Knight Therapeutics (GUD) Q1 2025 earnings summary

Executive summary

• Q1 2025 revenues were CAD 88 million (up 2–3% year-over-year), driven by promoted portfolio growth and new launches, partially offset by mature product declines and LATAM currency depreciation.

• Adjusted EBITDA was $12.1 million, down 11% year-over-year; adjusted EBITDA per share was $0.12, down 8%.

• Net income reached $2.2 million versus a net loss of $4.5 million in Q1 2024, with EPS at $0.02 compared to a loss per share of $0.04.

• Entered agreement to acquire Paladin assets for CAD 100 million plus CAD 20 million inventory, with up to $15 million in contingent payments, expected to close mid-2025.

• Expanded product portfolio with new in-licensing, regulatory approvals, and launches in Mexico, Brazil, and Canada.

Financial highlights

• Revenues increased by CAD 2 million (3%) year-over-year to $88.1 million; constant currency revenue growth was 8%.

• Gross margin was $34.9 million (40% of revenues), down from 48% in Q1 2024 due to hyperinflation accounting in Argentina; adjusted gross margin 47%.

• Operating loss was $5.5 million versus operating income of $2.7 million in Q1 2024.

• Cash and marketable securities totaled $141.5 million at quarter end.

• Cash inflow from operations was $3.7 million, down 88% year-over-year.

Outlook and guidance

• Fiscal 2025 revenue guidance reconfirmed at CAD 390–405 million, with adjusted EBITDA expected at approximately 13% of revenues.

• Guidance assumes mid-year closing of Paladin acquisition, no material hyperinflation adjustment in Argentina, and stable supply, pricing, and FX conditions.

• Paladin acquisition expected to significantly increase Canadian business scale and add stable cash flow products.