NEW YORK, Nov. 21 /PRNewswire-FirstCall/ -- Inyx, Inc. , a specialty pharmaceutical company focused on niche drug delivery technologies and products, announced today operating results for the third quarter and nine months ended September 30, 2005. The company also reaffirmed its year-end guidance and increased its outlook for 2006.
For the 2005 third quarter, revenues reached $12.9 million, the highest quarterly level in the company’s brief history and more than triple the $4.2 million reported a year ago, primarily as a result of acquisitions completed this year. Gross profit increased significantly to $5.1 million from $678,000 in the year-earlier period. There was a net loss in the 2005 quarter of $4.9 million, equal to $0.12 per share, compared with a net loss of $3.8 million, or $0.12 a share, in the year-earlier period. The 2005 third-quarter net loss included approximately $1.5 million in acquisition and integration expenses in the period.
For the first nine months of 2005, revenues more than doubled to $24.1 million from $11.5 million in the corresponding period last year, primarily as a result of acquisitions completed this year. Gross profit totaled $7.9 million, up materially from $1.2 million a year ago. The net loss in the 2005 period amounted to $16.1 million, equal to $0.39 per share, versus a net loss of $9.9 million, or $0.32 a share, a year earlier. The 2005 nine-month net loss also included approximately $750,000 in acquisition and integration expenses in the second quarter and approximately $5.0 million in non-cash- related charges due to the early extinguishment of convertible debt in the second period.
Results in Perspective
Jack Kachkar, M.D., Chairman & CEO of Inyx, Inc., said, “The strong increase in third-quarter revenues is due largely to our two acquisitions this year. These acquisitions have contributed significantly to our revenues, diversified and grown our client base, expanded our development and manufacturing capabilities, and enlarged our overall scope of business.”
The significant improvement in gross profit in this year’s third quarter was the result of a material improvement in the cost of sales. This improvement is attributable to a more favorable mix of higher-margin product support and technology service revenues as well as increased capacity utilization at Inyx’s facilities, thereby improving overhead absorption rates, and the addition of more profitable contracts as a result of the company’s two recent acquisitions. “We expect our operating profit margin to continue to improve as our capacity utilization continues to increase from expanding business, which also provides us with greater bulk-purchasing leverage with vendors,” explained Dr. Kachkar.
Inyx had higher operating expenses and financing costs in the third quarter as a result of its second acquisition this year. This acquisition was completed on August 31, 2005, so only one month of revenues in the quarter was contributed by this operation, which currently has an annualized revenue base of approximately $50 million.
Year-End & 2006 Guidance
“Even though our two United Kingdom-based operations are presently impacted by a lower currency exchange, as the U.S. Dollar has been stronger against the Great Britain Pound in the second half,” the Inyx CEO said, we still expect revenues for 2005 to total around $50 million and to achieve profitability at the plant operating level by year-end.
“Moreover, because of increasing business at our new Puerto Rico site as well as our greatly expanded U.K. base, plus our new strategic collaboration with King Pharmaceuticals, Inc. , our outlook for 2006 has increased,” he added. Inyx now expects revenues to total approximately $135 million in 2006, with EBITDA (earnings before income taxes, depreciation and amortization) margin to exceed 20% and a net after-tax profit margin of approximately 15%, based on current contracts and related schedules.
“Inyx is very well positioned in its niche drug delivery sectors,” Dr. Kachkar noted. Inyx has a comprehensive platform of inhalation-therapy technologies and expertise: metered dose inhalers (MDIs) and proven experience in converting from ozone-depleting to non-ozone-depleting MDIs, enhanced capabilities in dry powder inhalers (DPIs), and strong capabilities in nasal and oral spray pharmaceutical products. MDIs are the dominant delivery mode for asthma medication, and DPIs and nasal delivery are expected to gain increasing market share of both non-respiratory and respiratory inhalation therapy. “Inyx is seeing growth in all three delivery modalities,” informed Dr. Kachkar. Inyx also has a patented lipid-matrix technology that enhances inhalation delivery of not only single molecule but also combination drugs, which is another growing sector. In addition to inhalation therapy, Inyx has proprietary technology and expertise in hydrocarbon foam formulations that are gaining increasing applications in delivery of dermatological and topical pharmaceutical products.
“As a result of our company’s drug delivery technologies and expertise, we have an expanding base of clients, strategic relationships with leading pharmaceutical companies and related strong growth opportunities that are now opening up to Inyx to cultivate,” added the Inyx CEO.
About Inyx
Inyx, Inc. is a specialty pharmaceutical company with aerosol drug delivery technologies and products for the treatment of respiratory, allergy, dermatological, topical and cardiovascular conditions. Inyx focuses its expertise on both prescription and over-the-counter pharmaceutical products, and provides specialty pharmaceutical development and production consulting services. In addition, Inyx is developing its own proprietary products to be marketed by selected clients and strategic partners. The company’s operations are conducted through several wholly owned subsidiaries: Inyx USA, Ltd., based in Manati, Puerto Rico; Inyx Pharma Limited and Inyx Europe Limited, both near Manchester, England; Inyx Canada, Inc. based in Toronto, and Exaeris, Inc., based in Exton, Pennsylvania, which conducts Inyx’s collaborative marketing and commercial development activities. Inyx, Inc.'s corporate offices are in New York City. For more information, please visit: http://www.inyxinc.com.
Safe Harbor
Statements about Inyx’s future expectations, including future revenues and earnings, and all other statements in this press release other than historical facts, are “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, Section 21E of the Securities Exchange Act of 1934, and as that term is defined in the Private Securities Litigation Reform Act of 1995. The Company intends that such forward-looking statements be subject to the safe harbors created thereby. Since these statements involve risks and uncertainties and are subject to change at any time, the Company’s actual results could differ materially from expected results.
For more information, please contact: Jay M. Green, Executive Vice President, Inyx, Inc. 212-838-1111 jgreen@inyxinc.com (Financial Tables on Next Two Pages) INYX, INC. Consolidated Statement of Operations (expressed in thousands of U.S. dollars, except per share amounts) For the Three Months Ended September 30, 2005 2004 (Unaudited) Net revenues $12,908 $ 4,249 Cost of sales 7,837 3,571 Gross profit 5,071 678 Operating expenses: Research and development 929 942 General and administrative 5,813 2,521 Selling 181 95 Depreciation and amortization 903 155 Amortization of intangible assets 436 42 Total operating expenses 8,262 3,755 Loss from operations before interest and financing costs, income tax benefit and extraordinary item (3,191) (3,077) Interest and financing costs 1,750 750 Loss before income tax benefit and extraordinary item (4,941) (3,827) Income tax benefit - - Net loss before extraordinary item $(4,941) $(3,827) Extraordinary item - - Net loss $(4,941) $(3,827) Basic and fully diluted loss per share before extraordinary item $(0.12) $(0.12) Basic and fully diluted earnings per share from extraordinary item - - Basic and fully diluted loss per share $(0.12) $(0.12) Weighted average number of shares used in computing basic and fully diluted loss per share amounts 39,985,613 32,523,000 INYX, INC. Consolidated Statement of Operations (expressed in thousands of U.S. dollars, except per share amounts) For the Nine Months Ended September 30, 2005 2004 (Unaudited) Net revenues $24,086 $11,549 Cost of sales 16,236 10,392 Gross profit 7,850 1,157 Operating expenses: Research and development 1,876 1,341 General and administrative 12,239 6,820 Selling 355 255 Depreciation and amortization 1,619 431 Amortization of intangible assets 845 125 Total operating expenses 16,934 8,972 Loss from operations before interest and financing costs, income tax benefit and extraordinary item (9,084) (7,815) Interest and financing costs 7,896 2,474 Loss before income tax benefit and extraordinary item (16,980) (10,289) Income tax benefit - 393 Net loss before extraordinary item $(16,980) $(9,896) Extraordinary item 917 - Net loss $(16,063) $(9,896) Basic and fully diluted loss per share before extraordinary item $(0.41) $(0.32) Basic and fully diluted earnings per share from extraordinary item 0.02 - Basic and fully diluted loss per share $(0.39) $(0.32) Weighted average number of shares used in computing basic and fully diluted loss per share amounts 39,428,431 30,780,478
Inyx, Inc.
CONTACT: Jay M. Green, Executive Vice President of Inyx, Inc.,+1-212-838-1111, jgreen@inyxinc.com
Web site: http://www.inyxinc.com//
