News | News By Subject | News by Disease News By Date | Search News
Get Our FREE
Industry eNewsletter
email:    
   

Patheon (PTI.TO) Reports Fiscal 2012 First Quarter Results


3/12/2012 9:24:40 AM

Company transformation activities on track

TORONTO, March 9, 2012 /PRNewswire/ - Patheon Inc. (TSX: PTI), a leading provider of contract development and manufacturing services to the global pharmaceutical industry, announced today fiscal 2012 first quarter results. Quarterly results include:

  • Revenues of $153.9 million versus $175.7 million in the first quarter of last year. Excluding the $32.9 million impact of the reservation fee and accelerated deferred revenue associated with the termination of a manufacturing supply agreement in the first quarter of the fiscal year ended October 31, 2011, revenues increased by 7.8 percent.
  • Operating loss of $20.9 million, which includes $6.4 million in consulting fees, compared to operating income of $13.5 million in the first quarter of last year, a decrease of $34.4 million. Excluding the impact of the prior year termination of a manufacturing supply agreement, the decrease would have been $1.5 million.
  • Loss before discontinued operations of $19.3 million compared to income before discontinued operations of $3.7 million in the same period last year. This decrease was primarily driven by the after tax impact of the reservation fee and accelerated deferred revenue associated with the termination of a manufacturing and supply agreement recorded in the first quarter of fiscal 2011 and $6.4 million of consulting fees.
  • Adjusted EBITDA of $(9.2) million compared to $28.7 million in the same period last year, a decrease of $37.9 million. Excluding the impact of the prior year termination of the manufacturing supply agreement, the decrease would have been $5.0 million, primarily due to $6.4 million in consulting fees.

In commenting on Patheon's results, James C. Mullen, Patheon's Chief Executive Officer said, "Our first quarter of fiscal 2012 demonstrates that our underlying business has improved. The transformation activities are on track as we continue to improve efficiencies and productivity at the site level and in our general and administrative, pricing and procurement functions. In the second half of our fiscal year, consulting costs related to implementing our transformation program should decline and we anticipate recognizing real cost savings from our initiatives. Top line growth together with improved performance should deliver improved financial results in the future."

Fiscal 2012 First Quarter Operating Results from Continuing Operations
Revenues for the three months ended January 31, 2012 decreased $21.8 million to $153.9 million, from $175.7 million for the comparable period in fiscal 2011. Excluding currency fluctuations, revenues for the three months ended January 31, 2012 would have been approximately 11.8 percent lower than the same period of prior year. The decline was primarily due to the reservation fee and accelerated deferred revenue associated with the termination of a manufacturing supply agreement in the first quarter of fiscal 2011, the impact of which was $32.9 million.

Gross profit for the three months ended January 31, 2012 decreased $27.8 million to $14.4 million, from $42.2 million for the comparable period in fiscal 2011. The decrease in gross profit was primarily due to lower revenue and unfavorable mix, partially offset by lower accelerated depreciation in Puerto Rico.

Selling, general and administrative expenses for the three months ended January 31, 2012 increased $6.7 million to $34.5 million, from $27.8 million for the comparable period in fiscal 2011. The increase was primarily due to higher consulting fees related to our transformation activities and higher compensation expense.

Operating (loss) income for the three months ended January 31, 2012 decreased $34.4 million to a loss of $20.9 million (-13.6 percent of revenues), from income of $13.5 million (7.7 percent of revenues) for the first quarter of fiscal 2011, as a result of the factors discussed above.

As of January 31, 2012, the company was holding cash and cash equivalents of $32.5 million and had undrawn lines of credit available of $93.8 million.

Fiscal 2012 First Quarter Highlights of Business Segment Results

Commercial Manufacturing - Total CMO revenues for the three months ended January 31, 2012 decreased $25.9 million to $122.8 million, from $148.7 million for the comparable period in 2011. Had local currency exchange rates remained constant to the rates of the three months ended January 31, 2011, CMO revenues for the period would have been approximately 16.8 percent lower than the same period of prior year. Excluding the $32.9 million impact from the termination of the previously mentioned manufacturing supply agreement, total CMO revenues for the quarter would have increased $7.0 million, or 6.0 percent from the same period of prior year.

Total CMO Adjusted EBITDA for the three months ended January 31, 2012 decreased $37.2 million to negative Adjusted EBITDA of $1.6 million, from $35.6 million for the comparable period in 2011. The decrease was driven by the lower revenue, as discussed above, unfavorable mix and $3.2 million in consulting fees.

Pharmaceutical Development Services ("PDS") - Total PDS revenues for the three months ended January 31, 2012 increased by $4.1 million to $31.1 million, from $27.0 million for the comparable period in 2011. Had the local currency rates remained constant to the three months ended January 31, 2011, PDS revenues in the quarter would have been 15.6 percent higher than the same period of prior year. Higher development activities from new contracts across most sites contributed to the improved performance.

Total PDS Adjusted EBITDA for the three months ended January 31, 2012 increased by $1.3 million to $3.9 million, from $2.6 million for the comparable period in 2011. Improved revenues contributed to the higher Adjusted EBITDA.

Corporate - Corporate costs for the three months ended January 31, 2012 increased $2.0 million to $11.5 million, from $9.5 million for the comparable period last year primarily due to higher consulting fees.

Conference Call

Patheon will host a conference call and Web cast today (March 9, 2012) at 10:00 a.m. (EST). Interested parties are invited to access the conference call, via telephone, toll free at 1-888-231-8191 (U.S., including Puerto Rico) and 1-647-427-7452 (Canada and International). To view the slides accompanying the conference call click here. The link to the Web cast will also be posted on the investor relations section of Patheon's Web site prior to the call. Participants are encouraged to dial in five to fifteen minutes in advance to avoid delays. A live audio will also be available via the web at http://ir.patheon.com/events.cfm. (Please note that either Windows Media Player or RealPlayer are required).

A telephone replay of the conference call will be available between March 9, 2012 and March 16, 2012 by dialing 1-855-859-2056(toll free) or 1-403-451-9481, and by entering identification number 55107868, followed by the number key. The conference call will also be archived at http://ir.patheon.com/events.cfm.

About Patheon

Patheon Inc. (TSX: PTI) is a leading global provider of contract development and manufacturing services to the global pharmaceutical industry. The company provides the highest quality products and services to approximately 300 of the world's leading pharmaceutical and biotechnology companies. Its services range from preclinical development through commercial manufacturing of a full array of dosage forms including parenteral, soft gel, solid and liquid forms.

The company's comprehensive range of fully integrated Pharmaceutical Development Services includes pre-formulation, formulation, analytical development, clinical manufacturing, scale-up and commercialization. The company's integrated development and manufacturing network of 10 manufacturing facilities, nine development centers and one clinical trial material packaging facility across North America and Europe, enables customer products to be launched with confidence anywhere in the world.


Read at BioSpace.com

comments powered by Disqus
   

ADD TO DEL.ICIO.US    ADD TO DIGG    ADD TO FURL    ADD TO STUMBLEUPON    ADD TO TECHNORATI FAVORITES