The CLINUVEL Pharmaceuticals Limited (ASX: CUV) share price is racing higher on Friday after the release of its fourth quarter update.
At the time of writing the pharmaceutical company's shares are up 4% to $23.26.
How did CLINUVEL perform in the fourth quarter?
During the fourth quarter of FY 2020, CLINUVEL recorded cash receipts of $10.4 million. While this was almost double the cash receipts of $5.37 million it achieved in the prior quarter, this was largely down to seasonal factors.
The company's SCENESSE product is used to treat erythropoietic protoporphyria (EPP), a disease that causes itching, burning, and scarring of the skin on contact with sunlight. Given that the company has a focus on the Northern Hemisphere market, its sales are strongest during its spring and summer periods.
In comparison to the prior corresponding period, cash receipts actually declined 20% from $13 million.
Management notes that many of the countries in which CLINUVEL operates are still experiencing lockdowns and disruptions to daily life and commercial operations. This led to some clinics either deferring orders or reducing order sizes in the initial months of the COVID infections.
Nevertheless, despite the lower cash receipts, the company generated positive cash flow for the quarter. Net cash flow for the quarter came in at $7.2 million, lifting its cash and equivalents on hand by 7% over the quarter to $66.75 million.
Demand largely unaffected.
CLINUVEL's Chief Financial Officer, Darren Keamy, revealed that demand remained strong despite the pandemic.
He said: "Against the global economic contraction, CLINUVEL is best positioned to invest in its planned growth and expansion, and patient demand for treatment has been largely unaffected, a testament to the impact of EPP on patients' lives and their need for ongoing treatment."
"Looking back, we have had a clear, long-held, view on how to optimise our resources and prepare for adverse economic conditions. By maintaining a strong cash position, we are able to respond to changes quickly and nimbly, limiting the need to return to investors to access capital and allowing us to focus on the long-term growth of the Group," Mr Keamy said.
