	109.51	$	107.12
Weighted Average Structured Purchase Price	$	4.28	$	6.39
Weighted Average Pass Through Current Price	$	112.67	$	108.77
Weighted Average Structured Current Price	$	3.20	$	6.91
Effective Duration ⁽¹⁾		3.309		3.196

(1)

Effective duration of 3.309 indicates that an interest rate increase of 1.0% would be expected to cause a 3.309% decrease in the value of the MBS in the Company’s investment portfolio at December 31, 2020. An effective duration of 3.196 indicates that an interest rate increase of 1.0% would be expected to cause a 3.196% decrease in the value of the MBS in the Company’s investment portfolio at December 31, 2019. These figures include the structured securities in the portfolio but not the effect of the Company’s hedges. Effective duration quotes for individual investments are obtained from The Yield Book, Inc.

Financing, Leverage and Liquidity

As of December 31, 2020, the Company had outstanding repurchase obligations of approximately $65.1 million with a net weighted average borrowing rate of 0.25%. These agreements were collateralized by MBS with a fair value, including accrued interest, of approximately $65.4 million, and cash pledged to counterparties of approximately $3.4 million. At December 31, 2020, the Company’s liquidity was approximately $7.6 million, consisting of unpledged MBS and cash and cash equivalents.

We may pledge more of our structured MBS as part of a repurchase agreement funding, but retain cash in lieu of acquiring additional assets. In this way, we can, at a modest cost, retain higher levels of cash on hand and decrease the likelihood we will have to sell assets in a distressed market in order to raise cash. Below is a listing of outstanding borrowings under repurchase obligations at December 31, 2020.

($ in thousands)
Repurchase Agreement Obligations
					Weighted				Weighted
	Total				Average				Average
	Outstanding		% of		Borrowing		Amount		Maturity
Counterparty	Balances		Total		Rate		at Risk⁽¹⁾		(in Days)
Mirae Asset Securities (USA) Inc.	$	48,404	74.4	%	0.25	%	$	2,685	21
South Street Securities, LLC		7,302	11.2	%	0.30	%		409	133
Citigroup Global Markets, Inc.		6,038	9.3	%	0.23	%		335	19
JVB Financial Group, LLC		3,317	5.1	%	0.23	%		36	15
Mitsubishi UFJ Securities (USA), Inc.		10	0.0	%	0.65	%		110	13
	$	65,071	100.0	%	0.25	%	$	3,575	33

(1)	Equal to the fair value of securities sold plus accrued interest receivable and cash posted as collateral (if any), minus the sum of repurchase agreement liabilities and accrued interest payable.

Hedging

In connection with its interest rate risk management strategy, the Company economically hedges a portion of the cost of its repurchase agreement funding and also its junior subordinated notes by entering into derivative financial instrument contracts. The Company has not elected hedging treatment under U.S. generally accepted accounting principles (“GAAP”) in order to align the accounting treatment of its derivative instruments with the treatment of its portfolio assets under the fair value option election. As such all gains or losses on these instruments are reflected in earnings for all periods presented. As of December 31, 2020, such instruments were comprised entirely of Eurodollar futures contracts.

The table below presents information related to outstanding Eurodollar futures positions at December 31, 2020.

($ in thousands)

Junior Subordinated Debt Funding Hedges

Average

Weighted

Contract

Average

Notional

Entry

LIBOR

Open

Expiration Year

Amount

Rate

Equity⁽¹⁾

2021

1,000

1.02

0.18

)

(1)	Open equity represents the cumulative gains (losses) recorded on open futures positions.

Book Value Per Share

The Company’s Book Value Per Share at December 31, 2020 was $2.97. The Company computes Book Value Per Share by dividing total stockholders’ equity by the total number of shares outstanding of the Company’s Class A Common Stock. At December 31, 2020, the Company’s stockholders’ equity was $34.5 million with 11,608,555 Class A Common shares outstanding.

Summarized Financial Statements

The following is a summarized presentation of the unaudited consolidated balance sheets as of December 31, 2020, and 2019, and the unaudited consolidated statements of operations for the calendar quarters and years ended December 31, 2020 and 2019. Amounts presented are subject to change.



BIMINI CAPITAL MANAGEMENT, INC.
CONSOLIDATED BALANCE SHEETS
(Unaudited – Amounts Subject to Change)

	December 31, 2020		December 31, 2019
ASSETS
Mortgage-backed securities	$	65,178,231	$	217,840,953
Cash equivalents and restricted cash		10,911,357		12,385,117
Investment in Orchid Island Capital, Inc.		13,547,764		8,892,211
Accrued interest receivable		202,192		750,875
Deferred tax assets, net		34,668,467		33,288,536
Other assets		4,192,558		6,331,256
Total Assets	$	128,700,569	$	279,488,948

LIABILITIES AND EQUITY
Repurchase agreements	$	65,071,113	$	209,954,000
Junior subordinated notes		27,612,781		27,481,121
Other liabilities		1,528,826		2,076,836
Total Liabilities		94,212,720		239,511,957
Stockholders’ equity		34,487,849		39,976,991
Total Liabilities and Equity	$	128,700,569	$	279,488,948
Class A Common Shares outstanding		11,608,555		11,608,555
Book value per share	$	2.97	$	3.44



BIMINI CAPITAL MANAGEMENT, INC.
CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited – Amounts Subject to Change)

	Years Ended						Three Months Ended
	December 31,						December 31,
		2020			2019			2020			2019
Advisory services	$	6,795,072		$	6,907,910		$	1,825,929		$	1,855,659
Interest and dividend income		5,516,733			9,328,175			1,102,658			2,263,267
Interest expense		(2,224,141	)		(6,174,875	)		(300,470	)		(1,324,510	)
Net revenues		10,087,664			10,061,210			2,628,117			2,794,416
(Losses) gains		(10,279,321	)		(603,136	)		424,608			551,156
Expenses		6,666,901			6,439,709			1,660,107			1,614,336
Net (loss) income before income tax benefit		(6,858,558	)		3,018,365			1,392,618			1,731,236
Income tax benefit		(1,369,416	)		(10,281,612	)		(10,665,275	)		(11,223,976	)
Net (loss) income	$	(5,489,142	)	$	13,299,977		$	12,057,893		$	12,955,212

Basic and Diluted Net (loss) income Per Share of:
CLASS A COMMON STOCK	$	(0.47	)	$	1.09		$	1.04		$	1.11
CLASS B COMMON STOCK	$	(0.47	)	$	1.09		$	1.04		$	1.11



	Consolidated
	Three Months Ended December 31,
Key Balance Sheet Metrics		2020			2019
Average MBS⁽¹⁾	$	69,161,379		$	190,533,989
Average repurchase agreements⁽¹⁾		67,878,143			182,214,500
Average equity⁽¹⁾		28,458,902			33,499,385

Key Performance Metrics
Average yield on MBS⁽²⁾		3.45	%		3.99	%
Average cost of funds⁽²⁾		0.25	%		2.08	%
Average economic cost of funds⁽³⁾		3.88	%		0.96	%
Average interest rate spread⁽⁴⁾		3.20	%		1.91	%
Average economic interest rate spread⁽⁵⁾		(0.43	)%		3.03	%

(1)	Average MBS, repurchase agreements and stockholders’ equity balances are calculated using two data points, the beginning and ending balances.
(2)	Portfolio yields and costs of funds are calculated based on the average balances of the underlying investment portfolio/repurchase agreement balances and are annualized for the quarterly periods presented.
(3)	Represents interest cost of our borrowings and the effect of derivative agreements attributed to the period related to hedging activities, divided by average repurchase agreements.
(4)	Average interest rate spread is calculated by subtracting average cost of funds from average yield on MBS.
(5)	Average economic interest rate spread is calculated by subtracting average economic cost of funds from average yield on MBS.

About Bimini Capital Management, Inc.

Bimini Capital Management, Inc. is an asset manager that invests primarily in residential mortgage-related securities issued by the Federal National Mortgage Association (Fannie Mae), the Federal Home Loan Mortgage Corporation (Freddie Mac) and the Government National Mortgage Association (Ginnie Mae).

Through our wholly-owned subsidiary, Bimini Advisors Holdings, LLC (“Bimini Advisors”), we serve as the external manager of Orchid Island Capital, Inc. (“Orchid”). Orchid is a publicly-traded real estate investment trust (NYSE: ORC). Orchid is managed to earn returns on the spread between the yield on its assets and its costs, including the interest expense on the funds it borrows. As Orchid’s external manager, Bimini Advisors receives management fees and expense reimbursements for managing Orchid’s investment portfolio and day-to-day operations. Pursuant to the terms of the management agreement, Bimini Advisors provides Orchid with its management team, including its officers, along with appropriate support personnel. Bimini Advisors is at all times subject to the supervision and oversight of Orchid’s board of directors and has only such functions and authority as are delegated to it.

We also manage the portfolio of our wholly-owned subsidiary, Royal Palm Capital, LLC (“Royal Palm”). Royal Palm is managed with an investment strategy similar to that of Orchid. Bimini Capital Management, Inc. and its subsidiaries are headquartered in Vero Beach, Florida.

Forward Looking Statements

Statements herein relating to matters that are not historical facts are forward-looking statements as defined in the Private Securities Litigation Reform Act of 1995. The reader is cautioned that such forward-looking statements are based on information available at the time and on management’s good faith belief with respect to future events, and are subject to risks and uncertainties that could cause actual performance or results to differ materially from those expressed in such forward-looking statements. Important factors that could cause such differences are described in Bimini Capital Management, Inc.’s filings with the Securities and Exchange Commission, including Bimini Capital Management, Inc.’s most recent Annual Report on Form 10-K and Quarterly Reports on Form 10-Q. Bimini Capital Management, Inc. assumes no obligation to update forward-looking statements to reflect subsequent results, changes in assumptions or changes in other factors affecting forward-looking statements.

Earnings Conference Call Details

An earnings conference call and live audio webcast will be hosted Friday, March 12, 2021, at 10:00 AM ET. Participants can receive dial-in information via email by following the link:

https://www.incommglobalevents.com/registration/client/6953/bimini-capital-management-fourth-quarter-2020-earnings-call/

A live audio webcast of the conference call can be accessed via the investor relations section of the Company’s website at www.ir.biminicapital.com, and an audio archive of the webcast will be available for approximately one year.

View source version on businesswire.com: https://www.businesswire.com/news/home/20210311006005/en/

Bimini Capital Management, Inc.

Robert E. Cauley, 772-231-1400

Chairman and Chief Executive Officer

www.biminicapital.com

KEYWORDS: United States North America Florida

INDUSTRY KEYWORDS: Professional Services Residential Building & Real Estate Finance Construction & Property REIT Banking

MEDIA:

Logo

March 11, 2021 4:13 pm

Homology Medicines Reports Fourth Quarter and Full Year 2020 Financial Results and Recent Highlights

– Phase 2 PKU Gene Therapy Trial Recruiting Patients With Initial Data Expected by Year End –

– On Track to Initiate Phase 1/2 Trials With

In Vivo

Gene Editing Candidate for PKU and Gene Therapy Candidate for Hunter Syndrome This Year –

– Plans to Name a New Development Candidate in 2021 That Leverages the Potential of the AAVHSC Platform to Target Larger Disease Areas –

BEDFORD, Mass., March 11, 2021 (GLOBE NEWSWIRE) — Homology Medicines, Inc. (Nasdaq: FIXX), a clinical-stage genetic medicines company, announced today financial results for the fourth quarter and full year ended December 31, 2020, and highlighted recent accomplishments.

“In 2020, we remained focused on our mission, proactive in our preparations and successfully advanced our genetic medicines platform to meet our goals,” stated Arthur Tzianabos, Ph.D., President and Chief Executive Officer of Homology Medicines. “We ended the year with positive data from the dose-escalation phase of our pheNIX PKU gene therapy clinical trial and a subsequent $60 million equity investment from Pfizer. We also leveraged the potential of our fully characterized family of 15 AAVHSC vectors to expand our portfolio with an in vivo gene therapy development candidate for Hunter syndrome, which is differentiated from other available treatments and those in development. Our focus on internal manufacturing, which led us to be one of the first companies to scale to a 2,000-liter bioreactor, has continued to support our clinical and preclinical programs.”

Dr. Tzianabos added, “As we announced in early January, we have started 2021 off with ambitious plans to have three programs in the clinic this year, including our ongoing pheNIX PKU gene therapy trial and anticipated Phase 1/2 clinical trial initiations in PKU, with our first gene editing candidate, and Hunter syndrome, with our gene therapy candidate. The pheNIX clinical trial sites are actively recruiting at multiple PKU centers across the U.S., and we anticipate reporting data by year’s end. Additionally, we look forward to naming a development candidate in a new therapeutic area this year, demonstrating the broader capability of our AAVHSC platform, which may allow us to tackle diseases with larger patient populations in the future.”

Fourth Quarter 2020 and Recent Accomplishments

Outlined plans to have three clinical programs during 2021, including:
- Advancing Homology’s pheNIX clinical trial for adults with phenylketonuria (PKU), the world’s first PKU gene therapy clinical trial, with initial data from the Phase 2 randomized, concurrently controlled, dose expansion phase of the trial expected this year. This has the potential to be converted to a registrational trial.
- Plans to initiate two additional Phase 1/2 dose-escalation trials; one with Homology’s first gene editing candidate, HMI-103, which is for PKU, and one with HMI-203, Homology’s gene therapy candidate for Hunter syndrome.
Announced plans to unveil a development candidate in a new therapeutic area, unlocking the potential of the AAVHSC platform to target diseases with larger patient populations.
Presented the first data from IND-enabling studies with HMI-203 at the 17^th Annual WORLDSymposium™ Meeting. A single I.V. administration of HMI-203 in the adult murine model of Hunter syndrome:
- Led to robust biodistribution and sustained human I2S enzyme expression, which resulted in:
  - Significant reductions in key Hunter syndrome biomarkers of heparan sulfate glycosaminoglycans (GAGs) and lysosomal-associated membrane protein 1 (LAMP1) in the brain, liver, heart, spleen, lung and kidneys compared with vehicle.
  - Significant reductions in heparan sulfate GAGs in the cerebrospinal fluid (CSF) compared with vehicle.
- Ameliorated paw deformities, as shown by significant changes in measurements of ankle depth and width and paw depth and width, compared with vehicle.
- Led to uptake of human I2S from the serum of the HMI-203-treated model in human cell lines, demonstrating potential for cell cross-correction.
Shared long-term preclinical data with Homology’s HMI-202 in vivo gene therapy program for metachromatic leukodystrophy (MLD), which showed a single I.V. administration:
- Crossed the blood-brain barrier and blood-nerve barrier in the murine MLD disease model and in non-human primates (NHPs), with human ARSA (hARSA) detected in neuronal and glial cells.
- Showed durable hARSA activity in the central nervous system of the disease model, with distribution levels resembling those of Arsa in normal age-matched controls.
- Demonstrated significant changes in key MLD biomarkers of LAMP1, glial fibrillary acidic protein (GFAP), MAL transcript and neuronal sulfatides in the disease model compared with vehicle, similar to age-matched wild type controls.
Announced a $60 million equity investment from Pfizer Inc. with the purchase of 5,000,000 shares of common stock at a price of $12.00 per share, which closed on November 9, 2020. The investment includes a right of first refusal on potential future transactions involving PKU programs: HMI-102 gene therapy and HMI-103 gene editing.
Presented at the EveryLife Foundation for Rare Diseases 2020 Scientific Workshop on innovative strategies and potential advantages and outcomes of implementing home health services in the first-ever PKU gene therapy clinical trial during the pandemic.
Supported National PKU Alliance’s (NPKUA) #wearblueforPKU2020 campaign for PKU Awareness Day, and partnered with TinySuperheroes, an organization that empowers children overcoming an illness or disability, in recognition of Rare Disease Day 2021.
Regained worldwide exclusive rights from Novartis to research, develop, manufacture and commercialize Homology’s proprietary nuclease-free gene editing technology platform for an ophthalmic target. The companies believe studies conducted under the collaboration provide early proof-of-principle and support a nuclease-independent approach to editing of relevant cell types in the eye after sub-retinal injection. Results of the studies are the subject of a planned presentation at an upcoming scientific meeting.

Fourth Quarter 2020 and Full Year Financial Results

Net loss for the quarter ended December 31, 2020 was $(29.8) million or $(0.62) per share, compared to a net loss of $(24.2) million or $(0.55) per share for the same period in 2019. Net loss for the year ended December 31, 2020 was $(128.7) million or $(2.80) per share, compared to a net loss of $(103.9) million or $(2.47) per share for the same period in 2019.
Collaboration revenues for the three and twelve months ended December 31, 2020 were $1.0 million and $2.7 million, respectively, as compared to $0.6 million and $1.7 million for the comparable periods in 2019. Collaboration revenues consisted primarily of revenue recognized under the Company’s strategic collaboration with Novartis, which Novartis decided to conclude in February 2021 following a portfolio review. Also included in collaboration revenues is revenue recognized under the Company’s stock purchase agreement with Pfizer.
Total operating expenses for the three and twelve months ended December 31, 2020 were $30.8 million and $133.0 million, respectively, as compared to $26.1 million and $111.6 million for the comparable periods in 2019, and consisted of research and development expenses and general and administrative expenses.
Research and development expenses for the three and twelve months ended December 31, 2020 were $23.2 million and $100.4 million, respectively, as compared to $20.3 million and $89.4 million for the comparable periods in 2019. Research and development expenses increased due to a rise in direct research expenses, including costs incurred with Homology’s contract research organization (CRO) to conduct and manage the Phase 1/2 pheNIX clinical trial with HMI-102, costs related to manufacturing clinical trial materials and direct research expenses related to advancing the Company’s other development-stage programs, including HMI-203 for Hunter syndrome and increased personnel costs to support ongoing development programs, research initiatives, technology platform and manufacturing capabilities.
General and administrative expenses for the three and twelve months ended December 31, 2020 were $7.6 million and $32.6 million, respectively, as compared to $5.8 million and $22.2 million for the comparable periods in 2019. General and administrative expenses increased due to personnel costs as a result of new hires, increased audit and legal costs and increased costs associated with expanded operations.
As of December 31, 2020, Homology had approximately $217.4 million in cash, cash equivalents and short-term investments. Based on current projections, Homology expects cash resources to fund operations into the third quarter of 2022.

Upcoming Events

Project Alive – Presentation on HMI-203 gene therapy program for Hunter syndrome: March 20
Guggenheim Healthcare Talks Genomic Medicines and Rare Disease Day: April 1
20^th Annual Needham Virtual Healthcare Conference: April 12-15
American College of Medical Genetics and Genomics (ACMG) Annual Clinical Genetics Meeting – Presentations on pheNIX gene therapy clinical trial and HMI-203 gene therapy program: April 13-16
5^th Annual Chardan Genetic Medicines Manufacturing Summit: April 26-27
Association for Research in Vision and Ophthalmology (ARVO) 2021 Annual Meeting – Presentation on biodistribution of AAVHSCs and gene editing in ophthalmology research: May 1-7
Bank of America Merrill Lynch Health Care Conference: May 11-13
American Society of Gene & Cell Therapy (ASGCT) 24^th Annual Meeting: May 12-15
RBC Capital Markets Healthcare Conference: May 18-19

About Homology Medicines, Inc.

Homology Medicines, Inc. is a clinical-stage genetic medicines company dedicated to transforming the lives of patients suffering from rare genetic diseases with significant unmet medical needs by curing the underlying cause of the disease. Homology’s proprietary platform is designed to utilize its human hematopoietic stem cell-derived adeno-associated virus vectors (AAVHSCs) to precisely and efficiently deliver genetic medicines in vivo either through a gene therapy or nuclease-free gene editing modality across a broad range of genetic disorders. Homology has a management team with a successful track record of discovering, developing and commercializing therapeutics with a particular focus on rare diseases. The Company’s intellectual property covers its family of 15 AAVHSCs. Homology believes that its compelling preclinical data, scientific expertise, product development strategy, manufacturing capabilities and intellectual property position it as a leader in the development of genetic medicines. For more information, please visit www.homologymedicines.com.

Forward-Looking Statements

This press release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. All statements contained in this press release that do not relate to matters of historical fact should be considered forward-looking statements, including without limitation statements regarding our expectations surrounding the potential, safety, efficacy, and regulatory and clinical progress of our product candidates; our plans to name a development candidate in a new therapeutic area and potential thereof; plans and timing for the release of additional preclinical and clinical data; our beliefs regarding our manufacturing capabilities; our position as a leader in the development of genetic medicines; the sufficiency of our cash and cash equivalents to fund our operations; and our participation in upcoming presentations and conferences. These statements are neither promises nor guarantees, but involve known and unknown risks, uncertainties and other important factors that may cause our actual results, performance or achievements to be materially different from any future results, performance or achievements expressed or implied by the forward-looking statements, including, but not limited to, the following: the impact of the COVID-19 pandemic on our business and operations, including our preclinical studies and clinical trials, and on general economic conditions; we have and expect to continue to incur significant losses; our need for additional funding, which may not be available; failure to identify additional product candidates and develop or commercialize marketable products; the early stage of our development efforts; potential unforeseen events during clinical trials could cause delays or other adverse consequences; risks relating to the capabilities of our manufacturing facility; risks relating to the regulatory approval process; our product candidates may cause serious adverse side effects; inability to maintain our collaborations, or the failure of these collaborations; our reliance on third parties; failure to obtain U.S. or international marketing approval; ongoing regulatory obligations; effects of significant competition; unfavorable pricing regulations, third-party reimbursement practices or healthcare reform initiatives; product liability lawsuits; failure to attract, retain and motivate qualified personnel; the possibility of system failures or security breaches; risks relating to intellectual property and significant costs as a result of operating as a public company. These and other important factors discussed under the caption “Risk Factors” in our Annual Report on Form 10-K for the year ended December 31, 2020 and our other filings with the SEC could cause actual results to differ materially from those indicated by the forward-looking statements made in this press release. Any such forward-looking statements represent management’s estimates as of the date of this press release. While we may elect to update such forward-looking statements at some point in the future, we disclaim any obligation to do so, even if subsequent events cause our views to change.

– Financial Tables Follow –


HOMOLOGY MEDICINES, INC.
CONSOLIDATED STATEMENTS OF OPERATIONS
(in thousands, except share and per share amounts)

	For the Three Months Ended December 31,						For the Years Ended December 31,
		2020			2019			2020			2019

	(unaudited)
Collaboration revenue	$	980		$	563		$	2,702		$	1,666
Operating expenses:
Research and development		23,195			20,342			100,392			89,398
General and administrative		7,587			5,780			32,573			22,211
Total operating expenses		30,782			26,122			132,965			111,609
Loss from operations		(29,802	)		(25,559	)		(130,263	)		(109,943	)
Other income:
Interest income		11			1,392			1,569			6,027
Total other income		11			1,392			1,569			6,027
Net loss	$	(29,791	)	$	(24,167	)	$	(128,694	)	$	(103,916	)
Net loss per share-basic and diluted	$	(0.62	)	$	(0.55	)	$	(2.80	)	$	(2.47	)
Weighted-average common shares outstanding-basic and diluted		48,112,174			44,077,777			45,910,787			42,117,690


HOMOLOGY MEDICINES, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
(in thousands)

	December 31,
		2020		2019

Cash, cash equivalents and short-term investments	$	217,431	$	262,388
Property and equipment, net		37,002		42,716
Right-of-use assets		5,897		—
Other assets		3,407		5,463
Total assets	$	263,737	$	310,567

Accounts payable, accrued expenses and other liabilities	$	14,525	$	21,109
Operating lease liabilities		2,501		—
Operating lease liabilities, net of current portion		12,941		—
Deferred revenue		37,775		30,951
Stockholders’ equity		195,995		258,507
Total liabilities and stockholders’ equity	$	263,737	$	310,567

Company Contacts

Theresa McNeely
Chief Communications Officer
and Patient Advocate
[email protected]
781-301-7277

Media Contact:

Marisa Citrano
Senior Corporate Communications Associate
[email protected]
617-335-2841

March 11, 2021 4:13 pm

Catabasis Pharmaceuticals Reports Fourth Quarter and Full Year 2020 Financial Results and Provides a Corporate Update

Catabasis Pharmaceuticals Reports Fourth Quarter and Full Year 2020 Financial Results and Provides a Corporate Update

— Recently Completed Acquisition of Quellis Biosciences Includes QLS-215, a Potential Best-in-Class Monoclonal Antibody Inhibitor of Plasma Kallikrein in Preclinical Development for the Treatment of Hereditary Angioedema —

— Proceeds from $110M Private Placement Planned to Complete IND-Enabling Studies, Phase 1a and Phase 1b/2 Clinical Trials of QLS-215 —

BOSTON–(BUSINESS WIRE)–Catabasis Pharmaceuticals, Inc. (NASDAQ:CATB), a biopharmaceutical company, today reported financial results for the fourth quarter and full year ended December 31, 2020 and provided a corporate update.

“With our acquisition of Quellis and concurrent financing, we believe Catabasis is well positioned to advance the development of our lead program, QLS-215, as a differentiated and potential best-in-class new therapy for the chronic treatment of patients affected by hereditary angioedema to prevent attacks,” said Jill C. Milne, Ph.D., Chief Executive Officer of Catabasis. “QLS-215 is a monoclonal antibody inhibitor of plasma kallikrein in preclinical development, which we believe has the potential to demonstrate clinical proof of concept of its differentiated profile in Phase 1. Our mission has always been to bring hope with life-changing therapies to patients and their families affected by rare disease.”

QLS-215 for the Treatment of Hereditary Angioedema (HAE)

The vision for the lead program, QLS-215, is to develop the best-in-class monoclonal antibody inhibitor of plasma kallikrein for HAE with infrequent dosing and sustained inhibitory blood levels. HAE is a rare, debilitating and potentially life-threatening disease in which plasma kallikrein is a critical component that triggers a cascade of pathologic vascular permeability, vasodilation and ultimately excessive tissue swelling.
QLS-215 is a humanized monoclonal antibody targeting plasma kallikrein that has demonstrated potent inhibition of plasma kallikrein as well as an extended plasma half-life in non-human primates.
Catabasis expects to file an Investigational New Drug application for QLS-215 in the first half of 2022 and plans to initiate a Phase 1a clinical trial with initial results anticipated by the end of 2022. Subsequently, Catabasis expects to initiate a Phase 1b/2 trial in patients affected by HAE in 2023 with initial results anticipated by the end of 2023.

Acquisition of Quellis Biosciences

In January 2021, Catabasis acquired Quellis Biosciences Inc. in a stock-for-stock transaction whereby all outstanding equity interests of Quellis were exchanged in a merger for a combination of shares of Catabasis common stock and shares of Series X Preferred Stock.

Private Placement Financing

Concurrent with the acquisition of Quellis, Catabasis entered into definitive agreements for a private placement with institutional accredited investors to raise approximately $110 million before deducting placement agent and other offering expenses, through the issuance of shares of Series X Preferred Stock. The private placement closed on February 1, 2021.
The financing was led by Perceptive Advisors, with participation from Fairmount Funds Management LLC, RA Capital Management, Cormorant Asset Management, Venrock Healthcare Capital Partners, Logos Capital, Boxer Capital, Acorn Bioventures, Commodore Capital, Surveyor Capital (a Citadel company), Acuta Capital Partners, Sphera Healthcare, and Serrado Capital LLC.

Capital Structure

After the acquisition of Quellis and the private placement, Catabasis had approximately 23.4 million shares of common stock and approximately 86,000 shares of non-voting Series X Preferred Stock outstanding. Subject to stockholder approval, each share of Series X Preferred Stock is convertible into 1,000 shares of Catabasis common stock. If such conversion is approved by our stockholders, each share of Series X Preferred Stock will automatically convert into 1,000 shares of Catabasis common stock, subject to certain beneficial ownership limitations set by each holder not to exceed 19.99%. On a post-conversion basis, common shares outstanding will be approximately 109.5 million. Catabasis expects to seek stockholder approval at its 2021 Annual Meeting of Stockholders, which Catabasis has scheduled for June 2, 2021.

Fourth Quarter and Full Year 2020 Financial Results

Cash Position: As of December 31, 2020, Catabasis had cash, cash equivalents and short-term investments of $44.9 million, compared to $52.9 million as of September 30, 2020. Following December 31, 2020, Catabasis raised an additional $110 million in gross proceeds from a private placement financing, which resulted in approximately $104 million in net proceeds after deducting placement agent and other offering expenses. Assuming approval of the Preferred Stock conversion, the Company expects that it has sufficient cash to fund its current operating plan through 2023. Net cash used in operating activities for the three months ended December 31, 2020 was $8.1 million, compared to $7.8 million for the three months ended December 31, 2019. Net cash used in operating activities for the full year 2020 was $32.5 million, compared to $26.6 million for the full year 2019.

R&D Expenses: Research and development expenses were $5.7 million for the three months ended December 31, 2020, compared to $4.3 million for the three months ended December 31, 2019 and $25.6 million for the full year 2020, compared to $18.3 million for the full year 2019.

G&A Expenses: General and administrative expenses were $3.2 million for the three months ended December 31, 2020, compared to $2.5 million for the three months ended December 31, 2019 and $11.9 million for the full year 2020, compared to $8.8 million for the full year 2019.

Operating Loss: Loss from operations was $9.0 million for the three months ended December 31, 2020, compared to $6.7 million for the three months ended December 31, 2019 and $37.4 million for the full year 2020, compared to $27.1 million for the full year 2019.

Net Loss: Net loss was $9.0 million, or $0.45 per share, for the three months ended December 31, 2020, compared to a net loss of $6.6 million, or $0.55 per share, for the three months ended December 31, 2019 and $37.3 million, or $2.03 per share, for the full year 2020, compared to $26.3 million, or $2.35 per share, for the full year 2019.

About Catabasis

At Catabasis Pharmaceuticals, our mission is to bring hope with life-changing therapies to patients and families affected by rare diseases. Our lead program, QLS-215, is a potential best-in-class monoclonal antibody inhibitor of plasma kallikrein in preclinical development for the treatment of Hereditary Angioedema.

Forward Looking Statements

This press release contains forward-looking statements within the meaning of applicable securities laws and regulations including, but not limited to, statements regarding: the Company’s projected cash runway; expectations regarding the timing for the filing of an IND and commencement and completion of clinical trials for QLS-215; the potential attributes of QLS-215; future product development plans; and stockholder approval of the conversion rights of the Series X preferred stock. The use of words such as, but not limited to, “anticipate,” “believe,” “continue,” “could,” “estimate,” “expect,” “intend,” “may,” “might,” “plan,” “potential,” “predict,” “project,” “should,” “target,” “will,” or “would” and similar words expressions are intended to identify forward-looking statements. Forward-looking statements are neither historical facts nor assurances of future performance. Instead, they are based on our current beliefs, expectations and assumptions regarding the future of our business, future plans and strategies, our clinical results and other future conditions. Actual results may differ materially from those indicated by such forward-looking statements as a result of various important factors, including risks and uncertainties: related to the Company’s ability to recognize the anticipated benefits of the Quellis acquisition; the outcome of any legal proceedings that may be instituted against the Company or Quellis following the announcement of the Quellis acquisition and related transactions; costs related to the Quellis acquisition; changes in applicable laws or regulations; the possibility that the Company may be adversely affected by other economic, business, and/or competitive factors, including the COVID-19 pandemic; risks inherent in pharmaceutical research and development, such as: adverse results in our drug discovery, preclinical and clinical development activities, the risk that the results of pre-clinical studies may not be replicated in clinical studies, our ability to enroll patients in our clinical trials, and the risk that any of our clinical trials may not commence, continue or be completed on time, or at all; decisions made by the U.S. FDA and other regulatory authorities, investigational review boards at clinical trial sites and other review bodies with respect to QLS-215 and any future product candidates; our ability to manufacture sufficient quantities of drug substance and drug product on a cost-effective and timely basis; our ability to obtain, maintain and enforce intellectual property rights for QLS-215 and any other future product candidates; competition; our ability to manage our cash usage and the possibility of unexpected cash expenditures; our ability to obtain necessary financing to conduct our planned activities and to manage unplanned cash requirements; our ability to obtain stockholder approval of the conversion rights of the Series X preferred stock within six months of the closing of the Quellis acquisition, which, if we are unable to obtain, would trigger the rights of such stockholders to require repayment, in cash, for the shares of common stock underlying their shares of Series X Preferred Stock at their then fair market value; general economic and market conditions; as well as the risks and uncertainties set forth under the caption “Risk Factors” in the Company’s most recent Annual Report on Form 10-K filed with the SEC, as well as discussions of potential risks, uncertainties, and other important factors in our subsequent filings with the SEC. New risks and uncertainties may emerge from time to time, and it is not possible to predict all risks and uncertainties. We may not actually achieve the forecasts or expectations disclosed in our forward-looking statements, and you should not place undue reliance on our forward-looking statements. Neither we, nor our affiliates, advisors or representatives, undertake any obligation to publicly update or revise any forward-looking statement, whether as result of new information, future events or otherwise, except as required by law. These forward-looking statements should not be relied upon as representing our views as of any date subsequent to the date hereof.

Catabasis Pharmaceuticals, Inc. Consolidated Statements of Operations (In thousands, except share and per share data) (Audited)

	Year Ended December 31,
	2020			2019

Operating expenses:
Research and development	$	25,590		$	18,317
General and administrative		11,845			8,771
Total operating expenses		37,435			27,088
Loss from operations		(37,435	)		(27,088	)
Other income (expense):
Interest and investment income		236			845
Other expense, net		(101	)		(50	)
Total other income, net		135			795
Net loss	$	(37,300	)	$	(26,293	)
Net loss per share – basic and diluted	$	(2.03	)	$	(2.35	)
Weighted-average common shares outstanding used in net loss per share – basic and diluted		18,351,470			11,199,057

Catabasis Pharmaceuticals, Inc. Selected Consolidated Balance Sheets Data (In thousands) (Audited)

	December 31,		December 31,
	2020		2019
Assets
Cash and cash equivalents	$	24,930	$	9,899
Short-term investments		20,000		26,345
Right-of-use asset		966		2,349
Other current and long-term assets		1,560		3,187
Total assets		47,456		41,780
Liabilities and stockholders’ equity
Current portion of operating lease liabilities		649		1,225
Long-term portion of operating lease liabilities		397		1,028
Other current and long-term liabilities		5,741		3,807
Total liabilities		6,787		6,060
Total stockholders’ equity	$	40,669	$	35,720

Catabasis Pharmaceuticals, Inc. Selected Consolidated Statements of Cash Flows Data (In thousands) (Audited)

	Year Ended December 31,
	2020	2019
Net cash used in operating activities	$ (32,485)	$ (26,569)
Net cash provided by (used in) investing activities	6,300	(4,082)
Net cash provided by financing activities	40,860	25,620
Net increase (decrease) in cash, cash equivalents and restricted cash	$ 14,675	$ (5,031)

View source version on businesswire.com: https://www.businesswire.com/news/home/20210311005964/en/

Catabasis Contacts:

Investor relations:

Andrea Matthews

[email protected]

Media:

Elizabeth Higgins

[email protected]

KEYWORDS: Massachusetts United States North America

INDUSTRY KEYWORDS: Science Other Science Biotechnology Research Pharmaceutical Health Clinical Trials Other Health

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