Kamada Ltd.

Foreign Filer Report • Aug 11, 2021

UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549

FORM 6-K

Report of Foreign Private Issuer Pursuant to Rule 13a-16 or 15d-16 of the Securities Exchange Act of 1934

For the Month of August 2021

Commission File Number 001-35948

Kamada Ltd. (Translation of registrant's name into English)

2 Holzman Street Science Park, P.O. Box 4081 Rehovot 7670402 Israel

(Address of principal executive offices)

Indicate by check mark whether the registrant files or will file annual reports under cover Form 20-F or Form 40-F.

Form 20-F ☒ Form 40-F ☐

Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(1): ____

Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(7): ____

Indicate by check mark whether the registrant by furnishing the information contained in this Form is also thereby furnishing the information to the Commission pursuant to Rule 12g3-2(b) under the Securities Exchange Act of 1934.

Yes ☐ No ☒

If "Yes" is marked, indicate below the file number assigned to the registrant in connection with Rule 12g3-2(b): 82-____

This Form 6-K is being incorporated by reference into the Registrant's Form S-8 Registration Statements, File Nos. 333-192720, 333-207933, 333-215983, 333-222891 and 333-233267.

On August 11, 2021, Kamada Ltd. (the "Company") issued a press release titled "Kamada Reports Second Quarter and First Half 2021 Financial Results, Recent Achievements and Corporate Development Activities". In addition, the Company released its consolidated financial statements as of June 30, 2021 (Unaudited). A copy of the press release and consolidated financial statements as of June 30, 2021 (Unaudited) are attached to this Form 6-K as Exhibit 99.1 and Exhibit 99.2, respectively.

Exhibit No.	Description
99.1	Press Release, dated August 11, 2021
99.2	Kamada Ltd.'s Consolidated Financial Statements as of June 30, 2021 (Unaudited)

SIGNATURE

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

Date: August 11, 2021 KAMADA LTD.

By: /s/ Yifat Philip

Yifat Philip Vice President General Counsel and Corporate Secretary

Kamada Reports Second Quarter and First Half 2021 Financial Results, Recent Achievements and Corporate Development Activities

• Second Quarter 2021 Revenues were \$24.2 Million
• In Connection with the Transition of GLASSIA® Manufacturing, Kamada Largely Completed a Workforce Downsizing in the Second Quarter that will Result in an Approximately 10% Annual Labor Cost Reduction
• Pivotal Phase 3 InnovAATe Trial for Inhaled AAT for Treatment of Alpha-1 Antitrypsin Deficiency Continues to Advance as Kamada Evaluates Strategic Partnering Opportunities
• Ongoing Expansion of Plasma Collection Capacity at Recently Acquired U.S. Plasma Collection Center; Company Intends to Open Additional Centers
• Kamada Continues to Explore Additional Business Development Opportunities that Utilize and Expand the Company's Core Plasma-Derived Development, Manufacturing and Commercialization Expertise, and Further its Strategic Objective of Evolving into a Fully Integrated Specialty Plasma Company

REHOVOT, Israel – August 11, 2021 -- Kamada Ltd. (NASDAQ: KMDA; TASE: KMDA.TA), a plasma-derived biopharmaceutical company, today announced financial results for the three and six months ended June 30, 2021.

"Our business continued to perform as anticipated throughout the first half of 2021," said Amir London, Kamada's Chief Executive Officer. "Despite the expected decrease in revenue as compared to the first half of last year due to the planned transition of GLASSIA manufacturing to Takeda later this year, we achieved gross margins of 37 percent in the first half of 2021, as compared to 34 percent during the first six months of 2020. As an outlook for the second half of 2021, we anticipate a reduction in overall gross margins mainly due to anticipated change in products sales mix."

"We continue to progress the pivotal Phase 3 InnovAATe clinical trial of our proprietary Inhaled AAT for the treatment of Alpha-1 Antitrypsin Deficiency (AATD) and are exploring a potential commercial partnership with respect to this product. We are pleased with the level of external interest generated in this therapy to date," continued Mr. London.

"Moreover, we initiated the planning for the opening of additional U.S. plasma collection centers by leveraging our existing U.S. Food and Drug Administration license. In addition, we continue to achieve important progress around the advancement of our business development priorities and are exploring potential strategic transactions that would utilize and expand our core plasma-derived development, manufacturing, and commercialization expertise. We believe we have multiple prospects that would represent significant steps toward accomplishing our strategic goal of becoming a fullyintegrated specialty plasma company," concluded Mr. London.

Financial Highlights for the Three Months Ended June 30, 2021

• Total revenues were \$24.2 million in the second quarter of 2021, compared to \$33.1 million recorded in the second quarter of 2020.
• Gross profit was \$9.1 million in the second quarter of 2021, compared to \$11.1 million reported in the second quarter of 2020.
• In connection with the transition of GLASSIA manufacturing to Takeda, during the second quarter of 2021, the Company largely completed the planned workforce downsizing and incurred a one-time expense of \$0.6 million related to excess severance remuneration for the employees who were laid-off as part of this downsizing. The downsizing process is expected to result in an annualized reduction of approximately 10% in overall labor costs.
• Net income was \$0.9 million, or \$0.02 per share, in the second quarter of 2021, as compared to net income of \$3.5 million, or \$0.10 per share, in the second quarter of 2020.
• Adjusted EBITDA, as detailed in the tables below, was \$2.4 million in the second quarter of 2021, as compared to \$5.5 million in the second quarter of 2020. Adjusted EBITDA in the second quarter of 2021, excluding one-time severance expenses, was \$3.0 million.
• Cash used in operating activities was \$3.3 million in the second quarter of 2021, as compared to cash provided by operating activities of \$10.7 million in the second quarter of 2020.

Financial Highlights for the Six Months Ended June 30, 2021

• Total revenues were \$49.1 million in the first six months of 2021, compared to \$66.4 million recorded in the first six months of 2020.
• Gross profit was \$18.0 million in the first six months of 2021, compared to \$22.6 million reported in the first six months of 2020.
• Net income was \$3.6 million, or \$0.08 per share, in the first six months of 2021, as compared to net income of \$8.7 million, or \$0.20 per share, in the first six months 2020.
• Adjusted EBITDA, as detailed in the tables below, was \$6.2 million in the first six months of 2021, as compared to \$11.8 million in the first six months of 2020. Adjusted EBITDA in the first six months of 2021, excluding one-time severance expenses, was \$6.7 million.
• Cash used in operating activities was \$1.2 million in the first six months of 2021, as compared to cash provided by operating activities of \$8.7 million in the first six months of 2020.

Balance Sheet Highlights

As of June 30, 2021, the Company had cash, cash equivalents, and short-term investments of \$104.6 million, as compared to \$109.3 million on December 31, 2020.

Recent Corporate Highlights

• The FDA approved a label update for KEDRAB® (Rabies Immune Globulin [Human]), establishing the product's safety and effectiveness in children. KEDRAB is now indicated for passive, transient post-exposure prophylaxis of rabies infection in persons of all ages when given promptly following contact with a rabid or possibly rabid animal.
• Completed the supply of our plasma-derived COVID-19 Immunoglobulin (IgG) investigational product to the Israeli Ministry of Health (IMOH) for the treatment of hospitalized COVID-19 patients.

Conference Call

Kamada management will host an investment community conference call on Wednesday, August 11, 2021, at 8:30am Eastern Time to discuss these results and answer questions. Shareholders and other interested parties may participate in the conference call by dialing 877-407-0792 (from within the U.S.), 1-809-406-247 (from Israel), or 201-689-8263 (International) and entering the conference identification number: 13721962. The call will also be webcast live on the Internet at http://public.viavid.com/index.php?id=145993.

About Kamada

Kamada Ltd. (the "Company") is a global specialty plasma-derived biopharmaceutical company with a diverse portfolio of marketed products, a robust development pipeline and industry-leading manufacturing capabilities. The Company's strategy is focused on driving profitable growth from its current commercial products, its plasma-derived development pipeline and its manufacturing expertise, while evolving into a vertically integrated plasma-derived company. The Company's two leading commercial products are GLASSIA® and KEDRRAB®. GLASSIA was the first liquid, ready-to-use, intravenous plasma-derived AAT product approved by the FDA. The Company markets GLASSIA in the U.S. through a strategic partnership with Takeda Pharmaceuticals Company Limited ("Takeda") and in other countries through local distributors. Pursuant to an agreement with Takeda, the Company will continue to produce GLASSIA for Takeda through 2021 and Takeda will initiate its own production of GLASSIA for the U.S. market in 2021, at which point Takeda will commence payment of royalties to the Company until 2040. KEDRAB is an FDA approved anti-rabies immune globulin (Human) for post-exposure prophylaxis treatment. KEDRAB is being marketed in the U.S. through a strategic partnership with Kedrion S.p.A. The Company has additional four plasma-derived products administered by injection or infusion, that are marketed through distributors in more than 15 countries, including Israel, Russia, Brazil, Argentina, India and other countries in Latin America and Asia. The Company has two leading development programs; an inhaled AAT for the treatment of AAT deficiency for which the Company is currently conducting the InnovAATe clinical trial, a randomized, double-blind, placebo-controlled, pivotal Phase 3 trial, and a plasma-derived hyperimmune immunoglobulin (IgG) product as a potential treatment for coronavirus disease (COVID-19). The Company leverages its expertise and presence in the Israeli pharmaceutical market to distribute in Israel more than 20 products that are manufactured by third parties and have recently added nine biosimilar products to its Israeli distribution portfolio, which, subject to EMA and the Israeli MOH approvals, are expected to be launched in Israel between the years 2022 and 2025. FIMI Opportunity Fund, the leading private equity investor in Israel, is the Company's lead shareholder, beneficially owning approximately 21% of the outstanding ordinary shares.

Cautionary Note Regarding Forward-Looking Statements

This release includes forward-looking statements within the meaning of Section 21E of the U.S. Securities Exchange Act of 1934, as amended, and the safe harbor provisions of the U.S. Private Securities Litigation Reform Act of 1995. Forward-looking statements are statements that are not historical facts, including statements regarding: 1) workforce downsizing resulting in an approximate 10% annual labor cost reduction, 2) anticipation of a reduction in overall gross margins during the second half of 2021 mainly due to anticipated change in products sales mix, 3) optimism about commercial partnership prospects associated with our Inhaled AAT product, 4) plans for the opening of additional plasma collection centers in the U.S. by leveraging our FDA license, 5) optimism about strategic business development opportunities that will utilize and expand our core plasma-derived development, manufacturing, and commercialization expertise, and 6) the belief that those opportunities are may be significant steps toward accomplishing our strategic goal of becoming a fully integrated specialty plasma company. Forward-looking statements are based on Kamada's current knowledge and its present beliefs and expectations regarding possible future events and are subject to risks, uncertainties and assumptions. Actual results and the timing of events could differ materially from those anticipated in these forward-looking statements as a result of several factors including, but not limited to, the continued evolvement of the COVID-19 pandemic, its scope, effect and duration, availability of sufficient raw materials required to maintain manufacturing plans, the effects of the COVID-19 pandemic and related government mandates on the availability of adequate levels of work-force required to maintain manufacturing plans, disruption to the supply chain due to COVID-19 pandemic, continuation of inbound and outbound international delivery routes, impact of the workforce downsizing plan, continued demand for Kamada's products, including GLASSIA and KEDRAB, in the U.S. market and its Distribution segment related products in Israel, financial conditions of the Company's customer, suppliers and services providers, ability to reap the benefits of the recent acquisition of the plasma collection center, including the ability to open additional U.S. plasma centers, the ability to continue enrollment of the pivotal Phase 3 InnovAATe clinical trial and ability to find a suitable commercial partnership for this product, unexpected results of clinical studies, including plasma-derived IgG treatment for COVID-19 and the level of demand for such product, Kamada's ability to manage operating expenses, additional competition in the markets that Kamada competes, regulatory delays, prevailing market conditions and the impact of general economic, industry or political conditions in the U.S., Israel or otherwise. The forward-looking statements made herein speak only as of the date of this announcement and Kamada undertakes no obligation to update publicly such forward-looking statements to reflect subsequent events or circumstances, except as otherwise required by law.

CONTACTS:

Chaime Orlev Chief Financial Officer IR@kamada.com

Bob Yedid LifeSci Advisors, LLC 646-597-6989 Bob@LifeSciAdvisors.com

CONSOLIDATED STATEMENTS OF FINANCIAL POSITION

	As of June 30,	As of December 31,
	2021		2020		2020
		Unaudited			Audited
			U.S Dollars in thousands
Assets
Current Assets
Cash and cash equivalents	\$ 68,416	\$	57,399	\$	70,197
Short-term investments	36,137		47,272		39,069
Trade receivables, net	27,743		19,823		22,108
Other accounts receivables	2,450		2,980		4,524
Inventories	44,601		47,646		42,016
Total Current Assets	179,347		175,120		177,914
Non-Current Assets
Property, plant and equipment, net	25,665		24,574		25,679
Right-of-use-assets	3,453		3,796		3,440
Other long term assets	3,413		1,058		1,573
Contract assets	4,472		911		2,059
Deferred taxes	-		632		-
Total Non-Current Assets	37,003		30,971		32,751
Total Assets	\$ 216,350	\$	206,091	\$	210,665
Liabilities
Current Liabilities
Current maturities of bank loans	\$ 61	\$	431	\$	238
Current maturities of lease liabilities	1,149		990		1,072
Trade payables	17,948		22,760		16,110
Other accounts payables	6,989		5,497		7,547
Deferred revenues	-		589		-
Total Current Liabilities	26,147		30,267		24,967
Non-Current Liabilities
Bank loans	5		63		36
Lease liabilities	3,401		3,704		3,593
Deferred revenues	3,025		1,025		2,025
Employee benefit liabilities, net	1,429		1,267		1,406
Total Non-Current Liabilities	7,860		6,059		7,060
Shareholder's Equity
Ordinary shares	11,716		11,662		11,706
Additional paid in capital	209,942		207,731		209,760
Capital reserve due to translation to presentation currency	(3,490)		(3,490)		(3,490)
Capital reserve from hedges	58		411		357
Capital reserve from share-based payments	4,746		6,204		4,558
Capital reserve from employee benefits	(320)		(356)		(320)
Accumulated deficit	(40,309)		(52,397)		(43,933)
Total Shareholder's Equity	182,343		169,765		178,638
Total Liabilities and Shareholder's Equity
	\$ 216,350	\$	206,091	\$	210,665

CONSOLIDATED STATEMENTS OF PROFIT OR LOSS AND OTHER COMPREHENSIVE INCOME

	Six months period ended June 30,					Three months period ended June 30,	Year ended December 31,
		2021		2020		2021		2020		2020
		Unaudited					Unaudited			Audited
					U.S Dollars In thousands
Revenues from proprietary products	\$	40,193	\$	47,942	\$	19,323	\$	22,625	\$	100,916
Revenues from distribution		8,946		18,437		4,916		10,464		32,330
Total revenues		49,139		66,379		24,239		33,089		133,246
Cost of revenues from proprietary products		23,527		27,881		11,059		12,934		57,750
Cost of revenues from distribution		7,609		15,932		4,108		9,040		27,944
Total cost of revenues		31,136		43,813		15,167		21,974		85,694
Gross profit		18,003		22,566		9,072		11,115		47,552
Research and development expenses		5,364		6,970		2,736		3,623		13,609
Selling and marketing expenses		2,547		2,118		1,424		1,178		4,518
General and administrative expenses		6,112		4,619		3,303		2,307		10,139
Other expenses		570		34		563		32		49
Operating income		3,410		8,825		1,046		3,975		19,237
Financial income		209		615		99		298		1,027
Income (expense) in respect of securities measured at fair value, net *		-		102		-		-		102
Income (expenses) in respect of currency exchange
differences and derivatives instruments, net		121		65		(145)		(367)		(1,535)
Financial expenses		(116)		(135)		(63)		(58)		(266)
Income before tax on income		3,624		9,472		937		3,848		18,565
Taxes on income		-		796		-		390		1,425
Net Income	\$	3,624	\$	8,676	\$	937	\$	3,458	\$	17,140
Other Comprehensive Income (loss) :
Amounts that will be or that have been reclassified to profit
or loss when specific conditions are met
Gain (loss) from securities measured at fair value through
other comprehensive income Gain (loss) on cash flow hedges		- (43)		(188) 441		- 30		- 200		(188) 876
Net amounts transferred to the statement of profit or loss for
cash flow hedges Items that will not be reclassified to profit or loss in		(256)		(7)		(2)		(41)		(528)
subsequent periods:
Remeasurement gain (loss) from defined benefit plan		-		-		-		-		64
Tax effect		-		15		-		(12)		19
Total comprehensive income	\$	3,325	\$	8,937	\$	965	\$	3,605	\$	17,383
Earnings per share attributable to equity holders of the Company:
Basic net earnings per share	\$	0.08	\$	0.20	\$	0.02	\$	0.10	\$	0.39
Diluted net earnings per share	\$	0.08	\$	0.20	\$	0.02	\$	0.10	\$	0.38

CONSOLIDATED STATEMENTS OF CASH FLOWS

	Six months period Ended June, 30 2021				Three months period Ended June, 30				Year Ended December 31,
				2020	2021		2020		2020
				Unaudited					Audited
						U.S Dollars In thousands
Cash Flows from Operating Activities
Net income	\$	3,624	\$	8,676	\$	937	\$	3,458	\$ 17,140
Adjustments to reconcile net income to net cash provided by (used in) operating activities:
Adjustments to the profit or loss items:
Depreciation and impairment		2,372		2,380		1,225		1,188	4,897
Financial expenses (income), net		(214)		(647)		109		127	672
Cost of share-based payment		370		588		155		330	977
Taxes on income		-		796		-		390	1,425
Loss (gain) from sale of property and equipment		-		(6)		-		(6)	(7)
Change in employee benefit liabilities, net		23		(2)		60		16	201
		2,551		3,109		1,549		2,045	8,165
Changes in asset and liability items:
Decrease (increase) in trade receivables, net		(5,646)		3,416		(7,231)		6,432	1,332
Decrease (increase) in other accounts receivables		1,629		741		1,643		(772)	115
Increase in inventories		(2,401)		(4,473)		(3,446)		(5,859)	1,157
Decrease (increase) in deferred expenses		(2,362)		(911)		(1,209)		(490)	(3,085)
Increase (decrease) in trade payables		1,139		(2,719)		2,623		4,497	(9,560)
Increase (decrease) in other accounts payables		(799)		(314)		1,346		866	1,736
Decrease in deferred revenues		1,000		793		500		396	1,204
		(7,440)		(3,467)		(5,774)		5,070	(7,101)
Cash received (paid) during the period for:
Interest paid		(107)		(107)		(59)		(52)	(209)
Interest received		217		601		76		150	1,211
Taxes paid		(23)		(74)		(9)		(13)	(101)
		87		420		8		85	901
Net cash provided by operating activities	\$	(1,178)	\$	8,738	\$	(3,280)	\$	10,658	\$ 19,105

CONSOLIDATED STATEMENTS OF CASH FLOWS

	Six months period Ended June, 30				Three months period Ended June, 30		Year Ended December 31,
		2021		2020	2021	2020	2020
				Unaudited			Audited
					U.S Dollars In thousands
Cash Flows from Investing Activities
Proceeds of investment in short term investments, net	\$	2,967	\$	(15,646)	\$ 11,967	\$ -	\$ (7,646)
Purchase of property and equipment and intangible assets		(1,463)		(1,901)	(1,332)	(1,005)	(5,488)
Proceeds from sale of property and equipment		-		6	-	6	7
Acquisition of subsidiary (LLC), net (1)		(1,404)		-	-		-
Net cash used in investing activities		100		(17,541)	10,635	(999)	(13,127)
Cash Flows from Financing Activities
Proceeds from exercise of share base payments		10		20	3	15	64
Repayment of lease liabilities		(595)		(540)	(306)	(262)	(1,103)
Repayment of long-term loans		(206)		(247)	(85)	(124)	(492)
Proceeds from issuance of ordinary shares, net		-		24,895	-	-	24,895
Net cash provided by (used in) financing activities		(791)		24,128	(388)	(371)	23,364
Exchange differences on balances of cash and cash
equivalent		88		(588)	13	(1,177)	(1,807)
Increase in cash and cash equivalents		(1,781)		14,737	6,980	8,111	27,535
Cash and cash equivalents at the beginning of the period		70,197		42,662	61,436	49,288	42,662
Cash and cash equivalents at the end of the period	\$	68,416	\$	57,399	\$ 68,416	\$ 57,399	\$ 70,197
Significant non-cash transactions
Right-of-use asset recognized with corresponding lease
liability	\$	588	\$	345	\$ 286	\$ 287	\$ 539
Purchase of property and equipment	\$	748	\$	722	\$ 748	\$ 722	\$ 722
							Six months period Ended
Appendix A (1)							June, 30 2021
Acquisition of a subsidiary that was first consolidated
Current Assets (exclusive of cash and cash equivalents)							(184)
Non Current Assets							(1,460)
Current Liabilities							240
							(1,404)

Adjusted EBITDA

	Six months period ended June 30,			Three months period ended June 30,				Year ended December 31,
	2021		2020		2021		2020		2020
					In thousands
Net income	\$ 3,624	\$	8,676	\$	937	\$	3,458	\$	17,140
Taxes on income	-		796		-		390		1,425
Financial expense (income), net	(214)		(647)		109		127		692
Depreciation and amortization expense	2,372		2,380		1,225		1,188		4,897
Non-cash share-based compensation expenses	370		588		155		330		977
Adjusted EBITDA	\$ 6,152	\$	11,793	\$	2,426	\$	5,493	\$	25,131

Adjusted net income

	Six months period ended	June 30,		Three months period ended June 30,					Year ended December 31,
	2021		2020		2021		2020		2020
					In thousands
Net income	\$ 3,624	\$	8,676	\$	937	\$	3,458	\$	17,140
Share-based compensation charges	370		588		155		330		977
Adjusted net income	\$ 3,994	\$	9,264	\$	1,092	\$	3,788	\$	18,117

Page

KAMADA LTD.

CONSOLIDATED FINANCIAL STATEMENTS

AS OF JUNE 30, 2021 (Unaudited)

TABLE OF CONTENTS

Consolidated Statements of Financial Position	2
Consolidated Statements of Profit or Loss and Other Comprehensive Income	3
Consolidated Statements of Changes in Equity	4-7
Consolidated Statements of Cash Flows	8-9
Notes to the Interim Consolidated Financial Statements	10-20

---

CONSOLIDATED STATEMENTS OF FINANCIAL POSITION

	As of June 30,		As of December 31,
	2021		2020		2020
		Unaudited			Audited
		U.S Dollars in thousands
Assets
Current Assets
Cash and cash equivalents	\$ 68,416	\$	57,399	\$	70,197
Short-term investments	36,137		47,272		39,069
Trade receivables, net	27,743		19,823		22,108
Other accounts receivables	2,450		2,980		4,524
Inventories	44,601		47,646		42,016
Total Current Assets	179,347		175,120		177,914
Non-Current Assets
Property, plant and equipment, net	25,665		24,574		25,679
Right-of-use-assets	3,453		3,796		3,440
Other long term assets	3,413		1,058		1,573
Contract assets	4,472		911		2,059
Deferred taxes	-		632		-
Total Non-Current Assets	37,003		30,971		32,751
Total Assets	\$ 216,350	\$	206,091	\$	210,665
Liabilities
Current Liabilities
Current maturities of bank loans	\$ 61	\$	431	\$	238
Current maturities of lease liabilities	1,149		990		1,072
Trade payables	17,948		22,760		16,110
Other accounts payables	6,989		5,497		7,547
Deferred revenues	-		589		-
Total Current Liabilities	26,147		30,267		24,967
Non-Current Liabilities
Bank loans	5		63		36
Lease liabilities	3,401		3,704		3,593
Deferred revenues	3,025		1,025		2,025
Employee benefit liabilities, net	1,429		1,267		1,406
Total Non-Current Liabilities	7,860		6,059		7,060
Shareholder's Equity Ordinary shares	11,716		11,662		11,706
Additional paid in capital	209,942		207,731		209,760
Capital reserve due to translation to presentation currency	(3,490)		(3,490)		(3,490)
Capital reserve from hedges	58		411		357
Capital reserve from share-based payments	4,746		6,204		4,558
Capital reserve from employee benefits	(320)		(356)		(320)
Accumulated deficit	(40,309)		(52,397)		(43,933)
Total Shareholder's Equity
	182,343		169,765		178,638
Total Liabilities and Shareholder's Equity	\$ 216,350	\$	206,091	\$	210,665

The accompanying Notes are an integral part of the Consolidated Financial Statements.

CONSOLIDATED STATEMENTS OF PROFIT OR LOSS AND OTHER COMPREHENSIVE INCOME

	Six months period ended June 30,		Three months period ended June 30,	Year ended December 31,
	2021	2020	2021	2020	2020
	Unaudited		Unaudited		Audited
			U.S Dollars In thousands
Revenues from proprietary products	\$ 40,193	\$ 47,942	\$ 19,323	\$ 22,625	\$ 100,916
Revenues from distribution	8,946	18,437	4,916	10,464	32,330
Total revenues	49,139	66,379	24,239	33,089	133,246
Cost of revenues from proprietary products	23,527	27,881	11,059	12,934	57,750
Cost of revenues from distribution	7,609	15,932	4,108	9,040	27,944
Total cost of revenues	31,136	43,813	15,167	21,974	85,694
Gross profit	18,003	22,566	9,072	11,115	47,552
Research and development expenses	5,364	6,970	2,736	3,623	13,609
Selling and marketing expenses	2,547	2,118	1,424	1,178	4,518
General and administrative expenses	6,112	4,619	3,303	2,307	10,139
Other expenses	570	34	563	32	49
Operating income	3,410	8,825	1,046	3,975	19,237
Financial income	209	615	99	298	1,027
Income (expense) in respect of securities measured at fair value, net *	-	102	-	-	102
Income (expenses) in respect of currency exchange
differences and derivatives instruments, net	121	65	(145)	(367)	(1,535)
Financial expenses	(116)	(135)	(63)	(58)	(266)
Income before tax on income	3,624	9,472	937	3,848	18,565
Taxes on income	-	796	-	390	1,425
Net Income	\$ 3,624	\$ 8,676	\$ 937	\$ 3,458	\$ 17,140
Other Comprehensive Income (loss) : Amounts that will be or that have been reclassified to profit or loss when specific conditions are met
Gain (loss) from securities measured at fair value through
other comprehensive income	-	(188)	-	-	(188)
Gain (loss) on cash flow hedges	(43)	441	30	200	876
Net amounts transferred to the statement of profit or loss for cash flow hedges	(256)	(7)	(2)	(41)	(528)
Items that will not be reclassified to profit or loss in subsequent periods:
Remeasurement gain (loss) from defined benefit plan	-	-	-	-	64
Tax effect	-	15	-	(12)	19
Total comprehensive income	\$ 3,325	\$ 8,937	\$ 965	\$ 3,605	\$ 17,383
Earnings per share attributable to equity holders of the Company:
Basic net earnings per share	\$ 0.08	\$ 0.20	\$ 0.02	\$ 0.10	\$ 0.39
Diluted net earnings per share	\$ 0.08	\$ 0.20	\$ 0.02	\$ 0.10	\$ 0.38

The accompanying Notes are an integral part of the Consolidated Financial Statements.

	Share capital	Additional paid in capital	Capital reserve due to translation to presentation currency		Capital reserve from hedges		Capital reserve from sharebased payments		Capital reserve from employee benefits		Accumulated deficit		Total equity
Balance as of January 1, 2021 (audited)	\$ 11,706	\$ 209,760	\$	(3,490)	\$	357	\$	4,558	\$	(320)	\$	(43,933)	\$ 178,638
Net income	-	-		-		-		-		-		3,624	3,624
Other comprehensive income (loss) Tax effect	- -	- -		- -		(299) -		- -		- -		- -	(299) -
Total comprehensive income (loss)	-	-		-		(299)		-		-		3,624	3,325
Exercise and forfeiture of share-based payment into shares	10	182		-		-		(182)		-		-	10
Cost of share based payment	-	-		-		-		370		-		-	370
Balance as of June 30, 2021	\$ 11,716	\$ 209,942	\$	(3,490)	\$	58	\$	4,746	\$	(320)	\$	(40,309)	\$ 182,343

The accompanying Notes are an integral part of the Consolidated Financial Statements.

	Share capital	Additional paid in capital		Capital reserve from securities measured at fair value through other comprehensive income			Capital reserve due to translation to presentation currency	Capital reserve from hedges Unaudited U.S Dollars in thousands		Capital reserve from sharebased payments		Capital reserve from employee benefits	Accumulated deficit	Total equity
Balance as of January 1, 2020 (audited) \$	10,425 \$		180,819 \$		145 \$		(3,490) \$		8 \$		8,844 \$	(359) \$	(61,073) \$	135,319
Net income	-		-		-		-		-		-	-	8,676	8,676
Other comprehensive income (loss)	-		-		(188)		-		434		-	-	-	246
Taxes effect	-		-		43		-		(31)		-	3	-	15
Total comprehensive income (loss)	-		-		(145)		-		403		-	3	8,676	8,937
Issuance of ordinary shares	1,217		23,684		-		-		-		-	-	-	24,901
Exercise and forfeiture of share-based payment into shares	20		3,228		-		-		-		(3,228)	-	-	20
Cost of share based payment	-		-		-		-		-		588	-	-	588
Balance as of June 30, 2020	\$ 11,662 \$		207,731 \$			- \$	(3,490) \$		411 \$		6,204 \$	(356) \$	(52,397) \$	169,765

The accompanying Notes are an integral part of the Consolidated Financial Statements.

	Share capital	Additional paid in capital	Capital reserve due to translation to presentation currency	Capital reserve from hedges	Capital reserve from sharebased payments	Capital reserve from employee benefits	Accumulated deficit	Total equity
Balance as of April 1, 2021 (audited)	\$ 11,713	\$ 209,859	(3,490) \$	\$ 30	\$ 4,674	(320) \$	(41,246) \$	\$ 181,220
Net income	-	-	-	-	-	-	937	937
Other comprehensive income (loss)	-	-	-	28	-	-	-	28
Taxes effect	-	-	-	-	-	-	-	-
Total comprehensive income (loss)	-	-	-	28	-	-	937	965
Exercise and forfeiture of share-based payment into shares	3	83	-	-	(83)	-	-	3
Cost of share-based payment	-	-	-	-	155	-	-	155
Balance as of June 30, 2021	\$ 11,716	\$ 209,942	(3,490) \$	\$ 58	\$ 4,746	(320) \$	(40,309) \$	\$ 182,343
	Share capital	Additional paid in capital	Capital reserve due to translation to presentation currency	Capital reserve from hedges	Capital reserve from sharebased payments	Capital reserve from employee benefits	Accumulated deficit	Total equity
Balance as of April 1, 2020 Net income	\$ 11,647 -	\$ 204,702 -	\$ (3,490) -	264 -	\$ 8,903 -	\$ (356) -	\$ (55,855) 3,458	\$ 165,815 3,458
Other comprehensive income	-	-	-	159	-	-	-	159
Taxes effect	-	-	-	(12)	-	-	-	(12)
Total comprehensive income (loss)	-	-	-	147	-	-	3,458	3,605
Exercise into shares and forfeiture of share-based payment	15	3,029	-	-	(3,029)	-		15
Cost of share-based payment	-	-	-	-	330	-	-	330
Balance as of June 30, 2020	\$ 11,662	\$ 207,731	(3,490) \$	\$ 411	\$ 6,204	(356) \$	(52,397) \$	\$ 169,765

	Share capital	Additional paid in capital	Capital reserve from securities measured at fair value through other comprehensive income	Capital reserve due to translation Capital to reserve presentation from currency hedges Unaudited In thousands		Capital reserve from sharebased payments		Capital reserve from employee benefits		Accumulated deficit		Total equity
Balance as of
January 1, 2020 (audited) \$ Net income	10,425 -	\$ 180,819 -	\$ 145 -	\$ (3,490) \$ -		8 -	\$	8,844 -	\$	(359) \$ -		(61,073) \$ 17,140		135,319 17,140
Other comprehensive income (loss)	-	-	(188)	-		348		-		64		-		224
Tax effect	-	-	43	-		1		-		(25)		-		19
Total comprehensive income (loss)	-	-	(145)	-		349		-		39		17,140		17,383
Issuance of ordinary shares	1,217	23,678	-	-		-		-		-		-		24,895
Exercise and forfeiture of share-based payment into shares	64	5,263	-	-		-		(5,263)		-		-		64
Cost of share based payment	-	-	-	-		-		977		-		-		977
Balance as of December 31, 2020	\$ 11,706	\$ 209,760	\$ -	\$ (3,490) \$		357	\$	4,558	\$	(320) \$		(43,933) \$		178,638

The accompanying Notes are an integral part of the Consolidated Financial Statements.

CONSOLIDATED STATEMENTS OF CASH FLOWS

	Six months period Ended June, 30 2021					Three months period Ended June, 30			Year Ended December 31,
				2020	2021			2020	2020
				Unaudited					Audited
						U.S Dollars In thousands
Cash Flows from Operating Activities
Net income	\$	3,624	\$	8,676	\$	937	\$	3,458	\$ 17,140
Adjustments to reconcile net income to net cash provided by (used in) operating activities:
Adjustments to the profit or loss items:
Depreciation and impairment		2,372		2,380		1,225		1,188	4,897
Financial expenses (income), net		(214)		(647)		109		127	672
Cost of share-based payment		370		588		155		330	977
Taxes on income		-		796		-		390	1,425
Loss (gain) from sale of property and equipment		-		(6)		-		(6)	(7)
Change in employee benefit liabilities, net		23		(2)		60		16	201
		2,551		3,109		1,549		2,045	8,165
Changes in asset and liability items:
Decrease (increase) in trade receivables, net		(5,646)		3,416		(7,231)		6,432	1,332
Decrease (increase) in other accounts receivables		1,629		741		1,643		(772)	115
Increase in inventories		(2,401)		(4,473)		(3,446)		(5,859)	1,157
Decrease (increase) in deferred expenses		(2,362)		(911)		(1,209)		(490)	(3,085)
Increase (decrease) in trade payables		1,139		(2,719)		2,623		4,497	(9,560)
Increase (decrease) in other accounts payables		(799)		(314)		1,346		866	1,736
Decrease in deferred revenues		1,000		793		500		396	1,204
		(7,440)		(3,467)		(5,774)		5,070	(7,101)
Cash received (paid) during the period for:
Interest paid		(107)		(107)		(59)		(52)	(209)
Interest received		217		601		76		150	1,211
Taxes paid		(23)		(74)		(9)		(13)	(101)
		87		420		8		85	901
Net cash provided by operating activities	\$	(1,178)	\$	8,738	\$	(3,280)	\$	10,658	\$ 19,105

The accompanying Notes are an integral part of the Consolidated Financial Statements.

CONSOLIDATED STATEMENTS OF CASH FLOWS

	Six months period Ended June, 30				Three months period Ended June, 30	Year Ended December 31,
		2021		2020	2021	2020	2020
				Unaudited			Audited
Cash Flows from Investing Activities					U.S Dollars In thousands
Proceeds of investment in short term investments, net	\$	2,967	\$	(15,646)	\$ 11,967	\$ -	\$ (7,646)
Purchase of property and equipment and intangible assets		(1,463)		(1,901)	(1,332)	(1,005)	(5,488)
Proceeds from sale of property and equipment		-		6	-	6	7
Acquisition of subsidiary (LLC), net (1)		(1,404)		-	-		-
Net cash used in investing activities		100		(17,541)	10,635	(999)	(13,127)
Cash Flows from Financing Activities
Proceeds from exercise of share base payments		10		20	3	15	64
Repayment of lease liabilities		(595)		(540)	(306)	(262)	(1,103)
Repayment of long-term loans		(206)		(247)	(85)	(124)	(492)
Proceeds from issuance of ordinary shares, net		-		24,895	-	-	24,895
Net cash provided by (used in) financing activities		(791)		24,128	(388)	(371)	23,364
Exchange differences on balances of cash and cash equivalent		88		(588)	13	(1,177)	(1,807)
Increase in cash and cash equivalents		(1,781)		14,737	6,980	8,111	27,535
Cash and cash equivalents at the beginning of the period		70,197		42,662	61,436	49,288	42,662
Cash and cash equivalents at the end of the period	\$	68,416	\$	57,399	\$ 68,416	\$ 57,399	\$ 70,197
Significant non-cash transactions
Right-of-use asset recognized with corresponding lease
liability	\$	588	\$	345	\$ 286	\$ 287	\$ 539
Purchase of property and equipment	\$	748	\$	722	\$ 748	\$ 722	\$ 722
							Six months period Ended June, 30
Appendix A (1)							2021
Acquisition of a subsidiary that was first consolidated
Current Assets (exclusive of cash and cash equivalents)							(184)
Non Current Assets							(1,460)
Current Liabilities							240
							(1,404)

The accompanying Notes are an integral part of the Consolidated Financial Statements.

Note 1: General

Kamada Ltd. (the "Company") is a global specialty plasma-derived biopharmaceutical company with a diverse portfolio of marketed products, a robust development pipeline and industry-leading manufacturing capabilities. The Company's strategy is focused on driving profitable growth from its current commercial products, its plasma-derived development pipeline and its manufacturing expertise, while evolving into a vertically integrated plasma-derived company. The Company's two leading commercial products are GLASSIA® and KEDRRAB®. GLASSIA was the first liquid, ready-to-use, intravenous plasma-derived AAT product approved by the FDA. The Company markets GLASSIA in the U.S. through a strategic partnership with Takeda Pharmaceuticals Company Limited ("Takeda") and in other countries through local distributors. Pursuant to an agreement with Takeda, the Company will continue to produce GLASSIA for Takeda through 2021 and Takeda will initiate its own production of GLASSIA for the U.S. market in 2021, at which point Takeda will commence payment of royalties to the Company until 2040. KEDRAB is an FDA approved anti-rabies immune globulin (Human) for post-exposure prophylaxis treatment. KEDRAB is being marketed in the U.S. through a strategic partnership with Kedrion S.p.A. The Company has additional four plasma-derived products administered by injection or infusion, that are marketed through distributors in more than 15 countries, including Israel, Russia, Brazil, Argentina, India and other countries in Latin America and Asia. The Company has two leading development programs; an inhaled AAT for the treatment of AAT deficiency for which the Company is currently conducting the InnovAATe clinical trial, a randomized, double-blind, placebo-controlled, pivotal Phase 3 trial and a plasma-derived hyperimmune immunoglobulin (IgG) product as a potential treatment for coronavirus disease (COVID-19). The Company leverages its expertise and presence in the Israeli pharmaceutical market to distribute in Israel more than 20 products that are manufactured by third parties and have recently added nine biosimilar products to its Israeli distribution portfolio, which, subject to EMA and the Israeli MOH approvals, are expected to be launched in Israel between the years 2022 and 2025.

Pursuant to the agreement with Takeda (as detailed on Note 17 of the Company's annual financial statements as of December 31, 2020) the Company continues to produce Glassia for Takeda through 2021. Takeda will complete the technology transfer of Glassia and will initiate its own production of Glassia for the U.S. market in 2021. Accordingly, following the transition of manufacturing to Takeda, the Company will terminate the manufacturing and sale of Glassia to Takeda resulting in a significant reduction in revenues. Pursuant to the agreement, upon initiation of sales of Glassia manufactured by Takeda, Takeda will pay royalties to the Company at a rate of 12% on net sales through August 2025, and at a rate of 6% thereafter until 2040, with a minimum of \$5 million annually, for each of the years from 2022 to 2040. See note 3c below regarding a recent amendment to the agreement with Takeda.

These financial statements have been prepared in a condensed format as of June 30, 2021 and for the three months then ended ("interim consolidated financial statements").

These financial statements should be read in conjunction with the Company's annual financial statements as of December 31, 2020 and for the year then ended and the accompanying notes ("annual consolidated financial statements").

Note 2: Significant Accounting Policies

a. Basis of preparation of the interim consolidated financial statements:

The interim consolidated financial statements have been prepared in accordance with generally accepted accounting principles for the preparation of financial statements for interim periods, as prescribed in IAS 34, "Interim Financial Reporting".

b. Implementation of new accounting standards:

The accounting policy applied in the preparation of the interim consolidated financial statements is consistent with that applied in the preparation of the annual consolidated financial statements, except for the following:

i. Amendments to IFRS 9, IFRS 7, IFRS 16, IFRS 4 and IAS 39 regarding the IBOR reform:

In August 2020, the IASB issued amendments to IFRS 9, "Financial Instruments", IFRS 7, "Financial Instruments: Disclosures", IAS 39, "Financial Instruments: Recognition and Measurement", IFRS 4, "Insurance Contracts", and IFRS 16, "Leases" (the "Amendments").

The Amendments provide practical expedients when accounting for the effects of the replacement of benchmark InterBank Offered Rates (IBORs) by alternative Risk Free Interest Rates (RFRs).

Pursuant to one of the practical expedients, an entity will treat contractual changes or changes to cash flows that are directly required by the reform as changes to a floating interest rate. That is, an entity recognizes the changes in interest rates as an adjustment of the effective interest rate without adjusting the carrying amount of the financial instrument. The use of this practical expedient is subject to the condition that the transition from IBOR to RFR takes place on an economically equivalent basis.

In addition, the Amendments permit changes required by the IBOR reform to be made to hedge designations and hedge documentation without the hedging relationship being discontinued, provided certain conditions are met. The Amendments also provide temporary relief from having to meet the "separately identifiable" requirement according to which a risk component must also be separately identifiable to be eligible for hedge accounting.

The Amendments include new disclosure requirements in connection with the expected effect of the reform on an entity's financial statements, such as how the entity is managing the process to transition to the interest rate reform, the risks to which it is exposed due to the reform and quantitative information about IBOR-referenced financial instruments that are expected to change.

The Amendments are effective for annual periods beginning on or after January 1, 2021. The Amendments are to be applied retrospectively. However, restatement of comparative periods is not required. Early application is permitted.

The adoption of the Amendment does not have an effect on the Company's financial statements.

Note 2: Significant Accounting Policies (continued)

b. Implementation of new accounting standards (continued):

ii. Amendment to IAS 1, Presentation of Financial Statements: Classification of Liabilities as Current or Non-Current

In January 2020, the IASB issued an amendment to IAS 1, "Presentation of Financial Statements" (the "IAS 1 Amendment ") regarding the criteria for determining the classification of liabilities as current or non-current. The IAS 1 Amendment replaces certain requirements for classifying liabilities as current or non-current. Thus for example, according to the IAS 1 Amendment, a liability will be classified as noncurrent when the entity has the right to defer settlement for at least 12 months after the reporting period, and it "has substance" and is in existence at the end of the reporting period, this instead of the requirement that there be an "unconditional" right. According to the IAS1 Amendment, a right is in existence at the reporting date only if the entity complies with conditions for deferring settlement at that date. Furthermore, the IAS 1 Amendment clarifies that the conversion option of a liability will affect its classification as current or non-current, other than when the conversion option is recognized as equity.

The IAS 1Amendment is effective for reporting periods beginning on or after January 1, 2023 with earlier application being permitted. The IAS1 Amendment is applicable retrospectively, including an amendment to comparative data.

The Company has not yet commenced examining the effects of applying the IAS 1 Amendment on the financial statements.

iii. Amendment to IAS 37, Provisions, Contingent Liabilities and Contingent Assets

In May 2020, the IASB issued an amendment to IAS 37, regarding which costs a company should include when assessing whether a contract is onerous (the "IAS 37 Amendment"). According to the IAS 37 Amendment, when assessing whether a contract is onerous, the costs of fulfilling a contract that should be taken into consideration are costs that relate directly to the contract, which include as follows:

• Incremental costs; and
• An allocation of other costs that relate directly to fulfilling a contract (such as depreciation expenses for fixed assets used in fulfilling that contract and other contracts).

The IAS 37 Amendment is effective retrospectively for annual periods beginning on or after January 1, 2022, in respect of contracts where the entity has not yet fulfilled all its obligations. Early application is permitted. Upon application of the Amendment, the entity will not restate comparative data, but will adjust the opening balance of retained earnings at the date of initial application, by the amount of the cumulative effect of the Amendment.

The Company has not yet commenced examining the effects of the IAS 37 Amendment on the financial statements.

iv. Amendment to IAS 16, Property, Plant and Equipment

In May 2020, the IASB issued an amendment to IAS 16, "Property, Plant and Equipment" (the "IAS 16 Amendment") The Amendment annuls the requirement by which in the calculation of costs directly attributable to fixed assets, the net proceeds from selling certain items that were produced while the Company tested the functioning of the asset should be deducted (such as samples that were produced when testing the equipment). Instead, such proceeds shall be recognized in profit or loss according to the relevant standards and the cost of the sold items will be measured according to the measurement requirements of IAS 2, Inventories.

The IAS 16 Amendment is effective for annual periods beginning on or after January 1, 2022. Early application is permitted. The IAS 16 Amendment shall be applied on a retrospective basis, including an amendment of comparative data, only with respect to fixed asset items that have been brought to the location and condition required for them to operate in the manner intended by management subsequent to the earliest reporting period presented at the date of initial application of the IAS 16 Amendment. The cumulative effect of the Amendment will adjust the opening balance of retained earnings for the earliest reporting period presented.

The Company has not yet commenced examining the effects of the Amendment on the financial statements.

Note 3: Significant events in the reportimg period

a. Effects of the COVID-19 Pandemic Outbreak:

Following the global COVID-19 outbreak, there has been a decrease in economic activity worldwide, including Israel. The spread of the COVID-19 pandemic led, inter alia, to a disruption in the global supply chain, a decrease in global transportation, restrictions on travel and work that were announced by the State of Israel and other countries worldwide as well as a decrease in the value of financial assets and commodities across all markets in Israel and the world.

The Company's business activity and commercial operation were affected by these factors, and the Company has taken several actions to ensure its manufacturing plant remains operational with limited disruption to its business continuity. The Company continues to maintain higher inventory levels of raw materials through its suppliers and service providers to appropriately manage any potential supply disruptions and secure continued manufacturing. In addition, the Company is actively engaging its freight carriers to ensure inbound and outbound international delivery routes remain operational and identify alternative routes, if needed.

The Company is complying with the State of Israel mandates and recommendations with respect to its work-force management and has taken several precautionary health and safety measures to safeguard its employees and continues to monitor and assess orders issued by the State of Israel and other applicable governments to ensure compliance with evolving COVID-19 guidelines.

While COVID-19 related disruption continues to have various effect on the Company's business activities, commercial operation, revenues and operational expenses, as a results of the actions taken by the Company to date, its overall results of operations were not materially affected however, a number of factors, including but not limited to, continued effect of the factors mentioned above as well as, continued demand for the Company's products, including GLASSIA and KEDRAB, in the U.S. market and its distributed products in Israel, financial conditions of the Company's customer, suppliers and services providers, the Company's ability to manage operating expenses, additional competition in the markets that the Company competes, regulatory delays, prevailing market conditions and the impact of general economic, industry or political conditions in the U.S., Israel or otherwise, may have an effect on the Company's future financial position and results of operations.

The financial impact of these factors cannot be reasonably estimated at this time due to substantial uncertainty but may materially affect our business, financial condition and results of operations. The Company assess the impact of the COVID-19 pandemic in a number of possible scenarios and concluded that there are no uncertainties that may cast significant doubt on its ability to continue as a going concern or affect significantly on the Company liquidity.

Note 3: Significant events in the reportimg period (continued)

b. Acquisition of an FDA-Licensed Plasma Collection Center:

On March 31, 2021 the Company acquired the plasma collection center and certain related rights and assets from the privately-held B&PR of Beaumont, TX, USA. The plasma collection facility primarily specializes in the collection of hyper-immune plasma used for the Anti-D immunoglobulin, which is manufactured by the Company and distributed in international markets. The acquisition was consummated through Kamada Plasma LLC, a newly formed wholly owned subsidiary of the Company, which will operate the Company's plasma collection activity in the U.S.

In consideration for the assets acquired, the Company committed to a pay a total amount of \$1,654 thousands, of which \$ 1,404 thousands was paid at the closing of the acquisition, and the balance in the amount of \$250 thousands will be paid on March 31, 2022.

The Company incurred acquisition-related costs of \$140 thousand related mainly to legal and other consulting fees. These costs were recorded in general and administrative expenses in the statement of profit and loss during 2020 and the first quarter of 2021.

Identifiable assets acquired and liabilities assumed:

	U.S Dollars in thousands
Inventories	\$	184
Intangible assets (1)		1,378
Property, plant and equipment, net		82
Total acquired assets		1,644
Assumed liabilities		(240)
Net identifiable assets	\$	1,404

(1) The fair value of intangible assets (FDA-License for plasma collection and goodwill) has been determined provisionally pending completion of an independent valuation. If new information is obtained within one year from the acquisition date about facts and circumstances that existed at the acquisition date, the Company will retrospectively adjust the relevant amounts that were recognized at the time of the acquisition.

c. Amendment to GLASSIA® License Agreement with Takeda:

On March 31, 2021, the Company entered into an amendment to the Technology License Agreement with Takeda with respect to GLASSIA. Pursuant to the amendment, upon completion of the transition of GLASSIA manufacturing to Takeda, expected by the end of 2021, the Company will transfer to Takeda the GLASSIA U.S. Biologics License Application (BLA). In consideration for the BLA transfer, the Company will receive a \$2,000 thousand payment from Takeda. In addition, the terms of the final sales-based milestone of \$5,000 thousand due to Kamada under the license agreement were amended. As a result of such amendment the Company recognized the \$5,000 thousand milestone as a revenue during the first quarter of 2021.

d. Worforce Downsizing:

As a result of the transition of GLASSIA manufacturing to Takeda, Kamada initiated during the second quarter of 2021 a workforce downsizing program which is expected to continue through the beginning of the third quarter of 2021. During the second quarter of 2021 the Company accounted for \$550 thousand of costs associated with termination benefits which were recorded as a one-time expense in the other operating expenses.

Note 4: Operating Segments

a. General:

The company has two operating segments, as follows:

Proprietary Products - Development, manufacturing, sales and distribution of plasma-derived protein therapeutics.

Distribution - Distribute imported drug products in Israel, which are manufactured by third parties.

b. Reporting on operating segments:

	Six months period ended June 30, 2021
		Proprietary
	Products		Distribution			Total
				U.S Dollars in thousands
	Unaudited
Revenues	\$	40,193	\$	8,946	\$	49,139
Gross profit	\$	16,666	\$	1,337	\$	18,003
Unallocated corporate expenses						(14,593)
Finance income, net						214
Income before taxes on income					\$	3,624

Note 4: Operating Segments (continued)

b. Reporting on operating segments: (continued)

		Six months period ended June 30, 2020
		Proprietary
		Products		Distribution				Total
		U.S Dollars in thousands
		Unaudited
Revenues	\$	47,942	\$	18,437	\$	66,379
Gross profit	\$	20,061	\$	2,505	\$	22,566
Unallocated corporate expenses						(13,741)
Finance income, net						647
Income before taxes on income					\$	9,472

Three months period ended June 30, 2021
	Products						Total
U.S Dollars in thousands
\$	19,323	\$	4,916	\$	24,239
\$	8,264	\$	808	\$	9,072
					(8,026)
					(109)
				\$	937
		Proprietary		Distribution Unaudited

Note 4: Operating Segments (continued)

b. Reporting on operating segments (continued):

		Three months period ended June 30, 2020
		Proprietary
		Products				Distribution		Total
		U.S Dollars in thousands
		Unaudited
Revenues	\$	22,625	\$	10,464	\$	33,089
Gross profit	\$	9,691	\$	1,424	\$	11,115
Unallocated corporate expenses						(7,140)
Finance expenses, net						(127)
Income before taxes on income					\$	3,848

	Year Ended December 31, 2020
	Proprietary
	Products		Distribution			Total
	U.S Dollars in thousands
	Audited
Revenues
	\$	100,916	\$	32,330	\$	133,246
Gross profit	\$	43,166	\$	4,386	\$	47,552
Unallocated corporate expenses						(28,315)
Finance expenses, net						(672)
Income before taxes on income					\$	18,565

Note 4: Operating Segments (continues)

c. Reporting on operating segments by geographic region:

	Six months period ended June 30, 2021
		Proprietary Products	Distribution		Total
			Unaudited
Geographical markets
U.S.A and North America	\$	26,556	-	\$	26,576
Israel		5,588	8,946		14,534
Europe		3,394	-		3,394
Latin America		3,603	-		3,603
Asia		1,019	-		1,019
Others		33	-		33
	\$	40,193	\$ 8,946	\$	49,139

	Six months period ended June 30, 2020
	Proprietary Products		Distribution			Total
	U.S Dollars in thousands
	Unaudited
Geographical markets
U.S.A and North America	\$	40,460	\$	-	\$	40,460
Israel		2,005		18,437		20,442
Europe		3,287		-		3,287
Latin America		1,873		-		1,873
Asia		296		-		296
Others		21		-		21
	\$	47,942	\$	18,437	\$	66,379

	Three months period ended June 30, 2021
	Proprietary Products	Distribution		Total
	U.S Dollars in thousands
		Unaudited
Geographical markets
U.S.A and North America.	\$ 12,672		\$	12,672
Israel	3,602	4,916		8,518
Europe	967			967
Latin America	1,428			1,428
Asia	640			640
Others	14			14
	\$ 19,323	\$ 4,916	\$	24,239

Note 4: Operating Segments (continued)

c. Reporting on operating segments by geographic region (continued):

	Three months period ended June 30, 2020
	Proprietary Products Distribution					Total
	U.S Dollars in thousands
				Unaudited
Geographical markets
U.S.A and North America	\$	17,256	\$	-	\$	17,256
Israel		1,417		10,464		11,881
Europe		2,733		-		2,733
Latin America		1,015		-		1,015
Asia		183		-		183
Others		21		-		21
	\$	22,625	\$	10,464	\$	33,089

	Year ended December 31, 2020
	Proprietary Products		Distribution		Total
	U.S Dollars in thousands
			Audited
Geographical markets
U.S.A and North America	\$ 84,949	\$	-	\$	84,949
Israel	3,814		32,330		36,144
Europe	4,461		-		4,461
Latin America	6,867		-		6,867
Asia	766		-		766
Others	59		-		59
	\$ 100,916	\$	32,330	\$	133,246

Note 5: Financial Instruments

a. Classification of financial instruments by fair value hierarchy:

Financial assets (liabilities) measured at fair value

	Level 1	Level 2
	U.S Dollars in thousands
June 30, 2021
Derivatives instruments	\$ -	\$ 23
June 30, 2020
Derivatives instruments	\$ -	\$ 560
December 31, 2020
Derivatives instruments	\$ -	\$ 448

During the three months ended on June 30, 2021 there were no transfers due to the fair value measurement of any financial instrument from Level 1 to Level 2, and furthermore, there were no transfers to or from Level 3 due to the fair value measurement of any financial instrument.

20

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Adjusted EBITDA

	Six months period ended June 30,		Three months period ended June 30,				Year ended December 31,
	2021		2020		2021		2020		2020
					In thousands
Net income	\$ 3,624	\$	8,676	\$	937	\$	3,458	\$	17,140
Taxes on income	-		796		-		390		1,425
Financial expense (income), net	(214)		(647)		109		127		692
Depreciation and amortization expense	2,372		2,380		1,225		1,188		4,897
Non-cash share-based compensation expenses	370		588		155		330		977
Adjusted EBITDA	\$ 6,152	\$	11,793	\$	2,426	\$	5,493	\$	25,131

Adjusted net income

	Six months period ended June 30,		Three months period ended June 30,				Year ended December 31,
	2021		2020		2021		2020		2020
					In thousands
Net income	\$ 3,624	\$	8,676	\$	937	\$	3,458	\$	17,140
Share-based compensation charges	370		588		155		330		977
Adjusted net income	\$ 3,994	\$	9,264	\$	1,092	\$	3,788	\$	18,117