BUENA, N.J., March 2, 2015 /PRNewswire/ -- IGI Laboratories, Inc. (NYSE MKT: IG), a New Jersey based specialty generic pharmaceutical company, announced its financial results for the fourth quarter and year ended December 31, 2014.
Fourth Quarter and Year to Date 2014 Highlights
- Total revenues of $13.7 million in the fourth quarter of 2014, an increase of 104% over the same quarter in 2013
- Total revenues of $33.7 million for the year ended December 31, 2014, an increase of 85% over the same period in 2013
- Total net revenues generated from the sale of IGI label generic topical pharmaceutical products for the three and twelve months ended December 31, 2014 of $10.5 million, and $19.8 million, respectively
- Gross profit for the year ended December 31, 2014 equaled 50% as compared to 34% in the same period of 2013
- IGI filed eleven Abbreviated New Drug Applications (ANDAs), in 2014 with the U.S. Food and Drug Administration (FDA)
- Net income was $5.6 million in the fourth quarter of 2014, including a non-cash gain of $2.3 million, compared to $0.7 million in the same period in 2013
- Net income was $5.3 million for the year ended December 31, 2014, including a non-cash gain of $2.3 million, compared to a net loss of $0.1 million for the year ended December 31, 2013
IGI’s President and Chief Executive Officer, Jason Grenfell-Gardner, stated, “This year was a critical one for our team, and I believe we have delivered. At the beginning of 2014, we committed to increase revenue to $25.5 - $26.4 million for the year, achieve profitability, and to double our R&D spending while filing ten ANDAs. We increased our commitment in October of 2014 to $31.0 to $33.0 million in revenue for 2014, gross margins of approximately 50 percent, and we re-affirmed our expectation to file at least 10 ANDAs in 2014. Our team has delivered on these promises. Revenue grew 85% compared to 2013, and while we did increase R&D spending by 150%, we filed 11 ANDAs, and we were able to achieve $5.3 million in net income, including a non-cash gain of $2.3 million. On top of all these achievements, we were able to make two product acquisitions at the end of September as initial drivers of our TICO strategy.” Mr. Grenfell-Gardner continued, “In December we completed our offering of $143.75 million 3.75% Convertible Senior Notes, which net of fees and expenses helped to strengthen our balance sheet to include over $158 million in cash at the end of December. Our balance sheet is stronger than ever, and we are actively seeking to expand our product portfolio and manufacturing capabilities to execute on our TICO strategy to expand our topical, injectable, complex and ophthalmic presence in the specialty generic pharmaceutical markets. Our research and development team now has twenty-two ANDAs pending with the FDA. Based on December 2014 IMS Health data, the addressable market for our pipeline of twenty-two ANDAs, pending approval by the FDA, is estimated at $579 million. We believe we are well positioned to increase revenues to at least $55 to $57 million in 2015, which would lead to increased gross margins of between approximately 52 to 53 percent for 2015. As we continue to invest in R&D to drive our future growth, we expect to increase R&D expense to approximately 27 to 28 percent of total revenue in 2015, which would allow us to file at least twenty more ANDAs in 2015. Based on the foregoing, we would anticipate Adjusted EBITDA (Earnings before interest, taxes, depreciation and amortization) to range between $7.5 and $8.5 million in 2015.”
The Company will hold a conference call today at 4:15 pm ET to discuss 4th quarter 2014 results.
The Company invites you to listen to the call by dialing 1-888-346-3479. International participants should call 1-412-902-4260. Canadian participants should call 1-855-669-9657. Participants should ask to be joined into the IGI Laboratories, Inc. call.
This call is being webcast by MultiVu (a PR Newswire Company) and can be accessed in the Investor Relations Section of IGI’s website at www.igilabs.com.
About IGI Laboratories, Inc.
IGI Laboratories is a specialty generic pharmaceutical company. Our mission is to be a leading player in the specialty generic prescription drug market.
Forward Looking Statements
This press release includes certain “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. These forward-looking statements include, but are not limited to, plans, objectives, expectations and intentions, and other statements contained in this press release that are not historical facts and statements identified by words such as " will,” “believe,” “target,” “estimated,” “continue” or words of similar meaning. These statements are based on our current beliefs or expectations and are inherently subject to various risks and uncertainties, including those included from time to time in the “Risk Factors” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations” sections in our most recent Annual Report on Form 10-K, as updated by Quarterly Reports on Form 10-Q and other reports we file with the Securities and Exchange Commission. Actual results may differ materially from these expectations. Factors that could cause actual results to differ materially from these expectations include, but are not limited to: our inability to meet current or future regulatory requirements in connection with existing or future ANDAs; our inability to achieve profitability; our failure to obtain FDA approvals as anticipated; our inability to execute and implement our business plan and strategy; the potential lack of market acceptance of our products; our inability to protect our intellectual property rights; changes in and the impact of global political, economic, business, competitive, market, regulatory and other factors; and our inability to complete successfully future product acquisitions. We assume no obligation to update any forward-looking statements or information, which speak as of their respective dates.
Non-GAAP Financial Measures
In addition to reporting financial information required in accordance with U.S. generally accepted accounting principles (GAAP), IGI Labs is also presenting EBITDA and Adjusted EBITDA which are non-GAAP financial measures. Since EBITDA and Adjusted EBITDA are non-GAAP financial measures, they should not be used in isolation or as a substitute for consolidated statements of operations and cash flow data prepared in accordance with GAAP. In addition, IGI’s definition of Adjusted EBITDA may not be comparable to similarly titled non-GAAP financial measures reported by other companies.
Adjusted EBITDA, as defined by the Company, is calculated as follows:
Net income, plus:
Interest expense, net
Provision for income taxes
Depreciation and amortization
Amortization of acquisition costs related to Econazole purchase
Non-cash expenses, such as share-based compensation expense, and preferred stock dividend
Less change in the fair value of derivative liability
The Company believes that Adjusted EBITDA is a meaningful indicator, to both Company management and investors, of the past and expected ongoing operating performance of the Company. EBITDA is a commonly used and widely accepted measure of financial performance. Adjusted EBITDA is deemed by the Company to be a useful performance indicator because it includes an add back of non-cash and non-recurring operating expenses which have little to no bearing on cash flows and may be subject to uncontrollable factors not reflective of the Company’s true operational performance (i.e. fair value adjustments to the derivative liability).
While the Company uses EBITDA and Adjusted EBITDA in managing and analyzing its business and financial condition and believes these non-GAAP financial measures to be useful to investors in evaluating the Company’s performance, it is open to certain shortcomings.
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