Abcellera reports full year 2022 business results
Vancouver, british columbia--(business wire)--abcellera (nasdaq: abcl) today announced financial results for the full year 2022. all financial information in this press release is reported in u.s. dollars, unless otherwise indicated. “in 2022 we demonstrated strong topline results and ongoing success in our partnering business. even more significant is the progress we made in scaling and expanding the capabilities of our engine during the year,” said carl hansen, ph.d., founder and ceo of abcellera. “we believe we are at an inflection point and expect to drive deeper value with partners and to prove our ability to consistently deliver clinical candidates for patients in need.” fy 2022 business summary earned $485.4 million in total revenue. generated net income of $158.5 million, compared to net income of $153.5 million in 2021. reached a cumulative total of 174 programs under contract with 40 different partners. started discovery on 23 partnered programs, bringing the cumulative number of partnered program starts to 101. reporting the advancement of three additional molecules, taking the cumulative total to eight molecules in the clinic. key business metrics year ended december 31, change cumulative metrics 2021 2022 % number of discovery partners 36 40 11% programs under contract 156 174 12% partnered program starts 78 101 29% molecules in the clinic 5 8 60% abcellera added 18 partnered programs in 2022 to reach a cumulative total of 174 programs under contract that are either completed, in progress, or under contract with 40 different partners as of december 31, 2022 (up 12% from 156 on december 31, 2021). abcellera started discovery on 23 partnered programs in 2022 to reach a cumulative total of 101 partnered program starts (up 29% from 78 on december 31, 2021). abcellera’s partners advanced an additional three molecules into the clinic in 2022, bringing the cumulative total to eight molecules in the clinic. discussion of fy 2022 financial results revenue – total revenue was $485.4 million, compared to $375.2 million in 2021. royalties associated with bamlanivimab and bebtelovimab were $443.0 million. the partnership business generated research fees of $40.8 million, compared to $19.1 million in 2021. milestone payments were $0.9 million and licensing revenue was $0.7 million. research & development (r&d) expenses – r&d expenses were $107.9 million, compared to $62.1 million in 2021, reflecting continuing investments in the capacity and capabilities of abcellera’s engine for antibody discovery and development. sales & marketing (s&m) expenses – s&m expenses were $11.3 million, compared to $6.9 million in 2021. the increase reflects continued investments in business development. general & administrative (g&a) expenses – g&a expenses were $55.5 million, compared to $41.8 million in 2021, with the increase driven by investments to support the growth of the company. net earnings – net earnings were $158.5 million, or $0.56 per share on a basic and $0.50 on a diluted basis, compared to $153.5 million, or $0.56 per share on a basic and $0.48 diluted basis in 2021. liquidity – $886.5 million of cash, cash equivalents, and marketable securities. q4 highlights and financial results started nine partner-initiated programs. u.s. emergency use authorization (eua) for bebtelovimab was suspended due to emergence of covid-19 variants resistant to the treatment. added ten programs under contract with two new partners. revenue for the fourth quarter of 2022 was $21.5 million, representing 4% of the total for 2022. $9.5 million was generated in the quarter from royalties on net sales of bebtelovimab prior to the eua suspension, and $11.4 million was generated from research fees, representing 2% and 28% of the respective totals for 2022. operating expenses totaled $59.3 million in the fourth quarter or 22% of the total for 2022 and include $1.6 million in royalty fees, 2% of the total for the year. the net loss for the fourth quarter was $29.9 million, or ($0.10) per share on a basic and diluted basis. conference call and webcast abcellera will host a conference call and live webcast to discuss these results today at 2:00 p.m. pacific time (5:00 p.m. eastern time). the live webcast of the earnings conference call can be accessed on the events and presentations section of abcellera’s investor relations website. a replay of the webcast will be available through the same link following the conference call. about abcellera biologics inc. abcellera searches, decodes, and analyzes natural immune systems to find antibodies that its partners can develop into drugs to prevent and treat disease. abcellera partners with drug developers of all sizes, from large pharmaceutical to small biotechnology companies, empowering them to move quickly, reduce costs, and tackle the toughest problems in antibody drug development. for more information, please visit www.abcellera.com. definition of key business metrics we regularly review the following key business metrics to evaluate our business, measure our performance, identify trends affecting our business, formulate financial projections, and make strategic decisions. we believe that the following metrics are important to understand our current business. these metrics may change or may be substituted for additional or different metrics as our business develops. number of discovery partners represents the unique number of partners with whom we have executed partnership contracts. we view this metric as an indication of the competitiveness of our engine and our level of market penetration. the metric also relates to our opportunities to secure programs under contract. programs under contract represent the number of antibody development programs that are under contract for delivery of discovery research activities. a program under contract is counted when a contract is executed with a partner under which we commit to discover or deliver antibodies against one selected target. a target is any relevant antigen for which a partner seeks our support in developing binding antibodies. we view this metric as an indication of commercial success and technological competitiveness. it further relates to revenue from access fees. the cumulative number of programs under contract with downstream participation is related to our ability to generate future revenue from milestone payments and royalties. partnered program starts represent the number of unique programs under contract for which we have commenced the discovery effort. the discovery effort commences on the later of (i) the day on which we receive sufficient reagents to start discovery of antibodies against a target and (ii) the day on which the kick-off meeting for the program is held. we view this metric as an indication of our operational capacity to execute on programs under contract. it is also an indication of the selection and initiation of discovery projects by our partners and the resulting potential for near-term payments. cumulatively, partnered program starts with downstream participation indicate our total opportunities to earn downstream revenue from milestone fees and royalties in the mid- to long-term. molecules in the clinic represent the count of unique molecules for which an investigational new drug, or ind, new animal drug, or equivalent under other regulatory regimes, application has been approved based on an antibody that was discovered either by us or by a partner using licensed abcellera technology. where the date of such application approval is not known to us, the date of the first public announcement of a clinical trial will be used for the purpose of this metric. we view this metric as an indication of our near- and mid-term potential revenue from milestone fees and potential royalty payments in the long term. abcellera forward-looking statements this press release contains forward-looking statements, including statements made pursuant to the safe harbor provisions of the private securities litigation reform act of 1995. the forward-looking statements are based on management’s current beliefs and assumptions and on information currently available to management. all statements contained in this release other than statements of historical fact are forward-looking statements, including statements regarding our ability to develop, commercialize and achieve market acceptance of our current and planned products and services, our research and development efforts, and other matters regarding our business strategies, use of capital, results of operations and financial position, and plans and objectives for future operations. in some cases, you can identify forward-looking statements by the words “may,” “will,” “could,” “would,” “should,” “expect,” “intend,” “plan,” “anticipate,” “believe,” “estimate,” “predict,” “project,” “potential,” “continue,” “ongoing” or the negative of these terms or other comparable terminology, although not all forward-looking statements contain these words. these statements involve risks, uncertainties and other factors that may cause actual results, levels of activity, performance, or achievements to be materially different from the information expressed or implied by these forward-looking statements. these risks, uncertainties and other factors are described under "risk factors," "management's discussion and analysis of financial condition and results of operations" and elsewhere in the documents we file with the securities and exchange commission from time to time. we caution you that forward-looking statements are based on a combination of facts and factors currently known by us and our projections of the future, about which we cannot be certain. as a result, the forward-looking statements may not prove to be accurate. the forward-looking statements in this press release represent our views as of the date hereof. we undertake no obligation to update any forward-looking statements for any reason, except as required by law. source: abcellera biologics inc. abcellera biologics inc. consolidated statements of income and comprehensive income (all figures in u.s. dollars. amounts are expressed in thousands except share and per share data) year ended december 31, 2020 2021 2022 revenue: research fees $ 19,848 $ 19,076 $ 40,802 licensing revenue - 20,778 696 milestone payments 15,000 8,000 900 royalty revenue 198,307 327,349 443,026 total revenue 233,155 375,203 485,424 operating expenses: royalty fees 27,143 45,516 66,436 research and development(1) 29,393 62,062 107,879 sales and marketing(1) 3,842 6,913 11,270 general and administrative(1) 11,910 41,848 55,485 depreciation, amortization, and impairment 4,836 14,451 27,843 total operating expenses 77,124 170,790 268,913 income from operations 156,031 204,413 216,511 other (income) expense interest (income) (293 ) (3,330 ) (16,079 ) interest and other 6,811 6,080 4,045 grants and incentives (8,320 ) (17,486 ) (10,554 ) total other income (1,802 ) (14,736 ) (22,588 ) net earnings before income tax 157,833 219,149 239,099 income tax expense 38,915 65,685 80,580 net earnings $ 118,918 $ 153,464 $ 158,519 foreign currency translation adjustment - 280 (1,671 ) comprehensive income $ 118,918 $ 153,744 $ 156,848 net earnings per share attributable to common shareholders basic $ 0.53 $ 0.56 $ 0.56 diluted $ 0.45 $ 0.48 $ 0.50 weighted-average common shares outstanding basic 159,195,023 275,763,745 285,056,606 diluted 263,129,765 318,294,236 314,827,255 (1) exclusive of depreciation, amortization, and impairment abcellera biologics inc. consolidated balance sheet (all figures in u.s. dollars. amounts are expressed in thousands except share data) december 31, 2021 december 31, 2022 assets current assets: cash and cash equivalents $ 476,142 $ 386,535 marketable securities 246,835 499,950 total cash, cash equivalents, and marketable securities 722,977 886,485 accounts and accrued receivable 160,576 38,593 restricted cash 25,000 25,000 other current assets 21,247 75,413 total current assets 929,800 1,025,491 long-term assets: property and equipment, net 111,616 217,255 intangible assets, net 148,392 131,502 goodwill 47,806 47,806 investments in and loans to equity accounted investees 50,313 72,522 other long-term assets 30,642 46,331 total long-term assets 388,769 515,416 total assets $ 1,318,569 $ 1,540,907 liabilities and shareholders' equity current liabilities: accounts payable and other liabilities $ 32,017 $ 33,150 current portion of contingent consideration payable 22,934 44,211 income taxes payable 35,683 - accrued royalties payable 22,506 19,347 deferred revenue 7,536 21,612 total current liabilities 120,676 118,320 long-term liabilities: operating lease liability 36,413 76,675 deferred revenue 27,409 19,516 deferred grant funding 33,349 40,801 contingent consideration payable 35,886 16,054 deferred tax liability 37,370 33,178 other long-term liabilities 1,733 3,086 total long-term liabilities 172,160 189,310 total liabilities 292,836 307,630 commitments and contingencies shareholders' equity: common shares: no par value, unlimited authorized shares at december 31, 2021 and 2022: 283,257,104 and 286,851,595 shares issued and outstanding at december 31, 2021 and 2022 respectively 722,430 734,365 additional paid-in capital 35,357 74,118 accumulated other comprehensive income (loss) 280 (1,391 ) accumulated earnings 267,666 426,185 total shareholders' equity 1,025,733 1,233,277 total liabilities and shareholders' equity $ 1,318,569 $ 1,540,907 subsequent event abcellera biologics inc. consolidated statement of cash flows (expressed in thousands of u.s. dollars) december 31, 2020 december 31, 2021 december 31, 2022 cash flows from operating activities: net earnings $ 118,918 $ 153,464 $ 158,519 cash flows from operating activities: depreciation of property and equipment 2,317 4,403 8,953 amortization and impairment of intangible assets 2,519 10,062 18,890 amortization of operating lease right-of-use assets 435 2,785 5,259 stock-based compensation 8,397 30,646 49,481 deferred tax expense 2,098 (2,018 ) (2,114 ) other 4,707 3,570 8,547 changes in operating assets and liabilities: accounts and accrued research fees receivable (5,467 ) (37,386 ) (22,715 ) accrued royalties receivable (197,553 ) 59,864 129,171 income taxes payable 36,412 (13,530 ) (88,609 ) accounts payable and accrued liabilities 6,601 1,400 1,066 operating lease liabilities (350 ) (778 ) (3,064 ) deferred revenue 21,810 8,624 6,183 accrued royalties payable 27,143 (4,637 ) (3,160 ) deferred grant revenue (6,763 ) 30,718 9,264 other operating assets and liabilities 1,466 (2,603 ) 1,689 net cash provided by operating activities 22,690 244,584 277,360 cash flows from investing activities: purchases of property and equipment (9,673 ) (58,452 ) (70,660 ) purchase of intangible assets (5,000 ) - (2,000 ) purchases of marketable securities - (274,710 ) (763,982 ) proceeds from marketable securities - 27,608 510,631 receipt of grant funding - 32,621 16,434 acquisitions, net of cash acquired (87,643 ) (11,457 ) - long-term investments and other 1,783 (17,534 ) (17,369 ) investment in and loans to equity accounted investees (19,247 ) (30,323 ) (25,679 ) net cash used in investing activities (119,780 ) (332,247 ) (352,625 ) cash flows from financing activities: repayment of long-term debt and contingent consideration (19,942 ) (4,373 ) (323 ) proceeds from long-term debt and exercise of stock options 16,490 5,487 2,755 proceeds from convertible debentures 89,990 - - payment of liability for in-licensing agreement and other (387 ) (5,000 ) (4,060 ) net proceeds from issuance of common shares 522,840 - - proceeds from issuance of preferred shares - series a1 and a2 financing 74,662 - - net cash provided by (used in) financing activities 683,653 (3,886 ) (1,628 ) effect of exchange rate changes on cash and cash equivalents - (1,425 ) (9,599 ) increase (decrease) in cash and cash equivalents 586,563 (92,974 ) (86,492 ) cash and cash equivalents and restricted cash, beginning of year 7,553 594,116 501,142 cash and cash equivalents and restricted cash, end of year $ 594,116 $ 501,142 $ 414,650 restricted cash included within other current and other long-term assets - - 3,115 total cash, cash equivalents, and restricted cash shown on the balance sheets $ 594,116 $ 501,142 $ 411,535 supplemental disclosure of non-cash investing and financing activities: property and equipment purchases in accounts payable 656 5,397 5,868 right-of-use assets obtained in exchange for operating lease obligation 1,679 36,638 50,694 purchase of intangible assets in exchange for in-licensing agreement payable 9,060 - -
