DRI Healthcare Reports Second Quarter 2025 Results
Portfolio assets generate Total Income of $44.1 million
Reactivated NCIB and repurchased ~958 K units for $9.1 million, while redeeming $10 million of Series C Preferred Securities for $9.5 million
TORONTO, Aug. 13, 2025 /CNW/ - DRI Healthcare Trust (TSX: DHT.UN) (TSX: DHT.U) ("DRI Healthcare") today announced its financial results for the quarter ended June 30, 2025. DRI Healthcare's second quarter 2025 financial statements and Management's Discussion & Analysis ("MD&A") have been filed on SEDAR+ (www.sedarplus.ca). All dollar amounts are expressed in U.S. dollars unless otherwise indicated.
"Over the past few months, DRI Healthcare has undergone a truly transformational period. By successfully internalizing our external manager, we now have direct alignment between our management team and our unitholders—every decision is focused squarely on creating long-term value.", said Ali Hedayat, DRI Healthcare's Chief Executive Officer. "We've integrated a deeply committed team, sharpened our operating discipline, and are executing with the benefit of a high-quality portfolio of assets with durable growth potential. I'm especially proud that our first pre-approval investment has now been approved, validating our underwriting approach and accelerating future cash flow visibility. Together, these milestones position DRI Healthcare for stronger, more sustainable returns in the years ahead."
Q2 Highlights
Total Income of $44.1 million;
Total Cash Receipts of $40.2 million 1;
Adjusted EBITDA of $30.4 million 2;
Comprehensive Loss of $0.7 million;
Adjusted Cash Earnings per Unit of $0.51 (basic and diluted) 1,2;
Received Toronto Stock Exchange ("TSX") approval for normal course issuer bid to allow DRI Healthcare to acquire up to 3,148,536 units of DRI Healthcare ("Units") between May 20, 2025 and May 19, 2026.
Repurchased 958,279 Units under its Normal Course Issuer Bid ("NCIB") at an average price of $9.54, totaling $9.1 million under the Automated Purchase Plan ("AUPP").
Paid a quarterly cash distribution of US$0.10 per Unit on July 18, 2025.
Subsequent to Quarter End
Completed the previously announced transaction to internalize its investment management function, terminated the management agreement with DRI Capital Inc. ("DRI Capital") for a termination payment of $48 million, and acquired the relevant assets of DRI Capital for a purchase price of $1 million.
Completed the funding of the Ekterly (sebetralstat) optional payment of $22 million which increases DRI Healthcare's royalty entitlement on net sales up to and including the first $500 million from 5.0% to 6.0% and the potential one-time sales-based milestones payment to KalVista from $50 million to $57 million. Our total investment in Ekterly is now $127 million.
Repurchased 208,580 Units under its NCIB at an average price of US$10.24 totaling $2.1 million under the AUPP.
Declared a quarterly cash distribution of US$0.10 per Unit for the third quarter of 2025, payable on October 20, 2025 to unitholders of record on September 30, 2025.
_________________________
1 Total Cash Receipts and Adjusted EBITDA are non-GAAP financial measures. Adjusted Cash Earnings per Unit is a non-GAAP ratio. These measures are not standardized measures under IFRS and might not be comparable to similar financial measures disclosed by other issuers. The reconciliation of these measures can be found later in this press release and in DRI Healthcare's MD&A.
2 The weighted average number of basic and diluted units for the purposes of calculating Earnings per Unit for the three months ended June 30, 2025 were 55,685,363 Units.
Financial Highlights
Three months ended
Six months ended
(thousands of US dollars, except per Unit amounts)
June 30, 2025
June 30, 2024
June 30, 2025
June 30, 2024
Total income
44,130
41,604
88,158
83,671
Management fees
2,657
2,825
6,733
6,989
Performance fees
—
—
533
231
Amortization of royalty assets
24,751
25,679
49,496
50,725
Impairment of royalty assets
—
820
—
5,200
Other expenses
15,375
15,825
31,801
29,800
Gain (loss) on preferred securities
(971)
2,176
(971)
2,176
Other loss
—
(764)
—
(1,575)
Net earnings (loss)
376
(2,133)
(1,376)
(8,673)
Net unrealized gain (loss) on derivative instruments
(1,076)
228
(1,156)
1,425
Comprehensive earnings (loss)
(700)
(1,905)
(2,532)
(7,248)
Net earnings (loss) per Unit – basic
0.01
(0.04)
(0.02)
(0.15)
Net earnings (loss) per Unit – diluted
0.01
(0.04)
(0.02)
(0.15)
Total Cash Receipts 1
40,152
42,955
102,142
106,472
Adjusted EBITDA 1
30,372
32,903
82,031
88,367
Adjusted EBITDA Margin 1
76 %
77 %
80 %
83 %
Adjusted Cash Earnings per Unit – Basic 1
0.51
0.49
0.95
0.97
Adjusted Cash Earnings per Unit – Diluted 1
0.51
0.49
0.95
0.97
Weighted average number of Units – Basic
55,685,363
56,426,259
55,743,876
56,392,250
Weighted average number of Units – Diluted
55,685,363
56,426,259
55,743,876
56,392,250
Asset Performance
As at June 30, 2025, DRI Healthcare's portfolio included 28 royalty streams on 21 products that address a variety of therapeutic areas, such as oncology, neurology, ophthalmology, endocrinology, hematology, dermatology, lysosomal storage disorders and immunology. On June 30, 2025, the royalty asset portfolio had a book value, net of accumulated amortization, of $774.4 million, which during the three and six months ended June 30, 2025 generated Total Cash Royalty Receipts 1 of $40.2 million and $102.1 million, respectively, and royalty income of $44.8 million and $84.4 million, respectively. On June 30, 2025, the financial royalty asset had a book value of $54.2 million and generated a gain (loss) on the change in its fair value of $(0.9) million and $1.7 million, respectively, during the three and six months ended June 30, 2025.
(thousands of US dollars)
Cash Receipts
Three months ended
Six months ended
Royalty Asset
Therapeutic Area
Marketer(s)
June 30,
2025
June 30,
2024
June 30,
2025
June 30,
2024
Casgevy
Hematology
Vertex Pharmaceuticals
—
—
5,000
—
Empaveli/Syfovre
Hematology/Ophthalmology
Apellis, Sobi
147
2,552
1,272
2,575
Eylea I
Ophthalmology
Regeneron, Bayer, Santen
1,158
1,321
2,680
2,728
Eylea II
Ophthalmology
Regeneron, Bayer, Santen
248
285
579
590
Natpara
Endocrinology
Takeda
222
695
501
1,263
Omidria
Ophthalmology
Rayner Surgical
8,993
11,261
16,987
19,821
Oracea
Dermatology
Galderma
1,046
1,886
2,580
4,336
Orserdu I 1
Oncology
Menarini
6,410
5,315
14,920
13,335
Orserdu II 1
Oncology
Menarini
6,409
3,633
29,329
27,171
Rydapt 2
Oncology
Novartis
777
1,953
1,936
4,176
Spinraza
Neurology
Biogen
3,781
3,272
7,743
7,115
Vonjo I
Hematology
Sobi
2,553
2,887
5,648
5,789
Vonjo II 1
Hematology
Sobi
576
615
1,351
6,220
Xenpozyme
Lysosomal Storage Disorder
Sanofi
1,913
662
1,913
662
Xolair
Immunology
Roche, Novartis
2,162
1,666
4,535
4,112
Zejula
Oncology
GSK
1,103
932
2,052
1,894
Zytiga
Oncology
Johnson & Johnson
2,230
3,546
2,230
3,546
Other Products 3
Various
Various
424
474
886
1,139
Total Cash Royalty Receipts, Cash Receipts and Normalized Cash Receipts 4
40,152
42,955
102,142
106,472
____________________________
1 Cash receipts for Orserdu II and Orserdu I for the six months ended June 30, 2025 include $17,593 and $633, respectively, for reclamation of previous royalty deductions. Cash receipts for the six months ended June 30, 2024 include milestone royalty receipts of $2,104 from Orserdu I, $18,939 from Orserdu II and $5,000 from Vonjo II received in Q1 2024.
2 Cash receipts for the six months ended June 30, 2024 includes $1,000 in additional cash receipts related to a one-time payment received in Q1 2024.
3 Other Products includes royalty income from certain other royalty assets as well as royalty assets which are fully amortized and, where applicable, the entitlements to which have generally expired. Comparative figures for royalty assets Simponi, Stelara and Ilaris are included in Other products.
4 Total Cash Receipts, Total Cash Royalty Receipts and Normalized Total Cash Receipts are non-GAAP financial measures. These measures are not standardized measures under IFRS and might not be comparable to similar financial measures disclosed by other issuers. The reconciliation of these measures can be found later in this press release and in the DRI Healthcare's MD&A.
Liquidity and Capital
On June 30, 2025, DRI Healthcare had cash and cash equivalents of $82.5 million. DRI Healthcare's credit facility had an outstanding principal balance of $344.7 million on June 30, 2025.
DRI Healthcare had 55,500,947 Units issued and outstanding on June 30, 2025.
Distributions
On May 12, 2025, the board of trustees approved a quarterly cash distribution of $0.10 per Unit to unitholders of record as of June 30, 2025, which was paid on July 18, 2025. DRI Healthcare also announced today that its board of trustees has declared a quarterly cash distribution in the amount of $0.10 per Unit for the third quarter of 2025, payable on October 20, 2025, to unitholders of record as of September 30, 2025.
Normal Course Issuer Bid
During the three months ended June 30, 2025, DRI Healthcare repurchased and cancelled 958,279 Units under its NCIB for an aggregate amount of $9.1 million at a weighted average price of $9.54 per Unit. As previously announced, DRI Healthcare received approval on May 9, 2025 from the TSX to acquire, from time to time, if considered advisable, up to an aggregate of 3,148,536 Units for cancellation. Purchases will conclude on the earlier of the date on which DRI Healthcare has purchased the maximum number of Units permitted under the NCIB and May 19, 2026. In connection with the NCIB, DRI Healthcare established an AUPP where by Units of DRI Healthcare may be repurchased at the discretion of a dealer to the AUPP using commercially reasonable efforts and subject to trading parameters defined in the AUPP.
Subsequent to June 30, 2024, DRI Healthcare repurchased an additional 208,580 Units at an average price of US$10.24, totaling $2.1 million under the AUPP.
Second Quarter 2025 Conference Call & Webcast
As previously announced, management will hold a conference call on Thursday, August 14, 2025 at 8:00 a.m. (ET) to review DRI Healthcare's 2025 second quarter results. You can join the call by dialing 1-888-699-1199 or 416-945-7677 approximately 15 minutes prior to the call to secure a line.
A live webcast of the conference call, including a slide presentation, will be available at https://emportal.ink/3T55lqI. Please connect at least 15 minutes prior to the conference call to ensure adequate time for any software download that may be required to join the webcast. The webcast will be archived on DRI Healthcare's website following the call date.
Non-GAAP Financial Measures
The reconciliations of non-GAAP financial measures and non-GAAP ratios for the three and six months ended June 30, 2025 and 2024 to the most directly comparable measures calculated in accordance with IFRS are presented below.
Total Cash Receipts, Normalized Total Cash Receipts and Total Cash Royalty Receipts
Total Cash Receipts refers to Total Cash Royalty Receipts plus cash receipts from all products. Total Cash Receipts includes cash receipts from interest as well as non-recurring cash receipts. Total Cash Royalty Receipts refers to aggregate cash royalty receipts and milestone royalty receipts from DRI Healthcare's portfolio of royalty assets and forms part of Total Cash Receipts. Because of the lag between when DRI Healthcare records royalty income and receives the corresponding cash payments on its royalties and milestones, management believes Total Cash Receipts and Total Cash Royalty Receipts are useful measures when evaluating DRI Healthcare's operations, as they represent actual cash generated in respect of all royalty assets held during a period. DRI Healthcare also presents Normalized Total Cash Receipts, which refers to Total Cash Receipts adjusted to remove cash receipts that are not expected to recur in the normal course of operations. Management believes that Normalized Total Cash Receipts will assist readers in evaluating the period-over-period performance of DRI Healthcare's royalty portfolio since Normalized Total Cash Receipts only includes cash receipts generated by royalties and other amounts payable pursuant to the terms of DRI Healthcare's royalty assets. There were no adjustments required to normalize cash receipts for the six months ended June 30, 2025 and 2024.
Adjusted EBITDA and Adjusted EBITDA Margin
Management believes Adjusted EBITDA provides meaningful information about DRI Healthcare's operating cash flows as it eliminates the effects of other non-cash expenses and accruals and income and expenses that are not expected to recur, that have been recorded on the statement of net earnings (loss) and comprehensive earnings (loss). DRI Healthcare refers to EBITDA when reconciling its net earnings (loss) and comprehensive earnings (loss) to Adjusted EBITDA, but does not use EBITDA as a measure of its performance. Management believes that Adjusted EBITDA Margin is a useful supplemental measure to demonstrate the operating efficiency of DRI Healthcare's business on a cash basis.
Three months ended
Six months ended
(thousands of US dollars)
June 30,
2025
June 30,
2024
June 30,
2025
June 30,
2024
Comprehensive earnings (loss)
(700)
(1,905)
(2,532)
(7,248)
[+] Amortization of intangible royalty assets
24,751
25,679
49,496
50,725
[+] Impairment of intangible royalty assets
—
820
—
5,200
[-] Other interest income
(356)
(577)
(654)
17,039
[+] Interest expense
9,028
8,641
18,635
—
EBITDA
32,723
32,658
64,945
64,417
[+] Royalties receivable, beginning of period
45,006
45,470
62,362
64,082
[-] Royalties receivable, end of period
(49,647)
(43,542)
(49,647)
(43,542)
[-] Performance fees payable, beginning of period
(2,198)
(4,916)
(1,665)
(5,918)
[+] Performance fees payable, end of period
—
—
—
—
[+] Financial royalty assets, beginning of period
55,088
—
57,527
—
[-] Financial royalty assets, end of period
(54,184)
—
(54,184)
—
[+] Unrealized loss (gain) on marketable securities
115
—
(1,420)
—
[+] Acquired royalties receivable
—
—
—
3,560
[+] Unit-based compensation
970
4,675
1,430
7,242
[+] Board of trustees' unit-based compensation 2
452
198
556
552
[+] Loss (Gain) on preferred securities
971
(2,176)
971
(2,176)
[-] Other loss
—
764
—
1,575
[-] Net unrealized loss (gain) on derivative instruments
1,076
(228)
1,156
(1,425)
Adjusted EBITDA
30,372
32,903
82,031
88,367
[÷] Normalized Total Cash Receipts
40,152
42,955
102,142
106,472
Adjusted EBITDA Margin
76 %
77 %
80 %
83 %
_______________________________
2 Certain members of the board of trustees elected to be compensated fully or partially in Deferred Units ("DUs") under DRI Healthcare's Omnibus Equity Incentive Plan.
Adjusted Cash Earnings per Unit
Management believes that Adjusted Cash Earnings per Unit provides meaningful information about DRI Healthcare's performance as it provides a measure of the cash generated by DRI Healthcare's assets on a per Unit basis, excluding cash earnings that are not expected to recur.
Corporate Update
Further to DRI Healthcare's press release of July 1, 2025, subsequent to end of quarter, DRI Healthcare completed its previously announced transaction to internalize its investment management function. As a result of the transaction, the management agreement with DRI Capital was terminated in exchange for a $48 million termination payment and DRI Healthcare internalized the manager function by acquiring the relevant assets of DRI Capital for a purchase price of $1 million. As a result of the transactions contemplated by the asset purchase agreement, the employees of DRI Capital also transitioned to a subsidiary of DRI Healthcare.
DRI Healthcare shares that Mr. Amit Kapur, Chief Financial Officer, will be departing DRI Healthcare at the end of September. "Last summer, Amit graciously stepped in at a pivotal moment, helping to steady DRI Healthcare and lay a stronger foundation. He was instrumental in DRI Healthcare's strategic review, playing a significant leadership role in the evaluation of all options and ultimately facilitating the successful internalization of the manager. On behalf of the board of trustees, the team, and our unitholders, we thank Amit for his exceptional skill and leadership during a demanding period and wish him continued success as he brings that same expertise to his next venture." said Gary Collins, Executive Chair of DRI Healthcare.
_____________________
1 Certain members of the board of trustees elected to be compensated fully or partially in DUs under DRI Healthcare's Omnibus Equity Incentive Plan.
About DRI Healthcare
DRI Healthcare is a pioneer in global pharmaceutical royalty monetization. Since our founding in 1989, we have deployed more than $3.0 billion, acquiring more than 75 royalties on 45-plus drugs, including Ekterly, Eylea, Keytruda, Orserdu, Remicade, Spinraza, Stelara, Vonjo and Zytiga. DRI Healthcare's units are listed and trade on the Toronto Stock Exchange in Canadian dollars under the symbol "DHT.UN" and in U.S. dollars under the symbol "DHT.U". To learn more, visit drihealthcare.com or follow us on LinkedIn.
Caution concerning forward-looking statements
This news release may contain forward-looking information within the meaning of applicable securities legislation. Forward-looking information can generally be identified by the use of words such as "expect", "continue", "anticipate", "intend", "aim", "plan", "believe", "budget", "estimate", "forecast", "foresee", "close to", "target" or negative versions thereof and similar expressions. Some of the specific forward-looking information in this news release may include, among other things, statements regarding DRI Healthcare's ability to execute on its strategy, the potential and timing of royalty payments, the anticipated royalty income and anticipated sales of the products underlying such royalties, and DRI Healthcare's normal course issuer bid. Forward-looking information is based on a number of assumptions and is subject to a number of risks and uncertainties, many of which are beyond DRI Healthcare's control that could cause actual results to differ materially from those that are disclosed in or implied by such forward-looking information. These risks and uncertainties include, but are not limited to, the risk that the internalization of DRI Healthcare's manager will not generate the levels of anticipated benefits for DRI Healthcare and its unitholders and those additional risks and uncertainties that are disclosed in DRI Healthcare's most recent annual information form and under "Risk Factors" in DRI Healthcare's Management's Discussion and Analysis. The anticipated royalty terms for products in our portfolio may be shorter than the period of patent protection for the applicable product, depending on many factors, including the entry of generic drugs into the marketplace and competition, all of which are outside our control. No assurance can be given that these are all the factors that could cause actual results to vary materially from the forward-looking statements in this press release. You should not put undue reliance on forward-looking statements. No assurances can be given that any of the events anticipated by the forward-looking statements will transpire or occur, or if any of them do occur, the actual results, performance or achievements of DRI Healthcare could differ materially from the results expressed in, or implied by, any forward-looking statements. Certain assumptions underlying the forward-looking information in this news release include: DRI Healthcare's assumptions regarding demand and growth in pharmaceutical sales, R&D and opportunities for royalty investing; the competitive environment in which DRI Healthcare operates; DRI Healthcare's ability to implement its growth strategies; DRI Healthcare's ability to obtain financing and maintain its existing financing on acceptable terms; DRI Healthcare's ability to maintain good business relationships with marketers and other industry partners; timely receipt of cash royalty receipts; expectations regarding the duration of royalties; DRI Healthcare's ability to keep pace with changing consumer preferences; the absence of material adverse changes in DRI Healthcare's industry or the global economy; currency exchange and interest rates; the impact of competition; the changes and trends in DRI Healthcare's industry or the global economy; and stability in laws, rules, regulations and global standards in the pharmaceutical industry. All forward-looking information in this news release speaks as of the date of this news release. DRI Healthcare does not undertake to update any such forward-looking information whether as a result of new information, future events or otherwise except as required by law. Additional information about these assumptions and risks and uncertainties is contained in DRI Healthcare's filings with securities regulators, including its latest annual information form and Management's Discussion and Analysis. These filings are also available at DRI Healthcare's website at drihealthcare.com.
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- Canada News.Net
Birkenstock, Bugaboo, Coach thrive as rich Americans absorb hikes
LONDON, U.K.: For now, America's wealthier consumers appear unfazed by price increases on high-end products, from Birkenstock sandals to Bugaboo strollers, even as tariffs and economic uncertainty push brands to raise prices. German footwear brand Birkenstock has seen "tremendously strong" demand since introducing higher prices on July 1 to offset U.S. import tariffs, CEO Oliver Reichert told analysts this week. "We saw no pushback or cancellations," he said. The resilience mirrors trends across several premium brands. Bugaboo, the Dutch maker of strollers, high chairs, and playpens retailing for more than US$1,000, raised prices by $50 to $300 in May. "In general, we did not see any pushback," said Jeanelle Teves, Bugaboo's chief commercial officer for North America, noting retailers were "open and accepting" of the changes. Coach handbags have also remained popular, with parent company Tapestry reporting 4.6 million new North American customers this year, many from Gen Z and millennial demographics. CEO Joanne Kuvoiserat said the brand expects to maintain profit margins despite tariff pressures. Ralph Lauren likewise raised its annual revenue forecast as shoppers snapped up items like its $398 Polo Bear sweaters. However, CEO Patrice Louvet cautioned that price sensitivity in the second half remains a key unknown. Bank of America data supports the picture of steady luxury spending. The bank reported that middle—and upper-income cardholders spent more in July than a year earlier, even as spending by lower-income customers stayed flat. The bank noted that lower-income households account for only 15 percent of U.S. consumer spending, meaning overall demand could remain strong if higher-income spending holds up. However, some signs of caution are emerging. Procter & Gamble, maker of Tide detergent, noted that even wealthier consumers are becoming more selective in their purchases. Bugaboo manufactures in China and sells through retailers including Target, Nordstrom, and Bloomingdale's, as well as smaller independent stores. Coach's popular Tabby shoulder bag sells for $350, while Ralph Lauren's luxury apparel continues to command high prices. As brands watch the second half of the year unfold, the big question remains whether affluent shoppers will keep absorbing price hikes or begin to pull back in the face of a "broader pricing environment," Louvet said.
