Talecris Biotherapeutics Announces Third Quarter 2010 Financial Results

RESEARCH TRIANGLE PARK, N.C., Oct. 28 /PRNewswire-FirstCall/ -- Talecris Biotherapeutics Holdings Corp. (“Talecris”) (Nasdaq: TLCR) today announced its financial results for the three and nine months ended September 30, 2010 and filed its Quarterly Report on Form 10-Q with the U.S. Securities and Exchange Commission (SEC).

Third quarter 2010 net revenue increased by $11.3 million or 2.8% to $407.0 million from $395.7 million in the third quarter of 2009. Higher revenues from Talecris’ principal products 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 Koate® DVI Factor VIII (Human) in the third quarter of 2010 were partially offset by lower sales of albumin, PPF powder and intermediates compared to the third quarter of 2009. Third quarter 2010 gross margin was 43.5% compared to 41.7% in the third quarter of 2009. Third quarter 2010 income from operations was $97.0 million versus $69.4 million for the third quarter of 2009, a 39.8% increase. Net income was $56.1 million for the third quarter of 2010, an increase of $20.2 million compared to net income of $35.8 million for the third quarter of 2009. Diluted earnings per share were $0.43 in the third quarter of 2010, including an after-tax charge of $5.8 million ($0.05 per diluted share) for costs associated with Talecris’ definitive merger agreement with Grifols S.A. and Grifols, Inc. (Grifols), compared to diluted earnings per share of $0.38 (pro forma diluted EPS of $0.30) for the third quarter of 2009. Talecris’ third quarter 2009 results included the after-tax charge of $0.9 million ($0.01 per diluted share) for CSL merger-related expenses.

On a non-GAAP basis excluding merger-related items in both periods, Talecris’ net income was $61.9 million for the third quarter of 2010, an increase of 68.7% compared to $36.7 million for the third quarter of 2009. On the same basis, diluted earnings per share for the 2010 third quarter were $0.48, an increase of 65.5% from $0.29 for the third quarter of 2009. Additional information regarding the computation of non-GAAP financial measures is included in Exhibit B.

For the first nine months of 2010, Talecris’ net revenue increased by $47.7 million or 4.2% to $1,190.8 million compared to $1,143.1 million for the prior year. Higher revenues from Talecris’ principal products Gamunex IGIV and Prolastin-C/Prolastin as well as Koate Factor VIII in the first nine months of 2010 were partially offset by lower revenue from contract manufacturing and lower sales of PPF powder and hyperimmunes compared to the first nine months of 2009. Gross margin for the period was 43.7% compared to 41.9% in the first nine months of 2009. Net income for the first nine months of 2010 was $149.0 million, a decrease of $3.5 million compared to net income of $152.5 million for the first nine months of 2009. Diluted EPS for the first nine months of 2010 was $1.16 compared to $1.62 (pro forma diluted EPS of $1.26) for the first nine months of 2009. Talecris’ first nine months 2010 results included an after-tax charge of $11.0 million ($0.08 per diluted share) for costs associated with the Grifols acquisition. The first nine months 2009 diluted EPS included the $48.8 million after-tax benefit of the CSL merger termination fee ($0.52 per diluted share) which was partially offset by an after-tax charge of $8.7 million ($0.10 per diluted share) for CSL merger-related expenses.

On a non-GAAP basis excluding merger-related items in both periods, Talecris’ net income was $160.0 million for the first nine months of 2010, a 42.2% increase compared to $112.5 million for the first nine months of 2009. On the same basis, diluted EPS was $1.24 for the first nine months of 2010 compared to $0.90 for the first nine months of 2009, a 37.8% increase. Additional information regarding the computation of non-GAAP financial measures is included in Exhibit B.

“At Talecris, we look forward to the consummation of our proposed merger with Grifols,” said Lawrence D. Stern, Talecris’ chairman and chief executive officer. “While we work with the regulators and Grifols to complete the transaction, I am proud of the performance and strong results that our company has delivered in the first nine months of 2010. I am especially proud of the recent approval of Gamunex-C by the FDA which provides patients with primary immunodeficiency the first and only immune globulin approved for both a subcutaneous and intravenous delivery option. This new route of administration continues to build on Gamunex’s position as a versatile IG therapy with the broadest set of FDA approved indications.”