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Rafael Holdings Reports Second Quarter Fiscal 2025 Financial Results

1. Rafael Holdings plans a merger with Cyclo Therapeutics, closing anticipated in Q3. 2. Post-merger focus will be Trappsol® Cyclo™ for Niemann-Pick Disease Type C. 3. Company reported a Q2 loss of $4.6 million, reversing last year's profit. 4. Cash reserves stood at $48.3 million as of January 31, 2025. 5. Research expenses increased alongside continued trials for Trappsol® Cyclo™.

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Why Bullish?

The announced merger with Cyclo Therapeutics could enhance RFL's product pipeline and long-term value. Historical examples show mergers can lead to increased shareholder value, particularly in biotech.

How important is it?

The merger with Cyclo Therapeutics directly affects RFL's strategic positioning and market potential, thus influencing investor interest and price movements.

Why Long Term?

The merger's successful execution and subsequent clinical trial results will influence RFL's valuation over the longer horizon, especially if Trappsol® Cyclo™ proves effective.

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March 13, 2025 17:50 ET  | Source: Rafael Holdings, Inc. The planned merger with Cyclo Therapeutics is anticipated to close in Q3 pending shareholder approvals Post-merger the Company intends to focus its efforts on Cyclo’s lead clinical program Trappsol® Cyclo™ NEWARK, N.J., March 13, 2025 (GLOBE NEWSWIRE) -- Rafael Holdings, Inc. (NYSE: RFL), today reported its financial results for the second quarter and first six months of fiscal year 2025 ended January 31, 2025. “We look forward to the upcoming shareholder vote on our pending merger with Cyclo Therapeutics (Nasdaq: CYTH) later this month and anticipate closing promptly post shareholder approvals. Upon closing, the Company’s strategic focus will be on its lead clinical asset, Trappsol® Cyclo™,” said Bill Conkling, CEO of Rafael Holdings. Bill added, “We are encouraged by the preliminary results presented at the 21st Annual WORLDSymposium in early February from the ongoing Phase 3 TransportNPC™ Open-Label Sub-Study evaluating Trappsol® Cyclo™ for the treatment of Niemann-Pick Disease Type C1 in patients <3 years of age. We believe that Trappsol® Cyclo™ has the potential to improve the lives of patients suffering from this rare genetic disease and topline data from the 48-week interim analysis of 104 enrolled patients is expected in the middle of 2025.” Rafael Holdings, Inc. Second Quarter Fiscal Year 2025 Financial Results As of January 31, 2025, we had cash and cash equivalents of $48.3 million. For the three months ended January 31, 2025, we recorded a net loss attributable to Rafael Holdings of $4.6 million, or $0.19 per share, versus net income of $6.0 million, or $0.25 per fully diluted share in the year ago period. The year over year decline was attributable to the combined unrealized losses of $1.1 million on the Company’s investment in Cyclo equity which we purchased in advance of the potential merger as well as in the unrealized losses on convertible notes receivable from Cyclo in the current period, versus $9.7 million in unrealized gains on the Company’s investment in Cyclo in the year ago period. Research and development expenses were $0.9 million for the three months ended January 31, 2025, compared to $0.6 million in the year ago period. The year over year increase relates to activity at Cornerstone and Day Three, which were consolidated with Rafael Holdings during fiscal 2024. General and administrative expenses were $2.6 million in both the three months ended January 31, 2025, and 2024. Rafael Holdings, Inc. First Six Months Fiscal Year 2025 Financial Results For the six months ended January 31, 2025, we recorded a net loss attributable to Rafael Holdings of $13.6 million, or $0.57 per share, versus net income of $2.4 million, or $0.10 per share in the year ago period. The year over year decline was attributable to the combined unrealized losses of $4.9 million on the Company’s investment in Cyclo as well as in the convertible notes receivable from Cyclo, versus $7.6 million in unrealized gains on the Company’s investment in Cyclo in the year ago period. Research and development expenses were $2.3 million for the six months ended January 31, 2025, compared to $1.1 million in the year ago period. The year over year increase relates to activity at Cornerstone and Day Three, which were consolidated with Rafael Holdings during fiscal 2024. For the six months ended January 31, 2025, general and administrative expenses were $5.1 million compared to $4.6 million in the same period in the prior year. About Rafael Holdings, Inc. Rafael Holdings, Inc. is a holding company with interests in clinical and early-stage pharmaceutical companies including an investment in (and planned merger with) Cyclo Therapeutics Inc. (Nasdaq: CYTH), a biotechnology company dedicated to developing Trappsol® Cyclo™, which is being evaluated in clinical trials, including an ongoing Phase 3 trial for the potential treatment of Niemann-Pick Disease Type C1 (“NPC1”), a rare, fatal, and progressive genetic disorder. Rafael also holds a majority equity interest in LipoMedix Pharmaceuticals Ltd., a clinical stage pharmaceutical company, Barer Institute Inc., a wholly owned preclinical cancer metabolism research operation, a majority interest in Cornerstone Pharmaceuticals, Inc., formerly known as Rafael Pharmaceuticals Inc., a cancer metabolism-based therapeutics company, a majority interest in Rafael Medical Devices, LLC, an orthopedic-focused medical device company developing instruments to advance minimally invasive surgeries, and a majority interest in Day Three Labs, Inc., a company which empowers third-party manufacturers to reimagine their existing cannabis offerings enabling them to bring to market better, cleaner, more precise and predictable versions by utilizing Day Three’s technology and innovation like Unlokt™. The Company’s primary focus, to date, has been to expand our investment portfolio through opportunistic and strategic investments including therapeutics, which address high unmet medical needs. Upon closing of the planned merger with Cyclo, the Company intends to focus its efforts on making Trappsol®Cyclo™ its lead clinical program. Forward Looking Statements This press release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. All statements contained in this press release that do not relate to matters of historical fact should be considered forward-looking statements, including without limitation statements regarding our expectations surrounding the potential, safety, efficacy, and regulatory and clinical progress of our product candidates; plans regarding the further evaluation of clinical data; and the potential of our pipeline, including our internal cancer metabolism research programs. These statements are neither promises nor guarantees, but involve known and unknown risks, uncertainties and other important factors that may cause our actual 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, those disclosed under the caption “Risk Factors” in our Annual Report on Form 10-K for the year ended July 31, 2024, and our other filings with the SEC. These factors could cause actual results to differ materially from those indicated by the forward-looking statements made in this press release. Any such forward-looking statements represent management’s estimates as of the date of this press release. While we may elect to update such forward-looking statements at some point in the future, we disclaim any obligation to do so, even if subsequent events cause our views to change. Contact:Barbara RyanBarbara.ryan@rafaelholdings.com(203) 274-2825       RAFAEL HOLDINGS, INC.     CONSOLIDATED BALANCE SHEETS      (in thousands, except share and per share data)             January 31, 2025 July 31, 2024   (Unaudited)   ASSETS           CURRENT ASSETS     Cash and cash equivalents $48,319  $2,675  Available-for-sale securities  —   63,265  Interest receivable  —   515  Convertible note receivables, due from Cyclo  16,589   5,191  Accounts receivable, net of allowance for credit losses of $245 at January 31, 2025 and July 31, 2024  200   426  Prepaid expenses and other current assets  725   430  Total current assets  65,833   72,502        Property and equipment, net  1,933   2,120  Investments – Hedge Funds  —   2,547  Investments – Cyclo  10,759   12,010  Convertible note receivable classified as available-for-sale  1,135   1,146  Goodwill  —   3,050  Intangible assets, net  1,787   1,847  In-process research and development  1,575   1,575  Other assets  20   35  TOTAL ASSETS $83,042  $96,832        LIABILITIES AND EQUITY CURRENT LIABILITIES     Accounts payable $2,546  $2,556  Accrued expenses  1,412   1,798  Convertible notes payable  614   614  Other current liabilities  107   113  Due to related parties  731   733  Installment note payable  1,700   1,700  Total current liabilities  7,110   7,514        Accrued expenses, noncurrent  3,294   2,982  Convertible notes payable, noncurrent  75   73  Other liabilities  —   5  TOTAL LIABILITIES  10,479   10,574        COMMITMENTS AND CONTINGENCIES           EQUITY     Class A common stock, $0.01 par value; 35,000,000 shares authorized, 787,163 shares issued and outstanding as of January 31, 2025 and July 31, 2024  8   8  Class B common stock, $0.01 par value; 200,000,000 shares authorized, 24,227,096 issued and 24,125,609 outstanding (excluding treasury shares of 101,487) as of January 31, 2025, and 24,142,535 issued and 23,819,948 outstanding (excluding treasury shares of 101,487) as of July 31, 2024  241   238  Additional paid-in capital  280,831   280,048  Accumulated deficit  (215,390)  (201,743) Treasury stock, at cost; 101,487 Class B shares as of January 31, 2025 and July 31, 2024  (168)  (168) Accumulated other comprehensive income related to unrealized income on available-for-sale securities  135   111  Accumulated other comprehensive income related to foreign currency translation adjustment  3,724   3,691  Total equity attributable to Rafael Holdings, Inc.  69,381   82,185  Noncontrolling interests  3,182   4,073  TOTAL EQUITY  72,563   86,258        TOTAL LIABILITIES AND EQUITY $83,042  $96,832           RAFAEL HOLDINGS, INC. CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS  (unaudited, in thousands, except share and per share data)                    Three Months Ended January 31, Six Months Ended January 31,   2025   2024   2025   2024  Revenues$77  $68  $205  $136           Cost of Infusion Technology revenue 38   -   75   -  SG&A Expenses 2,591   2,561   5,114   4,601  R&D Expenses 947   612   2,273   1,101  Depreciation and amortization 90   38   176   55  Loss on impairment of goodwill 3,050   -   3,050   -  Operating Loss (6,639)  (3,143)  (10,483)  (5,621)          Interest income 489   693   1,057   1,275  Loss on initial investment in Day Three upon acquisition -   (1,633)  -   (1,633) Realized (loss) gain on available-for-sale securities (16)  399   178   576  Realized loss on investment in equity securities -   -   -   (46) Realized gain on investment - Cyclo -   -   -   424  Unrealized gain (loss) on investment - Cyclo 614   9,718   (3,751)  7,594  Unrealized gain (loss) on convertible notes receivable, due from Cyclo 486   -   (1,102)  -  Unrealized gain (loss) on investment - Hedge Funds -   51   -   (115) Interest expense (163)  -   (325)  -  Other (expense) income (78)  25   (80)  118  (Loss) income before income taxes (5,307)  6,110   (14,506)  2,572  Taxes (20)  -   (32)  (6) Equity in loss of Day Three -   (206)  -   (422)          Consolidated net (loss) income (5,327)  5,904   (14,538)  2,144  Net loss attributable to noncontrolling interests (686)  (143)  (891)  (265) Net (loss) income attributable to Rafael Holdings, Inc.$(4,641) $6,047  $(13,647) $2,409                    Loss per share        Basic$(0.19) $0.26  $(0.57) $0.10  Diluted$(0.19) $0.25  $(0.57) $0.10                    Weighted average shares in calculation        Basic 24,150,218   23,642,421   24,121,186   23,643,660  Diluted 24,150,218   24,402,069   24,121,186   24,403,308           

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