Theratechnologies’ Earnings Call: Growth Amid Challenges

Theratechnologies ((TSE:TH)) has held its Q4 earnings call. Read on for the main highlights of the call.

Theratechnologies’ recent earnings call painted a picture of a company on the upswing, with a strong fiscal year marked by a significant improvement in adjusted EBITDA and continued growth in EGRIFTA SV sales. This positive sentiment was bolstered by new strategic partnerships and credit facilities, although challenges such as declining TRYNGOLZA sales, increased G&A expenses, and high net finance costs were acknowledged. The company is actively addressing these issues to maintain its upward trajectory.

Significant Improvement in Adjusted EBITDA

Theratechnologies showcased a remarkable turnaround in its operational performance by ending the fiscal year with an adjusted EBITDA of $20 million, a stark contrast to the minus $3 million recorded the previous year. This improvement underscores the company’s effective cost management and strategic initiatives.

EGRIFTA SV Resumed Distribution and FDA Collaboration

The company successfully resumed the distribution of EGRIFTA SV after overcoming a brief shortage. Collaboration with the FDA facilitated the sale and distribution of newly manufactured batches, ensuring a steady supply to meet market demand.

Partnership with Ionis Pharmaceuticals

In a move to bolster its market presence, Theratechnologies entered into an exclusive licensing agreement with Ionis Pharmaceuticals. This partnership aims to introduce donidalorsen and olezarsen to the Canadian market, opening up new avenues for growth across multiple indications.

Strong Performance of EGRIFTA SV

EGRIFTA SV sales reached an impressive $60 million for the year, marking a 12% growth year-over-year. The latter part of 2024 saw notable acceleration in sales, reflecting the product’s strong market position and demand.

New Credit Facilities Secured

To support its long-term growth strategies, Theratechnologies secured up to $75 million in new credit facilities. These replace prior agreements, providing the company with greater financial flexibility to pursue its strategic objectives.

TRYNGOLZA Sales Decline

Despite the overall positive performance, TRYNGOLZA sales experienced an 8% decline due to increased competition. This dip impacted the company’s overall revenue, highlighting the need for strategic adjustments in this segment.

Oncology Program Impairment

The company recorded an impairment loss on the intangible asset related to its 2019 oncology platform acquisition. Efforts to find a partner for the program are ongoing, indicating a commitment to revitalizing this segment.

Higher G&A Expenses

General and administrative expenses rose by 38% in Q4 2024 compared to the previous year. This increase was primarily driven by higher stock-based compensation, reflecting the company’s investment in its workforce.

High Net Finance Costs

Net finance costs saw a significant rise, attributed to interest and costs related to the reimbursement of the Marathon loan, including a loss on debt modification. This highlights the financial challenges the company is navigating.

Forward-Looking Guidance

CEO Paul Levesque provided optimistic guidance for the future, emphasizing the company’s strategic developments. With an adjusted EBITDA of $20 million, the resumption of EGRIFTA SV distribution, and new credit facilities, Theratechnologies is well-positioned for future growth. The partnership with Ionis Pharmaceuticals is expected to generate over $30 million in revenue, with potential for further expansion. The company aims to leverage its infrastructure to sustain long-term growth.

In conclusion, Theratechnologies’ earnings call reflected a positive sentiment with significant achievements and strategic partnerships paving the way for future growth. Despite challenges such as declining TRYNGOLZA sales and increased expenses, the company is taking proactive steps to address these issues and capitalize on new opportunities. Investors and stakeholders can look forward to a promising outlook as Theratechnologies continues to strengthen its market position.