2024 Q3 Form 10-Q Financial Statement

#000121390024067732 Filed on August 12, 2024

View on sec.gov

Income Statement

Concept 2024 Q3 2024 Q2 2023 Q2
Revenue
YoY Change
Cost Of Revenue
YoY Change
Gross Profit
YoY Change
Gross Profit Margin
Selling, General & Admin $7.870M $4.907M
YoY Change 60.38% 21.82%
% of Gross Profit
Research & Development $2.764M $3.765M
YoY Change -26.58% -22.98%
% of Gross Profit
Depreciation & Amortization $270.00 $630.00
YoY Change -57.14% -13.7%
% of Gross Profit
Operating Expenses $10.63M $8.672M
YoY Change 22.63% -2.74%
Operating Profit -$10.63M -$8.672M
YoY Change 22.63% -2.74%
Interest Expense $204.8K $336.8K
YoY Change -39.18%
% of Operating Profit
Other Income/Expense, Net $204.8K $336.8K
YoY Change -39.18%
Pretax Income -$10.43M -$8.335M
YoY Change 25.12% -5.96%
Income Tax $144.0K $144.0K
% Of Pretax Income
Net Earnings -$10.57M -$8.479M
YoY Change 24.7% -4.34%
Net Earnings / Revenue
Basic Earnings Per Share -$0.06
Diluted Earnings Per Share -$0.06 -$0.06
COMMON SHARES
Basic Shares Outstanding 180.7M shares 180.7M shares 158.9M shares
Diluted Shares Outstanding 173.9M shares 153.8M shares

Balance Sheet

Concept 2024 Q3 2024 Q2 2023 Q2
SHORT-TERM ASSETS
Cash & Short-Term Investments $17.91M $33.28M
YoY Change -46.18% -30.73%
Cash & Equivalents $17.91M $33.28M
Short-Term Investments
Other Short-Term Assets $10.09M $7.832M
YoY Change 28.88% 180.7%
Inventory
Prepaid Expenses $10.09M $7.832M
Receivables
Other Receivables
Total Short-Term Assets $28.01M $41.11M
YoY Change -31.88% -19.12%
LONG-TERM ASSETS
Property, Plant & Equipment $2.010K
YoY Change -58.39%
Goodwill $9.347M $9.347M
YoY Change 0.0% 0.0%
Intangibles
YoY Change
Long-Term Investments
YoY Change
Other Assets $38.06K $38.06K
YoY Change 0.0% 0.0%
Total Long-Term Assets $69.08M $69.29M
YoY Change -0.3% -0.27%
TOTAL ASSETS
Total Short-Term Assets $28.01M $41.11M
Total Long-Term Assets $69.08M $69.29M
Total Assets $97.09M $110.4M
YoY Change -12.06% -8.24%
SHORT-TERM LIABILITIES
YoY Change
Accounts Payable $1.663M $3.080M
YoY Change -45.99% 82.17%
Accrued Expenses $550.5K $892.9K
YoY Change -38.35% -31.38%
Deferred Revenue
YoY Change
Short-Term Debt $0.00 $0.00
YoY Change
Long-Term Debt Due
YoY Change
Total Short-Term Liabilities $4.152M $5.791M
YoY Change -28.3% 29.81%
LONG-TERM LIABILITIES
Long-Term Debt $0.00 $0.00
YoY Change
Other Long-Term Liabilities $84.43K $320.0K
YoY Change -73.62% -39.95%
Total Long-Term Liabilities $84.43K $320.0K
YoY Change -73.62% -39.95%
TOTAL LIABILITIES
Total Short-Term Liabilities $4.152M $5.791M
Total Long-Term Liabilities $84.43K $320.0K
Total Liabilities $10.81M $12.10M
YoY Change -10.73% 21.29%
SHAREHOLDERS EQUITY
Retained Earnings -$190.6M -$152.3M
YoY Change 25.14% 25.14%
Common Stock $180.7K $158.9K
YoY Change 13.77% 8.71%
Preferred Stock
YoY Change
Treasury Stock (at cost)
YoY Change
Treasury Stock Shares
Shareholders Equity $85.68M $97.70M
YoY Change
Total Liabilities & Shareholders Equity $97.09M $110.4M
YoY Change -12.06% -8.24%

Cashflow Statement

Concept 2024 Q3 2024 Q2 2023 Q2
OPERATING ACTIVITIES
Net Income -$10.57M -$8.479M
YoY Change 24.7% -4.34%
Depreciation, Depletion And Amortization $270.00 $630.00
YoY Change -57.14% -13.7%
Cash From Operating Activities -$8.367M -$9.583M
YoY Change -12.68% 24.25%
INVESTING ACTIVITIES
Capital Expenditures
YoY Change
Acquisitions
YoY Change
Other Investing Activities
YoY Change
Cash From Investing Activities
YoY Change
FINANCING ACTIVITIES
Cash Dividend Paid
YoY Change
Common Stock Issuance & Retirement, Net
YoY Change
Debt Paid & Issued, Net
YoY Change
Cash From Financing Activities 13.72M 13.80M
YoY Change -0.58%
NET CHANGE
Cash From Operating Activities -8.367M -9.583M
Cash From Investing Activities
Cash From Financing Activities 13.72M 13.80M
Net Change In Cash 5.352M 4.216M
YoY Change 26.93% -154.67%
FREE CASH FLOW
Cash From Operating Activities -$8.367M -$9.583M
Capital Expenditures
Free Cash Flow
YoY Change

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<p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><b>1. NATURE OF OPERATIONS, BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES</b></p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"> </p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><b><i>Business</i></b></p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"> </p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">Citius Pharmaceuticals, Inc. (“Citius Pharma,” and together with its subsidiaries, the “Company,” “we” or “us”) is a late-stage biopharmaceutical company dedicated to the development and commercialization of first-in-class critical care products with a focus on oncology, anti-infectives in adjunct cancer care, unique prescription products and stem cell therapies.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"> </p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">On March 30, 2016, Citius Pharma acquired Leonard-Meron Biosciences, Inc. (“LMB”) as a wholly-owned subsidiary by issuing shares of its common stock.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"> </p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">On September 11, 2020, we formed NoveCite, Inc. (“NoveCite”), a Delaware corporation, of which we own 75% (7,500,000 shares) of the issued and outstanding capital stock (see Note 3).</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"> </p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">On August 23, 2021, we formed Citius Oncology, Inc. (formerly named Citius Acquisition Corp.) (“Citius Oncology”), as a wholly-owned subsidiary in conjunction with the acquisition of LYMPHIR, which began operations in April 2022. On October 23, 2023, Citius Pharma and Citius Oncology entered into an agreement and plan of merger and reorganization with TenX Keane Acquisition, and its wholly owned subsidiary, TenX Merger Sub Inc., whereby TenX Merger Sub Inc. will merge with and into Citius Oncology, with Citius Oncology surviving as a wholly owned subsidiary of TenX Keane Acquisition. The newly combined publicly traded company is to be named “Citius Oncology, Inc.” (see Note 9). </p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"> </p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">An inactive subsidiary, Citius Pharmaceuticals, LLC, was dissolved on December 29, 2023.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"> </p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">In-process research and development (“IPR&amp;D”) consists of (i) the $19,400,000 acquisition value of LMB’s drug candidate Mino-Lok®, which is an antibiotic solution used to treat catheter-related bloodstream infections and is expected to be amortized on a straight-line basis over a period of eight years commencing upon revenue generation, and (ii) the $40,000,000 acquisition value of the exclusive license for LYMPHIR (denileukin diftitox), which is a late-stage oncology immunotherapy for the treatment of cutaneous T-cell lymphoma (CTCL), a rare form of non-Hodgkin lymphoma, and is expected to be amortized on a straight-line basis over a period of twelve years commencing upon revenue generation.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"> </p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">Goodwill of $9,346,796 represents the value of LMB’s industry relationships and its assembled workforce. Goodwill will not be amortized but will be tested at least annually for impairment.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"> </p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">Since our inception, we have devoted substantially all our efforts to business planning, research and development, recruiting management and technical staff, and raising capital. We are subject to a number of risks common to companies in the pharmaceutical industry including, but not limited to, risks related to the development by Citius Pharma or its competitors of research and development stage products, regulatory approval and market acceptance of its products, competition from larger companies, dependence on key personnel, dependence on key suppliers and strategic partners, the Company’s ability to obtain additional financing and the Company’s compliance with governmental and other regulations.</p><p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"> </p><p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><b><i>Basis of Presentation and Summary of Significant Accounting Policies</i></b></p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"> </p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><i>Basis of Preparation </i>— The accompanying unaudited condensed consolidated financial statements include the operations of Citius Pharmaceuticals, Inc., and its wholly-owned subsidiaries, LMB and Citius Oncology, and its majority-owned subsidiary NoveCite. NoveCite began operations in October 2020 and Citius Oncology began operations in April 2022. All significant inter-company balances and transactions have been eliminated in consolidation.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"> </p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">The accompanying unaudited condensed consolidated financial statements of the Company have been prepared on the same basis as the annual consolidated financial statements and, in the opinion of management, reflect all adjustments, which include only normal recurring adjustments, necessary to fairly state the condensed consolidated financial position of the Company as of June 30, 2024, and the results of its operations and cash flows for the three- and nine-month periods ended June 30, 2024 and 2023. The operating results for the three- and nine-month periods ended June 30, 2024 are not necessarily indicative of the results that may be expected for the year ending September 30, 2024. These unaudited condensed consolidated financial statements should be read in conjunction with the audited consolidated financial statements and notes thereto included in the Company’s Annual Report on Form 10-K for the fiscal year ended September 30, 2023 filed with the Securities and Exchange Commission (“SEC”) on December 29, 2023.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"> </p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><i>Use of Estimates </i>— Our accounting principles require our management to make estimates and assumptions that affect the reported amounts of assets and liabilities and the disclosure of assets and liabilities at the date of the financial statements, and reported amounts of revenues and expenses during the reporting period. Estimates having relatively higher significance include the accounting for in-process research and development and goodwill impairment, stock-based compensation, valuation of warrants, and income taxes. Actual results could differ from those estimates and changes in estimates may occur.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"> </p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><i>Basic and Diluted Net Loss per Common Share</i> — Basic and diluted net loss per common share applicable to common stockholders is computed by dividing net loss applicable to common stockholders in each period by the weighted average number of shares of common stock outstanding during such period. For the periods presented, common stock equivalents, consisting of stock options and warrants, were not included in the calculation of the diluted loss per share because they were anti-dilutive.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"> </p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><b><i>Recently Issued Accounting Standards </i></b></p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"> </p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">Other than as disclosed in our Form 10-K, we are not aware of any other recently issued accounting standards not yet adopted that may have a material impact on our financial statements.</p>
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