Yahoo Finance Assertio Holdings Inc (ASRT) Reports Mixed Fourth Quarter and Full Year 2023 Financial Results
Net Product Sales: Q4 net product sales decreased to $32.5 million from $49.9 million in the prior year.
Net Loss: Reported a net loss of $57.4 million in Q4, compared to a net income of $88.6 million in the previous year.
Adjusted EBITDA: Q4 adjusted EBITDA fell to $4.5 million from $33.4 million year-over-year.
Cash Flow: Positive cash flow from operations at $5.7 million for the quarter.
2024 Outlook: Assertio targets net product sales of $110 to $125 million and adjusted EBITDA of $20 to $30 million.
On March 11, 2024, Assertio Holdings Inc (NASDAQ:ASRT), a pharmaceutical company engaged in neurology, orphan and specialty medicines, released its 8-K filing, detailing its financial results for the fourth quarter and full year ended December 31, 2023. The company, which markets FDA-approved products including Gralise, CAMBIA, and Zipsor, faced a challenging quarter with net product sales declining to $32.5 million from $49.9 million in the prior year's fourth quarter. This decline was attributed to the impact of generic competition on Indocin and Cambia, partially offset by the addition of Rolvedon sales.
Financial Performance and Challenges
Assertio reported a significant net loss of $57.4 million in the fourth quarter, a stark contrast to the net income of $88.6 million in the same period last year. This loss includes a substantial impairment charge of $40.8 million, primarily related to the Indocin intangible asset. The adjusted EBITDA also saw a decrease to $4.5 million from $33.4 million year-over-year, mainly due to the generic competition for Indocin and increased operating expenses from the acquisition of Spectrum.
The company's gross margin dropped from 88% to 70%, with inventory step-up amortization and changes in sales mix cited as contributing factors. Selling, general, and administrative (SG&A) expenses rose to $24.0 million from $13.7 million in the prior year's quarter, reflecting the higher operating expense from the Spectrum acquisition. Despite these challenges, Assertio generated positive cash flow from operations, amounting to $5.7 million for the quarter.
Strategic Focus and 2024 Outlook
Assertio's interim CEO, Heather Mason, emphasized the company's strategic focus on growth through Rolvedon and prudent management of Indocin. Mason highlighted the resolution of channel inventory issues and the implementation of a commercial strategy expected to drive sales growth for Rolvedon throughout 2024. The company also announced its initial 2024 operating guidance, targeting net product sales of $110 million to $125 million and adjusted EBITDA of $20 million to $30 million.
Assertio's balance sheet shows $73.4 million in cash and cash equivalents, with a convertible debt outstanding principal balance of $40.0 million, maturing in September 2027. The company's cash generated from operating activities for the year was a robust $49.6 million.
Assertio's performance in the fourth quarter and the full year of 2023 reflects the volatility and challenges within the pharmaceutical industry, particularly for companies like Assertio that are navigating the competitive landscape of generic entrants. The company's ability to maintain positive cash flow amidst declining sales and net losses is a testament to its operational resilience and strategic adjustments. The 2024 outlook suggests a focus on leveraging growth opportunities and optimizing operations to improve financial performance.
For detailed financial tables and further information on Assertio's performance, investors and interested parties are encouraged to review the full 8-K filing.
Explore the complete 8-K earnings release (here) from Assertio Holdings Inc for further details.
This article first appeared on GuruFocus.
