Talecris Biotherapeutics Announces Fourth Quarter and Full Year 2010 Results

RESEARCH TRIANGLE PARK, N.C., Feb. 23, 2011 /PRNewswire/ -- Talecris Biotherapeutics Holdings Corp. (“Talecris”) (Nasdaq: TLCR) today announced its financial results for the three and twelve months ended December 31, 2010 and filed its Form 10-K with the U.S. Securities and Exchange Commission (SEC).

Fourth quarter 2010 net revenue increased by $20.7 million or 5.3% to $410.8 million from $390.1 million in the fourth quarter of 2009. Higher revenues from Talecris’ principal products Gamunex-C®/Gamunex® Immune Globulin Intravenous (Human), 10% Caprylate/Chromatography Purified (IGIV) and Prolastin® Alpha-1 Proteinase Inhibitor (Human) (Prolastin, Prolastin A1PI, Prolastin-C A1PI) as well as Thrombate® III Antithrombin III (Human) in the fourth quarter of 2010 were partially offset by lower sales of albumin, hyperimmunes and contract manufacturing compared to the fourth quarter of 2009. Fourth quarter 2010 gross margin was 41.2% compared to 39.2% in the fourth quarter of 2009. Fourth quarter 2010 income from operations was $68.5 million versus $57.4 million for the fourth quarter of 2009, a 19.3% increase. Net income was $17.1 million for the fourth quarter of 2010, an increase of $15.7 million compared to net income of $1.4 million for the fourth quarter of 2009. Diluted earnings per share were $0.13 in the fourth quarter of 2010, including an after-tax charge of $6.3 million ($0.05 per diluted share) for costs associated with Talecris’ definitive merger agreement with Grifols S.A. and Grifols, Inc. (Grifols) as well as an after-tax charge of $26.6 million ($0.20 per diluted share) as the result of the Plasma Centers of America, LLC (PCA) jury verdict and related interest expense, compared to diluted earnings per share of $0.01 (pro forma diluted EPS of $0.00) for the fourth quarter of 2009. Talecris’ fourth quarter 2009 results included the after-tax charge of $0.5 million ($0.00 per diluted share) for CSL Limited (CSL) merger-related expenses as well as an after-tax charge of $26.3 million ($0.21 per diluted share) associated with the debt refinancing transactions.

On a non-GAAP basis excluding merger-related items in both periods, the 2010 PCA judgment and the 2009 debt refinancing charges, Talecris’ net income was $50.0 million for the fourth quarter of 2010, an increase of 77.3% compared to $28.2 million for the fourth quarter of 2009. On the same basis, diluted earnings per share for the 2010 fourth quarter were $0.38, an increase of 72.7% from $0.22 for the fourth quarter of 2009. Additional information regarding the computation of non-GAAP financial measures is included in Exhibit B.

For the full year 2010, Talecris’ net revenue increased by $68.4 million or 4.5% to $1,601.6 million compared to $1,533.2 million for the prior year. Gross margin for the period was 43.1% compared to 41.2% in the full year of 2009. Diluted earnings per share for the full year 2010 were $1.29 compared to $1.50 (pro forma diluted EPS of $1.26) for the full year 2009. Talecris’ full year 2010 results included an after-tax charge of $17.3 million ($0.13 per diluted share) for costs associated with the Grifols acquisition and an after-tax charge of $26.6 million ($0.21 per diluted share) as the result of the PCA judgment. The full year 2009 diluted earnings per share included the $48.8 million after-tax benefit of the CSL merger termination fee ($0.48 per diluted share), which was partially offset by an after-tax charge of $9.3 million ($0.08 per diluted share) for CSL merger-related expenses, as well as an after-tax charge of $26.3 million ($0.26 per diluted share) associated with the company’s debt refinancing transactions.

On a non-GAAP basis excluding merger-related items in both periods, the 2010 PCA judgment and the 2009 debt refinancing charges, Talecris’ net income was $210.0 million for the full year 2010, a 49.3% increase compared to $140.7 million for the full year 2009. On the same basis, diluted earnings per share was $1.63 for the full year 2010 compared to $1.11 for the full year 2009, a 46.8% increase. Additional information regarding the computation of non-GAAP financial measures is included in Exhibit B.

“The support for our proposed merger was evident by the overwhelming vote in favor of the merger by both Grifols’ and Talecris’ shareholders in the recent special meetings of shareholders,” said Lawrence D. Stern, Talecris’ chairman and chief executive officer. “While we await approval from the U.S. Federal Trade Commission of the transaction, I am proud of the performance and record results that our company delivered in 2010 driven by strong growth in our U.S. and European businesses. Our focus on demand generation through our expanded and reorganized sales force in the U.S., combined with the features and benefits of our products, contributed to 10.0% growth in U.S. Gamunex sales and 12.4% growth in U.S. Prolastin-C sales.”

“Extracting more value from our operations is a key aspect of our long-term strategy at Talecris. In 2010, we made significant progress towards this goal through our capital program. Specifically, the construction of our North Fractionation Facility in Clayton, North Carolina is well underway. We are on schedule to increase our fractionation capacity to 6.0 million liters by 2015,” continued Mr. Stern.

*Excludes merger-related items, companys debt refinancing transactions and PCA judgment; EPS reflects pro forma shares in 2009 for the IPO