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Kemper Reports Strong First Quarter 2019 Operating Results

Published

5 years ago

April 29, 2019

Reading Time: 13 minutes

CHICAGO–(BUSINESS WIRE)–Kemper Corporation (NYSE: KMPR)
reported net income of $155.3 million, or $2.35 per diluted share, for
the first quarter of 2019, compared to $53.8 million, or $1.02 per
diluted share, for the first quarter of 2018. In the first quarter of
2019, net income included a $50.9 million after-tax gain, or $0.77 per
diluted share, attributable to the change in fair value of equity and
convertible securities. As adjusted for the acquisition of Infinity
Property and Casualty Corporation¹, net income was $153.2
million, or $2.32 per diluted share, for the first quarter of 2019,
compared to $73.9 million, or $1.13 per diluted share, for the first
quarter of 2018.

Adjusted consolidated net operating income¹ was $98.9
million, or $1.50 per diluted share, for the first quarter of 2019,
compared to $57.5 million, or $1.10 per diluted share, for the first
quarter of 2018. These results increased primarily from the continued
profitable growth in Specialty Property & Casualty Insurance segment.

Highlights of the quarter include:

Consolidated earned premiums increased by 76 percent, or $465.0
million in the quarter, as reported, 12 percent, or $111.0 million, as
adjusted ¹
Specialty Property & Casualty Insurance segment’s earned premiums
increased by 162 percent, or $450.9 million in the quarter, as
reported, or 15 percent, or $96.9 million, as adjusted ¹

“Kemper delivered strong growth and earnings this quarter with solid
operating performance in our core businesses, including significant
increases in earned premiums, net income, earnings per share and book
value per share,” said Joseph P. Lacher, Jr., President and CEO. “Our
focus on growing, niche and underserved markets and ability to meet the
needs of our customers is driving growth in revenues and profitability.”


	Three Months Ended
(Dollars in Millions, Except Per Share Amounts) (Unaudited)	Mar 31, 2019			Mar 31, 2018
Net Income	$	155.3		$	53.8
Income from Continuing Operations	$	155.3		$	53.6
Adjusted Consolidated Net Operating Income¹	$	98.9		$	57.5

Impact of Catastrophe Losses and Related Loss Adjustment Expense (LAE) on Net Income	$	(13.8	)	$	(6.1	)

Diluted Net Income Per Share From:
Net Income	$	2.35		$	1.02
Income from Continuing Operations	$	2.35		$	1.02
Adjusted Consolidated Net Operating Income¹	$	1.50		$	1.10

Impact of Catastrophe Losses and Related LAE on Net Income Per Share	$	(0.21	)	$	(0.12	)

¹ Non-GAAP financial measure. All Non-GAAP financial measures
are denoted with footnote 1 throughout this release. See “Use of
Non-GAAP Financial Measures” for additional information.

Capital

Total Shareholders’ Equity at the end of the quarter was $3,320.1
million, an increase of $270.0 million, or 9 percent, since year-end
2018 driven by net income and unrealized gain on fixed maturity
portfolio, partially offset by dividends paid to shareholders. Kemper
ended the quarter with cash and investments at the holding company of
$118.6 million, and the $300 million revolving credit agreement was
undrawn.

During the first quarter of 2019, Kemper paid dividends of $16.2 million.

Kemper ended the quarter with a book value per share of $51.13, an
increase of 9 percent from $47.10 at the end of 2018. Book value per
share excluding net unrealized gains on fixed maturities¹ was
$47.41, up 4 percent from $45.40 at the end of 2018, driven by net
income, partially offset by dividends paid to shareholders.

Revenues

Total revenues for the first quarter of 2019 increased $543.3 million,
or 78 percent, to $1,236.3 million, compared to the first quarter of
2018, driven by $450.9 million of higher Specialty P&C earned premiums
and by $63.7 million of higher revenues from the increase in the fair
values of equity and convertible securities. Net investment income
increased $3.5 million to $82.7 million in the first quarter of 2019,
primarily from a $14.0 million increase in interest on fixed income
securities primarily from the addition of Infinity’s investment
portfolio, partially offset by a $12.0 million reduction in net
investment income on the alternative investments portfolio. Net realized
investment gains were $16.1 million in the first quarter of 2019,
compared to $2.6 million last year. Other income increased $0.7 million
to $1.9 million in the first quarter of 2019.

On an as adjusted basis¹, Specialty P&C earned premiums for
the first quarter of 2019 increased $96.9 million, or 15 percent, to
$729.3, compared to the first quarter of 2018, primarily from higher
policies in-force.

Segment Results

Unless otherwise noted, (i) the segment results discussed below are
presented on an after-tax basis, (ii) prior-year development includes
both catastrophe and non-catastrophe losses and LAE, (iii) catastrophe
losses and LAE exclude the impact of prior-year development, (iv) loss
ratio includes loss and LAE, and (v) all comparisons are made to the
prior year quarter unless otherwise stated.


	Three Months Ended
(Dollars in Millions) (Unaudited)	Mar 31, 2019			Mar 31, 2018
Segment Net Operating Income:
Preferred Property & Casualty Insurance	$	2.8		$	13.5
Specialty Property & Casualty Insurance	79.6			23.4
Life & Health Insurance	23.1			24.1
Total Segment Net Operating Income	105.5			61.0
Corporate and Other Net Operating Loss	(6.6		)	(3.5		)
Adjusted Consolidated Net Operating Income¹	98.9			57.5
Net Income (Loss) From:
Change in Fair Value of Equity and Convertible Securities	50.9			0.6
Net Realized Gains on Sales of Investments	12.7			2.1
Net Impairment Losses Recognized in Earnings	(2.8		)	(0.4		)
Acquisition Related Transaction, Integration and Other Costs	(4.4		)	(6.2		)
Income from Continuing Operations	$	155.3		$	53.6

The Preferred Property & Casualty Insurance segment reported net
operating income of $2.8 million for the first quarter of 2019, compared
to $13.5 million in 2018. Results decreased primarily from an elevated
level of catastrophe losses, a reduction in net investment income and
some above normal large loss activity. The Preferred Property & Casualty
Insurance segment’s combined ratio increased 4.4 percentage points to
102.7 percent, while the underlying combined ratio¹ increased
1.1 percentage points to 96.0 percent in the first quarter of 2019,
driven by an increase in the underlying loss ratio¹ in
Homeowners associated with the aforementioned loss activity.

The Specialty Property & Casualty Insurance segment reported net
operating income of $79.6 million for the first quarter of 2019,
compared to $23.4 million in 2018. Results increased primarily from
strong Personal Automobile growth and profitability. On an as adjusted
basis¹, the segment’s net operating income was $75.9 million
in the first quarter of 2019, compared to $49.8 million in 2018. The
segment’s underlying combined ratio¹ improved 1.7 percentage
points to 91.7 percent in the first quarter of 2019, primarily from an
improvement in the underlying loss ratio¹ in both Personal
Automobile and Commercial Automobile.

The Life & Health Insurance segment reported net operating income of
$23.1 million for the first quarter of 2019, compared to $24.1 million
in 2018. Income was lower primarily due to a reduction in net investment
income. Higher sales volumes in both the Life and Health business lines
resulted in increased earned premiums and corresponding variable
compensation expense. The benefits ratio also improved relative to the
first quarter of 2018 which was negatively impacted by a severe flu
season.

Unaudited condensed consolidated statements of income for the three
months ended March 31, 2019 and 2018 are presented below.


	Three Months Ended
(Dollars in Millions, Except Per Share Amounts)	Mar 31, 2019			Mar 31, 2018
Revenues:
Earned Premiums	$	1,074.8		$	609.8
Net Investment Income	82.7			79.2
Other Income	1.9			1.2
Income from Change in Fair Value of Equity and Convertible Securities	64.4			0.7
Net Realized Gains on Sales of Investments	16.1			2.6
Other-than-temporary Impairment Losses:
Total Other-than-temporary Impairment Losses	(3.5		)	(0.5		)
Portion of Losses Recognized in Other Comprehensive Income	(0.1		)	—
Net Impairment Losses Recognized in Earnings	(3.6		)	(0.5		)
Total Revenues	1,236.3			693.0
Expenses:
Policyholders’ Benefits and Incurred Losses and Loss Adjustment Expenses	765.4			436.9
Insurance Expenses	234.8			160.1
Interest and Other Expenses	41.4			29.0
Total Expenses	1,041.6			626.0
Income from Continuing Operations before Income Taxes	194.7			67.0
Income Tax Expense	(39.4		)	(13.4		)
Income from Continuing Operations	155.3			53.6
Income from Discontinued Operations	—			0.2
Net Income	$	155.3		$	53.8

Income from Continuing Operations Per Unrestricted Share:
Basic	$	2.38		$	1.03
Diluted	$	2.35		$	1.02

Net Income Per Unrestricted Share:
Basic	$	2.38		$	1.03
Diluted	$	2.35		$	1.02

Weighted-average Outstanding (Shares in Thousands):
Unrestricted Shares – Basic	64,815.0			51,502.9
Unrestricted Shares and Equivalent Shares – Diluted	65,606.0			51,868.2

Unaudited business segment revenues for the three months ended
March 31, 2019 and 2018 are presented below.


	Three Months Ended
(Dollars in Millions)	Mar 31, 2019			Mar 31, 2018
REVENUES:
Preferred Property & Casualty Insurance:
Earned Premiums:
Preferred Automobile	$	115.4		$	104.9
Homeowners	60.3			61.8
Other Personal	9.9			10.1
Total Earned Premiums	185.6			176.8
Net Investment Income	8.3			13.7
Total Preferred Property & Casualty Insurance Revenues	193.9			190.5
Specialty Property & Casualty Insurance:
Earned Premiums:
Specialty Personal Automobile	669.6			266.2
Commercial Automobile Insurance	59.7			12.2
Total Earned Premiums	729.3			278.4
Net Investment Income	21.5			9.9
Other Income	0.8			0.3
Total Specialty Property & Casualty Insurance Revenues	751.6			288.6
Life & Health Insurance:
Earned Premiums:
Life	95.8			93.7
Accident & Health	46.9			43.3
Property	17.2			17.6
Total Earned Premiums	159.9			154.6
Net Investment Income	51.7			53.7
Other Income	1.1			0.8
Total Life & Health Insurance Revenues	212.7			209.1
Total Segment Revenues	1,158.2			688.2
Income from Change in Fair Value of Equity and Convertible Securities	64.4			0.7
Net Realized Gains on Sales of Investments	16.1			2.6
Net Impairment Losses Recognized in Earnings	(3.6		)	(0.5		)
Other	1.2			2.0
Total Revenues	$	1,236.3		$	693.0

KEMPER CORPORATION AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
(Dollars in Millions)
(Unaudited)
	Mar 31, 2019		Dec 31, 2018
Assets:
Investments:
Fixed Maturities at Fair Value	$	6,573.1	$	6,424.2
Equity Securities at Fair Value	916.9		684.4
Equity Securities at Modified Cost	39.2		41.5
Equity Method Limited Liability Investments at Cost Plus Cumulative Undistributed Earnings	197.8		187.0
Convertible Securities at Fair Value	33.8		31.5
Short-term Investments at Cost which Approximates Fair Value	350.4		286.1
Other Investments	425.6		414.8
Total Investments	8,536.8		8,069.5
Cash	107.0		75.1
Receivables from Policyholders	1,048.6		1,007.1
Other Receivables	254.6		245.4
Deferred Policy Acquisition Costs	499.2		470.0
Goodwill	1,111.5		1,112.4
Current Income Tax Assets	19.7		38.9
Other Assets	604.8		526.5
Total Assets	$	12,182.2	$	11,544.9
Liabilities and Shareholders’ Equity:
Insurance Reserves:
Life & Health	$	3,568.5	$	3,558.7
Property & Casualty	1,868.7		1,874.9
Total Insurance Reserves	5,437.2		5,433.6
Unearned Premiums	1,499.5		1,424.3
Deferred Income Tax Liabilities	82.6		26.2
Liabilities for Unrecognized Tax Benefits	3.9		4.4
Collateralized Investment Borrowings at Cost	187.7		10.0
Debt at Amortized Cost	908.5		909.0
Accrued Expenses and Other Liabilities	742.7		687.3
Total Liabilities	8,862.1		8,494.8
Shareholders’ Equity:
Common Stock	6.5		6.5
Paid-in Capital	1,673.0		1,666.3
Retained Earnings	1,489.7		1,355.5
Accumulated Other Comprehensive Income	150.9		21.8
Total Shareholders’ Equity	3,320.1		3,050.1
Total Liabilities and Shareholders’ Equity	$	12,182.2	$	11,544.9

Unaudited selected financial information for the Preferred Property &
Casualty Insurance segment follows.


	Three Months Ended
(Dollars in Millions)	Mar 31, 2019			Mar 31, 2018
Results of Operations
Net Premiums Written	$	179.6		$	170.5

Earned Premiums	$	185.6		$	176.8
Net Investment Income	8.3			13.7
Total Revenues	193.9			190.5
Incurred Losses and LAE related to:
Current Year:
Non-catastrophe Losses and LAE	120.8			114.2
Catastrophe Losses and LAE	16.6			7.3
Prior Years:
Non-catastrophe Losses and LAE	(5.1		)	4.2
Catastrophe Losses and LAE	1.0			(5.4		)
Total Incurred Losses and LAE	133.3			120.3
Insurance Expenses	57.3			53.6
Operating Income	3.3			16.6
Income Tax Expense	(0.5		)	(3.1		)
Segment Net Operating Income	$	2.8		$	13.5

Ratios Based On Earned Premiums
Current Year Non-catastrophe Losses and LAE Ratio	65.1		%	64.6		%
Current Year Catastrophe Losses and LAE Ratio	8.9			4.1
Prior Years Non-catastrophe Losses and LAE Ratio	(2.7		)	2.4
Prior Years Catastrophe Losses and LAE Ratio	0.5			(3.1		)
Total Incurred Loss and LAE Ratio	71.8			68.0
Insurance Expense Ratio	30.9			30.3
Combined Ratio	102.7		%	98.3		%

Underlying Combined Ratio¹
Current Year Non-catastrophe Losses and LAE Ratio	65.1		%	64.6		%
Insurance Expense Ratio	30.9			30.3
Underlying Combined Ratio¹	96.0		%	94.9		%

Non-GAAP Measure Reconciliation
Combined Ratio	102.7		%	98.3		%
Current Year Catastrophe Losses and LAE Ratio	8.9			4.1
Prior Years Non-catastrophe Losses and LAE Ratio	(2.7		)	2.4
Prior Years Catastrophe Losses and LAE Ratio	0.5			(3.1		)
Underlying Combined Ratio¹	96.0		%	94.9		%

Unaudited selected financial information for the Specialty Property &
Casualty Insurance segment follows.


	Three Months Ended
(Dollars in Millions)	Mar 31, 2019			Mar 31, 2018
Results of Operations
Net Premiums Written	$	809.1		$	318.4

Earned Premiums	$	729.3		$	278.4
Net Investment Income	21.5			9.9
Other Income	0.8			0.3
Total Revenues	751.6			288.6
Incurred Losses and LAE related to:
Current Year:
Non-catastrophe Losses and LAE	544.3			212.3
Catastrophe Losses and LAE	0.6			0.2
Prior Years:
Non-catastrophe Losses and LAE	(18.3		)	(0.5		)
Catastrophe Losses and LAE	0.2			(0.3		)
Total Incurred Losses and LAE	526.8			211.7
Insurance Expenses	124.8			47.9
Other Expenses	0.6			—
Operating Income	99.4			29.0
Income Tax Benefit	(19.8		)	(5.6		)
Segment Net Operating Income	$	79.6		$	23.4

Ratios Based On Earned Premiums
Current Year Non-catastrophe Losses and LAE Ratio	74.6		%	76.2		%
Current Year Catastrophe Losses and LAE Ratio	0.1			0.1
Prior Years Non-catastrophe Losses and LAE Ratio	(2.5		)	(0.2		)
Prior Years Catastrophe Losses and LAE Ratio	—			(0.1		)
Total Incurred Loss and LAE Ratio	72.2			76.0
Insurance Expense Ratio	17.1			17.2
Combined Ratio	89.3		%	93.2		%

Underlying Combined Ratio¹
Current Year Non-catastrophe Losses and LAE Ratio	74.6		%	76.2		%
Insurance Expense Ratio	17.1			17.2
Underlying Combined Ratio¹	91.7		%	93.4		%

Non-GAAP Measure Reconciliation
Combined Ratio	89.3		%	93.2		%
Current Year Catastrophe Losses and LAE Ratio	0.1			0.1
Prior Years Non-catastrophe Losses and LAE Ratio	(2.5		)	(0.2		)
Prior Years Catastrophe Losses and LAE Ratio	—			(0.1		)
Underlying Combined Ratio¹	91.7		%	93.4		%

Unaudited selected financial information for the Life & Health
Insurance segment follows.


	Three Months Ended
(Dollars in Millions)	Mar 31, 2019			Mar 31, 2018
Results of Operations
Earned Premiums	$	159.9		$	154.6
Net Investment Income	51.7			53.7
Other Income	1.1			0.8
Total Revenues	212.7			209.1
Policyholders’ Benefits and Incurred Losses and LAE	105.4			104.9
Insurance Expenses	78.0			73.9
Operating Profit	29.3			30.3
Income Tax Expense	(6.2		)	(6.2		)
Segment Net Operating Income	$	23.1		$	24.1

Use of Non-GAAP Financial Measures

Adjusted Consolidated Net Operating Income¹

Adjusted Consolidated Net Operating Income¹ is an after-tax,
non-GAAP financial measure computed by excluding from Income from
Continuing Operations the after-tax impact of 1) loss from change in
fair value of equity and convertible securities, 2) net realized gains
on sales of investments, 3) net impairment losses recognized in earnings
related to investments, 4) acquisition related transaction, integration
and other costs, 5) loss from early extinguishment of debt and 6)
significant non-recurring or infrequent items that may not be indicative
of ongoing operations. Significant non-recurring items are excluded when
(a) the nature of the charge or gain is such that it is reasonably
unlikely to recur within two years and (b) there has been no similar
charge or gain within the prior two years. The most directly comparable
GAAP financial measure is Income from Continuing Operations.

Kemper believes that Adjusted Consolidated Net Operating Income¹
provides investors with a valuable measure of its ongoing performance
because it reveals underlying operational performance trends that
otherwise might be less apparent if the items were not excluded. Loss
from Change in Fair Value of Equity and Convertible Securities, Net
Realized Gains on Sales of Investments and Net Impairment Losses
Recognized in Earnings related to investments included in the Company’s
results may vary significantly between periods and are generally driven
by business decisions and external economic developments such as capital
market conditions that impact the values of the Company’s investments,
the timing of which is unrelated to the insurance underwriting process.
Loss from Early Extinguishment of Debt is driven by the Company’s
financing and refinancing decisions and capital needs, as well as
external economic developments such as debt market conditions, the
timing of which is unrelated to the insurance underwriting process.
Acquisition Related Transaction, Integration and Other Costs may vary
significantly between periods and are generally driven by the timing of
acquisitions and business decisions which are unrelated to the insurance
underwriting process. Significant non-recurring items are excluded
because, by their nature, they are not indicative of the Company’s
business or economic trends.

A reconciliation of Income from Continuing Operations to Adjusted
Consolidated Net Operating Income¹ for the three months ended
March 31, 2019 and 2018 is presented below.


	Three Months Ended
(Dollars in Millions) (Unaudited)	Mar 31, 2019			Mar 31, 2018
Income from Continuing Operations	$	155.3		$	53.6
Less Net Income (Loss) From:
Income from Change in Fair Value of Equity and Convertible Securities	50.9			0.6
Net Realized Gains on Sales of Investments	12.7			2.1
Net Impairment Losses Recognized in Earnings	(2.8		)	(0.4		)
Acquisition Related Transaction, Integration and Other Costs	(4.4		)	(6.2		)
Adjusted Consolidated Net Operating Income¹	$	98.9		$	57.5

Diluted Adjusted Consolidated Net Operating Income
Per Unrestricted Share¹

Diluted Adjusted Consolidated Net Operating Income Per Unrestricted Share¹
is a non-GAAP financial measure computed by dividing Adjusted
Consolidated Net Operating Income¹ attributed to unrestricted
shares by the weighted-average unrestricted shares and equivalent shares
outstanding. The most directly comparable GAAP financial measure is
Diluted Income from Continuing Operations Per Unrestricted Share.

A reconciliation of Diluted Income from Continuing Operations Per
Unrestricted Share to Diluted Adjusted Consolidated Net Operating Income
Per Unrestricted Share¹ for the three months ended March 31,
2019 and 2018 is presented below.


	Three Months Ended
(Unaudited)	Mar 31, 2019			Mar 31, 2018
Diluted Income from Continuing Operations Per Unrestricted Share	$	2.35		$	1.02
Less Net Income (Loss) Per Unrestricted Share From:
Income from Change in Fair Value of Equity and Convertible Securities	0.77			0.01
Net Realized Gains on Sales of Investments	0.19			0.04
Net Impairment Losses Recognized in Earnings	(0.04		)	(0.01		)
Acquisition Related Transaction and Integration Costs	(0.07		)	(0.12		)
Diluted Adjusted Consolidated Net Operating Income Per Unrestricted Share¹	$	1.50		$	1.10

Book Value Per Share Excluding Net Unrealized
Gains on Fixed Maturities¹

Book Value Per Share Excluding Net Unrealized Gains on Fixed Maturities¹
is a ratio that uses a non-GAAP financial measure. It is calculated by
dividing shareholders’ equity after excluding the after-tax impact of
net unrealized gains on fixed income securities by total Common Shares
Issued and Outstanding. Book Value Per Share is the most directly
comparable GAAP financial measure. Kemper uses the trends in book value
per share, excluding the after-tax impact of net unrealized gains on
fixed income securities, in conjunction with book value per share to
identify and analyze the change in net worth attributable to management
efforts between periods. Kemper believes the non-GAAP financial measure
is useful to investors because it eliminates the effect of items that
can fluctuate significantly from period to period and are generally
driven by economic developments, primarily capital market conditions,
the magnitude and timing of which are not influenced by management.
Kemper believes it enhances understanding and comparability of
performance by highlighting underlying business activity and
profitability drivers.

A reconciliation of the numerator used in the computation of Book Value
Per Share Excluding Net Unrealized Gains on Fixed Maturities¹
and Book Value Per Share at March 31, 2019 and December 31, 2018 is
presented below.


(Dollars in Millions) (Unaudited)	Mar 31, 2019		Dec 31, 2018
Shareholders’ Equity	$	3,320.1	$	3,050.1
Net Unrealized Gains on Fixed Maturities	241.9		110.4
Shareholders’ Equity Excluding Net Unrealized Gains on Fixed Maturities¹	$	3,078.2	$	2,939.7

Underlying Combined Ratio¹

Underlying Combined Ratio¹ is a non-GAAP financial measure
that is computed by adding the current year non-catastrophe losses and
LAE ratio with the insurance expense ratio. The most directly comparable
GAAP financial measure is the combined ratio, which is computed by
adding total incurred losses and LAE, including the impact of
catastrophe losses and loss and LAE reserve development from prior
years, with the insurance expense ratio. Kemper believes the underlying
combined ratio is useful to investors and is used by management to
reveal the trends in Kemper’s property and casualty insurance businesses
that may be obscured by catastrophe losses and prior-year reserve
development. These catastrophe losses may cause loss trends to vary
significantly between periods as a result of their incidence of
occurrence and magnitude, and can have a significant impact on incurred
losses and LAE and the combined ratio. Prior-year reserve development is
caused by unexpected loss development on historical reserves. Because
reserve development relates to the re-estimation of losses from earlier
periods, it has no bearing on the performance of the company’s insurance
products in the current period. Kemper believes it is useful for
investors to evaluate these components separately and in the aggregate
when reviewing its underwriting performance. The underlying combined
ratio¹ should not be considered a substitute for the combined
ratio and does not reflect the overall underwriting profitability of our
business.

As Adjusted for Acquisition¹

As Adjusted for Acquisition¹ amounts are non-GAAP financial
measures. For three months ended March 31, 2019, as adjusted amounts are
computed by subtracting the impact of purchase accounting adjustments
from the comparable consolidated GAAP financial measure reported by
Kemper. For the three months ended March 31, 2019, as adjusted amounts
are computed by adding the historical results of Infinity reported on a
GAAP basis to the comparable consolidated GAAP financial measure
reported by Kemper.

Contacts

Investors: Michael Marinaccio,
312.661.4930, [email protected]

News Media: Barbara Ciesemier,
312.661.4521, [email protected]

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With its submission of a Pre-IND Meeting Request Letter, Innocan initiates the regulatory process with the U.S. Food and Drug Administration (FDA) for the approval of its prolonged CBD release technology for human use

HERZLIYA, Israel and CALGARY, AB, April 22, 2024 /PRNewswire/ — Innocan Pharma Corporation (CSE: INNO) (FSE: IP4) (OTCQB: INNPF) (“Innocan” or the “Company”), is pleased to announce that is has reached a key milestone: the Company submitted its letter of application for a Pre-IND meeting, the first phase in the FDA approval process in the United States for Innocan’s Liposome-Cannabidiol (LPT-CBD) injectable treatment of chronic pain.

With the global market for pain therapeutics widely expected to exceed US$100 billion by 2032[1], LPT therapy which requires only one single monthly subcutaneous injection, is positioned as a highly attractive alternative to opioid-based approaches. Opioids have and continue to take a significant human toll in recent years, with more than three-quarters of drug overdose deaths in the United States involving opioids, according to the United States Center for Disease Control and Prevention[2].

Innocan’s therapy has shown consistent efficacy in multiple pre-clinical trials in recent years of it’s LPT-CBD injectable treatment through prolonged and controlled release of CBD in animals with chronic pain conditions. Innocan’s Pre-IND Meeting Request Letter to the FDA is a key milestone and important first step in seeking approval of its LPT-CBD therapy for use in humans. At the Pre-IND meeting, the objective will be to obtain guidance from the FDA on the preclinical and clinical development plan, enabling the initiation of an Investigational New Drug (IND) program in the United States.

Iris Bincovich, CEO of Innocan, commented: “We are extremely excited to embark on this next stage in the development of LPT-CBD injectables, this is a major Milestone for Innocan Pharma. We have invested significant effort and many thousands of person-hours in its research and development, accumulating a wealth of preclinical data that will serve as the foundation for our participation in the FDA process. This is a key milestone for Innocan and marks our first step towards the FDA’s recognition of our technology. We see significant potential for our therapy, with an addressable market for pain management therapeutics expected to exceed US $100 billion by 2032, and we look forward to tapping that.“

Dr. Joseph Pergolizzi, Innocan’s FDA Advisory Board Member, added:

“We have worked hard to catalogue the data collected as part of our animal LPT therapy testing program and prepare it for the FDA. We look forward to working under FDA guidance, with the goal of completing the review process as quickly and efficiently as possible. We believe that Innocan’s unique treatment method, if and when it should become FDA-approved has the potential of being a highly valuable non-opioid addition in the medical arsenal of the management of chronic pain.”

About Innocan

Innocan is a pharmaceutical tech company that operates under two main segments: Pharmaceuticals and Consumer Wellness. In the Pharmaceuticals segment, Innocan focuses on developing innovative drug delivery platform technologies based on advanced cannabinoids science, to treat various conditions to improve patients’ quality of life. This segment involves two drug delivery technologies: (i) LPT CBD- loaded liposome platform facilitating exact dosing and the prolonged and controlled release of CBD into the blood stream. The LPT delivery platform research is in the preclinical trial phase for: Pain Management. In the Consumer Wellness segment, Innocan develops and markets a wide portfolio of innovative and high-performance self-care products to promote a healthier lifestyle. Under this segment, Innocan has established a joint venture by the name of BI Sky Global Ltd. that focuses on advanced targeted online sales. https://innocanpharma.com/

For further information, please contact:

For Innocan Pharma Corporation:
Iris Bincovich, CEO

+1-516-210-4025

+972-54-3012842

+442037699377
[email protected]

NEITHER THE CANADIAN SECURITIES EXCHANGE NOR ITS REGULATION SERVICES PROVIDER HAVE REVIEWED OR ACCEPT RESPONSIBILITY FOR THE ADEQUACY OR ACCURACY OF THIS RELEASE.

Cautionary note regarding forward-looking information

Certain information set forth in this news release, including, without limitation, information regarding research and development, collaborations, the filing of potential applications with the FDA and other regulatory authorities, the potential achievement of future regulatory milestones, the potential for treatment of conditions and other therapeutic effects resulting from research activities and/or the Company’s products, requisite regulatory approvals and the timing for market entry, is forward-looking information within the meaning of applicable securities laws. By its nature, forward-looking information is subject to numerous risks and uncertainties, some of which are beyond Innocan’s control. The forward-looking information contained in this news release is based on certain key expectations and assumptions made by Innocan, including expectations and assumptions concerning the anticipated benefits of the products, satisfaction of regulatory requirements in various jurisdictions and satisfactory completion of requisite production and distribution arrangements.

Forward-looking information is subject to various risks and uncertainties which could cause actual results and experience to differ materially from the anticipated results or expectations expressed in this news release. The key risks and uncertainties include but are not limited to: general global and local (national) economic, market and business conditions; governmental and regulatory requirements and actions by governmental authorities; and relationships with suppliers, manufacturers, customers, business partners and competitors. There are also risks that are inherent in the nature of product distribution, including import / export matters and the failure to obtain any required regulatory and other approvals (or to do so in a timely manner) and availability in each market of product inputs and finished products. The anticipated timeline for entry to markets may change for a number of reasons, including the inability to secure necessary regulatory requirements, or the need for additional time to conclude and/or satisfy the manufacturing and distribution arrangements. As a result of the foregoing, readers should not place undue reliance on the forward-looking information contained in this news release concerning the timing of launch of product distribution. A comprehensive discussion of other risks that impact Innocan can also be found in Innocan’s public reports and filings which are available under Innocan’s profile at www.sedar.com.

Readers are cautioned that undue reliance should not be placed on forward-looking information as actual results may vary materially from the forward-looking information. Innocan does not undertake to update, correct or revise any forward looking information as a result of any new information, future events or otherwise, except as may be required by applicable law.

[1] https://www.gminsights.com/industry-analysis/pain-management-drugs-market

[2] https://www.cdc.gov/opioids/data/index.html

Logo – https://mma.prnewswire.com/media/2046271/3968398/Innocan_Pharma_Corporation_Logo.jpg

View original content:https://www.prnewswire.co.uk/news-releases/innocan-pharma-initiates-fda-approval-process-for-liposome-injection-therapy-for-chronic-pain-302122779.html

Curaleaf

Curaleaf Completes Acquisition of Northern Green Canada

Published

2 days ago

April 22, 2024

CISION (PR Newswire)

Bolsters Company’s Advantage in Several Key Emerging Markets, including Australia, New Zealand, Germany, Poland and the United Kingdom

NEW YORK, April 22, 2024 /PRNewswire/ — Curaleaf Holdings, Inc. (TSX: CURA) (OTCQX: CURLF) (“Curaleaf” or the “Company”), a leading international provider of consumer cannabis products, announced today the closing of its acquisition of Northern Green Canada (“NGC”), a vertically integrated Canadian licensed cannabis producer focused primarily on expanding in the international market through its EU-GMP certification. The accretive acquisition amplifies the Company’s strategic advantage in established European markets including Germany, Poland and the United Kingdom and provides a foothold in the emerging markets of Australia and New Zealand.

Integrating NGC’s international operation will equip Curaleaf with a secure and consistent high quality, non-irradiated, indoor EU-GMP flower supply, essential to maintaining its leading positions in Germany, the United Kingdom and Poland.

“We are thrilled to welcome NGC formally to the Curaleaf family of global brands,” said Boris Jordan, Founder and Executive Chairman of Curaleaf. “This is an incredibly important deal for our international expansion strategy, as we’ll be able to bolster our supply of high quality EU-GMP certified flower immediately to key European markets as well as enter the fast-growing markets of Australia and New Zealand.”

The global cannabis market is projected to generate $55 billion in sales by 2027. Emerging markets beyond the United States and Canada, including Germany, Australia and New Zealand are expected to contribute $6.3 billion of the $55 billion projection.

Terms of the acquisition of NGC include an initial payment at closing of the Company’s Subordinate Voting Shares valued at approximately US $16 million, subject to a typical post-closing adjustment. An earnout may also be paid in 2025 based upon 2024 performance of NGC’s operations, up to 50% of which will be cash and the rest paid in additional Subordinate Voting Shares. The issuance of Subordinate Voting Shares in connection with the acquisition of NGC has been conditionally approved by the Toronto Stock Exchange, subject to fulfilling customary listing conditions.

About Curaleaf Holdings
Curaleaf Holdings, Inc. (TSX: CURA) (OTCQX: CURLF) (“Curaleaf”) is a leading international provider of consumer products in cannabis with a mission to enhance lives by cultivating, sharing and celebrating the power of the plant. As a high-growth cannabis company known for quality, expertise and reliability, the Company and its brands, including Curaleaf, Select, Grassroots, JAMS, Find and Zero Proof provide industry-leading service, product selection and accessibility across the medical and adult use markets. Curaleaf International is the largest vertically integrated cannabis company in Europe with a unique supply and distribution network throughout the European market, bringing together pioneering science and research with cutting-edge cultivation, extraction and production. Curaleaf is listed on the Toronto Stock Exchange under the symbol CURA and trades on the OTCQX market under the symbol CURLF. For more information, please visit https://ir.curaleaf.com.

Forward Looking Statements
This media advisory contains forward-looking statements and forward-looking information within the meaning of applicable securities laws. These statements relate to future events or future performance. All statements other than statements of historical fact may be forward–looking statements or information. Generally, forward-looking statements and information may be identified by the use of forward-looking terminology such as “plans”, “expects” or, “proposed”, “is expected”, “intends”, “anticipates”, or “believes”, or variations of such words and phrases, or by the use of words or phrases which state that certain actions, events or results may, could, would, or might occur or be achieved. More particularly and without limitation, this news release contains forward-looking statements and information concerning the expected benefits of the acquisition of NGC, and the Company’s planned expansion on internal markets, the Company’s anticipated strategic advantages in European markets and emerging markets, the integration of NGC’s internal operations, the anticipated global cannabis market, and the listing of shares issuable in connection with the acquisition on the Toronto Stock Exchange. Such forward-looking statements and information reflect management’s current beliefs and are based on assumptions made by and information currently available to the Company with respect to the matters described in this new release, including the Company’s ability to successfully realize the expected benefits of the acquisition, and the Company’s ability to fulfil the listing conditions imposed by the Toronto Stock Exchange. Forward-looking statements involve risks and uncertainties, which are based on current expectations as of the date of this release and subject to known and unknown risks and uncertainties that could cause actual results to differ materially from those expressed or implied by such statements, including the failure to realize the expected benefits of the acquisition, or the Company’s failure to fulfil the listing conditions imposed by the Toronto Stock Exchange. Additional information about these assumptions and risks and uncertainties is contained under “Risk Factors and Uncertainties” in the Company’s latest annual information form filed on March 6, 2024, which is available under the Company’s SEDAR profile at http://www.sedar.com, and in other filings that the Company has made and may make with applicable securities authorities in the future. Forward-looking statements contained herein are made only as to the date of this press release and we undertake no obligation to update or revise any forward-looking statements whether as a result of new information, future events or otherwise, except as required by law. We caution investors not to place considerable reliance on the forward-looking statements contained in this press release. The Toronto Stock Exchange has not reviewed, approved or disapproved the content of this news release.

INVESTOR CONTACT
Curaleaf Holdings, Inc.
Camilo Lyon, Chief Investment Officer
[email protected]

MEDIA CONTACT
Curaleaf Holdings, Inc.
Tracy Brady, SVP Corporate Communications
[email protected]

View original content:https://www.prnewswire.co.uk/news-releases/curaleaf-completes-acquisition-of-northern-green-canada-302123010.html

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