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DUBLIN(BUSINESS WIRE)
Elan Corporation, plc today reported its second quarter and first half
2012 financial results.
Progress continued during the course of the second quarter,? said Mr.
Kelly Martin, chief executive officer. Underlying strength in the
Tysabri business was driven by continued adoption of the assay on a
global basis, which established the clinical framework to enable
additional net new patients to be added to Tysabri.?
We continue to invest time, capital and talent on neuroscience.
Advancement in the field across systems biology, computational
chemistry, companion diagnostics, biomarkers and their utilization, as
well as genetics, provides the ingredients for significant success and
patient therapeutic choice in the years ahead.?
Mr. Nigel Clerkin, chief financial officer, said, We continue to see
strong growth in demand for Tysabri. There are now over 69,000 patients
on therapy, an increase of 13% since the end of June 2011. Total
revenues grew by 6% in the second quarter of 2012 over the second
quarter of 2011, reflecting this increase in patient numbers, offset by
the impact of a revenue reserve against sales of Tysabri in Italy, as
well as the impact of foreign currency movements, including an 11%
decline in the dollar-euro exchange rate. Our net loss from continuing
operations was reduced by almost 40%, to $28.5 million in the second
quarter of 2012, from $47.0 million in the second quarter of 2011,
demonstrating the benefit of the lower interest expense following the
substantial debt reduction completed in the fourth quarter of 2011.?
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Unaudited Consolidated U.S. GAAP Income Statement Data
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Three Months Ended
June 30
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Six Months Ended
June 30
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2011
US$m
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2012
US$m
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2011
US$m
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2012
US$m
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270.6
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288.0
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Revenue (see page 8)
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517.7
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576.4
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144.9
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160.2
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Cost of goods sold
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276.3
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315.5
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125.7
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127.8
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Gross margin
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241.4
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260.9
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|
|
|
|
|
|
|
|
|
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Operating Expenses (see page 11)
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|
|
|
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50.3
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60.6
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Selling, general and administrative
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98.1
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120.7
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|
50.9
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49.2
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Research and development
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98.5
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98.2
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2.3
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(0.1)
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Other net charges/(gains) (see page 13)
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4.6
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1.9
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103.5
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109.7
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Total operating expenses
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201.2
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|
220.8
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22.2
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18.1
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Operating income
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40.2
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40.1
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|
|
|
|
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|
|
|
|
|
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Net Interest and Investment Gains and Losses
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|
|
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29.7
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12.4
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Net interest expense
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59.5
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29.2
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(0.2)
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Net loss/(gain) on disposal of equity method investments
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13.1
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39.1
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34.3
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Net loss on equity method investments (see page 13)
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51.6
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57.4
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(2.3)
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Net investment gains
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(2.3)
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66.5
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46.5
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Net interest and investment gains
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108.8
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99.7
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(44.3)
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(28.4)
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Net loss from continuing operations before tax
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(68.6)
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(59.6)
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2.7
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0.1
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Provision for income taxes
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6.1
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0.7
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(47.0)
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(28.5)
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Net loss from continuing operations
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(74.7)
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(60.3)
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|
|
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|
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Discontinued Operations
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(0.1)
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Net income/(loss) from discontinued operations, net of tax (see page
14)
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95.8
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(47.1)
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(28.5)
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Net income/(loss)
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21.1
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(60.3)
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(0.08)
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(0.05)
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Basic net loss per ordinary share - continuing operations
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(0.13)
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(0.10)
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Basic net income/(loss) per ordinary share discontinued operations
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0.16
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586.9
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591.8
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Basic weighted average number of ordinary shares outstanding (in
millions) continuing and discontinued operations
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586.4
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591.3
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(0.08)
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(0.05)
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Diluted net loss per ordinary share - continuing operations
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(0.13)
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(0.10)
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Diluted net income per ordinary share discontinued operations
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0.16
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586.9
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591.8
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Diluted weighted average number of ordinary shares outstanding (in
millions) continuing operations
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586.4
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591.3
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592.7
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Diluted weighted average number of ordinary shares outstanding (in
millions) discontinued operations
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591.4
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Unaudited Non-GAAP Financial Information Adjusted EBITDA
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Three Months Ended
June 30
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Non-GAAP Financial Information
Reconciliation Schedule
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Six Months Ended
June 30
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2011
US$m
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2012
US$m
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2011
US$m
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2012
US$m
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(47.0)
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(28.5)
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Net loss from continuing operations
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(74.7)
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(60.3)
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29.7
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12.4
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Net interest expense
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59.5
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29.2
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2.7
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0.1
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Provision for income taxes
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6.1
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0.7
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7.3
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6.7
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Depreciation and amortization
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14.5
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13.4
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(0.4)
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Amortized fees
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(0.3)
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(0.1)
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(7.7)
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(9.3)
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EBITDA from continuing operations
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5.1
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(17.1)
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6.5
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10.6
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Share-based compensation
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14.2
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26.3
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2.3
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(0.1)
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Other net charges/(gains)
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4.6
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1.9
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39.1
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34.3
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Net loss on equity method investments
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51.6
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57.4
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(0.2)
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Net loss/(gain) on disposal of equity method investment
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13.1
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(2.3)
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Net investment gains
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(2.3)
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37.9
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35.3
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Adjusted EBITDA from continuing operations
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73.2
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81.6
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To supplement its consolidated financial statements presented on a
U.S. GAAP basis, Elan provides readers with Adjusted EBITDA from
continuing operations, a non-GAAP measure of operating results. Adjusted
EBITDA from continuing operations is defined as net loss from continuing
operations plus or minus net interest expense, provision for income
taxes, depreciation and amortization of costs and revenue, share-based
compensation, other net charges and gains, net loss on equity method
investments, net loss or gain on disposal of equity method investment
and net investment gains. Adjusted EBITDA from continuing operations is
not presented as, and should not be considered an alternative measure of
operating results or cash flows from operations, as determined in
accordance with U.S. GAAP. Elan's management uses Adjusted EBITDA from
continuing operations to evaluate the operating performance of Elan and
its business and this measure is among the factors considered as a basis
for Elan's planning and forecasting for future periods. Elan believes
Adjusted EBITDA from continuing operations is a measure of performance
used by some investors, equity analysts and others to make informed
investment decisions. Adjusted EBITDA from continuing operations is used
as analytical indicator of income generated to service debt and to fund
capital expenditures. Adjusted EBITDA from continuing operations does
not give effect to cash used for interest payments related to debt
service requirements and does not reflect funds available for investment
in the business of Elan or for other discretionary purposes. Adjusted
EBITDA from continuing operations, as defined by Elan and presented in
this press release, may not be comparable to similarly titled measures
reported by other companies. A reconciliation of Adjusted EBITDA from
continuing operations to net loss from continuing operations is set out
in the table above titled, Non-GAAP Financial Information
Reconciliation Schedule?. A reconciliation of Adjusted EBITDA from
discontinued operations to net income from discontinued operations for
the three and six months ended June 30, 2011 is set out in Appendix II.
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Unaudited Consolidated U.S. GAAP Balance Sheet Data
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December 31
2011
US$m
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June 30
2012
US$m
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Assets
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Current Assets
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Cash and cash equivalents
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271.7
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626.4
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Restricted cash and cash equivalents current
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2.6
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2.6
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Investment securities current
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0.3
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131.9
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Deferred tax assets current
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26.2
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25.8
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Other current assets
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217.2
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222.6
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Total current assets
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518.0
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1,009.3
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Non-Current Assets
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Intangible assets, net
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309.9
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303.7
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Property, plant and equipment, net
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83.2
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80.3
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Equity method investments
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675.8
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146.4
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Investment securities non-current
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9.8
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10.2
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Deferred tax assets non-current
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118.9
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119.0
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Restricted cash and cash equivalents non-current
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13.7
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13.7
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Other assets
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24.5
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21.8
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Total Assets
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1,753.8
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1,704.4
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Liabilities and Shareholders Equity
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Accounts payable, accrued and other liabilities
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337.0
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307.0
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Long-term debt
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615.0
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615.8
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Shareholders equity
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801.8
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781.6
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Total Liabilities and Shareholders Equity
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1,753.8
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1,704.4
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Movement in Shareholders Equity
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Three Months ended June 30,
2012
US$m
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Six Months ended June 30,
2012
US$m
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808.2
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Opening shareholders equity
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801.8
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(28.5)
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Net loss for the period
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(60.3)
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10.7
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Share-based compensation
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26.4
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3.6
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Issuance of share capital
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8.6
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(12.4)
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Increase/(decrease) in net unrealized gain on investment securities
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5.1
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781.6
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Closing shareholders equity
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781.6
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Unaudited Consolidated U.S. GAAP Cash Flow Data
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Three Months Ended
June 30
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Six Months Ended
June 30
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2011
US$m
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2012
US$m
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2011
US$m
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2012
US$m
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|
|
|
|
|
|
|
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59.7(1)
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35.3
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Adjusted EBITDA
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123.0(1)
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81.6
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(30.5)
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(13.8)
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Net interest and tax
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(60.4)
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(28.5)
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(12.1)
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(0.1)
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Other net charges
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(142.7)(2)
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(1.5)
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(1.4)
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(2.3)
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Working capital increase
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(29.4)
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(38.5)
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15.7
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19.1
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Cash flows provided by/(used in) operating activities
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(109.5)
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13.1
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(4.7)
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(1.5)
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Net purchases of tangible and intangible assets
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(11.1)
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(6.0)
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2.5
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(0.2)
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Net proceeds from sale/(purchase) of investments
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2.1
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(0.4)
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(20.0)
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Purchase of equity method investment
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(20.0)
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|
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0.2
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Net proceeds from sale of equity method investment
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|
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381.1
|
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|
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(48.7)
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Funding provided to equity method investment
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|
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(48.7)
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|
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7.0
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Receipt of deferred consideration
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|
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7.0
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1.2
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3.6
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Cash flows from financing activities
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2.4
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8.6
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(0.1)
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|
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Restricted cash and cash equivalents movement
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205.5(2)
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|
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(5.4)
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(20.5)
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Net cash movement
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69.4
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354.7
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|
497.3
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646.9
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Beginning cash balance
|
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422.5
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271.7
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|
491.9
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626.4
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Cash and cash equivalents at end of period
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491.9
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626.4
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(1) Includes Adjusted EBITDA from discontinued operations
of $21.8 million for the three months ended June 30, 2011 and $49.8
million for the six months ended June 30, 2011. A reconciliation of
Adjusted EBITDA from discontinued operations to net income/(loss) from
discontinued operations for the three and six months ended June 30, 2011
is set out in Appendix II.
(2) Other charges includes the settlement reserve charge
outflow of $206.3 million related to the Zonegran settlement that was
paid in March 2011. The restricted cash and cash equivalents movement
includes the $203.7 million that was held in escrow in relation to this
settlement.
Overview
Operating Results
Quarter 2, 2012
Total revenue for the second quarter of 2012 increased by 6% to
$288.0 million from $270.6 million for the same period of 2011. Tysabri
global in-market net sales grew by 2% to $395.5 million in the second
quarter of 2012, from $389.0 million in the second quarter of 2011. This
reflects a 16% growth in U.S. in-market net sa
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