QUEBEC CITY, Canada, Nov. 8 /PRNewswire-FirstCall/ - Atrium Biotechnologies Inc. today announced that it had revenues of US$73.3 million for the quarter ended September 30, 2006, up 67% from US$44.0 million for the corresponding quarter in 2005. Earnings before interest, taxes, depreciation and amortization (EBITDA) for the third quarter 2006 were US$11.0 million, up 95% from US$5.6 million for the same period last year. Net earnings increased 108% to US$6.4 million for the quarter ended September 30, 2006, compared to US$3.1 million for the same quarter last year.
“These excellent results confirm the success of our growth strategy. Our ability to successfully integrate recently acquired companies allows us to create immediate value for our shareholders. While leveraging our know-how and our distinctive positioning which is based on the marketing of high quality products intended for specialized markets, we intend to maintain steady growth over the following months. We will expand our activities by creating organic growth as well as by the acquisition of companies with high value-added products and technologies. Atrium aims to become a world reference in the marketing of health and wellness products by consolidating its leadership position and its line of business”, stated Atrium’s President and Chief Executive Officer, Mr. Luc Dupont.
Earnings per share were US$0.21 per share for the third quarter 2006 compared to US$0.11 per share for the same period last year. The significant increase in net earnings allowed the Company to increase earnings per share even though the weighted average number of shares outstanding increased to 30.1 million during the third quarter 2006 compared to 29.1 million during the third quarter 2005.
Cash flows from operations (before changes in non-cash working capital items) for the third quarter 2006 were US$7.8 million, up 85% from US$4.2 million for the same period last year. The Company has a revolving credit facility with an authorized amount of US$112 million and has the flexibility to increase it up to US$179 million. As of September 30, 2006, US$86 million was drawn down under the existing facility.
“Our cash flow generating capacity along with our credit facility will allow the Company to continue its acquisition strategy in each of our divisions,” added John Dempsey, Vice President, Finance and Chief Financial Officer.
Health & Nutrition Division
Revenues from the Health & Nutrition Division were US$28.3 million for the quarter ended September 30, 2006, representing an increase of 304% over revenues of US$7.0 million for the same period last year. EBITDA was US$7.3 million for the quarter ended September 30, 2006 representing an increase of 161% over the same period last year where the EBITDA was US$2.8 million. Most of this increase came from the acquisition of Douglas Laboratories in December 2005, as well as from the strong organic sales growth of both our Douglas Laboratories and Pure Encapsulations brands.
Active Ingredients & Specialty Chemicals Division
Revenues from the Active Ingredients & Specialty Chemicals Division were US$45.0 million for the third quarter 2006, representing an increase of 22% over revenues of US$37.0 million for the same period in 2005. EBITDA was US$3.7 million for the quarter ended September 30, 2006, representing an increase of 31% over 2005 EBITDA of US$2.8 million. These increases are mainly attributable to important organic growth due to increased market penetration, the acquisition of Amisol in May 2006 and the distinctive positioning of the division which allowed us to increase both revenues and profits.
Nine-Month Financial Results
For the nine-month period ended September 30, 2006, revenues were US$223.6 million compared to US$142.5 million in 2005, representing a 57% increase. EBITDA increased 75% to US$34.0 million, compared to US$19.4 million for the same period in 2005. Net earnings increased 90% to US$19.6 million or US$0.65 per share, compared to US$10.3 million or US$0.38 per share for the same period in 2005. The weighted average number of shares outstanding was 30.1 million during the nine-month period ended September 30, 2006 compared to 27.3 million during the same period last year.
About Atrium
Atrium Biotechnologies Inc. is a recognized leading developer, manufacturer and marketer of science-based products for the cosmetics, pharmaceutical, chemical and nutrition industries. The Company focuses primarily on growing segments of the health and personal care markets which are benefiting from the trends towards healthy living and the ageing of the population. Atrium markets a broad portfolio of active ingredients, specialty chemicals and health and nutrition finished products through its highly specialized sales and marketing network in more than 50 countries, primarily in North America, Europe and Asia. Atrium has over 500 employees and operates three manufacturing facilities. Additional information about Atrium is available on its Web site at www.atrium-bio.com.
Conference Call and Webcast
Atrium will hold its quarterly conference call and webcast to discuss its Third Quarter 2006 on November 8, 2006 at 5:00 p.m. Eastern time. Participants may access the call by using the following numbers: 416-644-3430, 514-807-8791 or 1-866-249-1964. A live webcast is also available via the Company’s website at www.atrium-bio.com in the “Investors” section. A replay of the webcast will also be available on our website for a period of 30 days.
Caution Regarding Non-GAAP Measures
This press release is based on reported earnings in accordance with Canadian generally accepted accounting principles (GAAP). It is also based on earnings before interest, income taxes, depreciation and amortization (EBITDA) and gross margin. These measures do not have a standardized meaning prescribed by GAAP; therefore, other issuers using these terms may calculate them differently. Management believes that a significant portion of the users of its Consolidated Financial Statements for the quarter ended September 30, 2006 and MD&A analyze the Company’s results based on these performance measures.
Cautionary Note and Forward-Looking Statements
This press release contains certain forward-looking statements with respect to the Company. These forward-looking statements, by their nature, necessarily involve risks and uncertainties that could cause actual results to differ materially from those contemplated by these forward-looking statements. The Company considers the assumptions on which these forward-looking statements are based to be reasonable, but cautions the reader that these assumptions regarding future events, many of which are beyond its control, may ultimately prove to be incorrect since they are subject to risks and uncertainties that affect the Company. For additional information with respect to these and other factors, see the Company’s quarterly and annual filings with the Canadian securities commissions. The Company disclaims any intention or obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise, other than as required by law.
Attachment: Financial summary Atrium Biotechnologies Inc. Summary of Consolidated Financial Statements (in millions of US dollars except per share amounts) Consolidated Results for the 3-month periods ended September 30 (unaudited) 2006 2005 Change Revenues 73.3 44.0 66.5% Gross Margin (1) 21.6 11.9 81.9% 29.5% 27.0% EBITDA (2) 11.0 5.6 95.4% 15.0% 12.8% Net Earnings 6.4 3.1 107.9% Net earnings per share Basic 0.21 0.11 Diluted 0.20 0.10 Cash flows from operating activities before 7.8 4.2 84.8% changes in non-cash operating working capital items Consolidated Results for the 9-month periods ended September 30 (unaudited) 2006 2005 Change Revenues 223.6 142.5 56.9% Gross Margin (1) 66.1 38.7 70.8% 29.6% 27.2% EBITDA (2) 34.0 19.4 75.4% 15.2% 13.6% Net Earnings 19.6 10.3 90.3% Net earnings per share Basic 0.65 0.38 Diluted 0.60 0.35 Cash flows from operating activities before 23.4 14.1 66.0% changes in non-cash operating working capital items Atrium Biotechnologies Inc. Summary of Consolidated Financial Statements (in millions of US dollars except per share amounts) Consolidated Results for the 3-month periods ended September 30 (unaudited) 2006 2005 Change Health & Nutrition ------------------ Revenues 28.3 7.0 304.0% EBITDA (2) 7.3 2.8 160.9% 25.8% 39.9% Active Ingredients & Speciality Chemicals ----------------------------------------- Revenues 45.0 37.0 21.6% EBITDA (2) 3.7 2.8 30.8% 8.2% 7.7% Consolidated Results for the 9-month periods ended September 30 (unaudited) 2006 2005 Change Health & Nutrition ------------------ Revenues 85.9 21.9 292.3% EBITDA (2) 22.2 8.8 153.8% 25.9% 40.0% Active Ingredients & Speciality Chemicals ----------------------------------------- Revenues 137.7 120.6 14.2% EBITDA (2) 11.8 10.6 10.8% 8.6% 8.8% Consolidated Balance Sheet (unaudited) As at Sept. 30, As at Dec. 31, 2006 2005 Cash and Cash Equivalents and Short-term Investments 20.3 17.8 Current assets 110.1 109.3 Goodwill 116.4 109.0 Intangible assets and deferred charges 73.4 69.7 Total assets 310.5 298.2 Total debt 98.4 105.9 Shareholders’ equity 149.6 124.4 (1) Gross margin means sales less cost of goods sold; cost of goods sold does not include depreciation of production equipment. (2) EBITDA means earnings before interest, income taxes, depreciation and amortization.
ATRIUM BIOTECHNOLOGIES INC.
CONTACT: Investor Relations: John Dempsey, Vice President, Finance andChief Financial Officer, (418) 652-1116 ext. 287, jdempsey@atrium-bio.com;Media Relations: Frederic Tremblay, HKDP, (514) 395-0375 ext. 234,ftremblay@hkdp.qc.ca
