ANI Pharmaceuticals Reports Record Full Year Results, Reports Fourth Quarter 2017 Results, and Provides 2018 Guidance

Published: Feb 27, 2018

BAUDETTE, Minn., Feb. 27, 2018 /PRNewswire/ --

 

For the full year ended December 31, 2017:

  • Record net revenues of $176.8 million, an increase of 37% versus 2016
  • GAAP net loss of $1.1 million, including a $13.4 million charge due to the Tax Cuts and Jobs Act
  • Diluted GAAP loss per share of $0.09, including $1.16 impact of charge due to the Tax Cuts and Jobs Act
  • Adjusted non-GAAP EBITDA of $74.2 million
  • Adjusted non-GAAP diluted earnings per share of $3.91

For the fourth quarter 2017:

  • Net revenues of $47.3 million, an increase of 24% as compared to the same period in 2016
  • GAAP net loss of $9.6 million, including impact of $13.4 million charge due to the Tax Cuts and Jobs Act
  • Diluted GAAP loss per share of $0.83, including $1.16 impact of charge due to the Tax Cuts and Jobs Act
  • Adjusted non-GAAP EBITDA of $19.7 million
  • Adjusted non-GAAP diluted earnings per share of $1.08

Guidance for 2018:

  • Net revenues of $212 million to $228 million
  • Adjusted non-GAAP EBITDA of $90 million to $100 million
  • Adjusted non-GAAP diluted earnings per share of $5.43 to $6.08

 

ANI Pharmaceuticals, Inc. ("ANI") (NASDAQ: ANIP) today reported its financial results for the three and twelve months ended December 31, 2017, and provided its 2018 financial guidance. The Company will host its earnings conference call this morning, February 27, 2018, at 10:30 AM ET. Investors and other interested parties can join the call by dialing (866) 776-8875. The conference ID is 9773589.

Financial Summary

    (in thousands,
     except per
     share data)                                  Q4 2017          Q4 2016               2017      2016
                                                  -------          -------               ----      ----

    Net revenues                                           $47,286           $38,205   $176,842  $128,622

    Net
     (loss)/income                                        $(9,629)         $(1,080)  $(1,076)   $3,934

    GAAP
     (loss)/earnings
     per diluted
     share                                                 $(0.83)          $(0.09)   $(0.09)    $0.34

    Adjusted non-
     GAAP
     EBITDA(a)                                             $19,672           $17,933    $74,175   $61,112

    Adjusted non-
     GAAP diluted
     earnings per
     share(b)                                                $1.08             $0.90      $3.91     $2.96


    (a) See Table 3 for U.S. GAAP reconciliation.

    (b) See Table 4 for U.S. GAAP reconciliation.

Arthur S. Przybyl, President and CEO, stated,

"2017 was a record year for ANI, with revenues, adjusted non-GAAP EBITDA, and adjusted non-GAAP diluted earnings per share increasing 37%, 21%, and 32%, respectively, as compared to 2016. These increases are the result of the continued strength of our base business and six product launches in 2017, including four generic products and two brands, InnoPran XL® and Inderal® XL.

In December 2017, we continued to execute the strategic plan to grow our commercial portfolio by acquiring the NDAs and U.S. product rights for Atacand®, Atacand HCT®, Arimidex® and Casodex® - all products that can be manufactured at our containment facility in Baudette Minnesota. Since becoming a public company in 2013, ANI has deployed nearly $300M in product acquisitions to help build our current portfolio of commercial and pipeline products. We will continue to evaluate opportunities to expand the business throughout 2018.

Notably, we continue to work toward the development and subsequent commercialization of two branded pipeline products, Vancocin® oral solution and Cortrophin® gel.

Our Cortrophin® gel re-commercialization project continues to advance in line with internal timelines. Our team achieved important milestones in 2017, including the establishment of commercial relationships for our supply chain including raw material, API manufacture and finished dose manufacture. Successes in API manufacturing, analytical method development and process characterization allow ANI to advance manufacturing of commercial scale API and the registration batch in 2018.

Since going public in June 2013, we have focused on increasing our revenue and adjusted non-GAAP EBITDA through new product introductions, as evidenced in the table below showing our revenue and adjusted non-GAAP EBITDA growth from 2013 to our 2018 guidance, as well as the number of ANI's commercial products at the end of each year. The compound annual growth rates from 2013 to 2017 for net revenue and adjusted non-GAAP EBITDA are 56% and 77%, respectively."

    (in millions, except product
     data)                         Net         Adjusted non-     Number of
                                 Revenue      GAAP EBITDA(c)      Products
                                 -------       -------------      --------

    Actual Results:
    ---------------

    2013                                  $30                 $8            7

    2014                                  $56                $27           10

    2015                                  $76                $43           16

    2016                                 $129                $61           25

    2017                                 $177                $74           31

    Mid-point of 2018 Guidance:
    ---------------------------

    2018                                 $220                $95

    (c) See Tables 3 and 6 for U.S.
     GAAP reconciliation.

2018 Financial Guidance

For the twelve months ending December 31, 2018, ANI is providing guidance on net revenue, adjusted non-GAAP EBITDA and adjusted non-GAAP diluted earnings per share. The following table summarizes 2018 guidance as compared to 2017 actual results:

    (in
     millions,
     except
     per
     share
     data
     and
     percentages)          2017 2018 Guidance                 % Increase
                  Actual                                  from Prior Year
                  ------                                  ---------------

    Net
     revenues            $176.8              $212 to $228                 20% to 29%

     Adjusted
     non-
     GAAP
     EBITDA               $74.2               $90 to $100                 21% to 35%

     Adjusted
     non-
     GAAP
     diluted
     earnings
     per
     share                $3.91            $5.43 to $6.08                 39% to 55%

ANI's 2018 financial guidance reflects management's current assumptions regarding customer relationships, product pricing, prescription trends, competition, inventory levels, cost of sales, operating costs, timing of research and development spend, taxes, and the anticipated timing of future product launches and other key events. 2018 guidance includes:

  • revenues and expenses related to our December 29, 2017 acquisition of the NDAs and U.S. product rights for Atacand®, Atacand HCT®, Arimidex® and Casodex®;
  • continued growth in Research and Development spending driven by increased investment in our Cortrophin® Gel Re-Commercialization program. The above guidance ranges include approximately $14.0 million to $16.0 million of total ANI Research and Development expense as compared to $9.1 million incurred in 2017;
  • continued select investment in Selling, General, and Administrative expenses to support the continued growth of our business and brands;
  • a combined federal and state effective income tax rate of 23%; and
  • approximately 11.7 million shares of fully diluted common stock outstanding.

Effect of Tax Reform and Capital Allocation

The recently enacted Tax Cuts and Jobs Act will significantly enhance ANI's ability to invest in value generating opportunities and continue to leverage its wholly U.S. based manufacturing and research and development footprint.

  • Lower marginal tax rate: combined federal and state marginal tax rate will decrease from approximately 37% to 23%.
  • Improved cash flow: favorable impact of reduced cash tax burden in 2018 will approximate $10 to $13 million.
  • Strong capital position: ANI believes that this benefit, coupled with its existing cash balance of $31.1 million as of December 31, 2017, forecast cash flow from operating activities, and access to $50 million under its revolving credit facility will place it in a strong position to pursue business development activities in the coming year.
  • Continued internal investment: ANI plans to invest approximately $7 million in capital projects during 2018 in support of its operations and employees in Baudette, Minnesota. This is in addition to the $10.4 million invested during the course of 2017.

Cortrophin® Gel Re-commercialization Update

In the fourth quarter of 2017, ANI has continued to advance the manufacture of Corticotropin active pharmaceutical ingredient ("API"), now successfully manufacturing three intermediate scale batches of API. All three intermediate scale batches of API exhibit lot-to-lot consistency across many different chemical and biological test methods that we continue to employ in building our comprehensive characterization package. These methods are also being utilized to successfully demonstrate comparability to historically manufactured commercial lots of API. ANI has ordered the capital equipment necessary for commercial scale API manufacturing and soon plans to qualify this equipment for cGMP commercial scale manufacturing. We plan to initiate commercial scale API manufacturing in early 2018 and hope to initiate process validation and registration batch manufacturing by the end of 2018.

ANI executed a long-term commercial supply agreement with its existing Corticotropin API manufacturer and has now secured the long-term supply for both Corticotropin API and for the finished goods - Cortrophin® gel drug product. We have begun to manufacture development scale batches of Cortrophin® gel in the fourth quarter of 2017, whereby the Cortrophin® gel batches are using the API from our recently manufactured intermediate scale batches.

ANI requested a Type C meeting with the FDA in the fourth quarter of 2017 to provide the regulatory plan for re-commercialization of Cortrophin® gel. The FDA granted the Type C meeting with an FDA response scheduled to occur by the end of the first quarter of 2018.

For further details, please see ANI's Cortrophin® Gel Re-commercialization Milestone Update in Table 5.

Vancocin® Oral Solution Update

ANI is currently advancing a commercialization effort for Vancocin® oral solution. Following completion of ongoing formulation and manufacturing optimization, ANI intends to file a prior approval supplement ("PAS") in the second half of 2018. This product will be manufactured at ANI's site in Baudette, MN. The launch of this product will fulfill a currently unmet patient need for an FDA approved liquid oral dosage form of the vancomycin molecule. This product will compete in a market that currently exceeds $450 million annually. When launched, ANI estimates that Vancocin® oral solution could achieve peak sales potential of $50 million.

Fourth Quarter Results

    Net Revenues     Three Months Ended
                        December 31,
    (in thousands)

                    2017                2016  Change % Change
                    ----                ----  ------ --------

    Generic
     pharmaceutical
     products                $29,829         $29,296            $533     2%

    Branded
     pharmaceutical
     products                 15,521           6,524           8,997   138%

    Contract
     manufacturing             1,895           1,560             335    21%

    Contract
     services and
     other income                 41             825           (784) (95)%
                                 ---             ---            ----   ----

    Total net
     revenues                $47,286         $38,205          $9,081    24%
                             =======         =======          ======

For the three months ended December 31, 2017, ANI reported net revenues of $47.3 million, an increase of 24% from $38.2 million in the prior year period, due to the following factors:

  • Revenues from sales of generic pharmaceuticals increased slightly to $29.8 million from $29.3 million in the prior period, primarily due to increased unit sales of Flecainide and Methazolamide, as well as 2017 product launches, partially offset by decreased sales of EEMT due to market contraction and decreased sales of Propranolol ER due to lower prices.
  • Revenues from sales of branded pharmaceuticals increased 138%, to $15.5 million from $6.5 million in the prior period, primarily due to sales of Inderal® XL and InnoPran XL®, both of which were launched in Q1 2017, as well as increased sales of Inderal® LA and other branded products.
  • Contract manufacturing revenue increased by 21% to $1.9 million from $1.6 million in the prior year period, primarily as a result of the timing and volume of customer orders.
  • Contract services and other income decreased by 95%, to $41 thousand from $0.8 million, primarily due to lack of the $0.6 million royalty payment related to a license for patent rights received in 2016.

Operating expenses increased to $39.9 million for the three months ended December 31, 2017, from $36.9 million in the prior year period. The increase was primarily due to a $3.5 million increase in cost of sales as compared with the prior period, as a result of $2.9 million of cost of sales related to the net inventory step-up on Inderal® XL and InnoPran XL® inventory, higher sales of products sold with profit-sharing arrangements, and increased volume. In addition, research and development increased by $2.5 million as compared with the prior period, primarily due to work on the Cortrophin® gel re-commercialization and Vancocin® oral solution projects.

Excluding the $2.9 million of net inventory step-up costs related to sales of Inderal® XL and InnoPran XL® in the fourth quarter of 2017 and the $2.8 million of net inventory step-up costs related to sales of Inderal® LA and Propranolol ER in the fourth quarter of 2016, cost of sales remained relatively consistent at 37% of net revenues.

Net loss was $9.6 million for the three months ended December 31, 2017, as compared to net loss of $1.1 million in the prior year period. The net loss was primarily due to a $13.4 million charge recorded as a result of the re-measurement of our net deferred tax assets in relation to the tax rate decrease established in the Tax Cuts and Jobs Act, which was enacted on December 22, 2017. Changes in tax rates and tax laws are accounted for in the period of enactment, therefore the charge was recorded in the three months ended December 31, 2017. The effective tax rate for the three months ended December 31, 2017 was 321%, 308% of which related to the charge from the Tax Cuts and Jobs Act.

Diluted loss per share for the three months ended December 31, 2017 was $0.83, based on 11,560 thousand diluted shares outstanding and including a $1.16 of impact from the charge related to the Tax Cuts and Jobs Act, as compared to diluted loss per share of $0.09 in the prior year period. Adjusted non-GAAP diluted earnings per share was $1.08, as compared to adjusted non-GAAP diluted earnings per share of $0.90 in the prior year period. For a reconciliation of adjusted non-GAAP diluted earnings per share to the most directly comparable GAAP financial measure, please see Table 4.

Results for Year Ended December 31, 2017

    Net Revenues          Year Ended
                         December 31,
    (in thousands)

                    2017              2016  Change  % Change
                    ----              ----  ------  --------

    Generic
     pharmaceutical
     products                $118,437       $95,201          $23,236    24%

    Branded
     pharmaceutical
     products                  50,919        26,443           24,476    93%

    Contract
     manufacturing              7,046         5,537            1,509    27%

    Contract
     services and
     other income                 440         1,441          (1,001) (70)%
                                  ---         -----           ------   ----

    Total net
     revenues                $176,842      $128,622          $48,220    37%
                             ========      ========          =======

For the year ended December 31, 2017, ANI reported net revenues of $176.8 million, an increase of 37% from $128.6 million in the prior year period, due to the following factors:

  • Revenues from sales of generic pharmaceuticals increased 24%, to $118.4 million from $95.2 million in the prior period, primarily due to annualization of sales of the generic products launched during 2016, as well as 2017 product launches.
  • Revenues from sales of branded pharmaceuticals increased 93%, to $50.9 million from $26.4 million in the prior period, primarily due to sales of Inderal® XL and InnoPran XL®, both of which were launched in Q1 2017, as well as increased sales of Inderal® LA, which launched in Q2 2016.
  • Contract manufacturing revenue increased by 27% to $7.0 million from $5.5 million in the prior year period, primarily as a result of the timing and volume of customer orders.
  • Contract services and other income decreased by 70%, to $0.4 million from $1.4 million, primarily due to lack of the $0.6 million royalty payment related to a license for patent rights received in 2016, and also because sales of Fenofibrate in the ANI label have replaced the royalties previously received on the product.

Operating expenses increased to $148.5 million for the year ended December 31, 2017, from $108.5 million in the prior year period. The increase was primarily due to a $30.3 million increase in cost of sales as compared with the prior period, as a result of higher sales of products sold with profit-sharing arrangements, increased volume, and $10.4 million of cost of sales related to the inventory step-up on Inderal® XL, InnoPran XL®, and Inderal® LA inventory. In addition, research and development increased by $6.2 million as compared with the prior period, primarily due to work on the Cortrophin® gel re-commercialization and Vancocin® oral solution projects.

Excluding the $10.4 million of net inventory step-up costs related to sales of Inderal® XL, InnoPran XL®, and Inderal® LA in the year ended December 31, 2017 and $5.9 million of net inventory step-up costs related to sales of Inderal® LA and Propranolol ER in the year ended December 31, 2016, cost of sales increased as a percentage of net revenues to 39% from 33%, primarily as a result of increased sales of products with profit-sharing arrangements.

Net loss was $1.1 million for the year ended December 31, 2017, as compared to net income of $3.9 million in the prior year period. The net loss was primarily due to a $13.4 million charge recorded as a result of the re-measurement of our net deferred tax assets in relation to the tax rate decrease established in the Tax Cuts and Jobs Act, which was enacted on December 22, 2017. Changes in tax rates and tax laws are accounted for in the period of enactment, therefore the charge was recorded in the year ended December 31, 2017. The effective tax rate for the year ended December 31, 2017 was 107%, 82% of which related to the charge from the Tax Cuts and Jobs Act.

Diluted loss per share for the year ended December 31, 2017 was $0.09, based on 11,547 thousand diluted shares outstanding and including a $1.16 of impact from the charge related to the Tax Cuts and Jobs Act, as compared to diluted earnings per share of $0.34 in the prior year period. Adjusted non-GAAP diluted earnings per share was $3.91, as compared to adjusted non-GAAP diluted earnings per share of $2.96 in the prior year period. For a reconciliation of adjusted non-GAAP diluted earnings per share to the most directly comparable GAAP financial measure, please see Table 4.

Selected Balance Sheet Data

(in thousands)

                        December 31, 2017          December 31, 2016
                        -----------------          -----------------

    Cash                                   $31,144                    $27,365

    Accounts
     receivable, net                       $58,788                    $45,895

    Inventory, net                         $37,727                    $26,183

    Current assets                        $131,605                   $103,007

    Current liabilities                    $39,228                    $31,948

    Non-current debt                      $198,154                   $120,643

ANI generated $39.4 million of cash flow from operations in the year ended December 31, 2017. In February 2017, ANI purchased from Cranford Pharmaceuticals, LLC a distribution license, trademark, and certain finished goods inventory for Inderal® XL for $20.2 million in cash, using cash on hand. In February 2017, ANI purchased from Holmdel Pharmaceuticals, LP the NDA, trademark, and certain finished goods inventory for InnoPran XL®, including a license to an Orange Book listed patent, for $30.6 million in cash. ANI made the $30.6 million cash payment using $30.0 million of funds from its line of credit and $0.6 million of cash on hand. In December 2017, ANI purchased from AstraZeneca AB and AstraZeneca UK Limited the right, title, and interest in the NDAs and the U.S. rights to market Atacand®, Atacand HCT®, Arimidex®, and Casodex®, for $46.5 million in cash. ANI made the $46.5 million cash payment with funds from a $75.0 million five-year term loan entered into with Citizens Bank N.A. in December 2017. The funds from the term loan were also used to pay down the $25.0 million remaining balance on the line of credit.

ANI Product Development Pipeline

ANI's pipeline consists of 74 products, addressing a total annual market size of $3.1 billion, based on data from IMS Health. Of these 74 products, 51 were acquired and of these acquired products, ANI expects that 44 can be commercialized based on either CBE-30s or prior approval supplements filed with the FDA.

Non-GAAP Financial Measures

The Company's fiscal 2018 guidance for adjusted non-GAAP EBITDA and adjusted non-GAAP diluted earnings per share is not reconciled to the most comparable GAAP measure. This is due to the inherent difficulty of forecasting the timing or amount of items that would be included in a reconciliation to the most directly comparable forward-looking GAAP financial measures. Because a reconciliation is not available without unreasonable effort, it is not included in this release.

Adjusted non-GAAP EBITDA

ANI's management considers adjusted non-GAAP EBITDA to be an important financial indicator of ANI's operating performance, providing investors and analysts with a useful measure of operating results unaffected by non-cash stock-based compensation and differences in capital structures, tax structures, capital investment cycles, ages of related assets, and compensation structures among otherwise comparable companies. Management uses adjusted non-GAAP EBITDA when analyzing Company performance.

Adjusted non-GAAP EBITDA is defined as net income/(loss), excluding tax expense, interest expense, depreciation, amortization, the excess of fair value over cost of acquired inventory, stock-based compensation expense, costs related to major transactions not consummated, and other income / expense. Adjusted non-GAAP EBITDA should be considered in addition to, but not in lieu of, net income or loss reported under GAAP. A reconciliation of adjusted non-GAAP EBITDA to the most directly comparable GAAP financial measure is provided in Table 3.

Adjusted non-GAAP Net Income

ANI's management considers adjusted non-GAAP net income to be an important financial indicator of ANI's operating performance, providing investors and analysts with a useful measure of operating results unaffected by purchase accounting adjustments, non-cash stock-based compensation, non-cash interest expense, depreciation and amortization, and non-cash impairment charges. Management uses adjusted non-GAAP net income when analyzing Company performance.

Adjusted non-GAAP net income is defined as net income/(loss), plus the excess of fair value over cost of acquired inventory, stock-based compensation expense, costs related to major transactions not consummated, non-cash interest expense, depreciation and amortization expense, and non-cash impairment charges, less the tax impact of these adjustments calculated using an estimated statutory tax rate. Management will continually analyze this metric and may include additional adjustments in the calculation in order to provide further understanding of ANI's results. Adjusted non-GAAP net income should be considered in addition to, but not in lieu of, net income reported under GAAP. A reconciliation of adjusted non-GAAP net income to the most directly comparable GAAP financial measure is provided in Table 4.

Adjusted non-GAAP Diluted Earnings per Share

ANI's management considers adjusted non-GAAP diluted earnings per share to be an important financial indicator of ANI's operating performance, providing investors and analysts with a useful measure of operating results unaffected by purchase accounting adjustments, non-cash stock-based compensation, non-cash interest expense, depreciation and amortization, and non-cash impairment charges.

Management uses adjusted non-GAAP diluted earnings per share when analyzing Company performance.

Adjusted non-GAAP diluted earnings per share is defined as adjusted non-GAAP net income, as defined above, divided by the diluted weighted average shares outstanding during the period. Management will continually analyze this metric and may include additional adjustments in the calculation in order to provide further understanding of ANI's results. Adjusted non-GAAP diluted earnings per share should be considered in addition to, but not in lieu of, diluted earnings or loss per share reported under GAAP. A reconciliation of adjusted non-GAAP diluted earnings per share to the most directly comparable GAAP financial measure is provided in Table 4.

About ANI

ANI Pharmaceuticals, Inc. (the "Company" or "ANI") is an integrated specialty pharmaceutical company developing, manufacturing, and marketing high quality branded and generic prescription pharmaceuticals. The Company's targeted areas of product development currently include controlled substances, oncolytics (anti-cancers), hormones and steroids, and complex formulations involving extended release and combination products. For more information, please visit the Company's website www.anipharmaceuticals.com.

Forward-Looking Statements

To the extent any statements made in this release deal with information that is not historical, these are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Such statements include, but are not limited to, statements about price increases, the Company's future operations, products financial position, operating results and prospects, the Company's pipeline or potential markets therefor, and other statements that are not historical in nature, particularly those that utilize terminology such as "anticipates," "will," "expects," "plans," "potential," "future," "believes," "intends," "continue," other words of similar meaning, derivations of such words and the use of future dates.

Uncertainties and risks may cause the Company's actual results to be materially different than those expressed in or implied by such forward-looking statements. Uncertainties and risks include, but are not limited to, the risk that the Company may face with respect to importing raw materials; increased competition; acquisitions; contract manufacturing arrangements; delays or failure in obtaining product approvals from the U.S. Food and Drug Administration; general business and economic conditions; market trends; regulatory environment; products development; regulatory and other approvals; and marketing.

More detailed information on these and additional factors that could affect the Company's actual results are described in the Company's filings with the Securities and Exchange Commission, including its most recent Annual Report on Form 10-K and quarterly reports on Form 10-Q, as well as its proxy statement. All forward-looking statements in this news release speak only as of the date of this news release and are based on the Company's current beliefs, assumptions, and expectations. The Company undertakes no obligation to update or revise any forward-looking statement, whether as a result of new information, future events or otherwise.

For more information about ANI, please contact:
Investor Relations
IR@anipharmaceuticals.com

 

                                                                          ANI Pharmaceuticals, Inc. and Subsidiaries

                                                                               Table 1: US GAAP Income Statement

                                                                      (unaudited, in thousands, except per share amounts)



                                           Three Months Ended December 31,                          Year Ended December 31,

                                                                        2017                                                  2016       2017        2016
                                                                        ----                                                  ----       ----        ----


    Net Revenues                                                     $47,286                                               $38,205   $176,842    $128,622


    Operating Expenses

     Cost of sales (excl. depreciation and
      amortization)                                                   20,446                                                16,906     79,032      48,780

    Research and development                                           2,651                                                   135      9,070       2,906

    Selling, general, and administrative                               8,885                                                 7,369     31,580      27,829

    Depreciation and amortization                                      7,022                                                 5,812     27,928      22,343

    Intangible asset impairment charge                                   903                                                 6,685        903       6,685


       Total Operating Expenses                                       39,907                                                36,907    148,513     108,543


         Operating Income                                              7,379                                                 1,298     28,329      20,079


    Other Expense, Net

       Interest expense, net                                         (3,026)                                              (2,859)  (12,035)   (11,327)

       Other (expense)/income, net                                       (3)                                                 (43)        55        (74)


    Income/(Loss) Before (Provision)/
     Benefit for Income Taxes                                          4,350                                               (1,604)    16,349       8,678


    (Provision)/Benefit for Income Taxes                            (13,979)                                                  524   (17,425)    (4,744)


    Net (Loss)/Income                                               $(9,629)                                             $(1,080)  $(1,076)     $3,934


    (Loss)/Earnings Per Share

    Basic (Loss)/Earnings Per Share                                  $(0.83)                                              $(0.09)   $(0.09)      $0.34

    Diluted (Loss)/Earnings Per Share                                $(0.83)                                              $(0.09)   $(0.09)      $0.34


    Basic Weighted-Average Shares
     Outstanding                                                      11,560                                                11,516     11,547      11,445

    Diluted Weighted-Average Shares
     Outstanding                                                      11,560                                                11,516     11,547      11,573

 

                                                      ANI Pharmaceuticals, Inc. and Subsidiaries

                                                            Table 2: US GAAP Balance Sheets

                                                                    (in thousands)



                                                                                 December 31,             December 31,
                                                                                                     2017                   2016
                                                                                                     ----                   ----

    Current Assets

        Cash and cash equivalents                                                                 $31,144                $27,365

        Accounts receivable, net                                                                   58,788                 45,895

        Inventories, net                                                                           37,727                 26,183

        Prepaid income taxes                                                                        1,162                      -

        Prepaid expenses and other
         current assets                                                                             2,784                  3,564


            Total Current Assets                                                                  131,605                103,007


    Property and equipment, net                                                                    20,403                 10,998

    Restricted cash                                                                                 5,006                  5,002

    Deferred tax asset, net of
     valuation allowance                                                                           22,667                 26,227

    Intangible assets, net                                                                        229,790                175,792

    Goodwill                                                                                        1,838                  1,838

    Other long-term assets                                                                            829                      -


           Total Assets                                                                          $412,138               $322,864


    Current Liabilities

        Accounts payable                                                                           $3,630                 $3,389

        Accrued expenses and other                                                                  1,571                    927

        Accrued royalties                                                                          12,164                 11,956

        Accrued compensation and
         related expenses                                                                           2,306                  1,631

        Current income taxes payable                                                                    -                 2,398

        Accrued government rebates                                                                  7,930                  5,891

        Returned goods reserve                                                                      8,274                  5,756

        Current component of long-term borrowing, net
         of deferred financing costs                                                             3,353                      -


            Total Current Liabilities                                                              39,228                 31,948


        Long-term royalties                                                                             -                   625

        Long-term borrowing, net of deferred
         financing costs and current borrowing
         component                                                                              69,946                      -

        Convertible notes, net of discount and
         deferred financing costs                                                               128,208                120,643


           Total Liabilities                                                                      237,382                153,216


    Stockholders' Equity

    Common stock                                                                                        1                      1

    Treasury stock                                                                                  (259)                     -

    Additional paid-in capital                                                                    179,020                172,563

    Accumulated deficit                                                                           (4,006)               (2,916)


           Total Stockholders' Equity                                                             174,756                169,648


           Total Liabilities and
            Stockholders' Equity                                                                 $412,138               $322,864

 

                                                                                   ANI Pharmaceuticals, Inc. and Subsidiaries

                                                              Table 3: Adjusted non-GAAP EBITDA Calculation and US GAAP to Non-GAAP Reconciliation

                                                                                            (unaudited, in thousands)



                                                Three Months Ended December 31,                          Year Ended December 31,

                                                                             2017                                                  2016                  2017      2016
                                                                             ----                                                  ----                  ----      ----


       Net (Loss)/Income                                                 $(9,629)                                             $(1,080)             $(1,076)   $3,934


    Add back

       Interest expense, net                                                3,026                                                 2,859                12,035    11,327

       Other income/(expense), net                                              3                                                    43                  (55)       74

       Provision/(benefit) for
        income taxes                                                       13,979                                                 (524)               17,425     4,744

       Depreciation and
        amortization                                                        7,022                                                 5,812                27,928    22,343

        Intangible asset impairment
         charge                                                               903                                                 6,685                   903     6,685


    Add back

       Stock-based compensation                                             1,422                                                 1,380                 6,090     6,067

       Excess of fair value over
        cost of acquired inventory                                          2,946                                                 2,758                10,448     5,938

       Expenses related to
        transaction not consummated                                             -                                                    -                  477         -
                                                                              ---                                                  ---                  ---       ---

                       Adjusted non-GAAP EBITDA                           $19,672                                               $17,933               $74,175   $61,112

 

                                                                  ANI Pharmaceuticals, Inc. and Subsidiaries

                                     Table 4: Adjusted non-GAAP Net Income and Adjusted non-GAAP Diluted Earnings per Share Reconciliation

                                                              (unaudited, in thousands, except per share amounts)



                                     Three Months Ended December 31,                          Year Ended December 31,

                                                                  2017                                                  2016                     2017        2016
                                                                  ----                                                  ----                     ----        ----


       Net (Loss)/Income                                      $(9,629)                                             $(1,080)                $(1,076)     $3,934


    Add back

        Excess of fair value over
         cost of acquired inventory                              2,946                                                 2,758                   10,448       5,938

        Non-cash interest expense                                1,758                                                 1,784                    7,113       7,048

        Stock-based compensation                                 1,422                                                 1,380                    6,090       6,067

        Depreciation and
         amortization expense                                    7,022                                                 5,812                   27,928       22343

      Intangible asset impairment
       charge                                                      903                                                 6,685                      903       6,685

        Expenses related to
         transaction not consummated                                 -                                                    -                     477           -
                                                                   ---                                                  ---                     ---         ---

    Less

       Tax impact of adjustments                               (5,199)                                              (6,815)                (19,595)   (17,790)

    Add back

        Impact of Tax Cuts and Jobs
         Act of 2017 on Deferred Tax
         Assets                                                 13,394                                                     -                  13,394           -


    Adjusted non-GAAP Net Income                               $12,617                                               $10,524                  $45,682     $34,225


    Diluted Weighted-Average

         Shares Outstanding                                     11,723                                                11,635                   11,680      11,573


    Adjusted non-GAAP

        Diluted Earnings per Share                               $1.08                                                 $0.90                    $3.91       $2.96
                                                                 -----                                                 -----                    -----       -----

 

                                                    ANI Pharmaceuticals, Inc. and Subsidiaries

                                         Table 5: Cortrophin(R) Gel Re-Commercialization Milestone Update



                    Step                        Duration                      Status                              Additional Details
                    ----                        --------                      ------                              ------------------

    Manufacture small-
     scale batch of
     corticotropin API                           4 mos.                      Complete            •Initial batch yields similar to historical yields
    ------------------                           ------                      --------

    •Analytical method development and
     testing ongoing
    ----------------------------------

    Select drug product
     CMO                                         6 mos.                      Complete            • Drug product CMO has been selected
    -------------------                          ------                      --------            ------------------------------------

    Manufacture                                                                                   •Three intermediate-scale batches successfully
     intermediate-scale                                                                           completed
     batches of
     corticotropin API                          4-6 mos.                     Complete
    -------------------                         --------                     --------

    •Further refined/modernized
     analytical methods and process

    •Demonstrated lot-to-lot consistency
    ------------------------------------

    Type C meeting with FDA                                        FDA Response March 2018      • Meeting Request submitted 4Q17; FDA granted as
                                                                                                  Type C Meeting
    -------------------------                                      -----------------------

    • Information provided on ANI's
     regulatory plan for re-
     commercialization

    • FDA response scheduled for March
     2018
    ----------------------------------

    Manufacture demo                                                                              •Initiate formulation /fill /finish of drug
     batches of                                                                                   product
     Cortrophin(R) Gel                            TBD                     Target Q2 2018
    ------------------                            ---                     --------------                --------------------------------------------

    Manufacture
     commercial-scale
     batches of
     corticotropin API                     2-3 mos. per batch             Target 1H 2018         • Scale-up manufacturing process 5x
    ------------------                     ------------------             --------------

    • Manufacture API under cGMPs

    • Finalize API manufacturing process
     in prepration for process
     validation/registration batches
    ------------------------------------

    Manufacture
     registration batches
     of Cortrophin(R) Gel                  2-3 mos. per batch            Target end 2018         • Process validation
    ---------------------                  ------------------            ---------------

    • Registration / Commercial batches

    • Initiate registration-enabling
     ICH stability studies
    --------------------------------

    Initiate registration                        6 mos.                        TBD                •Six months of accelerated stability from drug
     stability for sNDA                                                                           substance and drug product batches at time of
                                                                                                  submission
    ---------------------                                 ------                           ---   -----------------------------------------------

    sNDA submission                               TBD                          TBD               •PAS filing - four month PDUFA date
    ---------------                               ---                          ---               -----------------------------------

 

 

                                                           ANI Pharmaceuticals, Inc. and Subsidiaries

                                 Table 6: Historical Adjusted non-GAAP EBITDA Calculation and US GAAP to Non-GAAP Reconciliation

                                                                    (unaudited, in thousands)



                                                                   Year Ended December 31,

                                                                                2015                                    2014        2013
                                                                                ----                                    ----        ----


       Net Income from Continuing Operations                                 $15,375                                 $28,747        $106


    Add back

       Interest expense, net                                                  11,008                                     787         467

       Other (expense)/income, net                                              (41)                                  (160)        305

       Provision/(benefit) for income taxes                                    6,358                                 (9,368)         20

       Depreciation and amortization                                           6,900                                   3,878       1,110


    Add back

       Stock-based compensation                                                3,856                                   3,423          36

       Merger-related expenses                                                     -                                      -      5,468
                                                                                 ---                                    ---      -----

                                Adjusted non-GAAP EBITDA                     $43,456                                 $27,307      $7,512

 

 

View original content:http://www.prnewswire.com/news-releases/ani-pharmaceuticals-reports-record-full-year-results-reports-fourth-quarter-2017-results-and-provides-2018-guidance-300604056.html

SOURCE ANI Pharmaceuticals, Inc.


Company Codes: NASDAQ-NMS:ANIP

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