SCOTTSDALE, Ariz.--(BUSINESS WIRE)--Jan. 2, 2004--Medicis (NYSE:MRX - News) today announced that its Board of Directors has approved a 2 for 1 stock split in the form of a stock dividend payable on January 23, 2004, to stockholders of record at the close of business on January 12, 2004. Holders of the Company’s common stock will receive one additional share for every one share held. Effective at the close of market on January 23, 2004, Medicis will have approximately 55 million shares of Class A Common Stock and approximately 758,000 shares of Class B Common Stock outstanding as a result of the stock dividend. For questions regarding new certificates, contact the transfer agent, Wells Fargo Shareowner Services, at (800) 468-9716.
Additionally, holders of the Company’s 2.5% contingent convertible bonds (“Bondholders”) have the right, but not the obligation, to convert their notes into shares of Medicis stock at a conversion price of $58.10 (pre-split). At December 31, 2003, there was approximately $169 million in principal value of bonds outstanding. This right of conversion of the Bondholders was triggered by the stock closing above $63.91 (pre-split) on 20 of the last 30 trading days and the last trading day of the quarter ending December 31, 2003. The Bondholders have this conversion right only until March 31, 2004. At such time and at the end of all future quarters, the conversion rights will be reassessed in accordance with the bond indenture agreement to determine if the conversion trigger rights have been achieved.
Under Generally Accepted Accounting Principles (“GAAP”), the Company is required to use the “if-converted method” and include the approximately 2.9 million underlying shares (pre-split) as outstanding for the three months ended December 31, 2003, regardless of whether the Bondholders actually convert their bonds into shares. All future quarters will be assessed based on the Bondholders’ conversion rights at that time. The revised guidance provided below uses the “if-converted method” and includes the approximately 2.9 million shares (pre-split) in the weighted shares outstanding and adds the tax-effected interest expense and associated bond offering costs to net income. At the time of this release, there have been no bonds converted.
EPS Guidance
Q1 Q2 Q3 Q4 FYE ’04
Previously provided guidance $0.36 $0.51 $0.66 $0.76 $2.29
Effect of the stock split ($0.18) ($0.25) ($0.33) ($0.38) ($1.14)
Effect of the conversion rights $0.00 ($0.02) ($0.02) ($0.03) ($0.07)
Revised guidance(a) $0.18 $0.24 $0.31 $0.35 $1.08
Special charges: Loss on early extinguishment of debt ($0.68) $0.00 $0.00 $0.00
R&D collaboration $0.00 ($0.02) $0.00 $0.00
GAAP EPS including special charges(b) ($0.50) $0.22 $0.31 $0.35
(a) Excluding loss on early extinguishment of debt and a payment to Dow Pharmaceutical, Inc. under an R&D collaboration
(b) GAAP earnings per share for fiscal year ended 2004 does not represent the sum of the quarters as the weighted average shares outstanding for the year differ from those used in the quarterly computations as a result of the first quarter loss.
At the time of this disclosure, Medicis believes these objectives are attainable based upon information currently available to the Company. The Company’s business is subject to all risk factors outlined in the Company’s most recent annual report on Form 10-K, its Form S-3 registration statement and other filed documents with the Securities and Exchange Commission. At the time of this release, the Company cannot, among other things, assess the forthcoming results of the Company’s research and development projects and the risks associated with the FDA approval process, risks associated with significant competition within the Company’s industry, nor can the Company validate its assumptions of the full impact on its business of the approval of competitive generic versions of the Company’s core brands, or any future competitive product approvals that may affect the Company’s brands. Additionally, Medicis may acquire and/or license products or technologies from third parties to enter into new strategic markets. The Company periodically makes up-front, non-refundable payments to third parties for research and development work which has been completed and periodically makes additional non-refundable payments for the achievement of various milestones. There can be no certainty which periods these potential payments could be made, nor if any payments such as these will be made at all. The above estimated future guidance does not include the potential payments associated with any such transactions.
Medicis is the leading independent specialty pharmaceutical company in the United States focusing primarily on the treatment of dermatological, pediatric and podiatric conditions, and aesthetics medicine. Medicis has leading branded prescription products in a number of therapeutic categories, including acne, asthma, eczema, fungal infections, hyperpigmentation, photoaging, psoriasis, rosacea, seborrheic dermatitis and skin and skin-structure infections. The Company’s products have earned wide acceptance by both physicians and patients due to their clinical effectiveness, high quality and cosmetic elegance.
The Company’s products include the prescription brands RESTYLANE®, DYNACIN® (minocycline HCl), LOPROX® (ciclopirox), LUSTRA® (hydroquinone), LUSTRA-AF® (hydroquinone) with sunscreen, ALUSTRA® (hydroquinone) with retinol, OMNICEF® (cefdinir), ORAPRED® (prednisolone sodium phosphate), PLEXION® Cleanser (sodium sulfacetamide/sulfur), PLEXION TS® (sodium sulfacetamide/sulfur), PLEXION SCT® (sodium sulfacetamide/sulfur), TRIAZ® (benzoyl peroxide), LIDEX® (fluocinonide), and SYNALAR® (fluocinolone acetonide), the over-the-counter brand ESOTERICA®, and BUPHENYL® (sodium phenylbutyrate), a prescription product indicated in the treatment of Urea Cycle Disorder. For more information about Medicis, please visit the Company’s website at www.medicis.com.
Except for historical information, this press release includes “forward-looking statements” within the meaning of the Securities Litigation Reform Act. All statements included in this press release that address activities, events or developments that Medicis expects, believes or anticipates will or may occur in the future are forward-looking statements. This includes earnings estimates, future financial performance and other matters. These statements are based on certain assumptions made by Medicis based on its experience and perception of historical trends, current conditions, expected future developments and other factors it believes are appropriate in the circumstances. Medicis cannot validate its assumptions of the full impact on its business of the approval of competitive generic versions of its core brands, or any future competitive product approvals that may affect its brands. Such statements are subject to a number of assumptions, risks and uncertainties, many of which are beyond the control of Medicis. Any such projections or statements include the current views of Medicis with respect to future events and financial performance. No assurances can be given, however, that these events will occur or that such results will be achieved. Also, there are a number of important factors that could cause actual results to differ materially from those projected, including the anticipated size of the markets, the availability of product supply, the receipt of required regulatory approvals, the ability to realize anticipated synergies and benefits of the Q-Med transaction, the risks and uncertainties normally incident to the pharmaceutical industry, dependence on sales of key products, the uncertainty of future financial results and fluctuations in operating results, dependence on Medicis’ strategy including the uncertainty of license payments and/or other payments due from third parties, the timing and success of new product development by Medicis or third parties, product introductions and other risks described from time to time in Medicis’ SEC filings including its Annual Report on Form 10-K for the year ended June 30, 2003. There can be no assurance as to when or if any of the holders of the Notes will have the right to convert or if the Notes will be converted, and what impact the increase in the number of shares outstanding will have on its results of operations. Forward-looking statements represent the judgment of Medicis’ management as of the date of this release, and Medicis disclaims any intent or obligation to update any forward-looking statements.
NOTE: Full prescribing information for any Medicis prescription product is available by contacting the Company. OMNICEF® is a registered trademark of Abbott Laboratories, Inc. under a license from Fujisawa Pharmaceutical Co., Ltd. RESTYLANE® is a registered trademark of HA North American Sales AB, a subsidiary of Medicis Pharmaceutical Corporation. All other marks (or brands) and names are the property of Medicis or its Affiliates.
Contact:
Medicis, Scottsdale Investor Relations & Corporate Communications 602-808-3854
Source: Medicis