Recordati S.p.A: Positive First Quarter 2010 Results, Sales And Income Increase. Three Year Business Plan Updated
MILAN, ITALY--(Marketwire - May 06, 2010) -
| Highlighted Links |
companynewsgroup Home Page |
- Pharmaceutical revenue EUR 179.6 million, + 1.6%.
- Operating income EUR 43.1 million, + 6.0%.
- Net income EUR 30.0 million, + 8.5%.
- Net financial position*: net debt of EUR 2.6 million.
- Urorec®/Silodyx® (silodosin) approved by the European Medicines Agency (E.M.A.) in Europe.
- Carbaglu® (carglumic acid) approved by the FDA in the U.S..
- Agreement with Leespharm for the marketing and sales of lercanidipine in China.
- Subsequent events: Agreement with Esteve for the marketing and sales of pitavastatin in Spain.
- 2010-2012 Business Plan updated.
The Board of Directors of Recordati S.p.A. approved the Group's consolidated results for the first quarter 2010 prepared in accordance with International Accounting Standards and International Financial Reporting Standards (IAS/IFRS) and in particular as per IAS 34 requirements for interim reporting. These financial statements are available at the company's offices, at Borsa Italiana S.p.A. and on the company's website:
http://www.recordati.com/rec_en/investors/reports/
Recordati presents its First quarter 2010 results and its updated 2010-2012 Business Plan, which was approved by the Board of Directors, to the financial community and specialized press today at 4.00 pm at Borsa Italiana. The complete presentation will be placed on the company's website at the following address:
http://www.recordati.com/rec_en/investors/presentations/
Financial highlights
- Consolidated revenue in the first quarter of 2010 is EUR 185.9 million, an increase of 1.2% over the same period of the preceding year. Pharmaceutical sales are EUR 179.6 million, an increase of 1.6% despite the expiry in January of the composition of matter patent covering lercanidipine in the main European countries. Pharmaceutical chemicals sales are EUR 6.2 million, down by 9.5%.
- Operating income, at 23.2% of sales, is EUR 43.1 million, an increase of 6.0% over the same period of the preceding year. R&D expenses grow by 7.4% reaching 8.8% of sales.
- Net income is EUR 30.0 million, an increase of 8.5%, higher than that recorded by operating income thanks to lower financial expenses.
- Net financial position* at 31 March 2010 records net debt of EUR 2.6 million, a reduction of EUR 17.2 million as compared to 31 December 2009. Shareholders' equity increased to EUR 542.0 million.
* Cash and short-term financial investments net of bank overdrafts and medium/long-term loans which include the measurement at fair value of hedging derivatives (fair value hedge).
Business development news
At the end of January Recordati was granted Marketing Authorization by the European Commission for the medicinal products Urorec® and Silodyx™ 4 mg, 8 mg, hard capsules, intended for treatment of the signs and symptoms of benign prostatic hyperplasia (BPH). Following national post- authorization procedures, as relevant, product launch could begin as from September 2010.
Also in January an agreement was finalized with Novartis for the acquisition in Greece and in other European countries of Lopresor® (metoprololo), a well known selective beta blocker for the treatment of different cardiovascular disorders, in particular hypertension and angina pectoris. Under the agreement Recordati acquires the product's marketing authorizations and know-how including manufacturing rights and a free unlimited license for the use of the brand Lopresor®. 2009 sales of Lopresor® (metoprolol) in the countries covered by the agreement were overall EUR 4 million, most of which were generated in Greece.
In March Recordati received approval by the Food and Drug Administration (FDA) in the U.S. of the NDA submitted by Orphan Europe for the use of Carbaglu® (carglumic acid) in pediatric and adult patients for the treatment of acute hyperammonaemia due to the deficiency of the hepatic enzyme N-acetyl glutamate synthase (NAGS deficiency) and as maintenance therapy for chronic hyperammonaemia due to NAGS deficiency.
Also during March a license agreement was signed with Lee's Pharmaceutical Holding Ltd for the sales and marketing of Zanidip® (lercanidipine) in the People's Republic of China.
Subsequent events and business outlook
In April Recordati signed a license agreement with Esteve, a leading pharmaceutical company in the Spanish market, for the marketing and sales in Spain of pitavastatin. Pitavastatin is a novel "statin" for the treatment of hypercholesterolemia. Esteve will co-market the product together with Recordati España, the Spanish subsidiary of the Recordati group. The drug is currently being evaluated by the UK Medicines and Healthcare products Regulatory Agency (MHRA), and is expected to be approved in Europe in the second half of 2010.
Business plan update
The development of the Recordati group will continue to be focused on the European pharmaceutical markets, both in Western and the emerging CEE countries. The group will develop its business through the growth of its product portfolio, which includes the launch of products filed for approval, the acquisition of new product licenses, the enhancement of its pipeline of products in development and by entering new markets.
Assumptions:
- Following the expiry of lercanidipine's patent in the main European countries during January 2010 it is expected that sales of this product will diminish progressively over the 2010-2012 period to approximately EUR 100 million and remain relatively stable thereafter. Sales of Zanipress® (lercanidipine+enalapril) will grow in line with expectations in the countries where already launched. Its launch in Italy is expected to take place at the beginning of 2011 and progressively in all countries where Zanidip® (lercanidipine) is currently sold. Sales of Zanipress® are targeted at approximately EUR 70 million by 2012 with further growth expected thereafter.
- The launch of Urorec® (silodosin), a new specialty indicated for the treatment of the symptoms of benign prostatic hyperplasia (BPH), will initiate progressively as from September 2010. Marketing authorization for Livazo® (pitavastatin) is expected to be granted in the third quarter 2010 and launches will be effected progressively in European markets during 2011.
Excluding the contribution of further acquisitions which may be completed within the period under analysis, our financial performance expectations for the 2010-2012 period are the following:
- For the full year 2010 revenues to exceed EUR 700 million, operating income to exceed EUR 140 million and net income to exceed EUR 95 million are expected.
- Targets for 2011: revenues of EUR 730 to 740 million, operating income of EUR 145 to 150 million and net income of EUR 100 to 102 million.
- Targets for 2012: revenues of EUR 780 to 800 million, operating income of EUR 155 to 160 million and net income of EUR 110 to 112 million.
Management comments
"The results of the first quarter and the Business Plan that we have just presented confirm the potential of our product portfolio and the ability to maintain a good level of profitability in the medium term despite market competition from generic versions of our important product lercanidipine" declared Giovanni Recordati, Chairman and Chief Executive Officer. "We will continue with our policy to acquire new products to develop as well as new geographical presence in order to add impetus to both sales and profits growth."
Conference Call
A simultaneous translation into English of the proceedings, which will start at 4.00 pm, is available via conference call. Dial-in numbers and access ID are:
Italy +39 02 36005955
UK +44 (0) 1452587427
USA +18665516755
France +33 (0) 170751217
Germany +49 (0) 6922227071
ID to access the call in the English language: 71717137
A set of slides which will be referred to during the call will be available on our website www.recordati.com under Investors/Company Presentations:
http://www.recordati.com/rec_en/investors/presentations/
Callers are invited to dial-in 10 minutes before conference time and provide the conference ID 71717137. If conference operator assistance is required during the connection please digit * followed by 0 or call +44 1452 569 034. A recording of the conference call will be subsequently placed on the website: http://www.recordati.com/rec_en/investors/presentations/
Recordati, established in 1926, is a European pharmaceutical group, listed on the Italian Stock Exchange (Reuters RECI.MI, Bloomberg REC IM, ISIN IT 0003828271),with a total staff of over 2,800, dedicated to the research, development, manufacturing and marketing of pharmaceuticals. It has headquarters in Milan, Italy, operations in the main European countries, and a growing presence in the new markets of Central and Eastern Europe. A European field force of around 1,400 medical representatives promotes a wide range of innovative pharmaceuticals, both proprietary and under license, in a number of therapeutic areas including a specialized business dedicated to treatments for rare diseases. Recordati's current and growing coverage of the European pharmaceutical market makes it a partner of choice for new product licenses from companies which do not have European marketing organizations. Recordati is committed to the research and development of new drug entities within the cardiovascular and urogenital therapeutic areas and of treatments for rare diseases. Consolidated revenue for 2009 was EUR 747.5 million, operating income was EUR 162.2 million and net income was EUR 110.6 million.
For further information:
Recordati website: www.recordati.com
Investor Relations Media Relations
Marianne Tatschke Claudio Rossetti (Echo Comunicazione d'Impresa)
(39)0248787393 (39)02 62694736
e-mail: inver@recordati.it e-mail: crossetti@echocom.it
Statements contained in this release, other than historical facts, are "forward-looking statements" (as such term is defined in the Private Securities Litigation Reform Act of 1995). These statements are based on currently available information, on current best estimates, and on assumptions believed to be reasonable. This information, these estimates and assumptions may prove to be incomplete or erroneous, and involve numerous risks and uncertainties, beyond the Company's control. Hence, actual results may differ materially from those expressed or implied by such forward-looking statements. All mentions and descriptions of Recordati products are intended solely as information on the general nature of the company's activities and are not intended to indicate the advisability of administering any product in any particular instance.
RECORDATI GROUP
Summary of consolidated results prepared in accordance with the International Accounting Standards and International Financial Reporting Standards (IAS/IFRS)
(thousands of EUR)
+-------------------------+------------------+------------------+--------+ |INCOME STATEMENT |First quarter 2010|First quarter 2009|Change %| +-------------------------+------------------+------------------+--------+ |REVENUE | 185,856| 183,687| 1.2| +-------------------------+------------------+------------------+--------+ |Cost of sales | (59,699)| (60,158)| (0.8)| +-------------------------+------------------+------------------+--------+ |GROSS PROFIT | 126,157| 123,529| 2.1| +-------------------------+------------------+------------------+--------+ |Selling expenses | (55,323)| (54,857)| 0.8| +-------------------------+------------------+------------------+--------+ |Research and development | (16,428)| (15,300)| 7.4| |expenses | | | | +-------------------------+------------------+------------------+--------+ |General & administrative | (10,433)| (10,918)| (4.4)| |expenses | | | | +-------------------------+------------------+------------------+--------+ |Other income (expenses), | (898)| (1,819)| (50.6)| |net | | | | +-------------------------+------------------+------------------+--------+ |OPERATING INCOME | 43,075| 40,635| 6.0| +-------------------------+------------------+------------------+--------+ |Financial income | (780)| (1,451)| (46.2)| |(expenses), net | | | | +-------------------------+------------------+------------------+--------+ |PRE-TAX INCOME | 42,295| 39,184| 7.9| +-------------------------+------------------+------------------+--------+ |Provision for income | (12,321)| (11,565)| 6.5| |taxes | | | | +-------------------------+------------------+------------------+--------+ |NET INCOME | 29,974| 27,619| 8.5| +-------------------------+------------------+------------------+--------+ |Attributable to: | | | | +-------------------------+------------------+------------------+--------+ |Equity holders of the | 29,974| 27,618| 8.5| |parent | | | | +-------------------------+------------------+------------------+--------+ |Minority interests | 0| 1| (100.0)| +-------------------------+------------------+------------------+--------+
+--------------------+--------------------+--------------------+----------+ | EARNINGS PER SHARE| First quarter 2010| First quarter 2009| Change %| +--------------------+--------------------+--------------------+----------+ | Basic | EUR 0.152| EUR 0.140| 8.6| +--------------------+--------------------+--------------------+----------+ | Diluted | EUR 0.144| EUR 0.136| 5.9| +--------------------+--------------------+--------------------+----------+ +--------------------+--------------------+--------------------+----------+Earnings per share (EPS) are based on average shares outstanding during each year, 197,652,801 in 2010 and 197,035,301 in 2009, net of average treasury stock which amounted to 11,472,355 in both years. Diluted earnings per share is calculated taking into account new shares authorized but not yet issued.
+-------------------------+------------------+------------------+--------+ |COMPOSITION OF REVENUE |First quarter 2010|First quarter 2009|Change %| +-------------------------+------------------+------------------+--------+ |Pharmaceuticals | 179,627| 176,804| 1.6| +-------------------------+------------------+------------------+--------+ | Pharmaceutical chemicals| 6,229| 6,883| (9.5)| +-------------------------+------------------+------------------+--------+ |TOTAL | 185,856| 183,687| 1.2| +-------------------------+------------------+------------------+--------+ | - of which International| 129,419| 128,165| 1.0| +-------------------------+------------------+------------------+--------+ +-------------------------+------------------+------------------+--------+RECORDATI GROUP
Summary of consolidated results prepared in accordance with the International Accounting Standards and International Financial Reporting Standards (IAS/IFRS)
(thousands of EUR)
+-------------------------+-----------+------------+ |ASSETS | 31.3.2010| 31.12.2009| +-------------------------+-----------+------------+ |Property, plant and | 53,908| 55,381| |equipment | | | +-------------------------+-----------+------------+ |Intangible assets | 110,022| 96,512| +-------------------------+-----------+------------+ |Goodwill | 306,228| 303,653| +-------------------------+-----------+------------+ |Equity investments | 3,723| 3,716| +-------------------------+-----------+------------+ |Non-current receivables | 3,840| 3,804| +-------------------------+-----------+------------+ |Deferred tax assets | 19,380| 21,793| +-------------------------+-----------+------------+ |TOTAL NON-CURRENT ASSETS | 497,101| 484,859| +-------------------------+-----------+------------+ |Inventories | 88,265| 86,627| +-------------------------+-----------+------------+ |Trade receivables | 142,302| 132,621| +-------------------------+-----------+------------+ |Other receivables | 18,723| 22,990| +-------------------------+-----------+------------+ |Other current assets | 4,764| 2,607| +-------------------------+-----------+------------+ |Fair value of hedging | 1,190| 0| |derivatives (fair value | | | |hedge) | | | +-------------------------+-----------+------------+ |Short-term financial | 87,633| 93,775| |investments, cash and | | | |cash equivalents | | | +-------------------------+-----------+------------+ |TOTAL CURRENT ASSETS | 342,877| 338,620| +-------------------------+-----------+------------+ |TOTAL ASSETS | 839,978| 823,479| +-------------------------+-----------+------------+
+-------------------------+-----------+------------+ |EQUITY AND LIABILITIES | 30.9.2009| 31.12.2008| +-------------------------+-----------+------------+ |Share capital | 26,141| 26,141| +-------------------------+-----------+------------+ |Capital in excess of par | 83,719| 83,719| |value | | | +-------------------------+-----------+------------+ |Treasury stock | (59,103)| (59,103)| +-------------------------+-----------+------------+ |Hedging reserve | (5,293)| (4,040)| +-------------------------+-----------+------------+ |Translation reserve | (2,269)| (6,178)| +-------------------------+-----------+------------+ |Other reserves | 25,432| 25,025| +-------------------------+-----------+------------+ |Retained earnings | 443,396| 332,836| +-------------------------+-----------+------------+ |Net income for the period| 29,974| 110,560| +-------------------------+-----------+------------+ |GROUP SHAREHOLDERS | 541,997| 508,960| |EQUITY | | | +-------------------------+-----------+------------+ |Minority interest | 19| 19| +-------------------------+-----------+------------+ |SHAREHOLDERS EQUITY | 542,016| 508,979| +-------------------------+-----------+------------+ |Loans due after one year | 83,260| 79,990| +-------------------------+-----------+------------+ |Employees | | | |termination | 19,556| 19,895| |pay | | | +-------------------------+-----------+------------+ |Deferred tax liabilities | 5,646| 5,661| +-------------------------+-----------+------------+ |Other non-current | 5,704| 6,179| |liabilities | | | +-------------------------+-----------+------------+ |TOTAL NON-CURRENT | 114,166| 111,725| |LIABILITIES | | | +-------------------------+-----------+------------+ |Trade payables | 89,057| 81,751| +-------------------------+-----------+------------+ |Other payables | 47,211| 48,406| +-------------------------+-----------+------------+ |Tax liabilities | 14,390| 12,555| +-------------------------+-----------+------------+ |Other current liabilities| 654| 517| +-------------------------+-----------+------------+ |Provisions | 19,071| 21,978| +-------------------------+-----------+------------+ |Fair value of hedging | 5,293| 4,040| |derivatives (cash flow | | | |hedge) | | | +-------------------------+-----------+------------+ |Fair value of hedging | 0| 2,257| |derivatives (fair value | | | |hedge) | | | +-------------------------+-----------+------------+ |Loans due within one year| 1,816| 2,419| +-------------------------+-----------+------------+ |Bank overdrafts | 6,304| 28,852| +-------------------------+-----------+------------+ |TOTAL CURRENT LIABILITIES| 183,796| 202,775| +-------------------------+-----------+------------+ |TOTAL EQUITY AND | 839,978| 823,479| |LIABILITIES | | | +-------------------------+-----------+------------+DECLARATION BY THE MANAGER RESPONSIBLE FOR PREPARING THE COMPANY'S FINANCIAL REPORTS
The manager responsible for preparing the company's financial reports Fritz Squindo declares, pursuant to paragraph 2 of Article 154-bis of the Consolidated Law on Finance, that the accounting information contained in this press release corresponds to the document results, books and accounting records.
This information is provided by HUGIN