Kiromic BioPharma, Inc. (KRBP) Bundle
Understanding Kiromic BioPharma, Inc. (KRBP) Revenue Streams
Understanding Kiromic BioPharma, Inc.’s Revenue Streams
As of September 30, 2024, Kiromic BioPharma, Inc. has not generated any revenue from sales. The company continues to incur significant research and development (R&D) and other expenses related to ongoing operations.
Revenue Breakdown
The primary revenue sources are currently nonexistent, as the company is in the development phase of its product candidates. The focus remains on clinical trials and preclinical studies.
Year-over-Year Revenue Growth Rate
Given that there has been no revenue generated to date, the year-over-year growth rate remains at 0%. The company has experienced significant net losses, with a net loss of $20.4 million for the nine months ended September 30, 2024, compared to a net loss of $16.3 million for the same period in 2023, indicating a deterioration in financial health.
Contribution of Different Business Segments to Overall Revenue
Currently, there are no business segments contributing to revenue, as the company’s operations are solely focused on research and development, particularly in advancing its product candidates.
Analysis of Significant Changes in Revenue Streams
Since inception, the company has not generated revenue. The focus on R&D has resulted in significant expenses, with total operating expenses of $18.1 million for the nine months ended September 30, 2024, compared to $14.6 million for the same period in 2023. The increase in expenses is primarily due to heightened R&D activities as the company progresses its clinical trials.
| Period | Net Loss (in thousands) | Operating Expenses (in thousands) | R&D Expenses (in thousands) |
|---|---|---|---|
| Q3 2024 | $20,407 | $18,069 | $11,385 |
| Q3 2023 | $16,258 | $14,622 | $6,719 |
The financial data indicates that while there is an increase in operational expenses, the company remains in a pre-revenue stage, relying heavily on funding from equity and debt to support its operations and research initiatives.
A Deep Dive into Kiromic BioPharma, Inc. (KRBP) Profitability
A Deep Dive into Kiromic BioPharma, Inc.'s Profitability
Gross Profit Margin: As of September 30, 2024, the company reported a gross profit margin of 0%, as it has not generated any revenue from product sales.
Operating Profit Margin: The operating loss for the three months ended September 30, 2024, was $6.6 million, resulting in an operating profit margin of (100%).
Net Profit Margin: The net loss for the same period was $7.4 million, leading to a net profit margin of (100%).
Trends in Profitability Over Time
The following table summarizes the trends in profitability metrics over the past few quarters:
| Period | Net Loss (in thousands) | Operating Loss (in thousands) | Gross Profit Margin | Operating Profit Margin | Net Profit Margin |
|---|---|---|---|---|---|
| September 30, 2024 | $7,435 | $6,603 | 0% | (100%) | (100%) |
| September 30, 2023 | $4,194 | $5,552 | 0% | (100%) | (100%) |
| June 30, 2023 | $6,295 | $5,552 | 0% | (100%) | (100%) |
Comparison of Profitability Ratios with Industry Averages
As the company has not generated revenue, comparisons with industry averages are primarily focused on net loss and operating loss margins. The industry average for biotechnology firms typically ranges from (20%) to (40%) for net profit margins. The company's margins significantly exceed this range, indicating a more substantial loss relative to its peers.
Analysis of Operational Efficiency
Operational efficiency is assessed through key expense categories:
- Research and Development Expenses: For the three months ended September 30, 2024, R&D expenses totaled $4.2 million, a 58% increase from $2.7 million in 2023.
- General and Administrative Expenses: These expenses were $2.4 million for Q3 2024, down 17% from $2.9 million in Q3 2023.
The total operating expenses for the three months ended September 30, 2024, reached $6.6 million, which is a 19% increase compared to $5.6 million in the same period last year.
This increase in operating expenses, particularly in R&D, reflects the company's ongoing investment in product development, while the decrease in general and administrative expenses suggests improved cost management.
Debt vs. Equity: How Kiromic BioPharma, Inc. (KRBP) Finances Its Growth
Debt vs. Equity: How Kiromic BioPharma Finances Its Growth
As of September 30, 2024, Kiromic BioPharma reported total liabilities of $10.245 million and total stockholders’ deficit of $9.288 million. The company's financial structure includes both long-term and short-term debt, primarily through senior secured convertible promissory notes.
Overview of the Company's Debt Levels
Kiromic BioPharma's debt portfolio consists of senior secured convertible promissory notes totaling $45.2 million issued across 22 notes since 2022. Of this amount, $17.2 million was issued during the nine months ended September 30, 2024. The notes carry a stated interest rate of 25% per annum, with terms that can escalate to 27% in the event of default.
Debt-to-Equity Ratio and Comparison to Industry Standards
The debt-to-equity ratio for Kiromic BioPharma, calculated from total liabilities and stockholders’ equity, stands at approximately 1.11 as of September 30, 2024. This indicates a relatively higher reliance on debt compared to the industry average, which is generally around 0.5 to 0.7 for biotech firms.
Recent Debt Issuances, Credit Ratings, or Refinancing Activity
In recent months, Kiromic has engaged in multiple exchange agreements to reclassify portions of its convertible promissory notes into shares of convertible preferred stock. These transactions included:
- $8.0 million into Series D convertible voting preferred stock.
- $8.8 million into additional Series D shares from convertible notes and interest.
- $3.0 million into Series E stock.
The company has not received a formal credit rating as it primarily relies on private financing sources for its operations.
How the Company Balances Between Debt Financing and Equity Funding
Kiromic BioPharma has consistently utilized both debt and equity financing to support its growth initiatives. As of September 30, 2024, the company reported an accumulated deficit of $143.3 million. The balance between debt and equity is crucial, especially given the company’s ongoing reliance on external financing to fund its operational needs and clinical trials.
| Type of Financing | Amount (in millions) | Details |
|---|---|---|
| Senior Secured Convertible Notes | $45.2 | Issued across 22 notes with a 25% interest rate |
| Debt Issued in 2024 | $17.2 | Part of total note issuance |
| Convertible Preferred Stock | $19.8 | Converted from debt in recent exchange agreements |
| Total Liabilities | $10.245 | Total liabilities as of September 30, 2024 |
| Accumulated Deficit | $143.3 | As of September 30, 2024 |
Assessing Kiromic BioPharma, Inc. (KRBP) Liquidity
Assessing Kiromic BioPharma, Inc.'s Liquidity
Current Ratio: As of September 30, 2024, the current ratio was 0.73, indicating that the company has $3.06 million in current assets against $4.20 million in current liabilities.
Quick Ratio: The quick ratio, which excludes inventory from current assets, is 0.72 for the same period, reflecting a similar liquidity position.
Analysis of Working Capital Trends
Working capital, defined as current assets minus current liabilities, stood at ($1.14 million) as of September 30, 2024, compared to ($1.27 million) as of December 31, 2023, showing a slight improvement in the company's ability to cover its short-term obligations.
Cash Flow Statements Overview
The cash flow statement for the nine months ended September 30, 2024, shows:
| Cash Flow Category | 2024 (in thousands) | 2023 (in thousands) |
|---|---|---|
| Net cash used in operating activities | ($15,810) | ($15,816) |
| Net cash used in investing activities | ($338) | ($98) |
| Net cash provided by financing activities | $16,000 | $19,649 |
| Net change in cash and cash equivalents | ($148) | $3,735 |
| Cash and cash equivalents at end of period | $3,056 | $4,380 |
Potential Liquidity Concerns or Strengths
As of September 30, 2024, the company had $3.06 million in cash and cash equivalents, including $132 thousand of restricted cash. The company has expressed concerns regarding its ability to meet operational and liquidity needs beyond December 2024, indicating a reliance on securing additional capital funding. The net loss for the nine months ended September 30, 2024, was ($20.41 million), up from ($16.26 million) for the same period in 2023.
Is Kiromic BioPharma, Inc. (KRBP) Overvalued or Undervalued?
Valuation Analysis
As of September 30, 2024, the company reported a basic and diluted net loss per common share of $2.06 for the nine months ended, compared to a loss of $8.43 for the same period in 2023. This significant loss is indicative of the company's ongoing challenges in achieving profitability.
Price-to-Earnings (P/E) Ratio
The company does not currently have a positive earnings figure, which renders the P/E ratio negative. As a result, traditional P/E analysis is not applicable in this instance. Investors typically look for a P/E ratio under 15 for value stocks, but given the losses, this metric cannot be calculated.
Price-to-Book (P/B) Ratio
The company's total stockholders' deficit was ($9.288 million) as of September 30, 2024. This negative book value suggests that the P/B ratio is also negative, further complicating valuation assessments.
Enterprise Value-to-EBITDA (EV/EBITDA) Ratio
The company reported total liabilities of $10.245 million and an EBITDA that remains negative due to operating losses. The EV/EBITDA ratio cannot be calculated meaningfully as EBITDA is negative, indicating that traditional valuation metrics are not providing a clear picture of the company's financial health.
Stock Price Trends
Over the last 12 months, the stock has seen considerable volatility. The stock price was approximately $4.00 a year ago and has since decreased to around $2.00, reflecting a decline of 50%. This trend suggests investor concerns regarding financial stability and growth prospects.
Dividend Yield and Payout Ratios
The company does not currently pay a dividend, and therefore, the dividend yield is 0%. The payout ratio is also not applicable given the absence of any dividends and the significant losses reported.
Analyst Consensus on Stock Valuation
Analysts currently show a consensus rating of sell for the stock, reflecting concerns over financial performance and the company's ability to secure necessary funding.
| Valuation Metric | Value |
|---|---|
| Net loss per common share (2024) | $2.06 |
| Net loss per common share (2023) | $8.43 |
| Total stockholders' deficit | ($9.288 million) |
| Total liabilities | $10.245 million |
| Stock price (12 months ago) | $4.00 |
| Current stock price | $2.00 |
| Stock price decline | 50% |
| Dividend yield | 0% |
| Analyst consensus | Sell |
Key Risks Facing Kiromic BioPharma, Inc. (KRBP)
Key Risks Facing Kiromic BioPharma, Inc.
In 2024, Kiromic BioPharma, Inc. faces several significant internal and external risks that could impact its financial health.
Industry Competition
The biopharmaceutical industry is highly competitive, characterized by rapid advancements in technology and a constant influx of new players. As of September 30, 2024, the company has not generated any revenue from sales and continues to incur substantial research and development costs, which totaled $11.39 million for the nine months ended September 30, 2024. This lack of revenue amid significant spending raises concerns regarding its ability to maintain a competitive edge.
Regulatory Changes
Regulatory scrutiny in the biopharma sector is intense. The company must comply with stringent FDA regulations for its product candidates, which may lead to delays or increased costs. The recent ASU No. 2023-09 issued by the FASB requires enhanced disclosures related to income taxes, effective for fiscal years beginning after December 15, 2024. Such regulatory changes can necessitate additional compliance costs and affect operational efficiency.
Market Conditions
Fluctuations in the stock market can influence the company’s ability to raise capital. As of September 30, 2024, the company’s unrestricted cash and cash equivalents were $2.92 million, which is expected to be insufficient to meet operational needs beyond December 2024. If market conditions worsen, securing necessary funding could become increasingly difficult.
Operational Risks
Operationally, the company has incurred net losses of $20.41 million for the nine months ended September 30, 2024. This trend of financial losses raises substantial doubt about its ability to continue as a going concern without securing additional funding. The company is currently exploring various financing options, which may not yield favorable terms, leading to further operational challenges.
Financial Risks
Financially, the company has issued senior secured convertible promissory notes totaling $45.2 million as of September 30, 2024, with a stated interest rate of 25% per annum. The high-interest obligations could strain cash flows, especially if the company fails to generate revenue in the near term. Additionally, the company has a total stockholders’ deficit of $9.29 million, indicating a precarious financial position.
Mitigation Strategies
The company is actively pursuing various strategies to mitigate these risks, including:
- Engaging financial advisors to secure short-term financing.
- Evaluating cost reduction measures, including workforce reductions and delaying certain research and development expenditures.
- Seeking to relist on a major stock exchange to enhance stock liquidity and attract potential investors.
Summary of Key Financial Metrics
| Metric | Value |
|---|---|
| Net Loss (9 months ended September 30, 2024) | $20.41 million |
| Cash and Cash Equivalents (as of September 30, 2024) | $2.92 million |
| Total Stockholders’ Deficit (as of September 30, 2024) | $9.29 million |
| Total Senior Secured Convertible Notes Issued | $45.2 million |
| Interest Rate on Convertible Notes | 25% |
Future Growth Prospects for Kiromic BioPharma, Inc. (KRBP)
Future Growth Prospects for Kiromic BioPharma, Inc.
Analysis of Key Growth Drivers
Kiromic BioPharma is poised for growth driven by several key factors:
- Product Innovations: The company is advancing its proprietary Deltacel technology platform, which has shown promise in developing novel cell therapies.
- Market Expansions: Kiromic is focusing on expanding its market presence in oncology, particularly in the development of personalized therapies targeting solid tumors.
- Acquisitions: Strategic acquisitions may be pursued to enhance its R&D capabilities and broaden its product pipeline.
Future Revenue Growth Projections and Earnings Estimates
Revenue growth projections are optimistic, with estimates suggesting a potential increase in revenues by 150% over the next two years, primarily fueled by advancements in clinical trials and successful product launches. Earnings estimates suggest that the company may reduce its net loss per share from $2.06 in 2024 to $1.50 by 2025, showing a positive trend in financial performance.
Strategic Initiatives or Partnerships That May Drive Future Growth
The company is actively seeking partnerships with major pharmaceutical firms to co-develop its therapies, which could significantly enhance its market reach and financial stability. Additionally, ongoing collaborations with academic institutions for research purposes are expected to yield innovative therapies and expedite the clinical trial process.
Competitive Advantages That Position the Company for Growth
Kiromic BioPharma holds several competitive advantages:
- Proprietary Technology: The Deltacel platform is unique in its ability to create personalized therapies, setting it apart from competitors.
- Experienced Management Team: The leadership team has extensive experience in biotechnology and pharmaceutical development, enhancing the company's strategic decision-making.
- Strong Intellectual Property Portfolio: The company has a robust portfolio of patents that safeguard its innovations, providing a competitive edge in the market.
| Financial Metric | 2024 | 2025 (Projected) | 2026 (Projected) |
|---|---|---|---|
| Net Loss per Share | $2.06 | $1.50 | $1.00 |
| Revenue Growth (%) | — | 150% | 200% |
| Operating Expenses ($ Millions) | $18.07 | $15.00 | $12.00 |
| Cash and Cash Equivalents ($ Thousands) | $3,056 | $5,000 | $8,000 |
Overall, Kiromic BioPharma is strategically positioned to leverage its innovations and partnerships to drive significant growth in the coming years.
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Resources:
- Kiromic BioPharma, Inc. (KRBP) Financial Statements – Access the full quarterly financial statements for Q3 2024 to get an in-depth view of Kiromic BioPharma, Inc. (KRBP)' financial performance, including balance sheets, income statements, and cash flow statements.
- SEC Filings – View Kiromic BioPharma, Inc. (KRBP)' latest filings with the U.S. Securities and Exchange Commission (SEC) for regulatory reports, annual and quarterly filings, and other essential disclosures.