Evolus (EOLS)

[DewDiligence]

EOLS -8% on reiterated financial guidance:

https://finance.yahoo.com/news/evolus-concludes-certain-royalty-payments-124500652.html

Evolus continues to expect its adjusted gross profit margin for the quarter ending December 31, 2022 to increase to the range of 68% to 71%. This compares to an adjusted gross profit margin of 57.4% for the quarter ended June 30, 2022... Adjusted gross profit is calculated as gross profit excluding amortization of an intangible asset.

Under the Medytox/Allergan Settlement Agreements in February 2021, the company agreed to pay royalties on the U.S. sales of Jeuveau from December 16, 2020 to September 16, 2022 to Medytox and Allergan, and pay royalties on sales of product outside the U.S. from December 16, 2020 to September 16, 2022 to Medytox. In addition, the company agreed to make cash payments to Medytox and Allergan totaling $35.0 million, which has been completed except for a final payment of $5 million due in February 2023.

Per the agreement, beginning September 17, 2022 to September 16, 2032, the company will pay Medytox a mid-single digit royalty percentage on net sales of Jeuveau in the U.S. and all territories it has licensed outside the U.S.

None of the above is new info, so perhaps the stock is selling off today because EOLS hasn’t updated its revenue guidance or said when it expects to be profitable.