Aptevo Therapeutics Inc. (APVO) Bundle
Understanding Aptevo Therapeutics Inc. (APVO) Revenue Streams
Understanding Aptevo Therapeutics Inc. Revenue Streams
As of September 30, 2024, Aptevo Therapeutics has reported a total revenue of $0.5 million for the nine months ended September 30, 2024, compared to $9.65 million for the same period in 2023. This decline is largely attributed to the absence of significant sales activity and the prior year’s revenue bolstered by a one-time gain from the sale of deferred payments and milestones to XOMA.
Breakdown of Primary Revenue Sources
The company primarily generates revenue through milestone payments related to its collaboration agreements and sales from its clinical assets. For the nine months ended September 30, 2024, the revenue sources included:
- Milestone Payments: $0.5 million from Medexus Pharmaceuticals related to IXINITY sales.
- Other Income: $0 million, a significant drop from $9.65 million in the prior year, which included a one-time payment from XOMA.
Year-over-Year Revenue Growth Rate
The year-over-year revenue growth rate has shown a substantial decrease:
| Period | Revenue (in thousands) | Growth Rate |
|---|---|---|
| 2024 (Nine Months Ended September 30) | $500 | -94.8% |
| 2023 (Nine Months Ended September 30) | $9,650 | N/A |
Contribution of Different Business Segments to Overall Revenue
For the nine months ended September 30, 2024, the contribution to total revenue is as follows:
- Clinical Programs: The clinical programs have not generated significant revenue during the reported period.
- Milestone Payments: These payments from collaborative agreements accounted for the entirety of the reported revenue.
Analysis of Significant Changes in Revenue Streams
There has been a notable shift in revenue dynamics:
- The absence of any new product launches or significant sales has led to revenue stagnation.
- The prior year's revenue was significantly inflated by a one-time gain of $9.65 million from the sale of rights to future payments, which has not recurred in 2024.
- Continued reliance on milestone payments indicates a risk in revenue predictability, particularly given the company's focus on clinical development and regulatory approvals.
Overall, Aptevo's financial health regarding revenue generation appears challenging as of 2024, highlighting the need for strategic partnerships and product development to improve revenue streams moving forward.
A Deep Dive into Aptevo Therapeutics Inc. (APVO) Profitability
A Deep Dive into Aptevo Therapeutics Inc. Profitability
Gross Profit Margin: For the nine months ended September 30, 2024, the company reported a gross profit margin of -116.57% compared to -67.67% for the same period in 2023.
Operating Profit Margin: The operating profit margin for the nine months ended September 30, 2024 stood at -118.78%, reflecting a decrease from -178.26% in the same period of the previous year.
Net Profit Margin: The net profit margin was -117.06% for the nine months ended September 30, 2024, compared to -158.30% for the nine months ended September 30, 2023.
Trends in Profitability Over Time
The following table summarizes the profitability metrics over the past two fiscal years:
| Period | Gross Profit Margin (%) | Operating Profit Margin (%) | Net Profit Margin (%) |
|---|---|---|---|
| 9 Months Ended September 30, 2024 | -116.57 | -118.78 | -117.06 |
| 9 Months Ended September 30, 2023 | -67.67 | -178.26 | -158.30 |
Comparison of Profitability Ratios with Industry Averages
As of September 30, 2024, the average gross profit margin in the biotechnology industry was approximately 70%, while the average operating margin was around -25% and the net profit margin averaged -10%.
Analysis of Operational Efficiency
For the nine months ended September 30, 2024, the company reported the following operational expenses:
| Expense Type | Amount (in thousands) |
|---|---|
| Research and Development | $10,498 |
| General and Administrative | $7,722 |
| Total Operating Expenses | $18,220 |
The decrease in research and development expenses from $13,516,000 in the prior year to $10,498,000 in 2024 indicates improved cost management efforts.
General and administrative expenses also decreased from $8,978,000 in 2023 to $7,722,000 in 2024, further reflecting operational efficiency.
Overall, the company's operational efficiency ratios continue to show significant room for improvement in comparison to industry standards.
Debt vs. Equity: How Aptevo Therapeutics Inc. (APVO) Finances Its Growth
Debt vs. Equity: How Aptevo Therapeutics Finances Its Growth
As of September 30, 2024, total liabilities for Aptevo Therapeutics amounted to $10.7 million, with current liabilities reaching $5.9 million. The company has no long-term debt outstanding following the repayment of its term loan in Q1 2023.
The debt-to-equity ratio is a crucial indicator of financial health. Aptevo's debt-to-equity ratio stood at 0.00 as of the latest reporting period, indicating that the company is entirely equity-financed. This is significantly lower than the biotechnology industry average of approximately 0.50 to 1.00, suggesting a conservative approach to leveraging.
Recent financing activities include several public offerings: on August 4, 2023, the company completed a public offering of common stock and warrants, raising a net amount of $4.3 million. Additionally, the company engaged in a Registered Direct Offering on July 1, 2024, generating $2.3 million in net proceeds.
Aptevo's financing strategy has heavily favored equity funding over debt. The company has relied on public offerings and collaborations for capital, with cash and cash equivalents reported at $7.8 million as of September 30, 2024. The absence of long-term debt allows Aptevo to maintain financial flexibility, particularly important in the volatile biotechnology sector.
| Financial Metric | Value |
|---|---|
| Total Liabilities | $10.7 million |
| Current Liabilities | $5.9 million |
| Long-term Debt | $0 million |
| Debt-to-Equity Ratio | 0.00 |
| Net Proceeds from August 2023 Offering | $4.3 million |
| Net Proceeds from July 2024 Offering | $2.3 million |
| Cash and Cash Equivalents (Sept 30, 2024) | $7.8 million |
This careful management of debt and equity has allowed Aptevo to navigate financial challenges while focusing on its research and development goals.
Assessing Aptevo Therapeutics Inc. (APVO) Liquidity
Assessing Aptevo Therapeutics Inc. Liquidity
Current and Quick Ratios
The current ratio as of September 30, 2024, is calculated as:
Current Assets: $7,753,000
Current Liabilities: $5,882,000
Thus, the current ratio is:
Current Ratio = Current Assets / Current Liabilities = 7,753 / 5,882 = 1.32
The quick ratio is also an important measure. It is calculated as:
Quick Assets: Cash and cash equivalents = $7,753,000
Since there are no inventories, the quick ratio is:
Quick Ratio = Quick Assets / Current Liabilities = 7,753 / 5,882 = 1.32
Analysis of Working Capital Trends
Working capital as of September 30, 2024:
Working Capital = Current Assets - Current Liabilities = 7,753 - 5,882 = $1,871,000
In comparison, as of September 30, 2023, working capital was:
Current Assets (2023): $19,110,000
Current Liabilities (2023): $7,224,000
Working Capital (2023) = 19,110 - 7,224 = $11,886,000
This indicates a significant decline in working capital year-over-year.
Cash Flow Statements Overview
| Cash Flow Category | 2024 (Nine Months Ended September 30) | 2023 (Nine Months Ended September 30) |
|---|---|---|
| Net cash provided by (used in) operating activities | $(18,026,000) | $(6,477,000) |
| Net cash provided by (used in) investing activities | $0 | $0 |
| Net cash provided by (used in) financing activities | $8,875,000 | $2,952,000 |
| Change in cash and cash equivalents | $(9,151,000) | $(3,525,000) |
Potential Liquidity Concerns or Strengths
As of September 30, 2024, cash and cash equivalents stand at $7,753,000 compared to $19,110,000 at the same time in 2023, indicating a liquidity decline. The accumulated deficit has reached $241,265,000, raising concerns about the company's ability to sustain operations without additional funding. For the nine months ended September 30, 2024, the company had a net loss of $17,818,000, highlighting ongoing financial challenges.
Is Aptevo Therapeutics Inc. (APVO) Overvalued or Undervalued?
Valuation Analysis
The valuation of a biotechnology company can be assessed through various financial ratios and metrics. As of September 30, 2024, the following key financial metrics are relevant for evaluating the financial health of the company.
Price-to-Earnings (P/E) Ratio
The company's most recent net loss was $17.8 million for the nine months ended September 30, 2024, resulting in a basic and diluted net loss per share of $0.48. Given that the company is not currently profitable, a traditional P/E ratio cannot be calculated.
Price-to-Book (P/B) Ratio
As of September 30, 2024, the total assets amount to $15.1 million and total liabilities are $10.7 million, resulting in stockholders' equity of $4.4 million. With 17,050,536 shares outstanding, the book value per share is approximately $0.26. The current stock price is approximately $0.33, leading to a P/B ratio of approximately 1.27.
Enterprise Value-to-EBITDA (EV/EBITDA) Ratio
As the company reported a net loss, there is no EBITDA available for the calculation. Thus, the EV/EBITDA ratio is not applicable.
Stock Price Trends
Over the last 12 months, the stock price has fluctuated significantly, with a high of $3,659.04 per share (adjusted for a 1-for-44 reverse stock split effective March 5, 2024) and a low of $0.165.
Dividend Yield and Payout Ratios
The company does not currently pay dividends, and thus the dividend yield is 0%. The payout ratio is not applicable as there are no earnings to distribute as dividends.
Analyst Consensus on Stock Valuation
Current analyst consensus indicates a rating of hold based on the company’s ongoing development stage and financial performance. Analysts are closely monitoring upcoming clinical trial results and potential partnerships that could impact future valuations.
Summary Table of Key Financial Metrics
| Metric | Value |
|---|---|
| Net Loss (9 Months Ended Sept 30, 2024) | $17.8 million |
| Basic & Diluted Loss per Share | $0.48 |
| Total Assets | $15.1 million |
| Total Liabilities | $10.7 million |
| Stockholders' Equity | $4.4 million |
| Shares Outstanding | 17,050,536 |
| Book Value per Share | $0.26 |
| Current Stock Price | $0.33 |
| P/B Ratio | 1.27 |
| High Stock Price (Last 12 Months) | $3,659.04 |
| Low Stock Price (Last 12 Months) | $0.165 |
| Dividend Yield | 0% |
| Analyst Consensus | Hold |
Key Risks Facing Aptevo Therapeutics Inc. (APVO)
Key Risks Facing Aptevo Therapeutics Inc.
The financial health of Aptevo Therapeutics Inc. is influenced by various internal and external risk factors that can impact its operations, profitability, and market position.
Overview of Internal and External Risks
- Industry Competition: The biotechnology sector is highly competitive, with numerous companies pursuing similar therapeutic areas. The ability to innovate and differentiate products is crucial.
- Regulatory Changes: Changes in regulatory policies or requirements can lead to delays in product development and increased costs. Compliance with regulations is essential for maintaining operational licenses.
- Market Conditions: Fluctuations in market conditions can impact funding availability and investor sentiment towards biotechnology firms. Economic downturns may limit capital raising opportunities.
Operational Risks
Aptevo faces operational risks related to its clinical trials and product development. Effective management of third-party contractors is critical. If these partners fail to meet their obligations, it could delay regulatory approvals.
Financial Risks
For the nine months ended September 30, 2024, Aptevo reported a net loss of $17.8 million compared to a net loss of $11.5 million for the same period in 2023. As of September 30, 2024, the company had an accumulated deficit of $241.3 million. Furthermore, the company's cash and cash equivalents stood at $7.8 million, indicating potential liquidity issues if additional funding is not secured.
Strategic Risks
The company’s future success relies heavily on its ability to develop and commercialize its product candidates. The anticipated timeline for regulatory approvals is lengthy and fraught with uncertainty. If products do not receive timely approval, the company may face significant financial strain.
Mitigation Strategies
To address these risks, Aptevo has indicated plans to raise additional funds through various means, including public offerings and collaborations. The company successfully raised $8.9 million from financing activities for the nine months ended September 30, 2024. However, the reliance on external funding creates additional risks, particularly if market conditions worsen.
| Risk Factor | Description | Impact | Mitigation Strategy |
|---|---|---|---|
| Industry Competition | High competition in biotechnology | Pressure on pricing and innovation | Focus on unique product development |
| Regulatory Changes | Potential changes in compliance requirements | Delays in product launches | Maintain proactive regulatory strategy |
| Market Conditions | Fluctuating economic environment | Impact on funding and investment | Diverse funding sources and strategic partnerships |
| Operational Risks | Dependence on third-party contractors | Delays in clinical trials | Rigorous oversight and management |
| Financial Risks | Recurring losses and cash burn rate | Liquidity concerns and going concern doubts | Additional fundraising efforts and cost management |
Future Growth Prospects for Aptevo Therapeutics Inc. (APVO)
Future Growth Prospects for Aptevo Therapeutics Inc.
Analysis of Key Growth Drivers
The company is focusing on several key growth drivers, including product innovations, market expansions, and strategic partnerships. The development of novel immuno-oncology candidates using the ADAPTIR technology platform positions the company to tap into a growing market segment. As of September 30, 2024, the company had cash and cash equivalents totaling $7.8 million.
Future Revenue Growth Projections
Future revenue growth projections for the company hinge on the successful commercialization of its product candidates. The company anticipates significant operating losses as it continues to invest in research and development. For the nine months ended September 30, 2024, the net loss was $17.8 million, compared to a net loss of $11.5 million for the same period in 2023. The anticipated revenues will largely depend on milestone payments and sales from ongoing collaborations, with potential milestone payments from Medexus of up to $5.8 million.
Strategic Initiatives or Partnerships
The company has entered into collaborations that may drive future growth. Notably, the partnership with Alligator Bioscience focuses on developing the bispecific antibody ALG.APV-527, which targets 4-1BB and 5T4. In the nine months ending September 30, 2024, the company recorded approximately $1.9 million in research and development expenses related to this collaboration.
Competitive Advantages
The company's competitive advantages include its proprietary ADAPTIR and ADAPTIR-FLEX platforms, which facilitate the design of versatile immune modulatory drugs. These platforms enable the development of multiple product candidates, such as mipletamig and ALG.APV-527, which are currently in clinical stages.
| Financial Metrics | Q3 2024 | Q3 2023 | 9M 2024 | 9M 2023 |
|---|---|---|---|---|
| Net Loss | $5.1 million | $6.3 million | $17.8 million | $11.5 million |
| Cash and Cash Equivalents | $7.8 million | $19.1 million | $7.8 million | $19.1 million |
| Research & Development Expenses | $3.1 million | $3.9 million | $10.5 million | $13.5 million |
| General & Administrative Expenses | $2.1 million | $2.7 million | $7.7 million | $9.0 million |
Conclusion
Strategic partnerships, innovative product development, and a focus on key growth drivers are essential for the company's future revenue growth. The anticipated milestone payments and collaborations are critical to navigating the current financial landscape.
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Updated on 16 Nov 2024
Resources:
- Aptevo Therapeutics Inc. (APVO) Financial Statements – Access the full quarterly financial statements for Q3 2024 to get an in-depth view of Aptevo Therapeutics Inc. (APVO)' financial performance, including balance sheets, income statements, and cash flow statements.
- SEC Filings – View Aptevo Therapeutics Inc. (APVO)' latest filings with the U.S. Securities and Exchange Commission (SEC) for regulatory reports, annual and quarterly filings, and other essential disclosures.