Kamada (KMDA) Q2 2026 earnings call transcript

Thank you, Operator. This is Brian Ritchie with LifeSci Advisors. Thank you all for participating in today's call. Joining me from KAMADA are Amir London, Chief Executive Officer, and Jaime Orlev, Chief Financial Officer. Earlier today, KAMADA announced its financial results for the three and six months ended June 30, 2026. If you have not received this news release, please go to the investors page of the company's website at www. kammada. com. Before we begin, I would like to caution that comments made during this conference call by management will contain forward-looking statements that involve risks and uncertainties regarding the operations and future results of KAMADA. I encourage you to review the company's filings with the Securities and Exchange Commission, including, without limitation, the company's forms 20F and 6K, which identify specific factors that may cause actual results or events to differ materially from those described in the forward Thank you.

Amir?

Thank you, Brian. My thanks also to investors and analysts for your interest in KAMADA and for participating in today's call. I'm pleased to report that we continue to execute on our strategic multi-year growth plan, delivering record-high operational and financial performance during the first half of 2026, We strong double-digit growth in revenues and adjusted EBITDA for both the six-month and second-quarter reporting periods.

Before proceeding to the specifics, I'd like to point out that when examining and analyzing the company performance during recent months and without future binary events, it's clear that the company growth strategy model, based on our well-defined four growth pillars, is working effectively. We are seeing growth and improvement across all financial metrics, including expanded sales and revenues, operational synergies and disciplined management of expenses, enhanced profitability and EBITDA, and a strengthened ability to generate cash from operation. It is important to note that the significant growth we are currently experiencing is driven solely by our existing commercial product portfolio, organic growth, and that once we execute the acquisitions and M&A transactions that are also part of a strategic plan, this growth will accelerate even further, resulting in enhanced financial metrics.

With that said, let's move on now to our first six-month performance. Total revenues were a record high of $100.2 million for the first half, an increase of approximately 13% year-over-year. Adjusted dividend was a record high of $25.7 million, up 14% year-over-year, and representing a notable 26% margin of revenues. For the second quarter of the year, total revenues were $54.9 million, the strongest in our history, representing a 23% year-over-year increase. Adjusted EBITDA was $14.1 million, up 29% year-over-year, and representing a 26% margin of revenues. Net income for the first half was $13.4 million and 18% up year-over-year, and second quarter net income was $9.3 million, up 26% year-over-year.

Our revenues and adjusted EBITDA for the first six months of the year represent approximately 50% of our 2026 annual guidance. Based on our first half performance, we are reiterating our 2026 annual guidance of $200 million to $205 million in revenues and $50 million to $53 million of adjusted EBITDA, respectively representing 12% and 23% growth when comparing 2026 guidance midpoints to 2025 results. As described on previous calls, we continue to be focused on our four growth drivers on a path for delivering continuous double-digit profitable annual growth.

We are focused on continuing sales growth of our entire commercial portfolio, including our six FDA-approved specialty plasma-derived products. In our distribution segment, growth is supported by the launch of additional biosimilar products in the Israeli market, as well as the expansion of the distribution business to the MENA region, which is ongoing with new distribution agreements being signed. We continue to ramp up plasma collection at our Texas-based facilities in support of our new three-year $50 million supply agreement and expect to commence plasma sales by year-end.

Lastly, securing new business development and M&A opportunities remains a core focus, and as already said, we are committed to expanding our current commercial portfolio and accelerating our current double-digit organic growth. The underlying demand for our products, including for KADROB in the U. S. market, as well as Varizig and HEPA-GAM, continues to increase. Our lead product continues to be our anti inoglobulin KEDRAB which is being distributed in the U through our collaboration with KADRION End utilization of the product in the U is continuing to increase significantly and our product supply to KADRION is increasing year over year and beyond KADRION contractual minimum commitment In addition to our significant market share in the U. S. , we continue to grow sales of KAMRAB in leading international markets such as Canada, Latin America, and Israel.

Glacier represents our second leading franchise with revenue contribution driven by our growing product sales in ex-U. S. markets such as Argentina, Russia, Israel, Switzerland, as well as additional markets mainly in Latin America, as well as royalty income generated from sale of the product by Takeda in the U. S. and Canada. We continue to support the comprehensive post-marketing research program for CytoGAM, which we launched last year, which we believe will help demonstrate the advantages of the product in the prevention and management of CMV disease.

This program was developed in collaboration with leading QPNA leaders to explore advancement of novel CMV disease management. The benefits of this program were recently highlighted by the presentation of data by Dr. Daniel Calabrissi, Assistant Professor of Medicine at the UCSF Lung Transplant Programs at the 2026 International Society for Heart and Lung Transplant Annual Meeting. The findings presented by Dr. Calabresi, based on analysis of CMV high-risk lung transplant recipients, suggest cytokine use is associated with improved clinical outcomes supporting increased cytokine utilization.

In addition, patients continue to be enrolled in the investigate-initiated trial titled SHIELD study, which is prospective randomized control multicenter study in CMV high-risk kidney transplant recipients. The trial is investigating the benefit of cytogram administrated at the conclusion of antiviral prophylaxis to reduce the risk of clinically significant late CMV in kidney transplant recipients who are CMV seronegative and have a CMV seropositive donor. We believe that the data generated by this study will support increased product utilization for cytogram in the large population of kidney transplant recipients. With respect to Varizig, our anti-Varizella zuster immunoglobulin, and Hepagram, our hepatitis B immunoglobulin, we are experiencing strong market demand for these products, resulting, among other things, from our product awareness activities in the U. S. market.

As for distribution operation, as part of activities to advance organic growth, we already have two biosimilar products launched in the Israeli market, and we are on track to launch two other products during this quarter. We have other biosimilar products in the pipeline to be launched in the coming years, and additional in-licensing agreements are in process. We believe that this portfolio will become an increasingly important portion of a distribution business with biosimilar annual sales of between $15 million to $20 million within the next few years.

We are also continuing to advance expansion of a distribution activity to the MENA region. We have recently entered into several distribution agreements and initiated activities to register the underlying products with local authorities. We continue to engage in discussion with additional international companies, offering them full service from registration all the way to commercialization.

In July, we were very pleased to announce our three-year, $50 million sales agreement, first of its kind, to supply normal source plasma to a leading biofarmaceutical company focused on plasma-derived therapies. This agreement validates our plasma collection strategy and the investment we made in our U. S. -based, state-of-the-art plasma collection centers, as well as our vertical integration strategy and multi-year revenue growth objectives.

We expect that initial commercial sales on this agreement will be recorded in the fourth quarter of this year and have included these projected revenues in our current annual guidance.

Moving to business development and M&A, we continue to evaluate opportunities to enrich our portfolio of marketed products and complement our existing commercial operation. This remains a core focus, and we are committed to expanding our current commercial portfolio, accelerating our long-term profitable growth.

With that, I'll turn the call over to Jaime for a detailed discussion of our financial results. Jaime, please go ahead.

Thank you, Amir. As Amir stated at the top of the call, we're recording record high financial results for the first six months and second quarter of 2026. Foto revenues for the first six months of 2026 was $100.2 million, a 13% increase from the $88.8 million generated in the first six months of 2025. The increase in revenues, primarily attributable to increased sales of KEDRAB in the U. S. market, as well as Verizig and HEPAGA.

Full of revenues for the first six months of 2026 are at approximately 50% of the midpoint of our 2026 annual guidance. As an anecdote, approximately five years ago, we reported $103 million in total revenues for the full year ended December 31, 2021. And now we're reporting a similar revenue figure for the first six months. This is a strong indication of the company's significant growth track. Total revenues for the second quarter of 2026 were $54.9 million, up 23% compared to the second quarter of 2025.

Second quarter revenues represents the highest revenue for a given quarter in KAMADA's history. I will now turn the call over to management for the KAMADA LTD earnings conference The net income was million or per diluted share up 18 compared to million or per diluted share in the first six months of 2025 For the second quarter of 2026, net income was $9.3 million, up 26%, compared to the second quarter of 2025. Adjusted DbD was $25.7 million in the first six months of 2026, a 14% increase as compared to the $22.5 million in the first six months of 2025.

Adjusted DbD for the first six months of 2026 represents a 26% margin of revenue and is at 50% of the midpoint of our 2026 annual guidance. Cash provided by operating activity during the first six months of 2026 was approximately $17.8 million, compared to $7.5 million during the first six months of 2025. As of June 30, 2026, we had cash and cash equivalent and short-term investments totaling $70.1 million, compared to $73.1 million at the end of March. The company's ability to maintain its cash position while making a $14.4 million dividend payment during the second quarter is indicative of its continued ability to convert operating profits into cash flow.

With that, I will transfer the call back to Amir.

Thank you, Jaime. Before we open the call to questions, I want to take a moment to acknowledge the other news we issued earlier this morning. As we announced, Jaime will be leaving KAMADA at the end of the year to pursue other opportunities. On behalf of everyone at KAMADA, as well as our board of directors, I'd like to thank Jaime for his leadership and significant contribution to KAMADA during his nine years of service. Jaime has been instrumental in our continued growth while maintaining a strong operating and financial position that underlies the growth track we reported on today.

We've initiated a search for a new CFO, and Jaime is committed to providing transitional support. Please join me in wishing him all the best in his future endeavors. I hope that that concludes our prepared remarks. We are ready to open the call to questions. Thank you.

Yeah, thanks, Annabelle. So H1 performance is approximately 50% of an annual midpoint guidance. Per guidance, we have already forecasted significant growth this year, 12% in revenue, 23% in EBITDA compared to last year, and we are executing to the plan. So that's basically kind of the rationale based on our performance and annual guidance. We expect another strong year next year of double-digit growth. So as we said, we believe that our growth model works. We guided between $200 million to $205 million. We're approximately 50% of that. We felt comfortable with the second part of the year expectations, and we will be guiding 2027 in due time, which will be another great year of significant growth for the company.

As for the gross margin decline, so gross margin is a little bit shifting between quarter to quarter based on the product mix and market mix. Important to mention that we've maintained our EBITDA rate of 26% of revenue, which we believe is a significant achievement. And we were able to significantly grow our net income by over 18% year over year. So with those financial metrics, we believe that we are on a very strong track also moving forward, generating significant profitability and significant cash of operation, being able to convert that profitability into real money, real cash.

Thank you. Okay. Can you hear me?

The lab that was approved was important for us in order to be even further vertically integrated. Until now, we were sending the samples of the anti-rebus product to an external lab. Having the lab in-house allows us quicker response and ability to get the product in process and final results, which allows us to release product faster to the market. With a significantly growing demand for KEDRAB this is an important factor in our ability to continuously support growing market demand And then in the quarter selling and marketing to me I thought was particularly low compared to the level of sales you had Was there a one-time item there, or how were you able to keep that so low?

We are being very effective in the way we are utilizing our resources. I think we are happy to present our investor year after year profitable growth. So it's not just we are just growing our top line, but also growing our revenues, growing our bottom line, EBITDA and net profits. And that's all about synergies, economy of scales, and responsible management of our resources.

So since we launched the Houston and San Antonio centers, we spoke about the fact that each one of those two centers will contribute between $8 to $10 million in revenue per year. So this is the capacity of those two centers. If you add the two centers together, you get to between $16 to $20 million per year. And if you take the $50 million divided by three, it's exactly, you know, this $17 million that we will be generating from those centers. So this is the current capacity, and this capacity has been basically sold based on the contract we signed. We are growing our specialty plasma collection in those centers, and that specialty plasma goes into our own production, and that's the second portion of this equation, of this formula.

So we're not just selling plasma out as a way to grow and increase our revenue and profitability, but we're also using specialty plasma for our own products in a way that over time will allow us to keep growing, improving our gross margins and overall profitability.

The cell center is a specialty center to collect only specialty plasma, which is being used by our needs. This was the original center required in Beaumont, and that's a specialty focus center.

Okay, I understood. All right, great. All right, thank you.

Thank you. Just a couple of them here, and they're related, so I'll ask them together. First is, can you talk about whether or not the organic growth is sustainable? And then maybe just discuss the consistency that we've seen in the business over the last several years and how sustainable that is long term.

Yeah, great question. So our business is highly sustainable, or the organic growth is highly sustainable. We've been able to grow our business year over year, double digit. We are projecting continued growth moving forward. We haven't completed yet our 2027 budget plan, but I can assure you that we will continue growing and all of this organically, and this is based on a strong business model, strategic model that is working very well for us. Six FDA-approved products in over 30 different countries in licensing and distribution segment, which is growing in terms of expansion to the MENA region, the newly signed plasma cells deals, which we just spoke about, and, of course, the transaction M&A, BD activities that we are searching and we will be executing over time.

I think I mentioned it at the beginning of the call, but I would like maybe to reiterate it, that when examining and analyzing the company performance during recent months, and KAMADA does not have any future binary events, we are basically growing year after year, quarter after quarter. It's clear that the company growth strategy model is working, and it's working effectively. We are seeing growth and improvement across all financial metrics. Look, compare our six-month performance to previous year, expanded sales, expanded revenues, operational synergies, disciplined management of expenses, enhanced profitability and EBITDA, and a very strong ability to generate cash from operation.

So I think that's basically the way to look at KAMADA, a very strong, profitable, growing business, generating cash, generating ability to continue investing into the business. We paid dividends last year and this year, and we believe that basically we have all the formula to continue growing in a very profitable way and bring value to our shareholders, especially when looking at our current share price and current valuation.

Thanks, Amir. Maybe we'll just turn it back to you for the closing comments, please.

Okay, thank you very much. So as communicated at the beginning of the call, and my answer to Brian, we continue to execute on our strategic multi-year gross plan, delivering record-high operational Thank you. We support clinicians and patients with important life-saving products that we develop, manufacture, and commercialize. We thank you all for your support. Remain committed to creating long-term shareholder value. We hope you all stay healthy and safe. Thank you for joining our call today.