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Target Hospitality Announces Second Quarter 2020 Results

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Target Hospitality Announces Second Quarter 2020 Results

THE WOODLANDS, Texas–(BUSINESS WIRE)–Target Hospitality Corp. (“Target Hospitality”, “Target” or the “Company”) (NASDAQ: TH), the largest provider of vertically-integrated specialty hospitality accommodations with premium catering and value-added hospitality services in the U.S., today reported results for the three months ended June 30, 2020.

Financial and Operational Highlights for the Second Quarter 2020

  • Revenues of $53.6 million for the three months ended June 30, 2020 as compared to $81.4 million for the same period in 2019
  • Net income (loss) of $(14.2) million for the three months ended June 30, 2020, compared to a net income of $10.6 million for the second quarter of 2019
  • Basic and diluted (loss) per share of $(0.15) for the three months ended June 30, 2020
  • Adjusted EBITDA(1) of $13.4 million, compared to $41.2 million for the second quarter of 2019
  • Strong cash generation in a challenging environment, with net cash provided by operating activities of $14.8 million and Discretionary Cash Flow (“DCF”) (1) of $14.7 million for the three months ended June 30, 2020
  • Strong balance sheet with liquidity of $59.9 million and net leverage of 3.4 times as of June 30, 2020
  • Maintaining financial flexibility with no near-term debt maturities, immediate covenants, liquidity or minimum credit rating on the Company’s Senior Secured Notes or revolving credit facility
  • Significant progress on previously announced cost reductions, including substantial reductions in capital spending and cash expense
  • Meaningful increase in project activity from TC Energy Corporation Keystone XL pipeline project, contributing approximately $15.4 million in revenue
  • Secured and extended additional minimum revenue contracts adding approximately $60 million in committed revenue from 2021 – 2025

Executive Commentary

“The second quarter was challenging, as the combined impacts of a global pandemic and deteriorating demand for a substantial portion of the global economy created an unprecedented operating environment. The acceleration of the global pandemic significantly reduced economic activity and the corresponding demand for crude oil, resulting in a pronounced reduction in customer activity in the second quarter. We took aggressive actions to quickly align with demand and appropriately positioned Target to successfully navigate this challenging environment. Despite reduced demand in our energy-oriented assets, Target delivered strong financial results with approximately $15 million of discretionary cash flow for the second quarter,” stated Brad Archer, President and Chief Executive Officer.

“The path for global economic demand remains uncertain for the foreseeable future. However, as we exited the second quarter, we began to see positive trends in several of Target’s operating metrics, including occupancy and utilization. Albeit modest, we do anticipate continued marginal improvements in customer activity and demand through the second half of the year and into 2021. As we progress towards a more normal operating environment, Target’s customer base and contract structure, including exclusivity provisions, will allow the Company to take advantage of a more balanced market,” concluded Mr. Archer.

Financial Results

Second Quarter Summary Highlights

Refer to exhibits to this earnings release for reconciliations of Non-GAAP financial measures to GAAP financial measures

 

 

 

 

 

 

 

 

For the Three Months Ended ($ in ‘000s, except ADR and per share amounts)

 

 

June 30, 2020

 

 

June 30, 2019

 

Revenue

 

$

53,620

 

$

81,358

 

Net income (loss)

 

$

(14,200)

 

$

10,580

 

Earnings (loss) per share – basic and diluted

 

$

(0.15)

 

$

0.11

 

Adjusted EBITDA

 

$

13,363

 

$

41,236

 

Average daily rate (ADR)

 

$

81.72

 

$

80.85

 

Average available beds

 

 

13,375

 

 

11,401

 

Average utilized beds

 

 

5,036

 

 

9,805

 

Utilization

 

 

38

%

 

86

%

Total revenue for the three months ended June 30, 2020 was $53.6 million compared to $81.4 million for the same period in 2019. The revenue decrease was primarily driven by a reduction in energy end-market customer activity as a result of the COVID-19 pandemic and significant volatility in commodity prices, offset by increased activity associated with TC Energy Corporation’s (“TCPL”) project. Net loss for the three months ended June 30, 2020 was $14.2 million, compared to net income of $10.6 million for the same period in 2019.

Adjusted EBITDA was $13.4 million for the three months ended June 30, 2020 compared to $41.2 million for the same period in 2019.

ADR increased by $0.87 to $81.72 for the three months ended June 30, 2020. Average utilized beds and utilization were 5,036 and 38%, respectively, for the three months ended June 30, 2020.

Capital Management

Capital expenditures for the three months ended June 30, 2020 were approximately $1.1 million, including minimal maintenance capital expenditures. As a result of lower aggregate demand and anticipated reduced customer activity levels, Target anticipates total capital spending to be less than $3 million through the remainder of 2020.

As of June 30, 2020, the Company had $19.9 million of cash and cash equivalents, and $425 million in gross amount of total long-term debt, which included $340 million in aggregate principal amount of Senior Secured Notes due March 2024 and borrowings of $85 million under the Company’s $125 million revolving credit facility. The Company had consolidated net leverage of 3.4 times, as defined under its credit facility.

Operational Update

As the Company previously stated, it took proactive steps to modify select commercial contracts for the long-term benefit of Target. These modifications, which have been materially completed, resulted in lower committed beds in 2020, while maintaining contract integrity by preserving ADR and margins for Target in future years. Additionally, Target secured and extended additional minimum revenue contract commitments, including exclusivity, from 2021 into 2025, significantly reducing near-term contract renewal risk and adding approximately $60 million in committed revenue. These modifications, in their entirety, provide greater visibility on long-term revenue and cash flow, while positioning Target to take advantage of increased demand as activity returns to a more normal pace.

Segment Results – Second Quarter 2020

Permian Basin

Refer to exhibits to this earnings release for reconciliations of Non-GAAP financial measures to GAAP financial measures

 

 

 

 

 

 

 

 

For the Three Months Ended ($ in ‘000s, except ADR)

 

June 30, 2020

 

June 30, 2019

 

Revenue

 

$

21,064

 

$

52,037

 

Adjusted gross profit(1)

 

$

6,860

 

$

32,588

 

Adjusted gross profit margin(1)

 

 

33

%

 

63

%

Average daily rate (ADR)

 

$

88.65

 

$

84.49

 

Average available beds

 

 

9,565

 

 

7,520

 

Average utilized beds

 

 

2,575

 

 

6,467

 

Utilization

 

 

27

%

 

86

%

Revenue for the three months ended June 30, 2020 was $21.1 million compared to $52.0 million for the same period in 2019. Revenue decreased primarily due to lower utilization as a result of significant volatility in crude oil prices leading to a sharp reduction in customer activity. ADR increased by $4.16, to $88.65 compared to the same period in 2019.

Adjusted gross profit margin was 33% for the three months ended June 30, 2020, reflecting lower utilization.

Bakken Basin

Refer to exhibits to this earnings release for reconciliations of Non-GAAP financial measures to GAAP financial measures

 

 

 

 

 

 

 

 

For the Three Months Ended ($ in ‘000s, except ADR)

 

June 30, 2020

 

June 30, 2019

 

Revenue

 

$

366

 

$

5,738

 

Adjusted gross profit(1)

 

$

(1,169)

 

$

2,698

 

Adjusted gross profit margin(1)

 

 

%

 

47

%

Average daily rate (ADR)

 

$

70.26

 

$

77.18

 

Average available beds

 

 

1,065

 

 

1,024

 

Average utilized beds

 

 

53

 

 

748

 

Utilization

 

 

5

%

 

73

%

Revenue for the three months ended June 30, 2020 was $0.4 million compared to $5.7 million for the same period in 2019. The decrease was attributable to the temporary closure of all communities in the Bakken in May 2020, as a result of the significant volatility in crude oil prices leading to a sharp reduction in customer activity.

Government

Refer to exhibits to this earnings release for reconciliations of Non-GAAP financial measures to GAAP financial measures

 

 

 

 

 

 

 

 

For the Three Months Ended ($ in ‘000s, except ADR)

 

June 30, 2020

 

June 30, 2019

 

Revenue

 

$

16,671

 

$

16,729

 

Adjusted gross profit(1)

 

$

12,909

 

$

12,317

 

Adjusted gross profit margin(1)

 

 

77

%

 

74

%

Average daily rate (ADR)

 

$

74.58

 

$

74.87

 

Average available beds

 

 

2,400

 

 

2,400

 

Average utilized beds

 

 

2,400

 

 

2,400

 

Utilization

 

 

100

%

 

100

%

Revenue for the three months ended June 30, 2020 was $16.7 million. Average available beds of 2,400 were fully utilized for the three months ended June 30, 2020, with an ADR of $74.58.

All Other

Refer to exhibits to this earnings release for reconciliations of Non-GAAP financial measures to GAAP financial measures

 

 

 

 

 

 

 

 

For the Three Months Ended ($ in ‘000s)

 

June 30, 2020

 

June 30, 2019

 

Revenue

 

$

15,519

 

$

6,854

 

Adjusted gross profit

 

$

1,860

 

$

1,529

 

Adjusted gross profit margin

 

 

12

%

 

22

%

This segment’s operations consist primarily of revenue from the construction phase of the TCPL project as well as vertically integrated specialty rental and hospitality services revenue not included in our other segments. Revenue for the three months ended June 30, 2020 was $15.5 million compared to $6.9 million for the same period in 2019. Revenue increased as a result of the significant increase in activity associated with the TCPL project following TC Energy’s announcement to proceed with the project in March of 2020.

As a result of the Supreme Court ruling in July 2020, the Company anticipates minimal activity associated with this project for the remainder of 2020.

Conference Call

The Company has scheduled a conference call for August 10, 2020 at 8:00 a.m. Central Time (9:00 am Eastern Time) to discuss the second quarter 2020 results.

The conference call will be available by live webcast through the Investors section of Target Hospitality’s website at www.TargetHospitality.com or by dialing in as follows:

 

 

Domestic:

1-877-423-9813

International:

1-201-689-8573

Reference:

Target Hospitality

Please register for the webcast or dial into the conference call approximately 15 minutes prior to the scheduled start time.

A replay of the conference call will be available for approximately 30 days and can be accessed through the Investors section of Target Hospitality’s website or by dialing 1-844-512-2921 (for Domestic callers), or 1-412-317-6671 (for International callers), with passcode 13707249.

About Target Hospitality

Target Hospitality is the largest provider of vertically integrated specialty rental accommodations and value-added hospitality services in the United States. Target Hospitality builds, owns and operates customized housing communities for a range of end users, and offers a full suite of cost-effective hospitality solutions including culinary, catering, concierge, laundry and security services as well as recreational facilities. Target Hospitality primarily serves the energy and government sectors and its growing network of communities is designed to maximize workforce productivity and satisfaction.

Cautionary Statement Regarding Forward Looking Statements

Certain statements made in this press release are “forward looking statements” within the meaning of the “safe harbor” provisions of the United States Private Securities Litigation Reform Act of 1995. When used in this press release, the words “estimates,” “projected,” “expects,” “anticipates,” “forecasts,” “plans,” “intends,” “believes,” “seeks,” “may,” “will,” “should,” “future,” “propose” and variations of these words or similar expressions (or the negative versions of such words or expressions) are intended to identify forward-looking statements. These forward-looking statements are not guarantees of future performance, conditions or results, and involve a number of known and unknown risks, uncertainties, assumptions and other important factors, many of which are outside our control, that could cause actual results or outcomes to differ materially from those discussed in the forward-looking statements. Important factors, among others, that may affect actual results or outcomes include: the severity and duration of the COVID-19 pandemic, related economic repercussions and the resulting negative impact on demand for oil and natural gas; operational challenges relating to the COVID-19 pandemic and efforts to mitigate the spread of the virus, including logistical challenges, protecting the health and well-being of our employees and customers, remote work arrangements, contract and supply chain disruptions; operational, economic, political and regulatory risks; our ability to effectively compete in the specialty rental accommodations and hospitality services industry; effective management of our communities; natural disasters, including pandemics and other business disruptions; the effect of changes in state building codes on marketing our buildings; changes in demand within a number of key industry end-markets and geographic regions; our reliance on third party manufacturers and suppliers; failure to retain key personnel; increases in raw material and labor costs; the effect of impairment charges on our operating results; our inability to recognize deferred tax assets and tax loss carry forwards; our future operating results fluctuating, failing to match performance or to meet expectations; our exposure to various possible claims and the potential inadequacy of our insurance; unanticipated changes in our tax obligations; our obligations under various laws and regulations; the effect of litigation, judgments, orders, regulatory or customer bankruptcy proceedings on our business; our ability to successfully acquire and integrate new operations; global or local economic and political movements; our ability to effectively manage our credit risk and collect on our accounts receivable; our ability to fulfill Target Hospitality’s public company obligations; any failure of our management information systems; our ability to meet our debt service requirements and obligations; and risks related to Bidco’s obligations under the senior notes. 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.

(1) Non-GAAP Financial Measures

This press release includes Adjusted gross profit, Adjusted gross profit margin, DCF and Adjusted EBITDA, which are measurements not calculated in accordance with US GAAP, in the discussion of our financial results because they are key metrics used by management to assess financial performance. Our business is capital-intensive, and these additional metrics allow management to further evaluate our operating performance. Reconciliations of these measures to the most directly comparable GAAP financial measures are contained herein. To the extent required, statements disclosing the definitions, utility and purposes of these measures are also set forth herein.

Definitions:

Target Hospitality defines Adjusted gross profit, as Gross profit plus depreciation of specialty rental assets and loss on impairment. Target Hospitality defines Adjusted gross profit margin as Adjusted gross profit divided by total revenue for the same period.

Target Hospitality defines EBITDA as net income (loss) before interest expense and loss on extinguishment of debt, income tax expense (benefit), depreciation of specialty rental assets, and other depreciation and amortization. Adjusted EBITDA reflects the following further adjustments to EBITDA to exclude certain non-cash items and the effect of what management considers transactions or events not related to its core business operations:

  • Other expense (income), net: Other expense (income), net includes consulting expenses related to certain projects, financing costs not classified as interest expense, gains and losses on disposals of property, plant, and equipment, involuntary asset conversions, COVID-19 related expenses, and other immaterial non-cash charges.
  • Restructuring costs: Target Parent incurred certain costs associated with restructuring plans designed to streamline operations and reduce costs.
  • Transaction expenses: Target Hospitality incurred certain transaction costs, including legal and professional fees, associated with the Business Combination. Such amounts were funded by proceeds from the Business Combination. The current period primarily included residual tax advisory filing related expenses associated with the Business Combination.
  • Acquisition-related expenses: Target Hospitality incurred certain transaction costs associated with the acquisition of Superior.
  • Officer loan expense: Non-cash charge associated with loans to certain executive officers of the Company that were forgiven and recognized as selling, general, and administrative expense upon consummation of the Business Combination. Such amounts are not expected to recur in the future.
  • Target Parent selling, general and administrative costs: Target Parent incurred certain costs in the form of legal and professional fees as well as transaction bonus amounts, primarily associated with a restructuring transaction that originated in 2017.
  • Stock-based compensation: Non-cash charges associated with stock-based compensation expense, which has been, and will continue to be for the foreseeable future, a significant recurring expense in our business and an important part of our compensation strategy.
  • Other adjustments: System implementation costs, including primarily non-cash amortization of capitalized system implementation costs, claim settlement, business development and certain severance costs.

Target Hospitality defines Discretionary cash flow as cash flow from operations less maintenance capital spending for specialty rental assets.

Utility and Purposes:

EBITDA reflects net income (loss) excluding the impact of interest expense and loss on extinguishment of debt, provision for income taxes, depreciation, and amortization. We believe that EBITDA is a meaningful indicator of operating performance because we use it to measure our ability to service debt, fund capital expenditures, and expand our business. We also use EBITDA, as do analysts, lenders, investors, and others, to evaluate companies because it excludes certain items that can vary widely across different industries or among companies within the same industry. For example, interest expense can be dependent on a company’s capital structure, debt levels, and credit ratings. Accordingly, the impact of interest expense on earnings can vary significantly among companies. The tax positions of companies can also vary because of their differing abilities to take advantage of tax benefits and because of the tax policies of the jurisdictions in which they operate. As a result, effective tax rates and provision for income taxes can vary considerably among companies. EBITDA also excludes depreciation and amortization expense, because companies utilize productive assets of different ages and use different methods of both acquiring and depreciating productive assets. These differences can result in considerable variability in the relative costs of productive assets and the depreciation and amortization expense among companies.

Target Hospitality also believes that Adjusted EBITDA is a meaningful indicator of operating performance. Our Adjusted EBITDA reflects adjustments to exclude the effects of additional items, including certain items, that are not reflective of the ongoing operating results of Target Hospitality. In addition, to derive Adjusted EBITDA, we exclude gains or losses on the sale of depreciable assets and impairment losses because including them in EBITDA is inconsistent with reporting the ongoing performance of our remaining assets. Additionally, the gain or loss on sale of depreciable assets and impairment losses represents either accelerated depreciation or excess depreciation in previous periods, and depreciation is excluded from EBITDA.

Adjusted gross profit, Adjusted gross profit margin, DCF and Adjusted EBITDA are not measurements of Target Hospitality’s financial performance under GAAP and should not be considered as alternatives to Net income (loss), Gross profit, Earnings per share, Net cash provided by operating activities, or other performance measures derived in accordance with GAAP. In addition, these non-GAAP measures may not be comparable to similarly titled measures of other companies. Target Hospitality’s management believe that Adjusted gross profit, Adjusted gross profit margin, DCF and Adjusted EBITDA provide useful information to investors about Target Hospitality and its financial condition and results of operations for the following reasons: (i) they are among the measures used by Target Hospitality’s management team to evaluate its operating performance; (ii) they are among the measures used by Target Hospitality’s management team to make day-to-day operating decisions, (iii) they are frequently used by securities analysts, investors and other interested parties as a common performance measure to compare results across companies in Target Hospitality’s industry.

Exhibit 1

Target Hospitality Corp.

Consolidated Statements of Comprehensive Income (Loss)

($ in thousands, except per share amounts)

(unaudited)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Three Months Ended

 

Six Months Ended

 

 

June 30,

 

June 30,

 

 

2020

 

2019

 

2020

 

2019

Revenue:

 

 

 

 

 

 

 

 

 

 

 

 

Services income

 

$

25,257

 

$

59,832

 

$

79,195

 

$

120,905

Specialty rental income

 

 

12,968

 

 

15,143

 

 

29,551

 

 

28,873

Construction fee income

 

 

15,395

 

 

6,383

 

 

16,528

 

 

13,562

Total revenue

 

 

53,620

 

 

81,358

 

 

125,274

 

 

163,340

Costs:

 

 

 

 

 

 

 

 

 

 

 

 

Services

 

 

31,459

 

 

29,736

 

 

60,466

 

 

61,745

Specialty rental

 

 

1,701

 

 

2,490

 

 

4,304

 

 

4,808

Depreciation of specialty rental assets

 

 

12,266

 

 

9,960

 

 

25,162

 

 

19,861

Gross profit

 

 

8,194

 

 

39,172

 

 

35,342

 

 

76,926

Selling, general and administrative

 

 

10,101

 

 

10,925

 

 

20,092

 

 

55,676

Other depreciation and amortization

 

 

4,098

 

 

3,816

 

 

8,214

 

 

7,579

Restructuring costs

 

 

 

 

 

 

 

 

168

Other expense (income), net

 

 

446

 

 

(123)

 

 

(569)

 

 

(161)

Operating income (loss)

 

 

(6,451)

 

 

24,554

 

 

7,605

 

 

13,664

Loss on extinguishment of debt

 

 

 

 

 

 

 

 

907

Interest expense, net

 

 

10,178

 

 

9,853

 

 

20,200

 

 

13,884

Income (loss) before income tax

 

 

(16,629)

 

 

14,701

 

 

(12,595)

 

 

(1,127)

Income tax expense (benefit)

 

 

(2,429)

 

 

4,121

 

 

(2,196)

 

 

2,272

Net income (loss)

 

 

(14,200)

 

 

10,580

 

 

(10,399)

 

 

(3,399)

Other comprehensive income

 

 

 

 

 

 

 

 

 

 

 

 

Foreign currency translation

 

 

45

 

 

(144)

 

 

(66)

 

 

(144)

Comprehensive income (loss)

 

$

(14,155)

 

$

10,436

 

$

(10,465)

 

$

(3,543)

 

 

 

 

 

 

 

 

 

 

 

 

 

Weighted average number shares outstanding – basic and diluted

 

 

96,003,079

 

 

100,217,035

 

 

95,926,467

 

 

89,960,451

 

 

 

 

 

 

 

 

 

 

 

 

 

Net income (loss) per share – basic and diluted

 

$

(0.15)

 

$

0.11

 

$

(0.11)

 

$

(0.04)

Exhibit 2

Target Hospitality Corp.

Condensed Consolidated Balance Sheet Data

($ in thousands)

(unaudited)

 

 

 

 

 

 

 

 

 

 

 

June 30,

 

December 31,

 

 

 

2020

 

2019

Assets

 

 

 

 

 

 

 

Cash and cash equivalents

 

19,929

 

$

6,787

Accounts receivable, less allowance for doubtful accounts

 

 

43,110

 

 

48,483

Other current assets

 

 

6,292

 

 

5,525

Total current assets

 

 

 

69,331

 

 

60,795

 

 

 

 

 

 

 

Specialty rental assets, net

 

 

 

336,218

 

 

353,695

Goodwill and Other intangibles, net

 

 

 

151,494

 

 

158,904

Other non-current assets

 

 

 

30,142

 

 

27,398

Total assets

 

 

$

587,185

 

$

600,792

 

 

 

 

 

 

 

Liabilities

 

 

 

 

 

 

 

Accounts payable

 

14,182

 

7,793

Deferred revenue and customer deposits

 

 

13,331

 

 

16,809

Other current liabilities

 

 

26,413

 

 

36,319

Total current liabilities

 

 

 

53,926

 

 

60,921

 

 

 

 

 

 

 

Long-term debt, net

 

 

 

324,789

 

 

323,258

Revolving credit facility

 

 

 

85,000

 

 

80,000

Other non-current liabilities

 

 

 

8,768

 

 

13,211

Total liabilities

 

 

$

472,483

 

 

$

477,390

 

 

 

 

 

 

 

Stockholders’ equity

 

 

 

 

 

 

 

Common stock and other stockholders’ equity

 

 

87,386

 

 

85,687

Accumulated earnings

 

 

27,316

 

 

37,715

Total stockholders’ equity

 

 

$

114,702

 

$

123,402

Total liabilities and stockholders’ equity

 

 

$

587,185

 

$

600,792

Exhibit 3

Target Hospitality Corp.

Condensed Consolidated Cash Flow Data

($ in thousands)

(unaudited)

 

 

 

 

 

 

 

 

 

 

 

For the Six Months Ended

 

 

June 30,

 

 

2020

 

2019

 

 

 

 

 

 

 

Cash, cash equivalents and restricted cash – beginning of period

 

$

6,839

 

$

12,451

 

 

 

 

 

 

 

Cash flows from operating activities

 

 

 

 

 

 

Net loss

 

 

(10,399)

 

 

(3,399)

Adjustments:

 

 

 

 

 

 

Depreciation

 

 

25,957

 

 

20,385

Amortization of intangible assets

 

 

7,410

 

 

7,055

Other non-cash items

 

 

2,951

 

 

6,006

Changes in operating assets and liabilities

 

 

(560)

 

 

(11,271)

Net cash provided by operating activities

 

$

25,359

 

$

18,776

 

 

 

 

 

 

 

Cash flows from investing activities

 

 

 

 

 

 

Purchases of specialty rental assets

 

 

(12,310)

 

 

(46,729)

Purchase of business

 

 

 

 

(30,000)

Other investing activities

 

 

549

 

 

873

Net cash used in investing activities

 

$

(11,761)

 

$

(75,856)

 

 

 

 

 

 

 

Cash flows from financing activities

 

 

 

 

 

 

Other financing activities

 

 

(441)

 

 

55,423

Net cash (used in) provided by financing activities

 

$

(441)

 

$

55,423

 

 

 

 

 

 

 

Effect of exchange rate changes on cash, cash equivalents and restricted cash

 

 

(15)

 

 

(144)

 

 

 

 

 

 

 

Change in cash, cash equivalents and restricted cash

 

 

13,142

 

 

(1,801)

 

 

 

 

 

 

 

Cash, cash equivalents and restricted cash – end of period

 

$

19,981

 

$

10,650

Exhibit 4

Target Hospitality Corp.

Reconciliation of Gross profit to Adjusted gross profit and Adjusted gross profit margin

($ in thousands)

(unaudited)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

For the Three Months Ended

For the Six Months Ended

 

 

June 30,

June 30,

 

 

2020

 

2019

 

2020

 

2019

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total Revenue

 

$

53,620

 

$

81,358

 

$

125,274

 

$

163,340

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Gross Profit

 

$

8,194

 

$

39,172

 

$

35,342

 

$

76,926

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Adjustments:

 

 

 

 

 

 

 

 

 

 

 

 

 

Depreciation of specialty rental assets

 

 

12,266

 

 

9,960

 

 

25,162

 

 

19,861

 

Adjusted gross profit

 

$

20,460

 

$

49,132

 

$

60,504

 

$

96,787

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Adjusted gross profit margin

 

 

38%

 

 

60%

 

 

48%

 

 

59%

 

Exhibit 5

Target Hospitality Corp.

Reconciliation of Net income (loss) to EBITDA and Adjusted EBITDA

($ in thousands)

(unaudited)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

For the Three Months Ended

 

For the Six Months Ended

 

 

June 30,

 

June 30,

 

 

2020

 

2019

 

 

2020

 

2019

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total Revenue

 

$

53,620

 

$

81,358

 

 

$

125,274

 

$

163,340

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net income (loss)

 

$

(14,200)

 

$

10,580

 

 

$

(10,399)

 

 

(3,399)

 

Income tax expense (benefit)

 

 

(2,429)

 

 

4,121

 

 

 

(2,196)

 

 

2,272

 

Interest expense, net

 

 

10,178

 

 

9,853

 

 

 

20,200

 

 

13,884

 

Loss on extinguishment of debt

 

 

 

 

 

 

 

 

 

907

 

Other depreciation and amortization

 

 

4,098

 

 

3,816

 

 

 

8,214

 

 

7,579

 

Depreciation of specialty rental assets

 

 

12,266

 

 

9,960

 

 

 

25,162

 

 

19,861

 

EBITDA

 

$

9,913

 

$

38,330

 

 

$

40,981

 

$

41,104

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Adjustments

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Other expense (income), net

 

 

729

 

 

456

 

 

 

(5)

 

 

418

 

Restructuring costs

 

 

 

 

 

 

 

 

 

168

 

Transaction expenses

 

 

332

 

 

1,428

 

 

 

356

 

 

37,993

 

Acquisition-related expenses

 

 

 

 

303

 

 

 

 

 

303

 

Officer loan expense

 

 

 

 

 

 

 

 

 

1,583

 

Target Parent selling, general, and administrative costs

 

 

 

 

 

 

 

 

 

246

 

Stock-based compensation

 

 

1,038

 

 

210

 

 

 

1,922

 

 

210

 

Other adjustments

 

 

1,351

 

 

509

 

 

 

2,460

 

 

509

 

Adjusted EBITDA

 

$

13,363

 

$

41,236

 

 

$

45,714

 

$

82,534

 

Exhibit 6

Target Hospitality Corp.

Reconciliation of Net cash provided by operating activities to Discretionary cash flows

($ in thousands)

(unaudited)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

For the Three Months Ended

 

For the Six Months Ended

 

 

June 30,

 

June 30,

 

 

2020

 

2019

 

2020

 

2019

Net cash provided by operating activities

 

$

14,810

 

$

25,521

 

$

25,359

 

$

18,776

Less: Maintenance capital expenditures for specialty rental assets

 

 

(66)

 

 

(489)

 

 

(695)

 

 

(1,018)

Discretionary cash flows

 

$

14,744

 

$

25,032

 

$

24,664

 

$

17,758

 

 

 

 

 

 

 

 

 

 

 

 

 

Purchase of specialty rental assets

 

 

(1,558)

 

 

(32,106)

 

 

(12,310)

 

 

(46,729)

Purchase of property, plant and equipment

 

 

(58)

 

 

(90)

 

 

(70)

 

 

(127)

Purchase of business, net of cash acquired

 

 

 

 

(30,000)

 

 

 

 

(30,000)

Repayments from affiliates

 

 

 

 

 

 

 

 

638

Receipt of insurance proceeds

 

 

 

 

362

 

 

619

 

 

362

Net cash used in investing activities

 

$

(1,616)

 

$

(61,834)

 

$

(11,761)

 

$

(75,856)

 

 

 

 

 

 

 

 

 

 

 

 

 

Proceeds from borrowings on Senior Secured Notes, net of discount

 

 

 

 

 

 

 

 

336,699

Principal payments on finance and capital lease obligations

 

 

(10,112)

 

 

(415)

 

 

(10,115)

 

 

(1,890)

Proceeds from borrowings on finance and capital lease obligations

 

 

9,418

 

 

 

 

10,151

 

 

Principal payments on borrowings from ABL

 

 

(15,000)

 

 

 

 

(37,500)

 

 

(27,790)

Proceeds from borrowings on ABL

 

 

15,000

 

 

30,000

 

 

42,500

 

 

77,240

Repayment of affiliate note

 

 

 

 

 

 

 

 

(3,762)

Contributions from affiliate

 

 

 

 

 

 

 

 

39,107

Recapitalization

 

 

 

 

 

 

 

 

218,752

Recapitalization – cash paid to Algeco Seller

 

 

 

 

 

 

 

 

(563,134)

Payment of deferred financing costs

 

 

 

 

(5,855)

 

 

 

 

(19,799)

Restricted shares surrendered to pay tax liabilities

 

 

(76)

 

 

 

 

(159)

 

 

Purchase of treasury stock

 

 

 

 

 

 

(5,318)

 

 

Net cash provided by (used in) financing activities

 

$

(770)

 

$

23,730

 

$

(441)

 

$

55,423

 

Business

Radius Health Business Update

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Radius Health Business Update
  • TYMLOS® new patient adds in April: modest growth vs. previous 4-month trailing averages

  • ~67% of new patients in April were initiated by a fracture focused bone health account

  • Meaningful FDA guidance on generic peptide requirements published on May 19, 2021

  • Anticipate abaloparatide depot formulation technical development work to commence 2H, 2021

  • RAD011 Type C meeting with the FDA on Prader Willi Syndrome (“PWS”) the week of June 14

BOSTON, June 02, 2021 (GLOBE NEWSWIRE) — Radius Health, Inc. (“Radius” or the “Company”) (NASDAQ: RDUS), provided a business update covering continued progress for the Company. Additional business updates will be provided as progress is achieved.

ABALOPARATIDE ASSET

U.S. TYMLOS Commercial Performance:

  • TYMLOS added ~1,650 new patients in April; 1% growth vs. trailing 4-month average

  • New patients: defined as those who have been prescribed TYMLOS and received their first dose

  • ~67% of new patients in April were initiated by a fracture focused bone health account

  • Added 45 new fracture / bone health focused prescribers during the month of April

Life Cycle:

  • ATOM (Male) Phase 3 pivotal study on schedule for readout: 2H, 2021

  • wearABLe (Transdermal System) Phase 3 pivotal study on schedule for readout: 2H, 2021

  • Anticipate abaloparatide depot formulation technical development work to commence 2H, 2021

Geographic Footprint:

  • Europe: re-submission expected for abaloparatide SC to EMA in 2H, 2021

  • Canada: abaloparatide SC submission – by our partner – expected in January, 2022

  • Japan: ‘planning discussions’ with PMDA, a precursor to potential abaloparatide-TD agreement with Teijin

  • Rest of world: multiple discussions ongoing with variety of counterparties

Intellectual Property Portfolio Advancement:

  • Three U.S. patents are presently listed in the Orange Book for TYMLOS: U.S. Patent No. 7,803,770 which expires on April 28, 2031 and U.S. Patent Nos. 8,148,333 and 8,748,382 which each expire on October 30, 2027

  • A fourth U.S. patent, U.S. Patent No. 10,996,208 directed to certain methods of analyzing abaloparatide to detect and quantify presence of beta Asp10, was issued on May 4, 2021 and will be added to the Orange book listing shortly; this patent expires on April 30, 2038

  • A new Japanese patent covering the abaloparatide transdermal system and its use in treating osteoporosis was granted in April, 2021 and will expire October 8, 2036

FDA Guidance on Synthetic Peptides:

On May 19, 2021 the FDA published updated guidance and requirements for synthetic peptides and what would be required in any generic filings and advancement. Radius views this new guidance as meaningful in assessing the probability of a generic synthetic peptide being filed and gaining market entry.

In sum, the Company views these newly communicated FDA requirements as making it significantly more challenging to advance and develop a generic version of abaloparatide.

The key components of the new FDA guidelines include:

  • Recombinantly sourced peptides cannot be approved in an ANDA and must be submitted in a 505(b)(2) NDA

  • Explicit references to the potential for significant consequences if anti-drug antibodies cross-react against endogenous peptides

  • New impurities must be within the FDA’s threshold; if greater, must be submitted as a 505(b)(2)

  • Explicit expectation: ANDA with new impurity must evaluate immunogenicity risks prior to filing

RAD011 ASSET

  • FDA Type C meeting for PWS will take place the week of June 14

  • Written minutes from the FDA meeting expected by the end of July

  • Post FDA discussion, expectation is to initiate a pivotal PWS trial before year end

  • Additional orphan indications being assessed in parallel – decisions and clarity in 2H, 2021

  • Multiple Advisory Board meetings completed: U.S., UK, EU for PWS plus a Psychiatry meeting

  • Internal team formed: clinical, pharm. science, regulatory, bio-stats, CMC, global franchise

  • External team established: manufacturing & supply chain, development, regulatory, advocacy

About Radius
Radius is a commercialized biopharmaceutical company committed to serving patients with unmet medical needs in endocrinology and other therapeutic areas. Radius’ lead product, TYMLOS® (abaloparatide) injection, was approved by the U.S. Food and Drug Administration for the treatment of postmenopausal women with osteoporosis at high risk for fracture. The Radius clinical pipeline includes investigational abaloparatide injection for potential use in the treatment of men with osteoporosis; an investigational abaloparatide transdermal system for potential use in the treatment of postmenopausal women with osteoporosis; the investigational drug, elacestrant (RAD1901), for potential use in the treatment of hormone-receptor positive breast cancer out-licensed to Menarini Group; and the investigational drug RAD011, a synthetic cannabidiol oral solution with potential utilization in multiple endocrine and metabolic orphan diseases, initially targeting Prader-Willi syndrome.

About TYMLOS (abaloparatide) injection
TYMLOS (abaloparatide) injection was approved by the U.S. Food and Drug Administration for the treatment of postmenopausal women with osteoporosis at high risk for fracture defined as history of osteoporotic fracture, multiple risk factors for fracture, or patients who have failed or are intolerant to other available osteoporosis therapy.

About ATOM Phase 3 Study
The ATOM Phase 3 study is a randomized, double-blind, placebo-controlled study to assess efficacy and safety of abaloparatide injection in 228 men with osteoporosis. The primary endpoint is change in lumbar spine BMD at 12 months compared with placebo, and if successful, will form the basis of a supplemental NDA seeking to expand the use of TYMLOS to treat men with osteoporosis at high risk for fracture.

About the Abaloparatide Transdermal System and wearABLe Phase 3 Study
The abaloparatide transdermal system was developed in a collaboration between Radius and Kindeva Drug Delivery (“Kindeva”) (formerly 3M Drug Delivery Systems) with the application of Kindeva’s innovative microstructured transdermal system technology. The Phase 3 wearABLe study is the first pivotal study to evaluate treatment using a novel non-injectable delivery of an anabolic therapy. The wearABLe study is a pivotal, randomized, open label, active-controlled, bone mineral density (“BMD”) non-inferiority bridging study that will evaluate the efficacy and safety of abaloparatide transdermal system versus TYMLOS (abaloparatide) injection in approximately 500 patients with postmenopausal osteoporosis at high risk for fracture. The primary endpoint of the study is the percentage change in lumbar spine BMD at 12 months.

About Elacestrant (RAD1901) and EMERALD Phase 3 Study
Elacestrant is a selective estrogen receptor degrader (SERD), out-licensed to Menarini Group, which is being evaluated for potential use as a once daily oral treatment in patients with ER+/ HER2- advanced breast cancer. Studies completed to date indicate that the compound has the potential for use as a single agent or in combination with other therapies for the treatment of breast cancer. The EMERALD Phase 3 trial is a randomized, open label, active-controlled study evaluating elacestrant as second- or third-line monotherapy in ER+/HER2- advanced/metastatic breast cancer patients. The study has enrolled 466 patients who have received prior treatment with one or two lines of endocrine therapy, including a cyclin-dependent kinase (CDK) 4/6 inhibitor. Patients in the study were randomized to receive either elacestrant or the investigator’s choice of an approved hormonal agent. The primary endpoint of the study is progression-free survival (PFS) in the overall patient population and in patients with estrogen receptor 1 gene (ESR1) mutations. Secondary endpoints include evaluation of overall survival (OS), objective response rate (ORR), and duration of response (DOR).

About RAD011
Investigational drug RAD011 is a pharmaceutical-grade synthetic cannabidiol oral solution, manufactured utilizing traditional pharmaceutical manufacturing processes. The product has purity specifications that meet standardized regulatory and quality control requirements and, compared to the process of developing a plant-derived product, the synthetic manufacturing process usually enables increased consistency and greater precision in the product supply. RAD011 has been assessed in over 150 patients across multiple indications and has potential utilization in multiple endocrine and metabolic orphan diseases. Radius is initially targeting Prader-Willi syndrome (PWS) and anticipates initiating a pivotal Phase 2/3 study for patients with PWS in the second half of 2021 pending regulatory discussion with the U.S. Food and Drug Administration (FDA).

Forward-Looking Statements
This press release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. All statements contained in this press release that do not relate to matters of historical fact should be considered forward-looking statements, including without limitation statements regarding our expectations regarding continued commercialization of TYMLOS in the U.S.; our expectations regarding our clinical trials, studies and other regulatory initiatives, including our wearABLe and ATOM Phase 3 clinical trials; and the progress in the development of our product candidates, including RAD011.

These forward-looking statements are based on management’s current expectations. These statements are neither promises nor guarantees, but involve known and unknown risks, uncertainties and other important factors that may cause our actual results, performance or achievements to be materially different from any future results, performance or achievements expressed or implied by the forward-looking statements, including, but not limited to, the following: the adverse impact the ongoing COVID-19 pandemic is having and is expected to continue to have on our business, financial condition and results of operations, including our commercial operations and sales, clinical trials, preclinical studies, and employees; quarterly fluctuation in our financial results; our dependence on the success of TYMLOS, and our inability to ensure that TYMLOS will obtain regulatory approval outside the U.S. or be successfully commercialized in any market in which it is approved, including as a result of risk related to coverage, pricing and reimbursement; risks related to competitive products; risks related to our ability to successfully enter into collaboration, partnership, license or similar agreements; risks related to clinical trials, including our reliance on third parties to conduct key portions of our clinical trials and uncertainty that the results of those trials will support our product candidate claims; the risk that adverse side effects will be identified during the development of our product candidates or during commercialization, if approved; risks related to manufacturing, supply and distribution; and the risk of litigation or other challenges regarding our intellectual property rights. These and other important risks and uncertainties discussed in our filings with the Securities and Exchange Commission, or SEC, including under the caption “Risk Factors” in our Annual Report on Form 10-K for the year ending December 31, 2020 and subsequent filings with the SEC, could cause actual results to differ materially from those indicated by the forward-looking statements made in this press release. Any such forward-looking statements represent management’s estimates as of the date of this press release. While we may elect to update such forward-looking statements at some point in the future, we disclaim any obligation to do so, even if subsequent events cause our views to change. These forward-looking statements should not be relied upon as representing our views as of any date subsequent to the date of this press release.

Investor & Media Relations Contact:
Ethan Holdaway
Email: investor-relations@radiuspharm.com
Phone: (617) 583-2017

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Central Maine business briefs: UMA vice president receives award

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Central Maine business briefs: Kennebec Savings Bank, Kennebec Federal Savings merger approved

 

Jonathan Henry, University of Maine at Augusta vice president of enrollment management and marketing, received the Martin Gallant Distinguished Counseling Professional Award from the Maine Counseling Association recognizing his distinguished career in the field. Jeremy Bouford, UMA coordinator of recruitment and outgoing president of the counseling association, presented him the award at the organization’s annual meeting this May.

“It was my distinct pleasure to present this award to Jon Henry not only on behalf of the Maine Counseling Association but also as a trusted and valued colleague,” said Bouford, according to a news release from UMA.

Jonathan Henry Photo courtesy of UMA

“I am honored to receive this award from the Maine Counseling Association,” said Henry. “Over 36 years in the admissions counseling and enrollment profession, I recognize now more than ever the role that having a counseling background has played in helping me succeed in my work with students, and helping to administer a university.”

Henry has worked in college admissions counseling and enrollment management for 36 years, the last 22 in Maine.

“Marty” Gallant was a long-serving school counselor in Caribou, who was actively involved with and dedicated to the Maine Counseling Association and the profession of school counseling. Maine Counseling Association established this award to honor him upon his retirement in 2016.

Association members work in a variety of settings across the profession including K-12 schools, colleges and universities, community-based agencies, clinical facilities and private practice.

Benton company names director of programs

BENTON — Assistance Plus,  a 29-year-old home health care, behavioral health and intellectual disability agency headquartered in Benton, has promoted Natalie Childs to director of programs.

Natalie Childs Contributed photo

Childs has been employed by Assistance Plus since June 2010, starting as a daily living support specialist, and most recently serving as the organization’s BH/DD program manager. According to Crystal Bailey, the agency’s human resources director, the promotion is a result of her hard work and dedication. Natalie will remain in her current office location at the company’s headquarters in Benton.

Childs graduated from Erskine Academy and holds a bachelor’s degree in criminal justice from Thomas College. She  is completing a master’s degree in health care administration from Fitchburg State University.

Assistance Plus has offices in Benton, Waterville and Wilton.

2021 Mainebiz Woman to Watch nominees sought

PORTLAND — Mainebiz seeks nominations for female business owners, CEOs, presidents and top executives with established track records of success and who have been trailblazers and mentors to be its 2021 Women to Watch.

Criteria:
• The nominee must be the president, CEO or executive director at her company or organization.
• The nominee should have an established track record of business success.
• The nominee and her company must have made outstanding contributions to their company, industry and community.

Nominate a 2021 Mainebiz Woman to Watch by June 28. Visit mainebiz.biz/nominations and complete the short form.

The Women to Watch awards program is sponsored by Drummond Woodsum, Northeast Delta Dental, TD Bank and Vistage. Chosen nominees will be featured in the Aug. 9 issue of Mainebiz and will be honored at the annual Women to Watch reception in person during the middle of September. The date and location will be announced soon.

Kennebec Savings Bank announces new hires

Paige O’Donnell Contributed photo

AUGUSTA – Kennebec Savings Bank President and CEO Andrew Silsby recently announced two new hires, each of whom come with strong backgrounds in banking and customer service.

Paige O’Donnell, who has joined Kennebec Savings Bank as vice president of retail banking, brings more than eight years of banking experience. Her most recent position was on TD Bank’s Small Business Banking Team as their team manager.

Amanda Dyer Contributed photo

“Paige brings new insight and energy to our retail team,” said Silsby, according to a news release from the bank. “We are fortunate to have her join Kennebec Savings Bank at such an exciting time in our history. The bank is growing, and Paige will help us continue to offer competitive and quality products to our customers.”

Amanda Dyer joins the bank with 12 years of experience. Prior to joining the bank, Dyer served as branch manager and loan officer for Norway Savings Bank at their Topsham location. Dyer is originally from the Freeport area and graduated from Freeport High School.

“Amanda will be a great asset to our Freeport Team,” said Silsby. “She is familiar with the Freeport area, and will bring valuable knowledge and expertise to our team. We look forward to her leadership.”

Kennebec Behavioral Health leaders recognized

Rob Rogers Contributed photo

AUGUSTA — At the 2021 Maine Prevention Professionals Conference held on May 19, KBH’s Robert Rogers was recognized with the 2021 Neill E. Miner Memorial Prevention Award. This award recognizes an individual who has made a significant contribution in the field of prevention. He has been at the forefront of so many initiatives and approaches to evidence-based prevention in Maine. He has been able to forge a unique bridge between the prevention and treatment disciplines. “Rob is an extraordinary prevention professional who has made significant contributions to the field and positively impacted the lives of countless youth and adults throughout central Maine,” said Tom McAdam, KBH chief executive officer, according to a news release from KBH. A surprise guest, McKenna Rogers, Rob’s daughter who also works in behavioral health, presented him with the award.

Dr. Alane O’Connor Contributed photo

At the Co-Occurring Collaborative Serving Maine Annual Summit held on May 6, the Visionary Leadership award was presented to Dr. Alane O’Connor. O’Connor is the first director of perinatal addiction treatment at Maine Medical Center, serving pregnant women in the Portland area. O’Connor also provides addiction medicine through Kennebec Behavioral Health’s Opioid Health Home in Skowhegan and is chairperson of Maine’s Opioid Response Clinical Advisory Committee. The collaborative’s Visionary Leadership Award recognizes an individual, organization or an initiative in the behavioral health care field that has demonstrated outstanding leadership in improving the lives of individuals with mental illnesses and substance use disorders and/or their communities. “For her dedication to advance the quality of substance use treatment and raising awareness to the needs of pregnant and parenting women living with this disease,” said Liam Shaw, CCSME Board Member, in the release.

Kennebec Behavioral Health was founded in 1960 and operates clinics in Waterville, Skowhegan, Winthrop, Augusta and Farmington.

Northern Light Health announces finance leadership changes

Chris Frauenhofer, vice president of finance of Northern Light Inland Hospital and interim administrator of Northern Light Continuing Care, Lakewood in Waterville, has been named as the new vice president of finance for Northern Light Health’s system Medical Group.

Chris Frauenhofer

Frauenhofer joined Northern Light Health in 2013, starting at Maine Coast Memorial Hospital before moving to Inland Hospital in 2017. Before joining Northern Light Health, he served in senior finance roles for more than 20 years at hospitals in New York, including Alice Hyde Medical Center and Niagara Falls Memorial Medical Center.

Frauenhofer received a master’s in business administration degree from Niagara University (New York) and a Bachelor of Science degree in business administration/registered accounting (program from State University of New York at Buffalo).

Frauenhofer lives in Mariaville. He will remain in the interim role at Lakewood until a new administrator is recruited.

Randy Clark Contributed photo

Randy Clark, vice president of finance and operations at Northern Light Sebasticook Valley Hospital in Pittsfield, will expand his duties to include Inland Hospital and Lakewood, becoming vice president of finance for both hospitals and the continuing care facility.

A resident of Vassalboro, Clark just celebrated 25 years with Northern Light Health. He started as a controller at Sebasticook Valley Hospital in 1996 and became vice president of finance in 2005. In 2016, operations was added to his leadership role. For a few years, he oversaw finance as vice president for both CA Dean Hospital in Greenville and Sebasticook Valley Hospital.

Clark earned his Bachelor of Science degree in business administration from the University of Maine (Orono) and his Master of Business Administration degree from Thomas College (Waterville).

“Chris and Randy have been vital to our local leadership teams, and integral to system finance work. We know they will continue to help our system and member organizations succeed in their new and expanded roles — not only when it comes to finance, but with all aspects of our mission to improve the health of the people and communities we serve. Both Chris and Randy have a passion for excellent service and finding new ways to deliver on our brand promise,” said Terri Vieira, president of Inland Hospital, Continuing Care, Lakewood, and Sebasticook Valley Hospital, according to a news release from Northern Light Health.

Maine Dental Association partners with Maine Needs

The Maine Dental Association recently partnered with nonprofit organization Maine Needs to assemble and distribute 200 cleaning and hygiene kits to four sites.

The association, though its donation campaign called Maine Needs a Smile, collected personal hygiene items such as toothbrushes, toothpaste, soap, deodorant and shampoo, and basic cleaning supplies, such as laundry detergent, all-purpose cleaner and trash bags, to help Maine families in need.

The initiative was started by three MDA member dentists, Dr. Meg Dombroski, Dr. Kathryn Horutz and Dr. Nicole Kimmes, along with MDA Executive Director Angela Westhoff. The group was familiar with the Maine Needs nonprofit organization, which strives to help individuals and families in Maine meet basic, material needs by providing donated clothing and essential products and household items, and which partners with schools, caseworkers, nurses and nonprofits throughout the state to provide those material resources.

“One of the most rewarding aspects of dentistry is the opportunity to make a difference in people’s lives every day. The Maine Needs A Smile community effort made it possible for dental professionals across Maine to join together to have a positive impact beyond our chairs,” said Kimmes, according to a news release from the association

One of the ways Maine Needs provides for individuals and families is through different “kits” that the public can put together and donate.

The Maine Needs a Smile initiative originally had a goal of assembling 100 cleaning and hygiene kits. Because of the support of MDA member dentists, dental staff, and the general public, 200 kits were put together and were distributed between four sites. Kits were distributed at the Community Concepts Early Learning Center in Farmington, River Valley Free Store in Mexico, Kaydenz Kitchen Food Pantry in Lewiston, and Penney Memorial United Baptist Church in Augusta.

Gardiner FCU gives to local food pantries, organizations

Gardiner Federal Credit Union recently hosted a small reception to distribute the funds raised in 2020. The guests were representatives of area food pantries and organizations that help local people with food insecurities. There are eight organizations, each receiving a check in the amount of $2,482.38.

When the pandemic hit the number of people in need of these services grew. There were many new faces. Initially, some pantries were overwhelmed. Thankfully, those able to give dug deep and helped them make certain no one was turned away empty-handed. Individuals, grocers and businesses helped keep them afloat.

The Tanzanian proverb, “Little by little, a little becomes a lot.” In most cases, GFCU raises its Ending Hunger funds, one dollar at a time. So, to the staff and the members, they may think that dollar won’t make a difference, but it does. In this case it added up to almost 20,000 of those dollars. Their efforts and the generosity of many, do make a difference and the funds add up to a lot.

Throughout the months of June and July, GFCU will sell Cash Calendars for Ending Hunger. The calendars are $10 each. A total of $2,400 in prizes, will be drawn each weekday in August. Winners will receive either $100 or $200, depending on which day(s) they win. Anyone with $10 can purchase a calendar. It is not necessary to be a member to support any of its fundraisers.

For more business news, visit CentralMaine.com.

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Here are 100+ AAPI-owned businesses to shop in 2021

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Here are 100+ AAPI-owned businesses to shop in 2021

As it did for companies across the globe, pandemic-related freight issues increasingly complicated the supply chain for Sahra Nguyen, founder and CEO of Nguyen Coffee Supply — and made it much more expensive to manage. And the spike in anti-Asian American and Pacific Islander violence increasingly strained an already difficult year:

“The biggest challenge is staying mentally, emotionally and physically safe so that I can continue to show up for my business, family and community,” said Nguyen.

AAPI-owned businesses have suffered tremendously since the onset Covid, according to a survey from the Asian/Pacific Islander American Chamber of Commerce and Entrepreneurship (ACE). Of the approximately 900 AAPI small business owners surveyed…

  • More than 80 percent reported negative effects
  • 10 percent have closed their business
  • And 45 percent have lost or let go of employees

In general, there’s been a 169-percent increase in hate crimes in major cities — nonprofit advocacy group Stop AAPI Hate received more than 6,600 reports of anti-AAPI violence since it launched in March 2020 — unemployment rates rose disproportionately and solutions have made headway, such as the Covid-19 Hate Crimes Act. All of it has added to an increased national focus on the challenges and realities that AAPI communities face.

Within the past year, the visibility of anti-AAPI violence in the U.S. — which goes back centuries — caused a large mobilization of people, organizations and retailers to up their support of the AAPI community through advocacy, donations and awareness in light of AAPI Heritage Month. Multiple online retailers and brands have been increasing efforts to highlight AAPI-owned businesses.

  • Amazon and Etsy launched storefronts highlighting AAPI small businesses.
  • Reviews site Yelp announced a new feature last month by which businesses can self-identify as “Asian-owned,” making it easier for shoppers to find them.
  • Shop by Shopify, a free app to navigate small businesses, unveiled a directory of Asian-owned businesses in March.
  • Food delivery giant Grubhub began its Donate the Change program this month, giving all proceeds to National ACE and AAPI-owned restaurants across the nation.

Jan Lo, CEO of travel brand Lo & Sons, said reports of attacks on members of the AAPI community this year — specifically involving anyone around his mom’s age — brought his family’s heritage a lot more personal. “We’re extremely proud of our AAPI heritage, but we have also tried to build an ethos around inclusivity,” he said. The challenges “can also be viewed as opportunities, as I think many people can connect to our story of our mom inspiring her sons to help her achieve her professional dreams — not just because we’re Asian.”

AAPI Heritage Month “gives us an opportunity to lift each other up, to celebrate and express pride in different parts of our community,” explained Ian Shin, assistant professor of history and American culture at the University of Michigan, adding that it also offers an “opportunity to revisit history and remind people that, in fact, anti-AAPI violence is not un-American — it’s woven into the fabric of American society from the mid 19th century onward.”

AAPI-owned businesses in 2021

AAPI-owned businesses nationwide were the most negatively impacted throughout the pandemic, demographically speaking, according to CNBC: The number of working AAPI business owners fell by 20 percent last year. Among the most affected areas was San Francisco’s Chinatown, which saw 75 percent of its storefronts become nonoperational at some point last year.

But what is an AAPI-owned business in the first place? The U.S. Small Business Administration (SBA) told us that it doesn’t specifically define what constitutes an AAPI-owned business. The U.S. Census Bureau does, however: having persons of Asian or Native Hawaiian and Pacific Islander origin owning 51 percent or more of the business — akin to its definitions of Black-owned businesses and women-owned businesses. This definition covers East Asia (like China, Japan and more), Southeast Asia (including the Philippines, Vietnam and more) and the Indian subcontinent (Pakistan, Bangladesh and more) — the three comprise more than 19 countries and 20 million citizens in the U.S. can trace their origins to here — as well as the Polynesia, Micronesia and Melanesia subregions, which include Native Hawaiian, Samoan, Fijian and Tahitian people, among others.

Despite these definitions, or lack thereof, the two agencies do provide some noteworthy insights. Based on the most recent data released by the Census Bureau, here’s what we know:

  • In 2012, there were roughly 2 million AAPI-owned businesses in the U.S. (2016 data)
  • In 2018, there were more than 577,000 Asian-owned and over 6,600 Pacific Islander-owned employer businesses in the U.S. (2021 data)

Sarah Paiji Yoo, co-founder and CEO of eco-friendly cleaning brand Blueland, said she’s “incredibly proud” to be an Asian American running a business but is often subject to racism, especially on social media — people comment assumptions regarding where Blueland manufactures its products, for example. Then there’s the “model minority myth,” a harmful argument that typically praises Asian Americans for economic, academic and cultural success based entirely on stereotypes. It’s yet another challenge for Lin Chen, founder and CEO of wellness brand Pink Moon. “People continue to generalize, stereotype and be selective in who they want to listen to, invest in [and] purchase from,” she told us.

In our guide to women-owned brands, owner and founder of Hero Cosmetics Ju Rhyu told us that running a business is accompanied by “a lot of responsibility” to support her community, “especially as a business owner, since there is privilege and influence in being in this position.” That privilege comes at a time when 44 percent of unemployed Asian American women have been out of work for at least six months. This year, over 1,000 AAPI executives like DoorDash founder Tony Xu and Zoom CEO Eric Yuan donated $10 million to groups supporting the AAPI community, including nonprofit Asian Pacific Fund and the Asian-Americans Advancing Justice, a legal advocacy group for hate crime victims. Other business leaders pledged $125 million to launch the Asian American Foundation, which will support AAPI organizations and causes over the next five years — the largest philanthropic commitment in history fully focused on the AAPI community. The foundation raised another $125 million from organizations like Walmart, Bank of America and the Ford Foundation.

While noteworthy efforts, the AAPI community receives less than 1 percent of philanthropic funds despite making up 7 percent of the population and the country’s fastest growing racial group, according to the Pew Research Center.

Being a South Asian founder, Silk + Sonder’s Meha Agrawal said “it often feels like all the odds are stacked up against us: We have to work harder [and] prove ourselves every step of the way.” But throughout her career, she’s learned that “the most important thing a female founder or woman of color can do is make sure that people in seats of privilege are brought along on our journey” to have transparent conversations while building a business.

Each Fall and Spring, AAPI nonprofit Gold House hosts the Gold Rush cohort of Founders — Sahra Nguyen participated last year — wherein founders attend weekly master classes and panels led by advisors, expose their brands to potential investors and influencers, and join a network of founders that meet regularly to share insights and build partnerships. ACE National also provides guidance for starting and maintaining a business, including how to navigate the Covid-19 pandemic, loans, government programs and health and wellness matters.

Business owners said messaging and connecting with other founders on social media, from Twitter to LinkedIn, helped them network. Founders “will be extremely helpful and crucial as you build [your business] and oftentimes they’ll be the only ones who can empathize and understand what you are going through in successes and failures,” noted Rhyu.

Pink Moon’s Lin Chen said she’s part of multiple networking groups on Facebook for Asian creatives and entrepreneurs, including Asian Hustle Network and Asian Creative Network.

Notable AAPI-owned products in 2021

Here are 14 items from AAPI-owned brands that stood out to us, from travel essentials and skincare products to eco-friendly tools and home goods. Since there is no central directory of AAPI-owned businesses, as defined by the Census Bureau’s 51-percent edict, we asked each business below to confirm that it meets the criteria: having persons of Asian or Native Hawaiian and Pacific Islander origin owning 51 percent or more of the business.

Pink Moon allows users to filter wellness and skincare products they see by skin type, age and goals.

One of their bestsellers includes this rose quartz gua sha that stimulates lymphatic drainage to reduce puffiness and increase elasticity in the skin, according to the brand. In including this product in their line, Chen initially wanted to celebrate Traditional Chinese Medicine and her heritage, “I want to contribute to the diverse voices in this industry and push for more inclusivity and positive change,” she said. For maximum results, the brand suggests users of the gua sha pair it with the Over the Moon Gua Sha Facial Oil, which is made from a sunflower-moringa oil blend that soothes skin inflammation.

Amy Liu originally started the company to deal with her own eczema and now Tower 28 is the “first and only makeup brand to 100-percent follow the National Eczema Association’s ingredient guidelines and avoid every known skin irritant and allergen for all skin sensitivities,” she shared. This AAPI month, Liu wants consumers to realize AAPI heritage “is about recognizing the incredible people in our community who are pushing the boundaries and speaking up about racism and the need for more Asian representation.”

Made with apricot and raspberry seed oil, this lip gloss is one of the most popular products. Designed to hydrate your lips without drying them out, according to the brand, the gloss comes in four shades: Coconut, Cashew, Oat and Almond.

Frustrated with the fit of his dress shirts, Taiwanese-American Wesley Kang founded Nimble Made “to bring more representation and inclusion in sizing standards, starting with a slim fit that actually fits,” he elaborated.

Made from 100-percent cotton, the brand’s machine-washable dress shirts feature 2-button adjustable rounded cuffs and a Franklin semi-spread collar.

Terrence Santos founded his company in 2015 when he was expecting his first child. Originally, he started looking for toys that would teach the Filipino language to his child, but found nothing — so he created a toy company that provided options. Now his company sells toys that teach Tagalog, Ilocano, Bisaya and Hawaiian. On each of the ten blocks, the company has engraved the Roman number, Tagalog translation, Mahjong character and an English translation.

Eunice Byun and Dave Nguyen are challenging the notion that we need dozens of gadgets to cook delicious meals. A few years ago, the ex Chanel and Revlon executives founded Material Kitchen, a direct-to-consumer company that offers a simplified kitchen starter set at an affordable price. This seven-piece set, which has a 5.0-star average rating from almost 100 consumers, features an 8” knife, 4” knife, tongs, wooden spoon, metal spoon, slotted spatula and wooden holder. What’s more is you can customize the set’s wood type and handle color.

Private Policy is a “genderless” clothing company founded by Haoran Li and Siying Qu, two former Parsons graduates. Inspired by the youth culture in New York City, the pair design clothes without the traditional menswear and womenswear labels. Made from 100-percent Rayon, this jacket can be worn with the sleeves on or off, serving multiple purposes. You can also shop their collection at Selfridges.

Nearly two decades ago, Taiwanese American Melinda Hwang’s father worked with a scientist (and family friend) to come up with a nanofiber membrane mask during the 2003 SARs epidemic. When the Covid-19 pandemic hit the U.S., Hwang’s family sent her those masks from Taiwan and, thus, Happy Masks was born.

The brand’s Pro Series offers a range of sizes — with the small size fitting ages three to 10 — and can withstand at least 50 washes by hand. It has adjustable ear straps and a nose wire to fit different face shapes, while its “parrot beak” design leaves enough room between the mask and the mouth and nose in order to breathe comfortably for long-term wear.

Nguyen Coffee Supply imports Vietnamese coffee beans from its partner farms in Vietnam and roasts them fresh weekly in Brooklyn. The Original Vietnamese Coffee Trio features three different coffee blends: Moxy, Truegrit and Loyalty Arabica-Robusta. The coffee comes finely ground, and you can brew it using the brand’s Phin Filter.

CEO and founder Sahra Nguyen said AAPI month is an important time for the community to share their stories. “Many people don’t understand our community because we’ve been erased and ignored for so long,” Nguyen said. “Taking the time to learn about our community’s unique experiences will deepen our connection and sense of shared humanity. From here, we can effectively work together to build a better world.”

CEO Jan Lo said the brand was inspired by his mom’s need for a lightweight, stylish and functional carry-on bag to take with her while traveling. While designing the brand’s first bag — The O.G. — Lo said he “quickly found that it wasn’t just my mother in need of a travel bag that didn’t sacrifice style for functionality.” Lo & Sons, which was co-founded by Lo, his mother and his brother, sells a variety of bags for men and women, including The Catalina Deluxe, which is featured in our roundup of the best weekender bags. The company sells apparel and face masks, too.

Edward and Judy Kwon founded the family-owned CALPAK in 1989 with the mission of making quality bags at an accessible price. Their daughter Jennifer Kwon has run the company since 2013. CALPAK’s bags range in size, style and color from the Kaya Laptop Backpack to the Hue Duffel Bag, which was also featured in our roundup of the best weekender bags. Beyond bags, luggage and organizers, CALPACK also sells men’s and women’s apparel, as well as wellness items like face masks, hand sanitizer and linen and room spray.

After five years of running gr8nola as a side hustle, founder Erica Liu Williams left her 10 year tech career to pursue the brand full time. gr8nola sells granola that’s free from refined sugar, dairy, soy and GMOs in a variety of flavors, from Peanut Butter and Matcha to Cacao and Cinnamon Chai. Williams said she feels it’s her responsibility to use her platform to share her perspective and the voices of others in the AAPI community. “I feel socially responsible to myself, family and broader community to be a role model for others by leading by example and showing other young girls and people who look like me that you can achieve success on your own terms, without succumbing to becoming a “model minority” stereotype,” Williams said.

Silk + Sonder is a subscription service that sends members guided monthly journals with prompts inspired by positive psychology, as well as gives them access to virtual programming for peer-to-peer support. “Silk + Sonder’s mission is to solve the emotional health epidemic for customers versus being a band-aid fix,” said Meha Agrawal, the company’s founder. “At its core, Silk + Sonder is a space for mindfulness, journaling, planning, tracking and creative expression all in one.”

When Sarah Paiji Yoo, Blueland’s CEO, decided to reduce her personal plastic consumption, she quickly realized how difficult it was to do. “Many household items use single-use plastic in their packaging,” said Yoo. “This ultimately is what led me to found Blueland, as no one should have to sacrifice a clean home and clean clothes for a clean planet.” Blueland sells refillable cleaning products like Glass + Mirror, Multi-Surface and Bathroom sprays — included in The Clean Up Kit — all of which are certified by the EPA’s Safer Choice program, as we previously reported in our guide to eco-friendly cleaning supplies.

Stephanie Hon launched Cadence with the mission to eliminate single-use travel-sized plastic in February of last year — a month before the Covid-19 pandemic hit the U.S. “We definitely put a pause on talking about air-travel, going to the gym before work, date nights, etcetera,” said Hon. But despite launching in the midst of the pandemic, the brand’s sustainable capsules repeatedly sold out. Cadence specializes in magnetic and refillable containers made from recycled ocean bound plastic that snap together and can keep your small travel essentials and daily items organized. You can buy the capsules individually or get them a bundle of six, and they come in a variety of colors including Lavender and Terracotta. Hon said one of her biggest challenges as an AAPI business owner was being “bullish” and retraining her inclinations. “To say I think we’re going to be a $XM company, to say it’s a great opportunity for people to be involved. There’s a perfect balance of humility and confidence that comes to light,” she said.

109 AAPI-owned brands to support in 2021

In addition to our favorite products from AAPI-owned brands, we’ve rounded up some businesses across various Shopping reader interests, including home, food, beauty and wellness. We asked each business below to confirm it meets the Census Bureau’s criteria of at least 51 percent AAPI ownership. While this list of AAPI-owned companies and products isn’t exhaustive, we aim to actively update this feature to help keep you informed about AAPI-owned companies worth considering.

AAPI-owned home and kitchen brands

Revamp your kitchen decor with a new apron or oven mitts from The Homebodies or treat yourself or your favorite friend to a new indoor plant from Bark & Vine.

  1. Aerangis
  2. Anak Toy Kompany
  3. Bark & Vine
  4. Blueland
  5. The Homebodies
  6. ILHA Candles
  7. KonMari
  8. Material Kitchen
  9. O-M Ceramics
  10. Pawena Studio
  11. Rooted
  12. Soothi
  13. Trail575
  14. Woo Ceramics

AAPI-owned beauty and skincare brands

Update your skincare regime by shopping for a Gua Sha facial tool from Mount Lai or combat maskne with Soko Glam’s Pimple Patch. You can also shop from dozens of AAPI-owned makeup brands, fragrance shops like Ellis Brooklyn or nail care brands like Sundays.

  1. Acaderma
  2. Asutra
  3. AVYA Skincare
  4. Bluelene
  5. Blume
  6. Cle Cosmetics
  7. Caire Beauty
  8. Circumference
  9. Ellis Brooklyn
  10. EM Cosmetics
  11. Essance Skincare
  12. Glow Recipe
  13. Happy 2nd Birthday
  14. Hero Cosmetics
  15. Krave Beauty
  16. LAPCOS
  17. Mount Lai
  18. Peach & Lily
  19. Pink Moon
  20. Soko Glam
  21. Sundays
  22. Supernal
  23. Tower 28 Beauty
  24. YINA

AAPI-owned food and beverages brands

These 17 standout food and beverage options are worth a try, especially if you’re looking to try out some spiced ice cream or a side of kimchi.

  1. Brightland
  2. ChocoVivo
  3. Fly By Jing
  4. Gr8nola
  5. Indifix
  6. Kasama
  7. Lunar
  8. Malai Ice Cream
  9. Mother-in-Law’s
  10. Nguyen Coffee Supply
  11. Omsom
  12. One Stripe Chai
  13. The Qi
  14. Red Boat Fish Sauce
  15. Sanzo
  16. Spicewalla
  17. Umamicart
  18. Wing on Wo & Co.

AAPI-owned bookstores

Looking to expand your at-home library but don’t know where to start? These AAPI-owned bookstores from across the country have a wide variety of options, from used to brand new.

  1. A Good Used Book
  2. Arkipelago Books
  3. Bel Canto Books
  4. Eastwind Books
  5. Femme Fire Books
  6. Maomi Bookstore
  7. Orphan Books
  8. Philippine Expressions Bookshop
  9. Townie Books

AAPI-owned fashion and accessories brands

These 26 fashion and accessory brands can help you update your wardrobe going into the summer. They include everything from on-trend chunky rings at BONBONWHIMS to Gentle Monster’s chic sunglasses.

  1. Abacaxi
  2. Bellemere NY
  3. BONBONWHIMS
  4. Chunks
  5. Gentle Monster
  6. Haerfest
  7. Hey Maeve
  8. Jason Wu
  9. JW Pei
  10. Kahili Creations
  11. KERISMA
  12. Kinn
  13. LEYT
  14. MOMMA
  15. Nimble Made
  16. NOTTE Jewelry
  17. Paper Project
  18. Pepper
  19. PH5
  20. Private Policy
  21. Proclaim
  22. Rastah
  23. Rue Saint Paul
  24. Sonia Hou Jewelry
  25. SVNR
  26. Verlas

AAPI-owned wellness and fitness brands

You can shop for face masks at Airpop and Happy Masks, get a good night’s sleep with Pluto Pillow or enhance your workout routine with Blogilates.

  1. Airpop
  2. Apothékary
  3. Asutra
  4. AVRE
  5. Blogilates
  6. CocoFloss
  7. Happy Masks
  8. L’Oeuf Poche
  9. Mono B
  10. Neuro
  11. Pluto Pillow
  12. Silk + Sonder

AAPI-owned travel brands

If you’re planning a few summer trips, you can get your hands on multiple AAPI-owned travel essentials, including a travel backpack from Brevitē or a versatile carry-on bag from Planeket.

  1. Brevitē
  2. Cadence
  3. Calpak
  4. Lo and Sons
  5. Planeket
  6. Senreve

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