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Exam Code: FINRA Practice exam 2023 by Killexams.com team
FINRA FINRA Administered Qualification Examination

Test Detail:
The FINRA Administered Qualification Examination is a series of exams administered by the Financial Industry Regulatory Authority (FINRA) for individuals seeking registration or licensure in the financial industry. These exams assess the knowledge and competence of individuals in various areas of the financial industry. Here is a detailed description of the test, including the number of questions and time allocation, course outline, exam objectives, and exam syllabus.

Number of Questions and Time:
The number of questions and time allocation for the FINRA Administered Qualification Examination can vary depending on the specific exam. Each exam within the FINRA qualification program has its own set of requirements. It is important to refer to the specific exam guidelines provided by FINRA for accurate information regarding the number of questions and time allocated for each exam.

Course Outline:
The course outline for the FINRA Administered Qualification Examination will depend on the specific exam being taken. FINRA offers a range of exams covering different areas of the financial industry, such as securities licensing, investment banking, and regulatory compliance. Each exam has its own course outline, which outlines the courses and knowledge areas that candidates are expected to be familiar with.

Exam Objectives:
The exam objectives for the FINRA Administered Qualification Examination are designed to assess candidates' knowledge and understanding of the relevant regulations, rules, and best practices in the financial industry. The specific objectives may vary depending on the exam being taken. Generally, the exam objectives aim to evaluate candidates' competence in areas such as:

1. Industry regulations and compliance
2. Ethical standards and professional conduct
3. Products and services offered in the financial industry
4. Investment strategies and analysis
5. Client relationship management and communication

Exam Syllabus:
The exam syllabus for the FINRA Administered Qualification Examination will vary depending on the specific exam. The syllabus outlines the specific content areas, topics, and knowledge domains that candidates are expected to study and understand in preparation for the exam. The syllabus typically covers areas such as:

1. Regulatory framework and industry rules
2. Securities laws and regulations
3. Product knowledge (e.g., stocks, bonds, mutual funds)
4. Compliance and ethics
5. Risk management and suitability
6. Investment analysis and strategies
7. Client communication and relationship management

Candidates should consult the specific exam resources and study materials provided by FINRA to ensure they are adequately prepared for the exam. It is recommended to allocate sufficient time for exam preparation, including studying relevant regulatory materials, reviewing industry guidelines, and practicing with sample exam questions.

FINRA Administered Qualification Examination
Financial Qualification availability
Killexams : Financial Qualification availability - BingNews https://killexams.com/pass4sure/exam-detail/FINRA Search results Killexams : Financial Qualification availability - BingNews https://killexams.com/pass4sure/exam-detail/FINRA https://killexams.com/exam_list/Financial Killexams : Wealth managers eye entering lucrative advice sector

There has been a six-fold increase from investment and wealth managers signing up to take a financial planning qualification.

A financial planning trainer has told Money Marketing that she has seen a big jump in the number of both doing the level 7 diploma in advanced financial planning.

This is associated with the Chartered Institute for Securities & Investment (CISI).

Over the past two years Lockie Consultants director Jacqueline Lockie has seen the number of investment and wealth managers doing level 7 rise from 5% to 30%.

Lockie said: “These two worlds [planners and investment managers] have been slowly coming together over the past 10 years”.

The reason why investment and wealth managers want to pursue a planning training course is because the profession offers an individual a more personal relationship with a client, Lockie added.

However, this can be worrying for the adviser community, as an investment manager tends to have more capital behind them.

So, this combined with a planning qualification can potentially be harmful and provide strong competition to other advisers.

She has seen an increase in demand for the financial advice market. Lockie used to be a financial planner herself for eight years.

Previously, she was CISI head of financial planning and the Association of Investment Companies (AIC) head of training.

The recently implemented Consumer Duty also resulted in a four-fold increase in the amount of people taking the level 7 course in May 2023.

The Duty was very concerning to wealth managers, which helped to drive them to take the level 7 course, Lockie said.

In general, both investment and wealth managers wanted to be prepared as much as possible for the Consumer Duty, and taking the level 7 financial planning was part of that.

Lockie also works with RQ Ratings, an organisation that aims to increase collaboration for accountants, solicitors and independent financial advisers.

Lockie said that “sometimes lawyers and accountants do not speak the same language as advisers”.

RQ Ratings would do the due diligence for an accountant looking to work with an adviser or vice versa.

Additionally, Lockie said: “Everyone is quite territorial about their client, so they want to know who they can trust”.

Lockie Consultants was set up in February 2021.

Fri, 11 Aug 2023 09:45:00 -0500 Darius McQuaid en-GB text/html https://www.moneymarketing.co.uk/news/six-fold-increase-in-investment-wealth-managers-taking-financial-planning-qualification/
Killexams : Best Online Personal Loans Of 2023

Upstart has made a mark on the personal loan space because of its artificial intelligence- and machine learning-based approach to borrower qualification. In fact, Upstart estimates that it has been able to approve 27% more borrowers than possible under a traditional lending model. With competitive APRs, Upstart is not a top lender for borrowers who can qualify for more competitive rates. Even so, the platform’s minimum 600 credit score makes it an accessible option to those with fair credit.

Upstart also offers a pretty flexible range of loan options, with amounts ranging from as low as $1,000 so you don’t have to borrow (or pay interest on) more than you really need. And, while Upstart’s loans cap out at $50,000—lower than some lenders—this is likely to be enough for many prospective borrowers.

Even though Upstart’s three- and five-year loan terms are more restrictive than other lenders, it’s likely to be an acceptable tradeoff for applicants who might not be approved in a more traditional lending environment. Plus, it’s available in every state except West Virginia and Iowa, so it’s as widely available as many other top lenders.

Eligibility:  Upstart stands out because it uses an AI-based platform to consider a range of non-conventional variables when evaluating borrower applications. And, while the platform advertises a minimum credit score of 600, Upstart may even accept applicants who don’t have enough credit history to have a score. When evaluating prospective borrowers, Upstart considers college education, job history, residence, debt-to-income ratio, bankruptcies and delinquencies and number of credit inquiries.

Borrowers also must have a full-time job or offer starting in six months, a regular part-time job or another source of regular income—with a minimum annual income of $12,000. Co-signers and co-applicants are not permitted.

Loan uses:  Upstart’s personal loans can be used for credit card and other debt consolidation, special events, moving and relocation, medical and dental costs and home improvements. In contrast to many other traditional and online lenders, Upstart also lets borrowers use personal loan funds to cover educational expenses (except in California, Connecticut, Illinois, Washington and the District of Columbia).

Upstart borrowers cannot use personal loans to finance illegal activity or purchase weapons, firearms or illegal drugs.

Turnaround time:  Upstart provides next-business day funding for borrowers whose loans are accepted before 5 p.m. Eastern time Monday through Friday. Loans that are approved after 5 p.m. are typically funded the following business day, or the day after that. That said, Upstart reports that 99% of loan applicants receive their money one business day after accepting their loan terms. Loans for education-related expenses may take up to an additional three business days after loan acceptance.

Tue, 01 Aug 2023 02:55:00 -0500 Rebecca Safier en-US text/html https://www.forbes.com/advisor/personal-loans/best-online-personal-loans/
Killexams : Health and financial influencers now need to disclose qualifications under new ASCI guidelines

The Advertising Standards Council of India said influencers must disclose their qualifications and registration or certification details prominently. Image for representation purpose only. File

The Advertising Standards Council of India (ASCI) said medical practitioners, health and fitness, and finance experts holding certifications from recognised institutions are required to “disclose” that they are certified experts and practitioners while sharing information or promoting products or services or making any health-related claims.

All advertisements published by social media influencers “must carry a disclosure label that clearly identifies it as an advertisement”, the ASCI said as it issued fresh guidelines on August 17.

Also Read | Centre issues guidelines to social media influencers to regulate promotions

“Influencers providing advice and/or promoting and/or commenting on merits or demerits on aspects related to commercial goods and services, in the fields of Banking, financial services and insurance (BFSI) and Health & Nutrition, must have the necessary qualifications and certifications in order to provide such information and advice to consumers,” ASCI said in a press release.

Qualifications mandatory

Under the new guidelines, finance influencers also known as ‘finfluencers’, if advising about stock or investments, must have been registered with SEBI and their SEBI registration number should be stated with their name and qualifications. For other financial advice, the influencer must have suitable qualifications such as an IRDAI insurance license, CA, CS etc. “In addition, they must abide by all disclosure requirements as mandated by financial sector regulators from time to time,” the regulatory body said.

Meanwhile, for posts related to health and nutrition, the influencer must have relevant qualifications such as a medical degree, or be a certified nurse, nutritionist, dietician, physiotherapist, or psychologist depending on the specific advice being given.

The ASCI said influencers must disclose their qualifications and registration or certification details prominently and in the case of promotional content, advised them to review and satisfy themselves that the advertiser is in a position to substantiate the claims made in the advertisement.

Also Read | Lights, camera, branding: The world of Instagram influencers

These additional guidelines for celebrities, influencers, and virtual influencers in the field of health and wellness were earlier released by the nodal Consumer Affairs Ministry. The Department of Consumer Affairs will actively monitor and enforce these guidelines. Violations may lead to penalties under the Consumer Protection Act 2019 and other relevant provisions of the law.

Why these guidelines?

The guidelines, introduced initially in May 2021, aim to help consumers identify promotional content and make informed decisions on products or services. The guidelines have been amended in keeping with the rapidly evolving nature and extensive impact of digital platforms, ASCI said.

Inaccurate and deceptive advertising content in categories such as BFSI, and health and nutrition products and services, could significantly impact consumer well-being and financial security.

Stating that “a one size fits all approach can be dangerous”, Manisha Kapoor, CEO and Secretary General, ASCI, said: “As losses to consumers could be substantial and serious due to improper advice in the categories of health and finance, it is necessary that influencers in these two critical categories are qualified to provide advice and that these qualifications are stated upfront, whenever they put out such advertising posts.

Unlike celebrities whom consumers clearly know the fields they belong to, consumers may not necessarily know which influencers have the necessary qualification and expertise to provide the right advice and also inform them of any associated risks. To safeguard consumers from the consequences of advice from non-experts, these additional requirements should now be followed by health and financial influencers,” she said.

The guidelines have been released after discussions with the stakeholders including the Ministry of Health, the Ministry of Ayush, Food Safety and Standards Authority of India (FSSAI), and Advertising Standards Council of India (ASCI).

(With PTI inputs)

Wed, 16 Aug 2023 20:15:00 -0500 en text/html https://www.thehindu.com/news/national/health-and-financial-influencers-now-need-to-disclose-qualifications-under-new-asci-guidelines/article67204768.ece
Killexams : Are you a senior? Here's a bank account exclusively for you! No result found, try new keyword!They typically come with special features, including waived fees and free monthly checks.Banks understand the financial needs of seniors differs ... they need to meet certain qualifications. To ... Mon, 21 Aug 2023 00:36:00 -0500 en-us text/html https://www.msn.com/ Killexams : Emergency financial assistance program for flood-impacted Vermonters

The Emergency Board is comprised of Governor Philip B. Scott, Chair; Senator Jane Kitchel; Senator Ann Cummings; Representative Diane Lanpher; and Representative Emilie Kornheiser. VermontBiz photo, July 31, 2023, Governor's Ceremonial Office, State House.

Vermont Business Magazine Emergency grant funding will be available to assist Vermont residents, including homeowners and renters, who were impacted by the July 2023 flood disaster, as declared in Executive Order No. 03-23, and need to replace flood-damaged and flood-destroyed appliances and equipment. Current FEMA reports estimate over 4,000 residences were impacted. This emergency funding will support addressing this urgent financial need. Efficiency Vermont will utilize existing, cost-effective programs, supply chain partners, and delivery mechanisms to ensure supply availability.

Program Amount: Up to $10,000,000

Grant Program: Applications will be considered, and grants will be awarded on a rolling basis and until all funds have been granted. Qualifying replacement appliances and equipment include those on Efficiency Vermont’s Qualifying Products List and comparably efficient equipment. Income qualifications are based on Vermont’s Area Median Income (AMI) in keeping with Efficiency Vermont’s standard practices. Priority will be given to Vermonters with income at or below 120% AMI. For renters, awards will be based on the renter’s income, not the landlord’s income. For a multi-unit dwelling, the average income of all renters in the building may be used to determine income for appliances and equipment that affect more than one unit.

Awards shall not exceed $10,000 per individual. Assistance will not be available for items reimbursed by another source, including insurance payouts and FEMA awards. Applicants will be required to verify income, proof of damage with damage assessments from FEMA and/or insurance companies and other documents as requested by the grantor.

Grant award decisions can be stacked with Distribution Utility Tier III and Efficiency Utility programs and incentives, federal tax incentives, Inflation Reduction Act incentives and state-controlled programs; ARPA-funded weatherization, heat pump and hot water heater switch-and save programs, electric panel upgrades, and flexible load management; FEMA assistance, and other grant awards or philanthropic dollars.

Public Service Department Commissioner June Tierney said at the Emergency Board meeting at the State House on July 31 that the program was developed over the previous weekend “with many cooks in the kitchen.”

The Emergency Board is comprised of Governor Philip B. Scott, Chair; Senator Jane Kitchel; Senator Ann Cummings; Representative Diane Lanpher; and Representative Emilie Kornheiser.

Tierney said it’s an emergency financial assistance program for flood impact and Vermonters the purpose of the program is emergency grant funding that will be available to assist Vermont residents including homeowners and renters who were impacted by the July 23rd 2023 flood disaster and as declared in the executive order 03-23 and these folks need to replace flood-damaged and flood-destroyed appliances and equipment.

FEMA reports estimate that over 4,000 residences were impacted.

“We don't know exactly how many of those are necessarily low or middle income but that is the target audience for this aid and the emergency funding would support addressing their needs.”

Efficiency Vermont would be deployed to utilize existing cost-effective programs supply chain partners and delivery mechanisms to ensure supply availability.

The Department will direct the grant funding to Efficiency Vermont in consultation with many other entities that are habitually active in the space anyway such as the Office of Economic Opportunity and the Vermont Housing Financing Authority.

The PSD will work with these stakeholders to essentially try to get affordable housing off of fossil fuel and to introduce efficiency measures instead.

Tierney said the grant program would be capped at $10 million that would be transferred from $35 million that was appropriated to the department for weatherization and would not to exceed $10,000 per individual. There would be income qualifications they would be using based on Vermont's area median income in keeping with practices that already exist at Efficiency Vermont and priority would be given to folks with income below 120 percent AMI.

They would also make sure the funds are spread out around the state to ensure regional distribution equity, meaning not any one community gets all the money because they have the most applications that get through the door first.

The electric utilities would also be involved in this process with their energy efficiency programs.

Also, customers would be allowed to stack the awards, with, say, existing federal tax incentives and inflation reduction act incentives and any other state control program.

“We all know there's a terrible, terrible need out there to weatherize buildings and the judgment that we can take 10 from 35 million is a solid judgment. I would be hesitating if we go much farther because any contractor will tell you when you're trying to address both efficiency and decarbonization, starting with the envelope of the building is the way to go and that is what weatherization is all about so that's where we are in the program development.”

Wed, 09 Aug 2023 03:41:00 -0500 en text/html https://vermontbiz.com/news/2023/august/10/emergency-financial-assistance-program-flood-impacted-vermonters
Killexams : Syncora ensure Inc. Announces the Availability of Certain Financial Information

NEW YORK--(BUSINESS WIRE)--Aug 14, 2023--

Syncora ensure Inc. (“Syncora Guarantee”) today announced that certain financial information of Syncora ensure has been made available on Syncora Guarantee's website ( www.syncoraguarantee.com ). The information posted is Syncora Guarantee’s Statutory Basis Financial Statements as of June 30, 2023.

About Syncora ensure Inc.

Syncora ensure Inc. is a New York-domiciled insurance company that is a wholly owned subsidiary of Syncora FinanceCo LLC. For additional information, please visit www.syncoraguarantee.com.

Important Information and Forward Looking Statements

This press release contains statements about future results, plans and events that may constitute "forward-looking" statements. We caution you that the forward-looking information presented in this press release is not a ensure of future events, and that genuine events may differ materially from those made in or suggested by the forward-looking information contained in this press release. In addition, forward-looking statements generally can be identified by the use of forward-looking terminology such as "may," "plan," "seek," "comfortable with," "will," "expect," "intend," "estimate," "anticipate," "believe" or "continue" or the negative thereof or variations thereon or similar terminology. Forward-looking statements are subject to a number of risks and uncertainties, many of which are beyond Syncora Guarantee's control. Readers are cautioned not to place undue reliance on forward-looking statements which speak only as of the date they are made. Syncora ensure does not undertake to update forward-looking statements to reflect the impact of circumstances or events that arise after the date the forward-looking statements are made.

View source version on businesswire.com:https://www.businesswire.com/news/home/20230814226122/en/

CONTACT: George Wilkinson

General Counsel

Syncora ensure Inc.

(212) 847-3607

KEYWORD: NEW YORK UNITED STATES NORTH AMERICA

INDUSTRY KEYWORD: PROFESSIONAL SERVICES INSURANCE FINANCE

SOURCE: Syncora ensure Inc.

Copyright Business Wire 2023.

PUB: 08/14/2023 05:00 PM/DISC: 08/14/2023 05:01 PM

http://www.businesswire.com/news/home/20230814226122/en

Copyright Business Wire 2023.

Mon, 14 Aug 2023 09:17:00 -0500 en text/html https://www.joplinglobe.com/region/national_business/syncora-guarantee-inc-announces-the-availability-of-certain-financial-information/article_badda3ab-ee2c-5ab6-9a73-0d9f9aeac598.html
Killexams : Enlight Renewable Energy Reports Second Quarter 2023 Financial Results

All of the amounts disclosed in this press release are in U.S. dollars unless otherwisenoted

TEL AVIV, Israel, Aug. 09, 2023 (GLOBE NEWSWIRE) -- Enlight Renewable Energy Ltd. (NASDAQ: ENLT, TASE: ENLT) today reported financial results for the second quarter ended June 30, 2023.

The Company’s quarterly earnings materials and a link to the earnings webcast, which will be held today at 8:00 AM ET, may be found on the investor relations section of Enlight’s website at https://enlightenergy.co.il/data/financial-reports/

Second Quarter 2023: Financial Highlights

  • Revenue of $53m, up 32% year over year.
  • Net Income of $22m, transitioning from a $1m loss last year.
  • Adjusted EBITDA* of $42m, up 58% year over year.
  • Cash flow from operation of $39m, up 95% year over year.

First Half 2023: Financial Highlights

  • Revenue of $124m, up 65% year over year.
  • Net income of $56m, up 600% year over year
  • Adjusted EBITDA* of $95m, up 86% year over year
  • Cash flow from operation of $95m, up 181% year over year.

“We delivered rapid growth and increased profitability in the second quarter of 2023, driven primarily by 700 MW of new operational projects. While quarterly revenue grew at a rate of 32% year over year, which was lower than expected, driven by lower wind production and electricity prices at Project Gecama in Spain, Adjusted EBITDA growth remained as expected at 58% thanks to lower O&M costs in Spain and better results across other projects”, said Gilad Yavetz, CEO of Enlight Renewable Energy.

“We made significant progress this quarter across our Mature Portfolio, which provides us with a strong indication of our ability to deliver consistent rapid growth.We reached commercial operation on150 MWof generation and 40 MWh of energy storage, including our first ever storage project,while securing critical milestones on over 2 GW of MatureProjects, including the addition of a new flagship project in the Western U.S to our Mature Portfolio.We believe thatthe progress we have made further de-risks our plan to reach 4.6 GW and 3.6 GWh of operational projects by the end 2025.”

“In addition, we continued to deliver projects with above-market returns. During the quarter, we secured 250 MW of power purchase agreement (“PPA”) amendments with an average price increase of 87% and signed 280 MW and 1,680 MWh of new PPAs at attractive prices. Project Atrisco was also recognized as an energy community under the Inflation Reduction Act (“IRA”), further increasing the projected returns for our first flagship project in the United States. We believe our proven record of delivering both rapid growth and above-market returns puts us in a prime position to capture the massive opportunity we see ahead.”

Second Quarter: Further Highlights

  • Delivering on project conversion: 150 MW and 40 MWh reached commercial operation; 94 MW commenced construction; 330 MW and 840 MWh added to the Mature Portfolio, including a new flagship solar and storage project in the Western U.S.
  • Focusing on project economics: 280 MW and 1,680 MWh of new PPAs signed at attractive pricing. Amended 250MW of PPAs at an average price increaseof 87%.
  • 4.3 GW of U.S. portfolio may benefit from energy community tax credit adder (+17% from Q1 estimate, post assessment of brownfield locations).
  • Project Atrisco expected to benefit from energy community adder, increasing projected returns; financial close expected by the end of September 2023. Project COD on track for Q2 2024 COD.
  • Secured $170m of corporate revolving credit facilities from several Israeli banks (currently undrawn), further enhancing the Company’s financial flexibility.
  • 65% of revenues in USD and EUR, driven by ongoing transition to large scale developed markets in Europe and North America. While we continue to invest in Israel in the positive backdrop of deregulation of the local electricity market, Israel’s share of our global mix is expected to shrink over time.
  • 2023 Guidance Updates: due to lower than expected wind production and electricity prices at Project Gecama in Spain, we are adjusting our revenue guidance from $290-300m to $265-275m. However, based on significantly lower than expected windfall taxes (O&M costs) in Spain and compensation recognized from Siemens Gamesa at Björnberget in connection with delays in reaching full production, we are reaffirming our Adjusted EBITDA guidance at $188-198m.

Overview of Financial and Operating Results: Revenue

In the second quarter of 2023, the Company’s revenues increased to $53m, up from $40m last year, a growth rate of 32% year over year. Growth was mainly driven by the revenue contribution of new operational projects, as well as the inflation indexation embedded in PPAs for already operational projects.

($ thousands)

For the six months period ended

For the three months Ended

Segment June 30, 2023 June 30, 2022 June 30, 2023 June 30, 2022
Israel 29,757 22,685 15,919 17,996
Central-Eastern Europe 44,337 37,946 21,102 16,616
Western Europe 45,193 9,596 13,405 3,007
Management and Construction 4,270 4,712 2,137 2,260
Total Revenues 123,557 74,939 52,563 39,879

Since the second quarter of last year, 700MW of projects started selling electricity, includingGecama andBjörnberget. These projects collectively contributed $11m of revenue during the second quarter of 2023.

The Company also benefited from inflation indexation embedded in its PPAs, which contributed an additional $3m of revenue during the quarter. This reflected an average indexation of 7.2% across 592 MW of PPAs for projects that have been operational for a full year.

With respect to FX, the impact of a strengthening Euro was offset by a weaker Shekel, with a cumulative negative impactof $1 million.

Financial performance was well-balanced between Western Europe, Central-Eastern Europe (“CEE”) and Israel, with 61% of revenues in the second quarter of 2023 denominated in Euros, 5% in another European currency and 30% denominated in Israeli shekel. In the second half of 2023, revenue is expected to include a substantial contribution denominated in U.S. dollars, following the COD of Apex Solar, the Company’s first project to reach commercial operations in the United States.

In addition to the above, the Company sold $5m of electricity in projects treated as financial assets in the second quarter.Under IFRS this revenue is accounted for as financing income or other non-P&L metrics.

Net Income

In the second quarter of 2023, the Company’s net income increased to $22m, transitioning from a $1m loss last year. $12m of the increase was driven by new projects, including $6m from Björnberget, largely reflecting the after-tax impact of the compensation recognized from Siemens Gamesa.

With respect to the accurate announcement by Siemens Gamesa on issues with its onshore wind turbines, we do not expect either a short or long term impact to Project Björnberget. During the second quarter, we recognized compensatory payments from Siemens Gamesa under our agreement due to delays in reaching full production. As of today, 56 of 60 turbines are operational. COD under the PPA has been declared and Björnberget is expected to reach full production in the coming weeks.

The residual growth in net income of $11m was driven by a reduced expectation of earnout payments to be incurred for the acquisition of Clenera for early stage projects not in our Mature Portfolio ($5m) and interest income on deposits as well as foreign exchange impacts (strengthening USD relative to the NIS) on our cash and cash equivalents ($6m).

Adjusted EBITDA*

In the second quarter of 2023, the Company’s Adjusted EBITDA grew by 58% to $42m compared to $26m for the same period in 2022.

The increase was driven by the same factors which affected our revenue increase in the same period, as well as $8m of compensation recognized from Siemens Gamesa due to the delay in reaching full production at Project Björnberget as described above, offset by a $2m increase in overhead as the team scales to accommodate rapid growth.

Portfolio Overview1

Key changes to the Company’s projects portfolio during the second quarter of 2023:

  • Operational portfolio grew by 150 MW and 40 MWh, including Apex Solar, AC/DC, and one project which reached COD within the Solar & Storage cluster in Israel.
  • Commenced construction on94MWinSerbia(Project Pupin, adjacent to Project Blacksmith).
  • Mature Project portfolio grew by 330 MW and 840 MWh, including Roadrunner, our new flagship solar and storage project in the Western U.S. with a signed PPA and interconnection agreement.

Portfolio Overview


1 As of August 09, 2023 (“Approval Date”).

United States

The Company delivered significant progress on its large U.S. portfolio during the second quarter of 2023.

The Apex Solar project, sized at 105MWdc and located in southwestern Montana, achieved mechanical completion and began operating in June. After optimization and tuning, commercial operations were achieved in July. The milestone is a significant one for the group as it represents Enlight’s first project to reach commercial operations in the United States.

In New Mexico, our 364 MW / 1,200 MWh Atrisco Solar project is advancing steadily. The project’s battery provider completed work to finalize factory qualification and has initialized battery pack shipments required for container deliveries, which are set to begin in the fourth quarter of 2023. Site work is on schedule and commercial operation is on track for the end of the second quarter 2024. Moreover, the Company confirmed that Atrisco qualifies for a 10% tax credit adder on both the solar and storage portions of the project. The adder is based on the project site’s brownfield status and subsequent qualification for energy community classification. Project finance definitive agreements are advancing with financial close now expected in September of 2023.

The Company is also progressing on the CO Bar project, located in Arizona. At 1.2 GW solar and 824 MWh storage, CO Bar is the first of the Company’s gigawatt sized projects to mature. In the second quarter, we successfully contracted the remaining 258 MW and 824 MWh of the project. CO Bar is now fully contracted with two leading Arizona utilities (Salt River Project and Arizona Public Service), under 20 year busbar PPAs. There is also potential to expand the storage part of the project in the future from 824 MWh today to 4 GWh given the size of our interconnection position. On the development front, the CO Bar project has primary land control and permitting in place. The system impact study (SIS) for the interconnection is complete, and the facilities study is expected in Q4 of 2023. CO Bar is expected to start construction in the fourth quarter of 2023 and achieve COD in phases through 2025. The project stands to benefit from the IRA, including the production tax credit (PTC) and the possibility of a domestic content adder on the storage.

Moreover, the Company added 278 MW and 800 MWh to its Mature Portfolio in the U.S., driven by the addition of Roadrunner,a flagship combined solar and storage project in Arizona.The project totaling 250 MW and 800 MWh is contracted to AEPCO under a 20 year busbar PPA. COD is expected in H1 2026. The projecthas site control, a signed PPA and a signed interconnection agreement. Final permitting is required, after which construction is expected to commence. The project highlights our continued market leadership in the West and the underlying quality of our project pipeline.  

Finally, the Company’s advanced portfolio and market specific knowledge has enabled it to avoid the increasing interconnection queue congestion across the United States over the quarter. In the second quarter, Rustic Hills secured its system impact study, a significant milestone for the project. The Company’s entire Mature Portfolio and Advanced Development Portfolio in the U.S. is now past the system impact study phase – a critical component of the interconnection study process. Given this advantage, the Company believes it is well positioned to continue and even potentially accelerate its growth in the United States.

On supply chain, the Company’s diversified sourcing strategy has reliably satisfied module and other equipment supply requirements in the United States. The Company has the right to purchase up to 2 GW of modules from India with delivery through 2025. We also have access to additional supply from Southeast Asia. Our battery cell source is now qualified in international factories, and we are seeing strong progress in reaching our goal to have qualified domestic supply for late 2024 deliveries and beyond. Our procurement strength is proving to be a source of strategic advantage in negotiating project contracts with utility offtake and demonstrating to financing parties we can hold construction schedules.

Europe

The Company made substantial progress on its European portfolio during the quarter. The Company reached commercial operation on 26 MW in Hungary. This is our second project to reach commercial operation in Hungary with another 60 MW currently under construction. In addition, during the quarter the Company commenced construction on project Pupin, a 94 MW wind project in Serbia. Pupin is located adjacent to our existing operational asset in Serbia, Project Blacksmith, leveraging the same point of interconnection under our land and expand strategy.

On the development front, Gecama Solar (Spain), a 250 MW solar and 200 MWh storage project, is approaching the start of construction. The Company believes the project is close to securing its environmental permit, which would be the final major development milestone. Construction is on schedule to commence by the end of 2023 with COD expected by year end 2024.

Within the Company’s operational portfolio in Europe, wind speeds during the second quarter were lower than expected across Spain, impacting Project Gecama (Spain). In addition, at Project Gecama, merchant pricing was lower than expected driven by falling natural gas prices. This was offset by significantly lower than expected windfall taxes (O&M costs). The windfall tax was implemented by the Spanish government to reduce the impact of high electricity prices on consumers, by taxing renewable generators. The windfall tax moves in tandem with natural gas prices. During the second quarter of 2023, Gecama (Spain) sold electricity at an average price of EUR 65 per MWh, of which 65% was hedged at EUR 58 per MWh with the remainder sold on merchant basis at EUR 79 per MWh. Windfall taxes were EUR 4 per MWh. While merchant prices were lower than expected in the second quarter, merchant prices in Spain remain high through 2024. During the second quarter, the Company signed hedges comprising 22% of production at an average price of EUR 97 per MWh for 2024 delivery.

Israel

In the second quarter, Genesis Wind, the largest renewable energy project in Israel, totaling 207 MWwas connectedto the grid. Full COD is expected by the end of the third quarter 2023.

The Company continues to progress construction on Solar + Storage project clusters, totaling 248 MW and 474 MWh of storage. During the second quarter 23 MW and 40 MWh reached commercial operation. An additional 67 MW and 115 MWh is expected to reach commercial operation before the end of 2023, with the remainder of the cluster expected to be commercialized by the end of the first half of 2024.

The Company made significant progress during the quarter on securing offtake for the Solar + Storage projects. Corporate PPAs were signed with leading multinationals including Amdocs, and SodaStream (subsidiary of PepsiCo) totaling 30 MW and 60 MWh, with negotiations ongoing with several additional offtakers. As a result of the deregulation of the electricity market in Israel, we are observing significant corporate demand for renewable energy, which has increased our PPA prices and the returns we expect to generate from our future projects.

Post-quarter end, in July 2023, the Company sold two small projects in Israel totaling 25 MW at a valuation of $465,000 per MW. This is expected to contribute about $6m of net proceeds in the third quarter.

Balance Sheet

The Company benefits from a strong and diversified liquidity position, with 84% of cash and cash equivalents held in U.S. dollars or Euros, with minimal exposure to the Israeli shekel.

($ thousands)   June 30, 2023
Cash and Cash Equivalents:    
Enlight Renewable Energy Ltd ,Enlight EU Energies Kft and Enlight Renewable LLC, excluding subsidiaries (“Topco”)   147,312
Subsidiaries   173,406
Deposits:    
Short term deposits   3,693
Restricted Cash:    
Projects under construction   86,909
Reserves, including debt service, performance obligations and others   39,305
Total Cash   450,625
Financial assets at fair value through profit or loss*   32,948
Total Liquidity   483,573

* Securities, largely government fixed income securities

The Company secured $170m of revolving credit facilities from numerous Israeli banks. The revolving credit facilities, which are undrawn, demonstrate our financial strength and provide additional flexibility to the Company as it delivers on its Mature Project portfolio.

2023 Financial Outlook

Commenting on the outlook, Enlight Chief Financial Officer Nir Yehuda noted, “In light of lower merchant pricing and weaker wind speeds in Spain we have revised our revenue forecast for the year. This impact is expected to be offset at the Adjusted EBITDA level by lower O&M costs, as windfall tax costs in Spain have significantly decreased, driven by lower natural gas prices, coupled with compensation recognized from Siemens Gamesa for Project Björnberget. We are therefore pleased to affirm our Adjusted EBITDA guidance for 2023.”

Details of the 2023 outlook include:

  • Revenue between $265m and $275m
  • Adjusted EBITDA*reaffirmed between$188m and $198m

* The section titled “Non-IFRS Financial Measures” below contains a description of Adjusted EBITDA, a non-IFRS financial measure discussed in this press release. A reconciliation between Adjusted EBITDA and Net Income, its most directly comparable IFRS financial measure, is contained in the tables below. The Company is unable to provide a reconciliation of Adjusted EBITDA to Net Income on a forward-looking basis without unreasonable effort because items that impact this IFRS financial measure are not within the Company’s control and/or cannot be reasonably predicted. These items may include, but are not limited to, forward-looking depreciation and amortization, share based compensation, other income, finance income, finance expenses, share of losses of equity accounted investees and taxes on income. Such information may have a significant, and potentially unpredictable, impact on the Company’s future financial results. We note that “Adjusted EBITDA” measures that we disclosed in previous filings in Israel were not comparable to “Adjusted EBITDA” disclosed in the release and in our future filings.

Conference Call Information

Enlight plans to hold its Second Quarter 2023 Conference Call and Webcast on Wednesday, August 09, 2023 at 8:00 a.m. ET to review its financial results and business outlook. Management will deliver prepared remarks followed by a question-and-answer session. Participants can join by conference call or webcast:

The press release with the financial results as well as the investor presentation materials will be accessible from the Company’s website prior to the conference call. Approximately one hour after completion of the live call, an archived version of the webcast will be available on the Company’s investor relations website at https://enlightenergy.co.il/info/investors/.

Supplemental Financial and Other Information

We intend to announce material information to the public through the Enlight investor relations website at https://enlightenergy.co.il/info/investors, SEC filings, press releases, public conference calls, and public webcasts. We use these channels to communicate with our investors, customers, and the public about our company, our offerings, and other issues. As such, we encourage investors, the media, and others to follow the channels listed above, and to review the information disclosed through such channels.

Any updates to the list of disclosure channels through which we will announce information will be posted on the investor relations page of our website.

Non-IFRS Financial Measures

This release presents Adjusted EBITDA, a financial metric, which is provided as a complement to the results provided in accordance with the International Financial Reporting Standards as issued by the International Accounting Standards Board (“IFRS”). A reconciliation of the non-IFRS financial information to the most directly comparable IFRS financial measure is provided in the accompanying tables found at the end of this release.

We define Adjusted EBITDA as net income (loss) plus depreciation and amortization, share based compensation, finance expenses, taxes on income and share in losses of equity accounted investees and minus finance income and non-recurring other income. Non-recurring other income for the second quarter of 2023 included income recognized in relation to the reduction of earnout we expect to pay as part of the Clenera Acquisition. With respect to other expense (income), as part of Enlight’s strategy to accelerate growth and reduce the need for equity financing, the Company sells parts of, or entire, developed assets from time to time, and therefore includes realized gains and losses from these asset dispositions in Adjusted EBITDA. Our management believes Adjusted EBITDA is indicative of operational performance and ongoing profitability and uses Adjusted EBITDA to evaluate the operating performance and for planning and forecasting purposes.

Non-IFRS financial measures have limitations as analytical tools and should not be considered in isolation or as substitutes for financial information presented under IFRS. There are a number of limitations related to the use of non-IFRS financial measures versus comparable financial measures determined under IFRS. For example, other companies in our industry may calculate the non-IFRS financial measures that we use differently or may use other measures to evaluate their performance. All of these limitations could reduce the usefulness of our non-IFRS financial measures as analytical tools. Investors are encouraged to review the related IFRS financial measure, Net Income, and the reconciliations of Adjusted EBITDA provided below to Net Income and to not rely on any single financial measure to evaluate our business.

Special Note Regarding Forward-Looking Statements

This press release contains forward-looking statements within the meaning of the U.S. Private Securities Litigation Reform Act of 1995. We intend such forward-looking statements to be covered by the safe harbor provisions for forward-looking statements as contained in Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. All statements contained in this press release other than statements of historical fact, including, without limitation, statements regarding the Company’s business strategy and plans, capabilities of the Company’s project portfolio and achievement of operational objectives, market opportunity and potential growth, discussions with commercial counterparties and financing sources, progress of Company projects, including anticipated timing of related approvals and counterparty obligations in connection with production delays, the Company’s future financial results, expected impact from various regulatory developments, including the IRA, expectations regarding wind production, electricity prices and windfall taxes, and Revenue, EBITDA, and Adjusted EBITDA guidance, the expected timing of completion of our ongoing projects, and the Company’s anticipated cash requirements and financing plans, are forward-looking statements. The words “may,” “might,” “will,” “could,” “would,” “should,” “expect,” “plan,” “anticipate,” “intend,” “target,” “seek,” “believe,” “estimate,” “predict,” “potential,” “continue,” “contemplate,” “possible,” “forecasts,” “aims” or the negative of these terms and similar expressions are intended to identify forward-looking statements, though not all forward-looking statements use these words or expressions.

These statements are neither promises nor guarantees, but involve known and unknown risks, uncertainties and other important factors that may cause our genuine results, performance or achievements to be materially different from any future results, performance or achievements expressed or implied by the forward-looking statements, including, but not limited to, the following: our ability to site suitable land for, and otherwise source, renewable energy projects and to successfully develop and convert them into Operational Projects;availability of, and access to, interconnection facilities and transmission systems;our ability to obtain and maintain governmental and other regulatory approvals and permits, including environmental approvals and permits;construction delays, operational delays and supply chain disruptions leading to increased cost of materials required for the construction of our projects, as well as cost overruns and delays related to disputes with contractors;our suppliers’ ability and willingness to perform both existing and future obligations;competition from traditional and renewable energy companies in developing renewable energy projects;potential slowed demand for renewable energy projects and our ability to enter into new offtake contracts on acceptable terms and prices as current offtake contracts expire;offtakers’ ability to terminate contracts or seek other remedies resulting from failure of our projects to meet development, operational or performance benchmarks;various technical and operational challenges leading to unplanned outages, reduced output, interconnection or termination issues;the dependence of our production and revenue on suitable meteorological and environmental conditions, and our ability to accurately predict such conditions;our ability to enforce warranties provided by our counterparties in the event that our projects do not perform as expected;government curtailment, energy price caps and other government actions that restrict or reduce the profitability of renewable energy production;electricity price volatility at assets with merchant exposure, unusual weather conditions (including the effects of climate change, could adversely affect wind and solar conditions), catastrophic weather-related or other damage to facilities, unscheduled generation outages, maintenance or repairs, unanticipated changes to availability due to higher demand, shortages, transportation problems or other developments, environmental incidents, or electric transmission system constraints and the possibility that we may not have adequate insurance to cover losses as a result of such hazards;our dependence on certain operational projects for a substantial portion of our cash flows;our ability to continue to grow our portfolio of projects through successful acquisitions;changes and advances in technology that impair or eliminate the competitive advantage of our projects or upsets the expectations underlying investments in our technologies;our ability to effectively anticipate and manage cost inflation, interest rate risk, currency exchange fluctuations and other macroeconomic conditions that impact our business;our ability to retain and attract key personnel;our ability to manage legal and regulatory compliance and litigation risk across our global corporate structure;our ability to protect our business from, and manage the impact of, cyber-attacks, disruptions and security incidents, as well as acts of terrorism or war;changes to existing renewable energy industry policies and regulations that present technical, regulatory and economic barriers to renewable energy projects;the reduction, elimination or expiration of government incentives for, or regulations mandating the use of, renewable energy;our ability to effectively manage our supply chain and comply with applicable regulations with respect to international trade relations, tariffs, sanctions, export controls and anti-bribery and anti-corruption laws;our ability to effectively comply with Environmental Health and Safety and other laws and regulations and receive and maintain all necessary licenses, permits and authorizations;our performance of various obligations under the terms of our indebtedness (and the indebtedness of our subsidiaries that we guarantee) and our ability to continue to secure project financing on attractive terms for our projects;limitations on our management rights and operational flexibility due to our use of tax equity arrangements;potential claims and disagreements with partners, investors and other counterparties that could reduce our right to cash flows generated by our projects;our ability to comply with tax laws of various jurisdictions in which we currently operate as well as the tax laws in jurisdictions in which we intend to operate in the future;the unknown effect of the dual listing of our ordinary shares on the price of our ordinary shares;various risks related to our incorporation and location in Israel;the costs and requirements of being a public company, including the diversion of management’s attention with respect to such requirements; certain provisions in our Articles of Association and certain applicable regulations that may delay or prevent a change of control; and; and the other risk factors set forth in the section titled “Risk factors” in our Annual Report on Form 20-F for the fiscal year ended December 31, 2022 filed with the Securities and Exchange Commission (the “SEC”)and our other documents filed with or furnished to the SEC.  

These statements reflect management’s current expectations regarding future events and operating performance and speak only as of the date of this press release. You should not put undue reliance on any forward-looking statements. Although we believe that the expectations reflected in the forward-looking statements are reasonable, we cannot ensure that future results, levels of activity, performance and events and circumstances reflected in the forward-looking statements will be achieved or will occur. Except as required by applicable law, we undertake no obligation to update or revise publicly any forward-looking statements, whether as a result of new information, future events or otherwise, after the date on which the statements are made or to reflect the occurrence of unanticipated events.

About Enlight

Founded in 2008, Enlight develops, finances, constructs, owns, and operates utility-scale renewable energy projects. Enlight operates across the three largest renewable segments today: solar, wind and energy storage. A global platform, Enlight operates in the United States, Israel and 9 European countries. Enlight has been traded on the Tel Aviv Stock Exchange since 2010 (TASE: ENLT) and completed its US IPO (Nasdaq: ENLT) in 2023.

Appendix 1 – Financial information

Consolidated Statements of Income

    For the six months ended

June 30

  For the three months ended

June 30

 
    2023   2022   2023   2022  
    USD in   USD in   USD in   USD in  
    thousands   thousands   thousands   thousands  
    (Unaudited)   (Unaudited)   (Unaudited)   (Unaudited)  
                   
Revenues   123,557   74,939   52,563   39,879   
Cost of sales   (20,413 ) (14,281 ) (10,160 ) (7,924 )
Depreciation and amortization   (25,961 ) (16,214 ) (13,211 ) (9,613 )
Gross profit   77,183   44,444   29,192   22,342   
General and administrative expenses   (16,491 ) (13,912 ) (8,418 ) (7,872 )
Development expenses   (2,888 ) (2,653 ) (1,513 ) (1,346 )
Other income   14,734   918   14,229   587   
    (4,645 ) (15,647 ) 4,298   (8,631 )
Operating profit   72,538   28,797   33,490   13,711   
           
Finance income   32,262   13,303   11,885   5,062   
Finance expenses   (33,431 ) (31,663 ) (17,068 ) (19,574 )
Total finance expenses, net   (1,169 ) (18,360 ) (5,183 ) (14,512 )
           
Profit (loss) before tax and equity loss   71,369   10,437   28,307   (801  )
Share of loss of equity accounted investees   (368 ) (70 ) (163 ) (11 )
Profit (loss) before income taxes   71,001   10,367   28,144   (812  )
Taxes on income   (15,294 ) (2,504 ) (5,713 ) (196 )
Profit (loss) for the period   55,707   7,863   22,431   (1,008  )
           
Profit (loss) for the period attributed to:          
Owners of the Company   38,541   2,679   14,547   (2,112  )
Non-controlling interests   17,166   5,184   7,884   1,104   
    55,707   7,863   22,431   (1,008  )
Earnings (loss) per ordinary share (in USD)          
   with a par value of NIS 0.1, attributable to          
   owners of the parent Company:          
Basic earnings (loss) per share   0.34   0.03   0.12   (0.02 )
Diluted earnings (loss) per share   0.32   0.03   0.12   (0.02 )
Weighted average of share capital used in the          
   calculation of earnings:          
Basic per share   113,564,373   94,566,329   117,638,008   95,596,371  
Diluted per share   121,823,868   97,214,919   125,873,060   95,659,637  

Consolidated Statements of Financial Position as of

    June 30   December 31
    2023   2022
    USD in   USD in
    thousands   thousands
Assets   (Unaudited)   (Audited)
         
Current assets        
Cash and cash equivalents   320,718   193,869
Deposits in banks   3,693   4,054
Restricted cash   86,909   92,103
Financial assets at fair value through profit or loss   32,948   33,895
Trade receivables   29,320   39,822
Other receivables   37,865   36,953
Current maturities of contract assets   7,533   7,622
Current maturities of loans to investee entities   -   13,893
Other financial assets   6,037   1,493
Total current assets   525,023   423,704
         
Non-current assets        
Restricted cash   39,305   38,728
Other long term receivables   32,597   6,542
Deferred costs in respect of projects   230,302   205,575
Deferred borrowing costs   3,685   6,519
Loans to investee entities   32,946   14,184
Contract assets   92,534   99,152
Fixed assets, net   2,509,953   2,220,734
Intangible assets, net   279,870   279,717
Deferred taxes   4,706   4,683
Right-of-use asset, net   117,006   96,515
Financial assets at fair value through profit or loss   50,838   42,918
Other financial assets   80,663   94,396
Total non-current assets   3,474,405   3,109,663
         
Total assets   3,999,428   3,533,367

Consolidated Statements of Financial Position as of (Cont.)

    June 30   December 31
    2023   2022 
    USD in   USD in
    thousands   thousands
Liabilities and equity   (Unaudited)   (Audited)
         
Current liabilities        
Credit and current maturities of loans from        
banks and other financial institutions   216,098   165,627  
Trade payables   25,954   34,638  
Other payables   65,552   77,864  
Current maturities of debentures   15,058   15,832  
Current maturities of lease liability   5,833   5,850  
Financial liabilities through profit or loss   44,863   35,283  
Other financial liabilities   9,902   50,255  
Total current liabilities   383,260   385,349  
         
Non-current liabilities        
Debentures   226,088   238,520  
Convertible debentures   126,459   131,385  
Loans from banks and other financial institutions   1,532,268   1,419,057  
Loans from non-controlling interests   92,312   90,908  
Financial liabilities through profit or loss   32,706   48,068  
Deferred taxes   37,553   14,133  
Employee benefits   8,463   12,238  
Lease liability   115,064   93,773  
Asset retirement obligation   50,480   49,902  
Total non-current liabilities   2,221,393   2,097,984  
         
Total liabilities   2,604,653   2,483,333  
         
Equity        
Ordinary share capital   3,284   2,827  
Share premium   1,028,395   762,516  
Capital reserves   52,689   30,469  
Proceeds on account of convertible options   15,496   15,496  
Accumulated profit (loss)   31,327   (7,214 )
Equity attributable to shareholders of the Company   1,131,191   804,094  
Non-controlling interests   263,584   245,940  
Total equity   1,394,775   1,050,034  
Total liabilities and equity   3,999,428   3,533,367  

Consolidated Statements of Cash Flows

  For the six months period ended June 30 For the three months period ended June 30
  2023  2022  2023  2022 
  USD in USD in USD in USD in
  Thousands Thousands Thousands Thousands
  (Unaudited) (Unaudited) (Unaudited) (Unaudited)
         
Cash flows for operating activities        
Profit (loss) for the period 55,707   7,863   22,431   (1,008 )
Adjustments required to present cash flows from operating activities (Annex A) 49,405   30,702   21,917   23,540  
         
Cash from operating activities 105,112   38,565   44,348   22,532  
Interest receipts 7,791   1,457   3,240   1,068  
Interest paid (22,695 ) (15,272 ) (10,631 ) (6,768 )
Income Tax paid (2,854 ) (1,741 ) (2,406 ) (1,501 )
Repayment of contract assets 7,447   10,699   4,807   4,985  
         
Net cash from operating activities 94,801   33,708   39,358   20,316  
         
Cash flows for investing activities        
Restricted cash, net 2,006   (72,593 ) (16,684 ) (56,595 )
Purchase, development, and construction of fixed assets (345,291 ) (246,689 ) (208,092 ) (104,715 )
Investment in deferred costs in respect of projects (14,331 ) (16,766 ) (2,752 ) (7,674 )
Proceeds from sale (purchase) of short-term financial assets measured at fair value through

profit or loss, net

(155 ) 190   (816 ) 853  
Changes in bank deposits 450   -   (946 ) -  
Loans provided to investee, net (8,903 ) (1,519 ) (21,161 ) (1,519 )
Payments on account of acquisition of consolidated company (1,073 ) (1,202 ) -   (1,202 )
Investment in investee (65 ) (98 ) (53 ) (98 )
Purchase of long-term financial assets measured at fair value through profit or loss (5,682 ) -   (2,478 ) -  
Net cash used in investing activities (373,044 ) (338,677 ) (252,982 ) (170,950 )

Consolidated Statements of Cash Flows (Cont.)

  For the six months period ended June 30 For the three months period ended June 30
  2023  2022  2023  2022 
  USD in USD in USD in USD in
  Thousands Thousands Thousands Thousands
  (Unaudited) (Unaudited) (Unaudited) (Unaudited)
 
Cash flows from financing activities        
Receipt of loans from banks and other financial institutions 202,542   213,998   33,001   103,112  
Repayment of loans from banks and other financial institutions (42,748 ) (24,032 ) (29,613 ) (12,548 )
Issuance of convertible debentures -   47,578   -   -  
Repayment of debentures (1,300 ) (1,463 ) -   -  
Dividends and distributions by subsidiaries to non-controlling interests (5,227 ) (3,113 ) (3,247 ) (2,982 )
Proceeds in respect of derivative financial instruments -   4,392   -   4,392  
Deferred borrowing costs (1,041 ) (2,637 ) (36 ) (1,046 )
Receipt of loans from non-controlling interests 274   19,278   274   -  
Repayment of loans from non-controlling interests (663 ) (2,387 ) -   (2,244 )
Issuance of shares 266,635   69,293   (3,166 ) -  
Repayment of lease liability (2,931 ) (2,715 ) (536 ) (702 )
Proceeds from investment in entities by non-controlling interest 2,679   775   -   613  
         
Net cash from (used in) financing activities 418,220   318,967   (3,323 ) 88,595  
         
Increase (Decrease) in cash and cash        
equivalents 139,977   13,998   (216,947 ) (62,039 )
         
Balance of cash and cash equivalents at        
beginning of period 193,869   265,933   542,467   338,878  
         
Effect of exchange rate fluctuations on cash and cash equivalents (13,128 ) (29,378 ) (4,802 ) (26,286 )
         
Cash and cash equivalents at end of period 320,718   250,553   320,718   250,553  

Consolidated Statements of Cash Flows (Cont.)

  For the six months period ended June 30 For the three months period ended June 30
  2023  2022  2023  2022 
  USD in USD in USD in USD in
  Thousands Thousands Thousands Thousands
  (Unaudited) (Unaudited) (Unaudited) (Unaudited)
Annex A - Adjustments Required to Present Cash        
Flows From operating activities:        
         
Income and expenses not associated with cash        
flows:        
Depreciation and amortization 26,777   17,032   13,637   10,017  
Finance expenses in respect of project finance loans 31,939   26,090   17,203   16,319  
Finance expenses in respect of loans from non-controlling interests 737   450   366   219  
Finance expenses (income) in respect of contingent consideration (6,303 ) 1,900   (6,501 ) 529  
Interest income from deposits (6,093 ) -   (3,077 ) -  
Fair value changes of financial instruments measured at fair value through profit or loss (2,423 ) 591   (458 ) 691  
Share-based compensation 2,850   5,110   1,461   2,629  
Deferred taxes 8,664   1,130   3,524   (250 )
Finance expenses in respect of lease liability 1,089   853   539   521  
Finance income in respect of contract asset (5,950 ) (11,431 ) (3,075 ) (3,949 )
Exchange rate differences and others (1,689 ) (1,050 ) (542 ) (1,112 )
Interest income from loans to investees (448 ) (539 ) (241 ) (222 )
Company’s share in losses of investee partnerships 367   71   162   12  
Finance expenses (income) in respect of forward transaction (2,979 ) 823   (2,680 ) 685  
  46,538   41,030   20,318   26,089  
         
Changes in assets and liabilities items:        
Change in other receivables (13,331 ) (851 ) (15,148 ) (335 )
Change in trade receivables 10,837   (10,057 ) 13,221   (2,079 )
Change in other payables 5,530   1,947   4,502   440  
Change in trade payables (169 ) (1,367 ) (976 ) (575 )
  2,867   (10,328 ) 1,599   (2,549 )
         
  49,405   30,702   21,917   23,540  

Segmental Reporting

  For the six months ended June 30, 2023
  Israel Central-

Eastern

Europe

Western

Europe

Management

and

construction

Total

reportable

segments

 Adjustments Total
  USD in thousands
  (Unaudited)
External revenues 29,757 44,337 45,193 4,270 123,557 -   123,557  
Inter-segment revenues - - - 2,642 2,642 (2,642 ) -  
Total revenues 29,757 44,337 45,193 6,912 126,199 (2,642 ) 123,557  
               
Segment Adjusted              
EBITDA 30,450 37,438 46,647 1,794 116,329 -   116,329  
               
               
Reconciliations of unallocated amounts:  
Headquarter costs (*) (14,493 )
Intersegment profit 701  
Repayment of contract asset under concession arrangements (7,447 )
Depreciation and amortization and share based compensation (29,627 )
Other incomes not attributed to segments 7,075  
Operating profit 72,538  
Finance income 32,262  
Finance expenses (33,431 )
Share in the losses of equity accounted investees (368 )
Profit before income taxes 71,001  
(*)   Including general and administrative and development expenses (excluding depreciation and amortization and share based compensation).

Segmental Reporting (cont.)

  For the six months ended June 30, 2022
   Israel Central-

Eastern

Europe 

Western

Europe 

Management

and

construction

Total

reportable

segments

Adjustments   Total  
  USD in thousands
  (Unaudited)
               
External revenues 22,685 37,946 9,596 4,712 74,939 -   74,939  
Inter-segment revenues - - - 3,216 3,216 (3,216 ) -  
Total revenues 22,685 37,946 9,596 7,928 78,155 (3,216 ) 74,939  
               
Segment Adjusted              
EBITDA 28,625 30,773 7,480 2,573 69,451 -   69,451  
               
               
Reconciliations of unallocated amounts:  
Headquarter costs (*) (7,670 )
Intersegment profit (143 )
Repayment of contract asset under concession arrangements (10,699 )
Depreciation and amortization and share based compensation (22,142 )
Operating profit 28,797  
Finance income 13,303  
Finance expenses (31,663 )
Share in the losses of equity accounted investees (70 )
Profit before income taxes 10,367  
(*)   Including general and administrative and development expenses (excluding depreciation and amortization and share based compensation).

Segmental Reporting (cont.)

  For the three months ended June 30, 2023
   Israel  Central-

Eastern

Europe

Western

Europe 

Management

and

construction

Total

reportable

segments

Adjustments  

Total

 
  USD in thousands
  (Unaudited)
External revenues 15,919 21,102 13,405 2,137 52,563 -   52,563  
Inter-segment revenues - - - 1,246 1,246 (1,246 ) -  
Total revenues 15,919 21,102 13,405 3,383 53,809 (1,246 ) 52,563  
               
Segment Adjusted              
EBITDA 16,987 17,691 18,740 1,043 54,461 -   54,461  
               
               
Reconciliations of unallocated amounts:  
Headquarter costs (*) (8,438 )
Intersegment profit 297  
Repayment of contract asset under concession arrangements (4,807 )
Depreciation and amortization and share based compensation (15,098 )
Other incomes not attributed to segments 7,075  
Operating profit 33,490  
Finance income 11,885  
Finance expenses (17,068 )
Share in the losses of equity accounted investees (163 )
Profit before income taxes 28,144  
(*)   Including general and administrative and development expenses (excluding depreciation and amortization and share based compensation).

Segmental Reporting (cont.)

  For the three months ended June 30, 2022
   Israel   Central

-Eastern

Europe 

Western

Europe 

Management

and

construction

Total

reportable

segments

Adjustments  

Total

 
  USD in thousands
  (Unaudited)       
External revenues 17,996 16,616 3,007 2,260 39,879 -   39,879  
Inter-segment revenues - - - 1,622 1,622 (1,622 ) -  
Total revenues 17,996 16,616 3,007 3,882 41,501 (1,622 ) 39,879  
               
Segment Adjusted              
EBITDA 19,943 12,888 1,622 1,218 35,671 -   35,671  
               
               
Reconciliations of unallocated amounts:  
Headquarter costs (*) (4,404 )
Intersegment profit 75  
Repayment of contract asset under concession arrangements (4,985 )
Depreciation and amortization and share based compensation (12,646 )
Operating profit 13,711  
Finance income 5,062  
Finance expenses (19,574 )
Share in the losses of equity accounted investees (11 )
Profit before income taxes (812 )
(*)   Including general and administrative and development expenses (excluding depreciation and amortization and share based compensation).

Appendix 2 - Reconciliations between Net Income to Adjusted EBITDA

($ thousands) For the six months ended at For the three months ended at
  06/30/23 06/30/22 06/30/23 06/30/22
Net Income (loss) 55,707   7,863   22,431   (1,008 )
Depreciation and amortization 26,777   17,032   13,637   10,017  
Share based compensation 2,850   5,110   1,461   2,629  
Finance income (32,262 ) (13,303 ) (11,885 ) (5,062 )
Finance expenses 33,431   31,663   17,068   19,574  
Non-recurring other income (*) (7,075 ) -   (7,075 ) -  
Share of losses of equity accounted investees 368   70   163   11  
Taxes on income 15,294   2,504   5,713   196  
Adjusted EBITDA 95,090   50,939   41,513   26,357  
(*)   Non-recurring other income comprised the recognition of income related to reduced earnout payments expected to be incurred for the acquisition of Clenera for early-stage projects.

Appendix 3 - Mature Projects: 4.6 GW and 3.6 GWh operational by 2025

Appendix 4 - Mature Projects information

a) Segment information: Operational projects

($ thousands)   6 Months ended June 30 3 Months ended June 30
Operational Project Segments Installed

Capacity

(MW)

Installed

Storage

(MWh) 

Generation

(GWh)

Reported Revenue* Segment Adjusted

EBITDA****

Generation

(GWh)

Reported Revenue* Segment Adjusted

EBITDA****

2023 2022 2023 2022 2023 2022 2023 2022 2023 2022 2023 2022
Israel* 237 - 275 234 29,757 22,685 30,450 28,613 151 168 15,919 17,996 16,987 19,931
Western Europe**** 831 - 675 185 45,193 9,596 46,647 7,477 259 70 13,405 3,007 18,740 1,619
Central & Eastern Europe 316 - 400 379 44,337 37,946 37,438 30,760 180 165 21,102 16,616 17,691 12,875
Total Consolidated 1,384 - 1,350 798 119,287 70,227 114,535 66,850 590 404 50,426 37,619 53,418 34,425
Unconsolidated

at Share

12 -                    
Total 1,396 -                      
Total Consolidated H1 Segment Adjusted EBITDA 114,535
Less: H1 EBITDA for projects that were not fully operational for H1 (Bjorn) (11,897)
Annualized Consolidated Adjusted EBITDA** 205,276
Invested capital for projects that were fully operational as of January 1st 2023*** 1,600,000  
Asset Level Return on Project Costs 12.8%
*   In addition to our reported revenue, we generated $8m and $6m in the 6 months and 3 months respectively ,ended June 23 of proceeds from the sale of electricity under long terms PPAs which are not treated as revenue (projects treated as Financial Assets)
**    We use an annualized total amount of Segment Adjusted EBITDA given the rapid growth of our Operational Projects between quarters, which resulted in rapid growth in our Segment Adjusted EBITDA in between quarters. In addition, our geographic and technological diversity substantially mitigates any seasonal effects.
***    Invested capital in a project reflects the total cost we incurred to complete the development and construction of such project.
****    EBITDA results for 2023 included $8m of compensation recognized from Siemens Gamesa due to the delay in reaching full production at Project Björnberget
     

b) Operational Projects Further Detail

($ thousands)       6 Months ended June 30, 2023 3 Months ended June 30, 2023  
Operational Project Segment Installed

Capacity

(MW)

Installed

Storage

(MWh)

Reported

Revenue*

Segment Adjusted

EBITDA**

Reported

Revenue*

Segment Adjusted EBITDA** Debt balance as of

June 30, 2023

Ownership %
Emek Habacha Israel 109 - 14,271   6,865   160,433 41%
Haluziot Israel 55 - 9,877   6,182   174,438 90%
Sunlight 1+2 Israel 42 - 3,384   1,972   53,375 75%
Israel Solar Projects* Israel 31 - 2,225   900   115,832 98%
Total Israel   237 - 29,757 30,450 15,919 16,987 504,079  
Gecama W. Europe 329 - 30,355   9,457   165,926 72%
Bjorenberget** W. Europe 372 - 4,602   1,298   172,585 55%
Picasso W. Europe 116 - 9,063   2,185   81,635 69%
Tully W. Europe 14 - 1,174   465   12,406 50%
Total Western Europe   831 - 45,193 46,647 13,405 18,740 432,551  
Selac CEE 105 - 14,800   6,760   101,182 60%
Blacksmith CEE 105 - 17,920   8,082   96,607 50%
Lukovac CEE 49 - 7,883   3,608   42,516 50%
Attila CEE 57 - 3,735   2,651   36,944 50%
Total Central and Eastern Europe ("CEE") 316 - 44,337 37,438 21,102 17,691 277,249  
Total Consolidated Projects 1,384 - 119,288 114,535 50,426 53,418 1,213,879  
Uncons. Projects at share 12             50%
Total   1,396 - 119,288 114,535 50,426 53,418 1,213,879    
                   
($ millions)                
Operational after

financial statements

Segment Installed

Capacity (MW)

Installed

Storage (MWh)

  Est. First Full

Year Revenue

Est. First Full Year

EBITDA

Debt balance as of

June 30, 2023

Ownership %
Solar+Storage Cluster Israel 23 40     4 3 - 100%
AC/DC Hungary 26 -     2 2 - 100%
Apex Solar United States 105 -     12 8 117 100%
Total   154 40     18 13 117  
*   In addition to our reported revenue, we generated $8m and $6m in the 6 months and 3 months respectively ,ended June 23 of proceeds from the sale of electricity under long terms PPAs which are not treated as revenue (projects treated as Financial Assets)
**   EBITDA results for 2023 included $8m of compensation recognized from Siemens Gamesa due to the delay in reaching full production at Project Björnberget

c) Projects under construction

Consolidated Projects

($ millions)*

Country Capacity

(MW)

Storage

Capacity

(MWh)

Est.

COD

Est. Total

Project Cost

Capital

Invested as of June 30, 2023

Est. Equity Required (%) Equity Invested

as of June 30, 2023

Est. Tax Equity

(% of project cost)**

Debt balance

as of June 30, 2023

Est. First Full Year Revenue Est. First Full Year EBITDA**** Ownership %*****
Atrisco Solar United States 364 1,200 H1 2024 824-866*** 217 12.5% 217 55% - 51-53 43-45 100%
Genesis Wind + Expansion Israel 207 - H2 2023 331-348 326 15% 51 N/A 275 49-51 39-41 54%
Solar+Storage Clusters Israel 225 434 H2 2023 – H1 2024 282-297 149 25% 125 N/A 24 31-32 22-23 68%
Tapolca Hungary 60 - H1 2024 50-52 16 35% 16 N/A - 9-10 8-9 100%
Pupin Serbia 94 - H2 2025 149-157 7 30% 7 N/A - 25-26 16-17 100%
Total Consolidated Projects   950 1,634   1,636-1,720 715   416   299 165-172 128-135  
Uncons. Projects at share Israel 19 16 H1 2024 18-19 14 30% 14 N/A - 2 2 50%
Total   969 1,650   1,654-1,739 729   430   299 167-174 130-137  
*   For projects not located in the United States, the conversion into U.S. dollars was based on foreign exchange rates as of the date of the financial statements (June 30, 2023)
**   Total tax equity investment anticipated as a percentage of total project costs
***   Project costs for Atrisco are presented as net of reimbursable network upgrades of $68m which are to be reimbursed in first five years of project
****   EBITDA does not include recognition of PTC or ITC tax credits. EBITDA is a non-IFRS financial measure. The Company is unable to provide a reconciliation of EBITDA to Net Income on a forward-looking basis without unreasonable effort because items that impact this IFRS financial measure are not within the Company’s control and/or cannot be reasonably predicted.
*****   The legal ownership share for all U.S. projects is 90%, but Enlight invests 100% of the equity in the project and entitled to 100% of the project distributions until full repayment of Enlight capital plus a preferred return

d) Pre-Construction Projects (due to commence construction within 12 months of the Approval Date)

Major Projects

($ millions)*

Country Generation Capacity

(MW)

Storage

Capacity

(MWh)

Est.

COD

Est. Total

Project Cost

Capital

Invested as of June 30, 2023

Est. Equity Required (%) Equity

Invested as of

June 30, 2023

Est. Tax

Equity (% of project cost)**

Est. First Full Year Revenue Est. First Full Year EBITDA*** Ownership %****
CoBar Complex United States 1,210 824 2025 1,595-1,677 24 18% 24 47% 103-109 81-85 100%
Rustic Hills United States 256 - H1 2025 304-320 5 18% 5 52% 16-17 13-14 100%
Roadrunner United States 250 800 H1 2026 565-593 1 15% 1 51% 41-43 32-33 100%
Gecama Solar Spain 250 200 H2 2024 244-257 1 50% 1 N/A 38-40 32-33 72%
Other Projects

($ millions)*

MW Deployment Storage

Capacity

(MWh)

Est. Total

Project Cost

Capital Invested as of June 30, 2023 Est. Equity Required (%) Equity Invested as of June 30, 2023 Est. Tax Equity (% of project cost)** Est. First Full Year Revenue Est. First Full Year EBITDA*** Ownership %****
  2023 2024 2025  
United States - - 319 - 386-406 11 21% 11 44% 25-26 19-20 100%
Europe     - 400 115-121 - 45% - N/A 34-36 15--16 100%
Israel - - 38 406 177-186 2 28% 2 N/A 39-41 14-15 70%
Total - - 357 806 678-713 13   13   98-103 48-51  
Uncons. projects at share - - 20 50 27-28 - 30% - N/A 3 2 50%
                     
Total Pre-Construction 2,344 MW   2,680 MWh 3,413-3,588 44   44   299-315 208-218  
*   For projects not located in the United States, the conversion into U.S. dollars was based on foreign exchange rates as of the date of the financial statements (June 30, 2023)
**   Total tax equity investment anticipated as a percentage of total project costs
***    EBITDA does not include recognition of PTC or ITC tax credits. EBITDA is a non-IFRS financial measure. The Company is unable to provide a reconciliation of EBITDA to Net Income on a forward-looking basis without unreasonable effort because items that impact this IFRS financial measure are not within the Company’s control and/or cannot be reasonably predicted
****   The legal ownership share for all U.S. projects is 90%, but Enlight invests 100% of the equity in the project and entitled to 100% of the project distributions until full repayment of Enlight capital plus a preferred return

Appendix 5 – Corporate level (TopCo) debt

($ thousands) June 30, 2023
Debentures:  
Debentures 241,146*
Convertible debentures 126,459
Loans from banks and other financial institutions:  
Loans from banks and other financial institutions 116,011
Total corporate level debt 483,616
*   Including current maturities of debentures in the amount of 15,058

Appendix 6 – Functional Currency Conversion Rates:

The financial statements of each of the Company’s subsidiaries were prepared in the currency of the main economic environment in which it operates (hereinafter: the “Functional Currency”). For the purpose of consolidating the financial statements, results and financial position of each of the Group’s member companies are translated into the Israeli shekel (“NIS”), which is the Company’s Functional Currency. The Group’s consolidated financial statements are presented in U.S. dollars (“USD”).

FX Rates to USD:

Date of the financial statements: Euro NIS
As of 30th June 2023 1.09 0.27
As of 30th June 2022 1.05 0.29
     
Average for the 3 months period ended:    
June 2023 1.09 0.27
June 2022 1.06 0.30

Photos accompanying this announcement are available at:

https://www.globenewswire.com/NewsRoom/AttachmentNg/b495ea3b-cdb7-44ed-a5e9-13ddca98788dhttps://www.globenewswire.com/NewsRoom/AttachmentNg/96fdb186-fb8e-4e48-8d2c-c7809229ae8e

Tue, 08 Aug 2023 22:58:00 -0500 en text/html https://www.bakersfield.com/ap/news/enlight-renewable-energy-reports-second-quarter-2023-financial-results/article_e5e41fe0-6d62-59e6-afb2-ad6275f9fc0c.html
Killexams : CoreCivic Reports Second Quarter 2023 Financial Results

Reduces Total Debt by $34.1 Million

Increases 2023 Full Year Guidance

BRENTWOOD, Tenn., Aug. 07, 2023 (GLOBE NEWSWIRE) -- CoreCivic, Inc. CXW (the Company) announced today its financial results for the second quarter of 2023.

Damon T. Hininger, CoreCivic's President and Chief Executive Officer, said, "Our second quarter financial results were better than our forecast and we are increasing our financial outlook for the year. We are increasing our financial outlook despite the challenging labor market, above average inflation and a higher interest rate environment. During the second quarter, we continued to execute on our long-term capital allocation strategy of reducing debt by repurchasing $21.0 million of our 8.25% Senior Notes that are scheduled to mature on April 15, 2026, through open market purchases."

Hininger continued, "The post-pandemic environment is creating new challenges for a number of our government partners, particularly as a result of the expiration of the Public Health Emergency for COVID-19 that occurred in May, which ended the Title 42 closure of the southern border. Specifically, certain government agencies are experiencing an increase in the need for correctional and detention capacity. We believe the significant investments we have made in our workforce have positioned us well to meet these emerging needs."

Financial Highlights – Second Quarter 2023

  • Total revenue of $463.7 million
    • CoreCivic Safety revenue of $421.7 million
    • CoreCivic Community revenue of $28.4 million
    • CoreCivic Properties revenue of $13.6 million
  • Net Income of $14.8 million
  • Diluted earnings per share of $0.13
  • Adjusted Diluted EPS of $0.12
  • Normalized Funds From Operations per diluted share of $0.33
  • Adjusted EBITDA of $72.1 million

Second Quarter 2023 Financial Results Compared With Second Quarter 2022

Net income in the second quarter of 2023 totaled $14.8 million, or $0.13 per diluted share, compared with net income in the second quarter of 2022 of $10.6 million, or $0.09 per diluted share. Adjusted for special items, adjusted net income in the second quarter of 2023 was $13.6 million, or $0.12 per diluted share (Adjusted Diluted EPS), compared with adjusted net income in the second quarter of 2022 of $16.2 million, or $0.13 per diluted share. Special items for each period are presented in detail in the calculation of Adjusted Net Income and Adjusted Diluted EPS in the Supplemental Financial Information following the financial statements presented herein.  

The special items in the prior year quarter contributed to the increase in net income per share of $0.04. The $0.01 per share decline in Adjusted Diluted EPS occurred in part due to the expiration of our contract with the Federal Bureau of Prisons (BOP) at the McRae Correctional Facility on November 30, 2022, and ongoing labor market pressures, including above average wage inflation, and higher staffing levels. Despite the expiration of the contract with the BOP at the McRae facility, a facility we sold to the state of Georgia in 2022, our renewal rate on owned and controlled facilities remains high at 94% over the previous five years. We believe our renewal rate on existing contracts remains high due to a variety of reasons including the aged and constrained supply of available beds within the U.S. correctional system, our ownership of the majority of the beds we operate, the value our government partners place in the wide range of recidivism-reducing programs we offer to those in our care, and the cost effectiveness of the services we provide.

Earnings before interest, taxes, depreciation and amortization (EBITDA) was $71.8 million in the second quarter of 2023, compared with $71.1 million in the second quarter of 2022. Adjusted EBITDA was $72.1 million in the second quarter of 2023, compared with $78.8 million in the second quarter of 2022. Adjusted EBITDA decreased from the prior year quarter primarily due to the previously mentioned labor market pressures across our facility portfolio, including above average wage inflation and higher staffing levels in anticipation of increased occupancy, and the expiration of our BOP contract at the McRae Correctional Facility in November 2022. EBITDA at the McRae Correctional Facility was $2.4 million during the second quarter of 2022.  

Although labor market pressures continue to be more difficult than historical norms, we have experienced improvements in the number of applicants at many of our facilities which has allowed us to achieve higher staffing levels in the second quarter of 2023 than in the prior year quarter. We believe the investments in staffing we made during the pandemic have positioned us to manage the increased number of residents we began to experience in the second quarter of 2023. On May 11, 2023, all remaining COVID-19 related health policies expired, most notably occupancy restrictions on our facilities and Title 42, a policy that denied entry at the United States border to asylum-seekers and anyone crossing the border without proper documentation or authority in an effort to contain the spread of COVID-19. Since the end of Title 42, the number of individuals in the custody of U.S. Immigration and Customs Enforcement (ICE) has increased 43%. We have experienced a similar increase within our facilities under contract with ICE, which we believe was possible because of our investments in staffing. Since May 11, 2023, through July 31, 2023, ICE detention populations within our facilities have increased by 2,573, or 45%. Despite the difficult labor market, we have been able to reduce certain labor-related expenses, such as registry nursing, temporary wage incentives, and travel, each of which moderated during the second quarter of 2023. We believe we can further reduce these expenses as the tight labor market continues to alleviate, which we expect will take additional time.

Funds From Operations (FFO) was $39.0 million, or $0.34 per diluted share, in the second quarter of 2023, compared to $34.3 million, or $0.28 per diluted share, in the second quarter of 2022. Normalized FFO, which excludes special items, was $37.8 million, or $0.33 per diluted share, in the second quarter of 2023, compared with $40.7 million, or $0.34 per diluted share, in the second quarter of 2022. Normalized FFO was impacted by the same factors that affected Adjusted EBITDA.  

Adjusted Net Income, EBITDA, Adjusted EBITDA, FFO, and Normalized FFO, and, where appropriate, their corresponding per share amounts, are measures calculated and presented on the basis of methodologies other than in accordance with generally accepted accounting principles (GAAP). Please refer to the Supplemental Financial Information and the note following the financial statements herein for further discussion and reconciliations of these measures to net income, the most directly comparable GAAP measure.

Business Update

New Lease Agreement with the State of Oklahoma at the Davis Correctional Facility. On June 14, 2023, we announced that we entered into a lease agreement with the Oklahoma Department of Corrections (ODOC) for the company-owned 1,670-bed Davis Correctional Facility, which we currently report in our CoreCivic Safety segment and operate under a management contract with the ODOC. The management contract was scheduled to expire on June 30, 2023. However, effective July 1, 2023, the Company entered into a 90-day contract extension for the management contract, after which time operations of the Davis facility will transfer from CoreCivic to the ODOC in accordance with the new lease agreement. We incurred a facility net operating loss of $0.9 million and $1.5 million for the three and six months ended June 30, 2023, respectively. Annual lease revenue under the new lease agreement will be $7.5 million during the base term, which we expect will generate margins consistent with the average margin we report in our Properties segment. The new lease agreement includes a base term commencing October 1, 2023, with a scheduled expiration date of June 30, 2029, and unlimited two-year renewal options. Upon commencement of the new lease agreement, the Davis facility will be reported in our CoreCivic Properties segment.

Share Repurchases

On May 12, 2022, our Board of Directors approved a share repurchase program authorizing the Company to repurchase up to $150.0 million of our common stock. On August 2, 2022, our Board of Directors authorized an increase in our share repurchase program of up to an additional $75.0 million in shares of our common stock, or a total of up to $225.0 million. During the three and six months ended June 30, 2023, we repurchased 0.1 million and 2.6 million shares of our common stock, respectively, at an aggregate purchase price of $0.7 million and $25.6 million, respectively, and in each case excluding fees, commissions and other costs related to the repurchases. Since the share repurchase program was authorized, through June 30, 2023, we have repurchased a total of 9.2 million shares at an aggregate price of $100.1 million under this share repurchase program, excluding fees, commissions and other costs related to the repurchases.

As of June 30, 2023, we had $124.9 million remaining under the share repurchase program authorized by the Board of Directors. Additional repurchases of common stock will be made in accordance with applicable securities laws and may be made at management's discretion within parameters set by the Board of Directors from time to time in the open market, through privately negotiated transactions, or otherwise. The share repurchase program has no time limit and does not obligate us to purchase any particular amount of our common stock. The authorization for the share repurchase program may be terminated, suspended, increased or decreased by our Board of Directors in its discretion at any time.

Debt Repayments

During the second quarter of 2023, we reduced our total debt balance by $34.1 million, or $24.5 million, net of the change in cash, increasing out total debt repaid for the six months ended June 30, 2023, to $72.7 million, net of the change in cash. During the second quarter of 2023, we purchased $21.0 million of our 8.25% Senior Notes in open market purchases, reducing the outstanding balance of the 8.25% Senior Notes to $593.1 million. We have no debt maturities until the 8.25% Senior Notes mature in April 2026.

2023 Financial Guidance

Based on current business conditions, we are providing the following update to our financial guidance for the full year 2023:

  Guidance
Full Year 2023
Prior Guidance
Full Year 2023
$58.4 million to $66.4 million $51.2 million to $63.2 million
$59.5 million to $67.5 million $53.5 million to $65.5 million
$0.51 to $0.58 $0.44 to $0.55
$0.52 to $0.59 $0.46 to $0.57
$1.36 to $1.44 $1.29 to $1.40
  • Normalized FFO per diluted share
$1.37 to $1.45 $1.31 to $1.42
$297.0 million to $303.0 million $291.3 million to $301.3 million
$297.3 million to $303.3 million $293.6 million to $303.6 million


During 2023, we expect to invest $68.0 million to $71.0 million in capital expenditures, consisting of $36.0 million to $37.0 million in maintenance capital expenditures on real estate assets, $25.0 million to $26.0 million for maintenance capital expenditures on other assets and information technology, and $7.0 million to $8.0 million for other capital investments.

Supplemental Financial Information and Investor Presentations

We have made available on our website supplemental financial information and other data for the second quarter of 2023. Interested parties may access this information through our website at http://ir.corecivic.com/ under "Financial Information" of the Investors section. We do not undertake any obligation and disclaim any duties to update any of the information disclosed in this report.  

Management may meet with investors from time to time during the third quarter of 2023. Written materials used in the investor presentations will also be available on our website beginning on or about August 28, 2023. Interested parties may access this information through our website at http://ir.corecivic.com/ under "Events & Presentations" of the Investors section.

Conference Call, Webcast and Replay Information

We will host a webcast conference call at 10:00 a.m. central time (11:00 a.m. eastern time) on Tuesday, August 8, 2023, which will be accessible through the Company's website at www.corecivic.com under the "Events & Presentations" section of the "Investors" page. To participate via telephone and join the call live, please register in advance here https://register.vevent.com/register/BI245ce05fd4c64a6ead7845124358177d. Upon registration, telephone participants will receive a confirmation email detailing how to join the conference call, including the dial-in number and a unique passcode.

About CoreCivic

CoreCivic is a diversified, government-solutions company with the scale and experience needed to solve tough government challenges in flexible, cost-effective ways. We provide a broad range of solutions to government partners that serve the public good through high-quality corrections and detention management, a network of residential and non-residential alternatives to incarceration to help address America's recidivism crisis, and government real estate solutions. We are the nation's largest owner of partnership correctional, detention and residential reentry facilities, and one of the largest prison operators in the United States. We have been a flexible and dependable partner for government for 40 years. Our employees are driven by a deep sense of service, high standards of professionalism and a responsibility to help government better the public good. Learn more at www.corecivic.com.

Forward-Looking Statements

This press release contains statements as to our beliefs and expectations of the outcome of future events that are "forward-looking" statements within the meaning of Section 21E of the Securities Exchange Act of 1934, as amended, and the Private Securities Litigation Reform Act of 1995, as amended. These forward-looking statements are subject to risks and uncertainties that could cause genuine results to differ materially from the statements made. These include, but are not limited to, the risks and uncertainties associated with: (i) changes in government policy, legislation and regulations that affect utilization of the private sector for corrections, detention, and residential reentry services, in general, or our business, in particular, including, but not limited to, the continued utilization of our correctional and detention facilities by the federal government, including as a consequence of the United States Department of Justice, or DOJ, not renewing contracts as a result of President Biden's Executive Order on Reforming Our Incarceration System to Eliminate the Use of Privately Operated Criminal Detention Facilities, or the Private Prison EO, impacting utilization primarily by the BOP and the United States Marshals Service, and the impact of any changes to immigration reform and sentencing laws (we do not, under longstanding policy, lobby for or against policies or legislation that would determine the basis for, or duration of, an individual's incarceration or detention); (ii) our ability to obtain and maintain correctional, detention, and residential reentry facility management contracts because of reasons including, but not limited to, sufficient governmental appropriations, contract compliance, negative publicity and effects of inmate disturbances; (iii) changes in the privatization of the corrections and detention industry, the acceptance of our services, the timing of the opening of new facilities and the commencement of new management contracts (including the extent and pace at which new contracts are utilized), as well as our ability to utilize available beds; (iv) general economic and market conditions, including, but not limited to, the impact governmental budgets can have on our contract renewals and renegotiations, per diem rates, and occupancy; (v) fluctuations in our operating results because of, among other things, changes in occupancy levels; competition; contract renegotiations or terminations; inflation and other increases in costs of operations, including a continuing rise in labor costs; fluctuations in interest rates and risks of operations; (vi) the impact resulting from the termination of Title 42, the federal government's policy to deny entry at the United States southern border to asylum-seekers and anyone crossing the southern border without proper documentation or authority in an effort to contain the spread of the coronavirus and related variants, or COVID-19; (vii) our ability to successfully identify and consummate future development and acquisition opportunities and realize projected returns resulting therefrom; (viii) our ability to have met and maintained qualification for taxation as a real estate investment trust, or REIT, for the years we elected REIT status; and (ix) the availability of debt and equity financing on terms that are favorable to us, or at all. Other factors that could cause operating and financial results to differ are described in the filings we make from time to time with the Securities and Exchange Commission.

We take no responsibility for updating the information contained in this press release following the date hereof to reflect events or circumstances occurring after the date hereof or the occurrence of unanticipated events or for any changes or modifications made to this press release or the information contained herein by any third-parties, including, but not limited to, any wire or internet services.


CORECIVIC, INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
(UNAUDITED AND AMOUNTS IN THOUSANDS, EXCEPT PER SHARE AMOUNTS)

ASSETS   June 30,
2023
  December 31,
2022
         
Cash and cash equivalents   $ 41,840     $ 149,401  
Restricted cash     13,256       12,764  
Accounts receivable, net of credit loss reserve of $7,771 and $8,008, respectively     261,539       312,435  
Prepaid expenses and other current assets     37,087       32,134  
Assets held for sale     -       6,936  
                Total current assets     353,722       513,670  
Real estate and related assets:        
Property and equipment, net of accumulated depreciation of $1,771,005 and $1,716,283, respectively     2,141,714       2,176,098  
Other real estate assets     204,850       208,181  
Goodwill     4,844       4,844  
Other assets     322,651       341,976  
         
                Total assets   $ 3,027,781     $ 3,244,769  
         
LIABILITIES AND STOCKHOLDERS' EQUITY        
         
Accounts payable and accrued expenses   $ 260,395     $ 285,226  
Current portion of long-term debt     13,243       165,525  
                Total current liabilities     273,638       450,751  
         
Long-term debt, net     1,058,816       1,084,858  
Deferred revenue     20,109       22,590  
Non-current deferred tax liabilities     95,674       99,618  
Other liabilities     140,408       154,544  
         
                Total liabilities     1,588,645       1,812,361  
         
Commitments and contingencies        
         
Preferred stock ― $0.01 par value; 50,000 shares authorized; none issued and outstanding at June 30, 2023 and December 31, 2022, respectively     -       -  
Common stock ― $0.01 par value; 300,000 shares authorized; 113,605 and 114,988 shares issued and outstanding at June 30, 2023 and December 31, 2022, respectively     1,136       1,150  
Additional paid-in capital     1,787,207       1,807,689  
Accumulated deficit     (349,207 )     (376,431 )
                Total stockholders' equity     1,439,136       1,432,408  
         
                Total liabilities and stockholders' equity   $ 3,027,781     $ 3,244,769  

CORECIVIC, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS
(UNAUDITED AND AMOUNTS IN THOUSANDS, EXCEPT PER SHARE AMOUNTS)

    For the Three Months Ended
June 30,
  For the Six Months Ended
June 30,
      2023       2022       2023       2022  
                 
REVENUE:                
     Safety   $ 421,743     $ 416,354     $ 839,393     $ 830,602  
     Community     28,364       25,775       54,778       49,890  
     Properties     13,574       14,526       27,411       29,117  
     Other     1       42       102       76  
      463,682       456,697       921,684       909,685  
                 
EXPENSES:                
     Operating                
        Safety     335,726       324,261       664,124       645,282  
        Community     22,905       21,282       45,620       41,509  
        Properties     3,324       3,377       6,685       6,659  
        Other     53       80       116       179  
            Total operating expenses     362,008       349,000       716,545       693,629  
     General and administrative     32,612       31,513       65,291       62,614  
     Depreciation and amortization     31,615       32,259       62,657       64,287  
     Shareholder litigation expense     -       1,900       -       1,900  
      426,235       414,672       844,493       822,430  
                 
                 
                 
OTHER INCOME (EXPENSE):                
Interest expense, net     (18,268 )     (21,668 )     (37,419 )     (44,588 )
Expenses associated with debt repayments and refinancing transactions     (226 )     (6,805 )     (226 )     (6,805 )
Gain (loss) on sale of real estate assets, net     (25 )     1,060       (25 )     3,321  
Other income (expense)       78       (37 )     31       1,005  
                 
                 
INCOME BEFORE INCOME TAXES    
19,006
     
14,575
     
39,552
     
40,188
 
                 
     Income tax expense     (4,176 )     (4,013 )     (12,322 )     (10,623 )

NET INCOME

  $ 14,830     $ 10,562     $ 27,230     $ 29,565  
                 
                 
BASIC EARNINGS PER SHARE   $ 0.13     $ 0.09     $ 0.24     $ 0.25  
                 
DILUTED EARNINGS PER SHARE   $ 0.13     $ 0.09     $ 0.24     $ 0.24  

CORECIVIC, INC. AND SUBSIDIARIES
SUPPLEMENTAL FINANCIAL INFORMATION
(UNAUDITED AND AMOUNTS IN THOUSANDS, EXCEPT PER SHARE AMOUNTS)

CALCULATION OF ADJUSTED NET INCOME AND ADJUSTED DILUTED EPS

  For the Three Months Ended
June 30,
  For the Six Months Ended
June 30,
    2023       2022       2023       2022  
               
Net income $ 14,830     $ 10,562     $ 27,230     $ 29,565  
               
Special items:              
Expenses associated with debt repayments and refinancing transactions   226       6,805       226       6,805  
Income tax expense (benefit) associated with change in corporate tax structure   (1,378 )     -       930       -  
Loss (gain) on sale of real estate assets, net   25       (1,060 )     25       (3,321 )
Shareholder litigation expense   -       1,900       -       1,900  
Income tax benefit for special items   (75 )     (2,041 )     (75 )     (1,416 )
Adjusted net income $ 13,628     $ 16,166     $ 28,336     $ 33,533  
Weighted average common shares outstanding – basic   113,628       120,529       113,840       120,662  
Effect of dilutive securities:              
Restricted stock-based awards   324       817       631       721  
Weighted average shares and assumed conversions - diluted   113,952       121,346       114,471       121,383  
Adjusted Diluted EPS $ 0.12     $ 0.13     $ 0.25     $ 0.28  

CORECIVIC, INC. AND SUBSIDIARIES
SUPPLEMENTAL FINANCIAL INFORMATION
(UNAUDITED AND AMOUNTS IN THOUSANDS, EXCEPT PER SHARE AMOUNTS)

CALCULATION OF FUNDS FROM OPERATIONS AND NORMALIZED FUNDS FROM OPERATIONS

  For the Three Months Ended
June 30,
  For the Six Months Ended
June 30,
    2023       2022       2023       2022  
               
Net income $ 14,830     $ 10,562     $ 27,230     $ 29,565  
Depreciation and amortization of real estate assets   24,198       24,501       48,369       48,667  
Loss (gain) on sale of real estate assets, net   25       (1,060 )     25       (3,321 )
Income tax expense (benefit) for special items   (7 )     283       (7 )     908  
Funds From Operations $ 39,046     $ 34,286     $ 75,617     $ 75,819  
               
Expenses associated with debt repayments and refinancing transactions   226       6,805       226       6,805  
Income tax expense (benefit) associated with change in corporate tax structure   (1,378 )     -       930       -  
Shareholder litigation expense   -       1,900       -       1,900  
Income tax benefit for special items   (68 )     (2,324 )     (68 )     (2,324 )
Normalized Funds From Operations $ 37,826     $ 40,667     $ 76,705     $ 82,200  
               
Funds From Operations Per Diluted Share $ 0.34     $ 0.28     $ 0.66     $ 0.62  
Normalized Funds From Operations Per Diluted Share $ 0.33     $ 0.34     $ 0.67     $ 0.68  

CALCULATION OF EBITDA AND ADJUSTED EBITDA

  For the Three Months Ended
June 30,
  For the Six Months Ended
June 30,
    2023     2022       2023     2022  
               
Net income $ 14,830   $ 10,562     $ 27,230   $ 29,565  
Interest expense   21,214     24,292       43,303     49,684  
Depreciation and amortization   31,615     32,259       62,657     64,287  
Income tax expense   4,176     4,013       12,322     10,623  
EBITDA $ 71,835   $ 71,126     $ 145,512   $ 154,159  
Expenses associated with debt repayments and refinancing transactions   226     6,805       226     6,805  
Loss (gain) on sale of real estate assets, net   25     (1,060 )     25     (3,321 )
Shareholder litigation expense   -     1,900       -     1,900  
Adjusted EBITDA $ 72,086   $ 78,771     $ 145,763   $ 159,543  

CORECIVIC, INC. AND SUBSIDIARIES
SUPPLEMENTAL FINANCIAL INFORMATION
(UNAUDITED AND AMOUNTS IN THOUSANDS, EXCEPT PER SHARE AMOUNTS)

GUIDANCE -- CALCULATION OF ADJUSTED NET INCOME, FUNDS FROM OPERATIONS, EBITDA & ADJUSTED EBITDA

  For the Year Ending
December 31, 2023
  Low End of Guidance   High End of Guidance
Net income $ 58,394     $ 66,394  
Expenses associated with debt repayments and refinancing transactions   226       226  
Income tax expense associated with change in corporate tax structure   930       930  
Loss on sale of real estate assets, net   25       25  
Income tax benefit for special items   (75 )     (75 )
Adjusted net income $ 59,500     $ 67,500  
       
Net income $ 58,394     $ 66,394  
Depreciation and amortization of real estate assets   97,250       97,750  
Loss on sale of real estate assets, net   25       25  
Income tax benefit for special items   (7 )     (7 )
Funds From Operations $ 155,662     $ 164,162  
Expenses associated with debt repayments and refinancing transactions   226       226  
Income tax expense associated with change in corporate tax structure   930       930  
Income tax benefit for special items   (68 )     (68 )
Normalized Funds From Operations $ 156,750     $ 165,250  
Diluted EPS $ 0.51     $ 0.58  
Adjusted Diluted EPS $ 0.52     $ 0.59  
FFO per diluted share $ 1.36     $ 1.44  
Normalized FFO per diluted share $ 1.37     $ 1.45  
       
Net income $ 58,394     $ 66,394  
Interest expense   84,750       83,750  
Depreciation and amortization   127,750       127,750  
Income tax expense   26,106       25,106  
EBITDA $ 297,000     $ 303,000  
Expenses associated with debt repayments and refinancing transactions   226       226  
Loss on sale of real estate assets, net   25       25  
Adjusted EBITDA $ 297,251     $ 303,251  
               

NOTE TO SUPPLEMENTAL FINANCIAL INFORMATION

Adjusted Net Income, EBITDA, Adjusted EBITDA, FFO, and Normalized FFO, and, where appropriate, their corresponding per share metrics are non-GAAP financial measures. The Company believes that these measures are important operating measures that supplement discussion and analysis of the Company's results of operations and are used to review and assess operating performance of the Company and its properties and their management teams. The Company believes that it is useful to provide investors, lenders and securities analysts disclosures of its results of operations on the same basis that is used by management.  

FFO, in particular, is a widely accepted non-GAAP supplemental measure of performance of real estate companies, grounded in the standards for FFO established by the National Association of Real Estate Investment Trusts (NAREIT). NAREIT defines FFO as net income computed in accordance with GAAP, excluding gains (or losses) from sales of property and extraordinary items, plus depreciation and amortization of real estate and impairment of depreciable real estate and after adjustments for unconsolidated partnerships and joint ventures calculated to reflect funds from operations on the same basis. As a company with extensive real estate holdings, we believe FFO and FFO per share are important supplemental measures of our operating performance and believe they are frequently used by securities analysts, investors and other interested parties in the evaluation of REITs and other real estate operating companies, many of which present FFO and FFO per share when reporting results. EBITDA, Adjusted EBITDA, and FFO are useful as supplemental measures of performance of the Company's properties because such measures do not take into account depreciation and amortization, or with respect to EBITDA, the impact of the Company's tax provision and financing strategies. Because the historical cost accounting convention used for real estate assets requires depreciation (except on land), this accounting presentation assumes that the value of real estate assets diminishes at a level rate over time. Because of the unique structure, design and use of the Company's properties, management believes that assessing performance of the Company's properties without the impact of depreciation or amortization is useful. The Company may make adjustments to FFO from time to time for certain other income and expenses that it considers non-recurring, infrequent or unusual, even though such items may require cash settlement, because such items do not reflect a necessary or ordinary component of the ongoing operations of the Company. Normalized FFO excludes the effects of such items. The Company calculates Adjusted Net Income by adding to GAAP Net Income expenses associated with the Company's debt repayments and refinancing transactions, and certain impairments and other charges that the Company believes are unusual or non-recurring to provide an alternative measure of comparing operating performance for the periods presented.

Other companies may calculate Adjusted Net Income, EBITDA, Adjusted EBITDA, FFO, and Normalized FFO differently than the Company does, or adjust for other items, and therefore comparability may be limited. Adjusted Net Income, EBITDA, Adjusted EBITDA, FFO, and Normalized FFO and, where appropriate, their corresponding per share measures are not measures of performance under GAAP, and should not be considered as an alternative to cash flows from operating activities, a measure of liquidity or an alternative to net income as indicators of the Company's operating performance or any other measure of performance derived in accordance with GAAP. This data should be read in conjunction with the Company's consolidated financial statements and related notes included in its filings with the Securities and Exchange Commission.

Contact:    Investors: Cameron Hopewell - Managing Director, Investor Relations - (615) 263-3024
Financial Media: David Gutierrez, Dresner Corporate Services - (312) 780-7204

© 2023 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.

Mon, 07 Aug 2023 08:31:00 -0500 text/html https://www.benzinga.com/pressreleases/23/08/g33609092/corecivic-reports-second-quarter-2023-financial-results
Killexams : Arlington Asset Investment Corp. Reports Second Quarter 2023 Financial Results

MCLEAN, Va., Aug. 14, 2023 /PRNewswire/ -- Arlington Asset Investment Corp. (NYSE: AAIC) (the "Company," "Arlington," "we," "us" or "our") today reported financial results for the quarter ended June 30, 2023.

Second Quarter 2023 Financial Highlights

  • $6.64 per common share of book value, a 2.6% increase from prior quarter
  • $0.15 per diluted common share of GAAP net income available to common shareholders
  • $0.06 per diluted common share of non-GAAP earnings available for distribution
  • 0.5 to 1 "at risk" leverage ratio as of June 30, 2023
  • Entered into Agreement and Plan of Merger with Ellington Financial Inc. ("Ellington Financial")

Second Quarter Investment Portfolio

As of June 30, 2023, the Company's investment portfolio capital allocation was as follows (dollars in thousands):

June 30, 2023
Assets Invested Capital
Allocation (1)
Invested Capital
Allocation (%)
Leverage (2)
MSR financing receivables $ 195,893 $ 195,893 66 %
Credit investments 130,347 33,952 11 % 2.8
Agency MBS 124,267 68,894 23 % 0.8
Total invested capital $ 450,507 298,739 100 %
Cash and other corporate capital, net 7,884
Total investable capital $ 306,623 0.5
(1) Our investable capital is calculated as the sum of our shareholders' equity capital and long-term unsecured debt. 
(2) Our leverage is measured as the ratio of the sum of our repurchase agreement financing, net payable or receivable for unsettled securities, net contractual forward purchase or sale price of our TBA commitments and leverage within our MSR financing receivables less our cash and cash equivalents compared to our investable capital.
(3) Includes our net investment of $2,152 in a VIE with gross assets and liabilities of $2,265 and $113, respectively, that is consolidated for GAAP financial reporting purposes.
(4) Agency mortgage-backed securities ("MBS") assets include the fair value of the agency MBS which underlie our TBA forward purchase and sale commitments.  In accordance with GAAP, our TBA forward commitments are reflected on the consolidated balance sheets as derivative assets and liabilities at fair value in the financial statement line items "other assets" and "other liabilities".  As of June 30, 2023, the fair value of the underlying agency MBS that underlie our net short position in TBA commitments had a fair value of ($343,236) with a net carrying value of $1,504.

MSR Related Investments

The Company is party to agreements with a licensed, U.S. government sponsored enterprise ("GSE") approved residential mortgage loan servicer that enable the Company to garner the economic return of an investment in a mortgage servicing right ("MSR") purchased by the mortgage servicing counterparty.  The arrangement allows the Company to participate in the economic benefits of investing in an MSR without holding the requisite licenses to purchase or hold MSRs directly.  Under the terms of the arrangement, the Company provides capital to the mortgage servicing counterparty to purchase MSRs directly and the Company, in turn, receives all the economic benefits of the MSRs less a fee payable to the counterparty. At the Company's request, the mortgage servicing counterparty may utilize leverage on the MSRs to which the Company's MSR financing receivables are referenced to finance the purchase of additional MSRs to increase potential returns to the Company.  These transactions are accounted for as financing receivables in the Company's consolidated financial statements. 

The Company's MSR financing receivable investments as of June 30, 2023 are summarized in the tables below (dollars in thousands):

Amortized Cost Basis (1) Unrealized Gain Fair Value
$ 144,480 $ 51,413 $ 195,893
(1) Represents capital investments plus accretion of interest income net of cash distributions.

 

MSR Financing Receivable Underlying Reference Amounts:
MSRs Financing Advances
Receivable
Cash and Other
Net Receivables
Counterparty
Incentive Fee
Accrual
MSR Financing
Receivables
Implicit
Leverage
$ 182,751 $ $ 3,283 $ 9,859 $ $ 195,893

 

Underlying Reference MSRs:
Holder of Loans Unpaid Principal
Balance
Weighted-
Average
Note Rate
Weighted-
Average
Servicing Fee
Weighted-
Average
Loan Age
Price Multiple (1) Fair Value
Fannie Mae $ 12,093,517 3.09 % 0.25 % 32 months 1.39 % 5.57 $ 168,668
Freddie Mac 985,572 3.71 % 0.25 % 28 months 1.43 % 5.72 14,083
Total/weighted-average $ 13,079,089 3.14 % 0.25 % 32 months 1.40 % 5.58 $ 182,751
(1) Calculated as the underlying MSR price divided by the weighted-average servicing fee.

As of June 30, 2023, the mortgage servicing counterparty had no draws outstanding under its credit facility collateralized by the MSRs to which the Company's MSR financing receivables are referenced.  The weighted average yield on the Company's MSR financing receivables was 13.79% for the second quarter of 2023 compared to 13.78% for the first quarter of 2023, and the genuine weighted-average constant prepayment rate ("CPR") for the MSRs underlying the Company's MSR financing receivables was 5.19% for the second quarter of 2023 compared to 3.44% for the first quarter of 2023.  As of June 30, 2023, the valuation multiple of the MSRs underlying the Company's MSR financing receivables, calculated as the underlying MSR price divided by the weighted-average servicing fee, was 5.58x.

Credit Investments

The Company's credit investments generally include mortgage loans secured by residential or commercial real property or MBS collateralized by residential or commercial mortgage loans or residential solar panel loans ("non-agency" MBS or ABS).  As of June 30, 2023, the Company's credit investment portfolio at fair value was comprised of the following (dollars in thousands):

Market Price Fair Value (1) Financing Invested
Capital (2)
Leverage
AAA rated commercial MBS $ 99.66 $ 99,657 $ 79,493 $ 20,355 3.9
Commercial mortgage loan 100.00 25,992 17,247 8,899 1.9
Business purpose residential MBS 61.85 2,935 2,935
Solar ABS 34.84 1,763 1,763
Total/weighted-average $ 130,347 $ 96,740 $ 33,952 2.8
(1) For non-commercial credit investments in securities, includes contractual accrued interest receivable.
(2) Invested capital includes investment accrued interest receivable and financing accrued interest payable.
(3) Includes our net investment of $2,152 in a VIE with gross assets and liabilities of $2,265 and $113, respectively, that is consolidated for GAAP financial reporting purposes.

As of June 30, 2023, the Company had $79.5 million in repurchase agreements outstanding with a weighted average rate of 5.84% and remaining weighted average maturity of 19 days secured by $88.7 million of non-agency MBS at fair value.  As of June 30, 2023, the Company had a $17.2 million repurchase agreement outstanding with a rate of 7.75% and remaining maturity of 115 days secured by a $26.0 million commercial mortgage loan at fair value. 

Agency MBS

The Company's agency MBS consist of residential mortgage pass-through certificates for which the principal and interest payments are guaranteed by a government sponsored enterprise, such as the Federal National Mortgage Association ("Fannie Mae") or the Federal Home Loan Mortgage Corporation ("Freddie Mac").  As of June 30, 2023, the Company's agency MBS investment portfolio was comprised of the following (dollars in thousands): 

Fair Value
Agency MBS $ 467,503
Net short TBA Position (343,236)
Total agency MBS investment portfolio $ 124,267

As of June 30, 2023, the Company's specified agency MBS investment portfolio was comprised of the following (dollars in thousands):

Unpaid
Principal
Balance
Net
Unamortized
Purchase
Premiums
(Discounts)
Amortized
Cost Basis
Net Unrealized
Gain (Loss)
Fair Value Market
Price
Coupon Weighted
Average
Expected
Remaining
Life
Fannie Mae $ 241,390 $ (4,859) $ 236,531 $ (8,690) $ 227,841 $ 94.39 4.13 % 9.7
Freddie Mac 254,421 (2,847) 251,574 (11,912) 239,662 94.20 4.09 % 9.9
Total/weighted-average $ 495,811 $ (7,706) $ 488,105 $ (20,602) $ 467,503 $ 94.29 4.11 % 9.8

The Company's weighted average yield on its specified agency MBS was 4.26% for the second quarter of 2023 compared to 4.23% for the first quarter of 2023, and the genuine weighted-average CPR for the Company's specified agency MBS was 4.58% for the second quarter of 2023 compared to 3.52% for the first quarter of 2023. 

As of June 30, 2023, the Company's net short TBA agency MBS investment portfolio was comprised of the following (dollars in thousands):

Notional Amount:
Net Long (Short) Implied Implied Net Carrying
Position (1) Cost Basis (2) Fair Value (3) Amount (4)
3.0% 30-year MBS sale commitments $ (67,000) $ (59,315) $ (58,944) $ 371
4.0% 30-year MBS purchase commitments 40,000 37,875 37,522 (353)
4.0% 30-year MBS sale commitments (90,000) (84,818) (84,424) 394
4.5% 30-year MBS sale commitments (247,000) (238,482) (237,390) 1,092
Total net long (short) agency TBA positions $ (364,000) $ (344,740) $ (343,236) $ 1,504
(1) Notional amount represents the unpaid principal balance of the underlying agency MBS.
(2) Implied cost basis represents the contractual forward price for the underlying agency MBS.
(3) Implied fair value represents the current fair value of the underlying agency MBS.
(4) Net carrying amount represents the difference between the implied cost basis and the implied fair value of the underlying agency MBS.  This amount is reflected on the Company's consolidated balance sheets as a component of "other assets" and "other liabilities."

As of June 30, 2023, the Company had $403.2 million of repurchase agreements outstanding with a weighted average rate of 5.31% and remaining weighted average maturity of 13 days secured by an aggregate of $423.4 million of agency MBS at fair value.  The Company's weighted average cost of repurchase agreement funding secured by agency MBS was 5.14% during the second quarter of 2023 compared to 4.67% during the first quarter of 2023. 

The Company enters into various hedging transactions to mitigate the interest rate sensitivity of its cost borrowing and the value of its fixed-rate agency MBS and MSR financing receivables.  Under the terms of the Company's interest rate swap agreements, the Company pays or receives interest payments based on a fixed rate and pays or receives variable interest payments based upon the Secured Overnight Financing Rate ("SOFR").  As of June 30, 2023, the Company's interest swap agreements were comprised of the following (dollars in thousands):

Weighted-average:
Notional 
Amount
Fixed Receive 
(Pay) Rate
Variable (Pay)
Receive Rate
Net (Pay)
Receive Rate
Remaining
Life (Years)
Fair 
Value
Receive-fixed $ 60,000 3.58 % (5.06) % (1.48) % 4.4 $ (1)
Pay-fixed 25,000 (4.20) % 5.06 % 0.86 % 1.6 (2)
Total / weighted-average $ 85,000 1.29 % (2.08) % (0.79) % 3.6 $ (3)

The Company's weighted average net pay rate of its interest rate swap agreements was 0.80% during the second quarter of 2023 compared to 0.53% during the first quarter of 2023.  Under GAAP, the Company has not designated these transactions as hedging instruments for financial reporting purposes and, therefore, all gains and losses on its hedging instruments are recorded to line item "investment and derivative gains (losses), net" in the Company's financial statements. 

Other Second Quarter 2023 Financial Highlights

The Company's book value was $6.64 per common share as of June 30, 2023 compared to $6.47 per common share as of March 31, 2023.  Book value per common share is calculated as total equity less the preferred stock liquidation preference divided by common shares outstanding plus vested restricted stock units convertible into common stock less unvested restricted common stock.  The Company's fully diluted book value was $5.77 per common share as of June 30, 2023.  Fully diluted book value per share is calculated as total equity less the preferred stock liquidation preference divided by common shares outstanding, including unvested restricted common stock, plus vested restricted stock units convertible into common stock and performance-based restricted stock units expected to be earned and convertible into common stock upon the previously announced proposed sale of the Company to Ellington Financial. 

The Company's "at risk" leverage ratio was 0.5 to 1 as of June 30, 2023 compared to 0.4 to 1 as of March 31, 2023.  The Company's "at risk" leverage ratio is calculated as the sum of the Company's repurchase agreement financing, net payable or receivable for unsettled securities, net contractual price of TBA purchase and sale commitments and financing embedded in its MSR financing receivables less cash and cash equivalents compared to the Company's investable capital measured as the sum of the Company's shareholders' equity and long-term unsecured debt. 

Additional Information

The Company will make available additional quarterly information for the benefit of its shareholders through a supplemental presentation that will be available at the Company's website, www.arlingtonasset.com.  The presentation will be available on the Webcasts and Presentations section located under the Updates & Events tab of the Company's website. 

About the Company

Arlington Asset Investment Corp. (NYSE: AAIC) currently invests primarily in mortgage related assets and has elected to be taxed as a REIT.  The Company is headquartered in the Washington, D.C. metropolitan area.  For more information, please visit www.arlingtonasset.com.

Statements concerning interest rates, portfolio allocation, financing costs, portfolio hedging, prepayments, dividends, book value, utilization of loss carryforwards, any change in long-term tax structures (including any REIT election), use of equity raise proceeds and any other guidance on present or future periods constitute forward-looking statements that are subject to a number of factors, risks and uncertainties that might cause genuine results to differ materially from stated expectations or current circumstances.  These factors include, but are not limited to, inflation, changes in interest rates, increased costs of borrowing, decreased interest spreads, credit risks underlying the Company's assets, especially related to the Company's mortgage credit investments, changes in political and monetary policies, changes in default rates, changes in prepayment rates and other assumptions underlying our estimates related to our projections of future earnings available for distribution, changes in the Company's returns, changes in the use of the Company's tax benefits, the Company's ability to qualify and maintain qualification as a REIT, changes in the agency MBS asset yield, changes in the Company's monetization of net operating loss carryforwards, changes in the Company's investment strategy, changes in the Company's ability to generate cash earnings and dividends, preservation and utilization of the Company's net operating loss and net capital loss carryforwards, impacts of changes to and changes by Fannie Mae and Freddie Mac, actions taken by the U.S. Federal Reserve, the Federal Housing Finance Agency and the U.S. Treasury, availability of opportunities that meet or exceed the Company's risk adjusted return expectations, ability and willingness to make future dividends, ability to generate sufficient cash through retained earnings to satisfy capital needs, the Company's ability to consummate the proposed plan of merger with Ellington, the uncertainty and economic impact of a resurgence of the coronavirus (COVID-19) pandemic or other public health emergencies, and the effect of general economic, political, regulatory and market conditions, including the impact of a potential recessionary environment.  These and other material risks are described in the Company's most accurate Annual Report on Form 10-K and any other documents filed by the Company with the SEC from time to time, which are available from the Company and from the SEC, and you should read and understand these risks when evaluating any forward-looking statement. All forward-looking statements speak only as of the date on which they are made. New risks and uncertainties arise over time, and it is not possible to predict those events or how they may affect the Company.  Except as required by law, the Company is not obligated to, and does not intend to, update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.

Financial data to follow

 

ARLINGTON ASSET INVESTMENT CORP.
CONSOLIDATED BALANCE SHEETS
(Dollars in thousands, except per share amounts)
(Unaudited)
June 30, 2023 March 31, 2023
ASSETS
Cash and cash equivalents (includes $229 and $-0-, respectively, $ 13,249 $ 12,833
Restricted cash of consolidated VIEs 12
Agency mortgage-backed securities, at fair value 467,503 460,984
MSR financing receivables, at fair value 195,893 183,058
Credit investments, at fair value 128,195 130,362
Mortgage loans of consolidated VIEs, at fair value 910 1,344
Deposits 2,421 11,171
Other assets (includes $1,114 and $1,850, respectively, from consolidated VIEs) 9,287 8,252
Total assets $ 817,470 $ 808,004
LIABILITIES AND EQUITY
Liabilities:
Repurchase agreements $ 499,900 $ 484,348
Secured debt of consolidated VIEs, at fair value 113 160
Long-term unsecured debt 86,611 86,508
Other liabilities (includes $-0- and $-0-, respectively, from consolidated VIEs) 10,834 21,843
Total liabilities 597,458 592,859
Equity:
Preferred stock (liquidation preference of $33,420) 32,821 32,821
Common stock 284 284
Additional paid-in capital 2,025,638 2,024,979
Accumulated deficit (1,838,731) (1,842,939)
Total equity 220,012 215,145
Total liabilities and equity $ 817,470 $ 808,004
Book value per common share (1) $ 6.64 $ 6.47
Book value per diluted common share (1) $ 5.77 $ 5.62
Common shares outstanding (in thousands) (2) 28,081 28,081
Diluted common shares outstanding (in thousands) (3) 32,360 32,360
(1) Book value and diluted book value per common share are calculated as total equity less the preferred stock liquidation preference divided by
(2) Represents common shares outstanding plus vested restricted stock units convertible into common stock less shares of unvested restricted
(3) Represents common shares outstanding, including restricted stock, plus vested restricted stock units convertible into common stock and
June 30, 2023 March 31, 2023
Assets and liabilities of consolidated VIEs:
Cash and restricted cash $ 241 $
Mortgage loans, at fair value 910 1,344
Other assets 1,114 1,850
Secured debt, at fair value (113) (160)
Other liabilities
Net investment in consolidated VIEs $ 2,152 $ 3,034

 

ARLINGTON ASSET INVESTMENT CORP.
CONSOLIDATED STATEMENTS OF OPERATIONS
(Dollars in thousands, except per share data)
(Unaudited)
Three Months Ended
June 30,
2023
March 31,
2023
December 31,
2022
September 30,
2022
Interest income
MSR financing receivables $ 4,709 $ 4,685 $ 4,446 $ 3,608
Agency mortgage-backed securities 5,040 4,976 4,732 3,631
Credit securities and loans 2,802 2,762 2,932 2,736
Mortgage loans of consolidated VIEs 56 1,398 2,302 2,303
Other 109 179 314 110
Total interest and other income 12,716 14,000 14,726 12,388
Rent revenues from single-family properties 869 2,103
Interest expense
Repurchase agreements 6,604 6,125 5,081 2,863
Long-term debt secured by single-family properties 335 741
Long-term unsecured debt 1,561 1,541 1,516 1,456
Secured debt of consolidated VIEs 681 906 912
Total interest expense 8,165 8,347 7,838 5,972
Single-family property operating expenses 755 1,872
Net operating income 4,551 5,653 7,002 6,647
Investment and derivative gain (loss), net 6,417 (3,851) 1,809 1,235
General and administrative expenses
Compensation and benefits 2,037 2,255 3,200 2,256
Other general and administrative expenses 2,676 1,656 1,267 1,121
Total general and administrative expenses 4,713 3,911 4,467 3,377
Income (loss) before income taxes 6,255 (2,109) 4,344 4,505
Income tax provision (benefit) 1,387 109 (45) 1,074
Net income (loss) 4,868 (2,218) 4,389 3,431
Dividend on preferred stock (660) (660) (660) (675)
Net income (loss) available (attributable) to
   common stock
$ 4,208 $ (2,878) $ 3,729 $ 2,756
Basic earnings (loss) per common share $ 0.15 $ (0.10) $ 0.13 $ 0.10
Diluted earnings (loss) per common share $ 0.15 $ (0.10) $ 0.13 $ 0.10
Weighted average common shares outstanding (in
   thousands)
Basic 28,081 28,004 27,956 28,338
Diluted 28,709 28,004 28,468 28,913

 

Non-GAAP Earnings Available for Distribution

In addition to the results of operations determined in accordance with GAAP, we also report a non-GAAP financial measure "earnings available for distribution".  We define earnings available for distribution as net income available to common stock determined in accordance with GAAP adjusted for the following items:

  • Plus (less) realized and unrealized losses (gains) on investments and derivatives;
  • Plus (less) income tax provision (benefit) for TRS realized and unrealized gains and losses on investments and derivatives
  • Plus TBA dollar roll income (expense)
  • Plus (less) interest rate swap net interest income (expense)
  • Plus depreciation of single-family residential properties
  • Plus stock-based compensation
  • Plus non-recurring general and administrative expenses

Realized and unrealized gains and losses recognized with respect to our mortgage related investments and economic hedging instruments, which are reported in line item "investment and derivative gain (loss), net" of our consolidated statements of comprehensive income, other than TBA dollar roll income and interest rate swap net interest income or expense, are excluded from the computation of earnings available for distribution as such gains on losses are not reflective of the economic interest income earned or interest expense incurred from our interest-bearing financial assets and liabilities during the indicated reporting period.  Because our long-term-focused investment strategy for our mortgage related investment portfolio is to generate a net spread on the leveraged assets while prudently hedging periodic changes in the fair value of those assets attributable to changes in benchmark interest rates, we generally expect the fluctuations in the fair value of our mortgage related investments and economic hedging instruments to largely offset one another over time.  In addition, certain of our investments are held by our TRS which is subject to U.S. federal and state corporate income taxes.  In calculating earnings available for distribution, any income tax provision or benefit associated with gains or losses on our mortgage related investments and economic hedging instruments are also excluded from earnings available for distribution.

TBA dollar roll income (expense) represents the economic equivalent of net interest income (expense) generated from our transactions in non-specified fixed-rate agency MBS, executed through sequential series of forward-settling purchase and sale transactions that are settled on a net basis (known as "dollar roll" transactions). Dollar roll income (expense) is generated (incurred) as a result of delaying, or "rolling," the settlement of a forward-settling purchase (sale) of a TBA agency MBS by entering into an offsetting "spot" sale (purchase) with the same counterparty prior to the settlement date, net settling the "paired-off" positions in cash, and contemporaneously entering another forward-settling purchase (sale) with the same counterparty of a TBA agency MBS of the same essential characteristics for a later settlement date at a price discount relative to the spot sale (purchase). The price discount of the forward-settling purchase (sale) relative to the contemporaneously executed spot sale (purchase) reflects compensation to the seller for the interest income (inclusive of expected prepayments) that, at the time of sale, is expected to be foregone as a result of relinquishing beneficial ownership of the MBS from the settlement date of the spot sale until the settlement date of the forward purchase, net of implied repurchase financing costs. We calculate dollar roll income (expense) as the excess of the spot sale (purchase) price over the forward-settling purchase (sale) price and recognize this amount ratably over the period beginning on the settlement date of the sale (purchase) and ending on the settlement date of the forward purchase (sale). In our consolidated statements of comprehensive income prepared in accordance with GAAP, TBA agency MBS dollar roll income (expense) is reported as a component of the overall periodic change in the fair value of TBA forward commitments within the line item "investment and derivative gain (loss), net."

We utilize interest rate swap agreements to economically hedge a portion of our exposure to variability in future interest cash flows, attributable to changes in benchmark interest rates, associated with future roll-overs of our short-term repurchase agreement financing arrangements. Accordingly, the net interest income earned or expense incurred (commonly referred to as "net interest carry") from our interest rate swap agreements in combination with repurchase agreement interest expense recognized in accordance with GAAP represents our effective "economic interest expense." In our consolidated statements of comprehensive income prepared in accordance with GAAP, the net interest income earned or expense incurred from interest rate swap agreements is reported as a component of the overall periodic change in the fair value of derivative instruments within the line item "investment and derivative gain (loss), net."

The following table provides a reconciliation of GAAP net income (loss) available (attributable) to common stock for the last four fiscal quarters (unaudited, dollars in thousands):

Three Months Ended
June 30,
 2023
March 31,
 2023
December 31,
 2022
September 30,
 2022
Net income (loss) available (attributable) to common stock $ 4,208 $ (2,878) $ 3,729 $ 2,756
Add (less):
Investment and derivative (gain) loss, net (6,417) 3,851 (1,809) (1,235)
Income tax provision (benefit) for TRS investment 921 (344) (344) 406
Depreciation of single-family residential properties 225 632
Stock-based compensation expense 659 757 865 919
Non-recurring corporate transaction expenses 1,757 716
Add back:
TBA dollar roll income (expense) 683 74 (429) (421)
Interest rate swap net interest (expense) income (172) (118) 212 258
Non-GAAP earnings available for distribution $ 1,639 $ 2,058 $ 2,449 $ 3,315
Non-GAAP earnings available for distribution per $ 0.06 $ 0.07 $ 0.09 $ 0.11
Weighted average diluted common shares outstanding 28,709 28,478 28,468 28,913
(1) Non-recurring corporate transaction expenses represent non-recurring legal and professional service fees related to the sale process of the Company and proposed plan of merger with Ellington Financial.

Earnings available for distribution is used by management to evaluate the financial performance of our long-term-focused, net interest spread-based investment strategy and core business activities over periods of time as well as assist with the determination of the appropriate level of periodic dividends to common stockholders. In addition, we believe that earnings available for distribution assists investors in understanding and evaluating the financial performance of our long-term-focused, net interest spread-based investment strategy and core business activities over periods of time as well as its earnings capacity.

A limitation of utilizing this non-GAAP financial measure is that the effect of accounting for all events or transactions in accordance with GAAP does, in fact, reflect the financial results of our business and these effects should not be ignored when evaluating and analyzing our financial results. In addition, our calculation of earnings available for distribution may not be comparable to other similarly titled measures of other companies.  Therefore, we believe that earnings available for distribution should be considered as a supplement to, and in conjunction with, net income and comprehensive income determined in accordance with GAAP. Furthermore, there may be differences between earnings available for distribution and taxable income determined in accordance with the Internal Revenue Code.  As a REIT, we are required to distribute at least 90% of our REIT taxable income (subject to certain adjustments) to qualify as a REIT and all of our taxable income in order to not be subject to any U.S. federal or state corporate income taxes. Accordingly, earnings available for distribution may not equal our distribution requirements as a REIT.

Cision View original content:https://www.prnewswire.com/news-releases/arlington-asset-investment-corp-reports-second-quarter-2023-financial-results-301899335.html

SOURCE Arlington Asset Investment Corp.

Mon, 14 Aug 2023 00:59:00 -0500 en text/html https://markets.businessinsider.com/news/stocks/arlington-asset-investment-corp-reports-second-quarter-2023-financial-results-1032550757
Killexams : Eloxx Pharmaceuticals Reports Second Quarter 2023 Financial and Operating Results and Provides Business Update

Announced today that all 3 patients (100% response rate) treated with ELX-02 showed an improvement in podocyte foot process effacement post-treatment in kidney biopsies assessed by electron microscopy, demonstrating the disease-modifying effect of ELX-02

Announced achievement of remission in one patient in Phase 2 clinical study of ELX-02 for the treatment of Alport syndrome and decision to advance ELX-02 into a pivotal trial in Alport syndrome

Highlighted significant unmet need in the treatment of Alport syndrome and additional positive data from Phase 2 clinical study evaluating ELX-02 in KOL event

Received Food and Drug Administration (FDA) Investigational New Drug clearance to begin single ascending dose (SAD) study of ZKN-013; first subject intended to be dosed by the end of 2023

Raised $3.4M in net proceeds through “at-the-market” equity offering program as of August 11, 2023

Nasdaq granted Eloxx’s request for an extension to regain compliance with the Market Value of Listed Securities continued listing requirement

WATERTOWN, Mass., Aug. 14, 2023 (GLOBE NEWSWIRE) -- Eloxx Pharmaceuticals, Inc. (NASDAQ: ELOX), a leader in ribosomal RNA-targeted genetic therapies for rare diseases, today reported its financial results for the three months ended June 30, 2023, and provided a business update.

“This is a transformative time at Eloxx. With today’s confirmation of the disease modifying potential of ELX-02 in all three patient biopsies from the Alport syndrome trial, we look forward to advancing to a pivotal trial of ELX-02 for the treatment of Alport syndrome,” said Sumit Aggarwal, President and Chief Executive Officer of Eloxx. “We also plan to initiate a clinical study for our lead TURBO-ZM™ based molecule, ZKN-013, for the potential treatment of recessive dystrophic epidermolysis bullosa (RDEB) with first patient dosing expected by the end of 2023.”

Second Quarter 2023 and Subsequent Highlights

Alport Syndrome

  • Eloxx intends to advance ELX-02 into pivotal trial for the treatment of Alport syndrome with nonsense mutations, pending obtaining the necessary capital. Alport syndrome is a rare genetic kidney disorder caused by mutations in COL4A3/4/5 genes, characterized by podocyte injury and impaired kidney filter function leading to proteinuria.
  • In a separate press release, Eloxx today announced positive biopsy results from its proof-of-concept Phase 2 open-label clinical trial (NCT05448755) of ELX-02 for the treatment of Alport syndrome after eight weeks of treatment. All three patients (100% response rate) treated with ELX-02 showed an improvement in podocyte foot process effacement post-treatment in kidney biopsies assessed by electron microscopy demonstrating the disease modifying effect of ELX-02 and potential for improvement in proteinuria with longer duration of treatment.
    • Podocytes are specialized cells that bind to the glomerular basement membrane and form finger-like extensions called foot processes that enable efficient ultrafiltration. Podocyte injury leads to the effacement (loss) of podocyte foot processes and proteinuria in nearly all cases of Alport syndrome.
    • In two patients, widespread foot process effacement was improved to segmental foot process effacement. In the third patient, moderate to severe foot process effacement was improved to moderate only.
    • Eloxx previously announced achievement of remission in one patient. One month after the end of treatment, the patient demonstrated a rapid increase in Urine Protein to Creatinine (UPCR), providing additional evidence of drug activity.
    • ELX-02 was well-tolerated in the study, with no discontinuations to date.
  • An IND application for ELX-02 is expected to be submitted to the FDA in the third quarter of 2023.
  • Additional data recently announced regarding the efficacy of ELX-02 in its cystic fibrosis study bolsters the strength of results in Phase 2 Alport syndrome trial, further supporting Eloxx’s decision to advance into a pivotal trial in Alport syndrome.
  • Alport syndrome RaDaR natural history data presented at the 60th European Renal Association Congress indicates that Alport syndrome patients with autosomal recessive COL4A4 mutations have severest disease, with a more rapid progression to kidney failure. The patient that achieved remission in Eloxx Phase 2 trial had autosomal recessive COL4A4 nonsense mutation resulting in a truncated protein.

Recessive Dystrophic Epidermolysis Bullosa (RDEB) and Junctional Epidermolysis Bullosa (JEB)

  • In May 2023, Eloxx announced that the FDA has cleared the IND application to initiate a SAD clinical trial in healthy volunteers for ZKN-013 for the potential treatment of RDEB with nonsense mutations. RDEB is a rare skin disease characterized by mutations in the Collagen 7 gene. Eloxx plans to initiate the Phase 1 SAD clinical study, assuming sufficient funding, with the first subject expected to be dosed by the end of 2023.
  • Further SAD and multiple ascending dose (MAD) testing are expected to be conducted following the completion of the planned dose cohorts in the SAD study and discussion with the FDA. The MAD testing could potentially include RDEB patients given the strong benefit/risk in patients cited by FDA.
  • Preclinical results demonstrated read-through activity of ZKN-013 in multiple COL7 genotypes across multiple RDEB patient derived fibroblasts and keratinocytes. In this trial, read-through activity resulted in up to an 18-fold increase in full-length COL VII protein levels. Prolonged treatment with ZKN-013 was shown to further increased COL VII protein levels. Functionality of the restored full-length COL VII protein was observed. These results have been accepted for presentation at an upcoming medical conference.

Familial Adenomatous Polyposis (FAP)

  • Eloxx also plans, assuming sufficient funding, to develop ZKN-013 to treat FAP, targeting a subset of patients that have nonsense mutations in the Adenomatous Polyposis Coli (APC) gene that is truncated in these patients.

TURBO-ZM Platform

  • Cancer Research Communications published “A Novel Class of Ribosome Modulating Agents Exploits Cancer Ribosome Heterogeneity to Selectively Target the CMS2 Subtype of Colorectal Cancer.” The publication demonstrates the of potential the TURBO-ZM chemistry technology platform to develop novel Ribosome Modulating Agents (RMAs) and details preclinical data that demonstrate activity for ZKN-157 against subtypes of colorectal cancer.
    • Results suggest that MYC-overexpressing cancers can be targeted by exploiting ribosome heterogeneity in cancer, as preclinical data has demonstrated the activity of ZKN-157 against subtypes of colorectal cancer. This research potentially provides opportunities to selectively target MYC-driven cancers with a novel mechanism and possible synergy with existing cancer therapies.

Second Quarter 2023 Financial Results

For the three months ended June 30, 2023, we incurred a net loss of $4.3 million, or $1.96 per share, which included $0.6 million in stock-based compensation. For the same period in the prior year, we incurred a net loss of $10.6 million, or $4.90 per share, which included $0.7 million in stock-based compensation.

R&D expenses were $2.3 million for the three months ended June 30, 2023, which included $0.3 million in stock-based compensation. For the same period in the prior year, R&D expenses were $7.7 million, which included $0.3 million of stock-based compensation. The decrease was primarily related to a decrease in clinical trial expenses for activities related to inhaled delivery of ELX-02 in cystic fibrosis and a decrease in clinical trial expenses related to a decrease in Cystic Fibrosis Foundation funded activities.

General and administrative (G&A) expenses were $1.8 million for the three months ended June 30, 2023, which included $0.3 million in stock-based compensation. For the same period in the prior year, G&A expenses were $2.6 million, which included $0.4 million of stock-based compensation. The decrease was primarily related to a decrease in salaries and other personal related costs, a decrease in expenses attributable to professional and consulting fees, and a decrease in facility and overhead expenses.

As of June 30, 2023, we had unrestricted cash and cash equivalents of $4.3 million, and subsequent to quarter end, as of August 11, 2023, the Company raised an additional $1.7 million in gross proceeds through our previously established “at-the-market” equity offering program (the “ATM Program”). Eloxx remains focused on its liquidity position and is committed to raising additional capital in the near term in order to fund its operating plan through the end of 2023 and beyond. Assuming that we initiate Phase 3 clinical trial activities, which is subject to sufficient funding, in the third quarter of 2023 and that we maintain compliance with our debt covenants, we believe that our current cash position will be sufficient to fund our operations into the fourth quarter of 2023.

Eloxx received notice from the Nasdaq Listing Qualifications Panel (the “Hearings Panel”) of The Nasdaq Stock Market LLC (“Nasdaq”) that it has determined to extend the previously granted extension from July 30, 2023 until October 9, 2023 to allow the Company time to regain compliance with Listing Rule 5550(b)(2), which requires a listed company to have at least $35 million in market value of listed securities in order to qualify for continued listing on the Nasdaq Capital Market.

About Alport syndrome

Alport syndrome is a genetic disorder characterized by kidney disease with high levels of proteinuria, hearing loss and eye abnormalities caused by mutations in the genes (COL4A3, COL4A4, and COL4A5) needed for production of type 4 collagen. Approximately 6% to 7% of Alport syndrome patients, or approximately 9,400 to 12,750 individuals, are estimated to have nonsense mutations. These patients have significantly worse clinical outcomes than other patients with Alport syndrome and have no disease modifying treatment options.

About Eloxx Pharmaceuticals

Eloxx Pharmaceuticals, Inc. is engaged in the science of ribosome modulation, leveraging its innovative TURBO-ZM™ chemistry technology platform in an effort to develop novel Ribosome Modulating Agents (RMAs) and its library of Eukaryotic Ribosome Selective Glycosides (ERSGs). Eloxx’s lead investigational product candidate, ELX-02, is a small molecule drug candidate designed to restore production of full-length functional proteins. ELX-02 is in Phase 2 clinical development for the treatment of Alport syndrome in patients with nonsense mutations. For more information, please visit www.eloxxpharma.com.

Forward-looking Statements

This press release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. All statements other than statements of present and historical facts contained in this press release, including without limitation, statements regarding our cash runway to fund our operating plan, our plans to raise additional capital, and our ability to comply with the covenants in our debt agreement, the expected timing of and results from trials of our product candidates and the potential of our product candidate to treat nonsense mutations are forward-looking statements. Forward-looking statements can be identified by the words “aim,” “may,” “will,” “would,” “should,” “expect,” “explore,” “plan,” “anticipate,” “could,” “intend,” “target,” “project,” “contemplate,” “believe,” “estimate,” “predict,” “potential,” “seeks,” or “continue” or the negative of these terms similar expressions, although not all forward-looking statements contain these words. Forward-looking statements are based on management's current plans, estimates, assumptions and projections based on information currently available to us. Forward-looking statements are subject to known and unknown risks, uncertainties and assumptions, and genuine results or outcomes may differ materially from those expressed or implied in the forward-looking statements due to various important factors, including, but not limited to: our ability to progress any product candidates in preclinical or clinical trials; the uncertainty of clinical trial results and the fact that positive results from preclinical studies are not always indicative of positive clinical results; the scope, rate and progress of our preclinical studies and clinical trials and other research and development activities; the competition for patient enrollment from drug candidates in development; the impact of the global COVID-19 pandemic on our clinical trials, operations, vendors, suppliers, and employees; our ability to obtain the capital necessary to fund our operations; the cost of filing, prosecuting, defending and enforcing any patent claims and other intellectual property rights; our ability to obtain financial in the future through product licensing, public or private equity or debt financing or otherwise; our ability to regain and maintain compliance with the continued listing requirements of the Nasdaq Capital Market; general business conditions, regulatory environment, competition and market for our products; and business ability and judgment of personnel, and the availability of qualified personnel and other important factors discussed under the caption “Risk Factors” in our Quarterly Report on Form 10-Q for the quarterly period ended June 30, 2023, as any such factors may be updated from time to time in our other filings with the SEC, accessible on the SEC’s website at www.sec.gov and the “Financials & Filings” page of our website at https://investors.eloxxpharma.com/financials-filings.

All forward-looking statements speak only as of the date of this press release and, except as required by applicable law, we have no obligation to update or revise any forward-looking statements contained herein, whether as a result of any new information, future events, changed circumstances or otherwise.

Contact

Investors
John Woolford
john.woolford@westwicke.com
443.213.0506

Media
Laureen Cassidy
laureen@outcomescg.com

Source: Eloxx Pharmaceuticals

 
ELOXX PHARMACEUTICALS, INC. AND SUBSIDIARIES
UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEETS
(Amounts in thousands, except share and per share data)
         
         
    June 30, 2023   December 31, 2022
ASSETS        
Current assets:        
Cash and cash equivalents   $ 4,331     $ 19,207  
Restricted cash     210       261  
Prepaid expenses and other current assets     841       661  
Total current assets     5,382       20,129  
Property and equipment, net     130       169  
Operating lease right-of-use asset     481       825  
Total assets   $ 5,993     $ 21,123  
         
LIABILITIES AND STOCKHOLDERS’ DEFICIT        
Current liabilities:        
Accounts payable   $ 3,121     $ 3,020  
Accrued expenses     2,752       2,799  
Current portion of long-term debt     2,276       3,980  
Advances from collaboration partners     12,535       12,535  
Current portion of operating lease liability     492       712  
Derivative liabilities     75       45  
Total current liabilities     21,251       23,091  
Long-term debt, net of current portion     3,334       8,557  
Operating lease liability     4       135  
Total liabilities     24,589       31,783  
Total stockholders’ deficit:     (18,596 )     (10,660 )
Total liabilities and stockholders’ deficit   $ 5,993     $ 21,123  
         
 
ELOXX PHARMACEUTICALS, INC. AND SUBSIDIARIES
UNAUDITED CONSOLIDATED STATEMENTS OF OPERATIONS
(Amounts in thousands, except share and per share data)
                 
    Three Months Ended June 30,   Six Months Ended June 30,
    2023   2022   2023   2022
Operating expenses:                
Research and development   $ 2,338     $ 7,651     $ 5,826     $ 15,550  
General and administrative     1,802       2,645       3,797       5,699  
Total operating expenses     4,140       10,296       9,623       21,249  
Loss from operations     (4,140 )     (10,296 )     (9,623 )     (21,249 )
Other expense, net     201       322       948       989  
Net loss   $ (4,341 )   $ (10,618 )   $ (10,571 )   $ (22,238 )
                 
Net loss per share, basic and diluted   $ (1.96 )   $ (4.90 )   $ (4.83 )   $ (10.27 )
Weighted average number of shares of common stock used in computing net loss per share, basic and diluted     2,212,364       2,166,352       2,189,487       2,166,314  
                                 

 


Mon, 14 Aug 2023 02:30:00 -0500 en text/html https://markets.businessinsider.com/news/stocks/eloxx-pharmaceuticals-reports-second-quarter-2023-financial-and-operating-results-and-provides-business-update-1032551116
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