- Company Provides 2007 Financial Guidance -
FREMONT, Calif., Feb. 21 /PRNewswire-FirstCall/ -- PDL BioPharma, Inc.
(PDL) (Nasdaq: PDLI) today reported financial results for the fourth
quarter and full year ended December 31, 2006.
-- Total revenues for the full year 2006 increased 48 percent to $414.8
million from $280.6 million for the full year 2005. Total revenues for
the fourth quarter of 2006 rose 29 percent to $107.8 million from $83.7
million in the same period of 2005. Total revenues in 2006 included
approximately $25.5 million of revenues that would have been deferred
to subsequent years, but that were recognized in 2006 as a result of
the discontinuation of the Roche collaborations for the development of
daclizumab in both asthma and transplant maintenance.
-- GAAP net loss for the full year 2006 was $130.0 million, or $1.14 per
basic and diluted share, compared with a GAAP net loss of $166.6
million, or $1.60 per basic and diluted share, for the full year 2005.
GAAP net loss for the fourth quarter of 2006 was $89.7 million,
compared with a GAAP net loss of $34.1 million for the comparable 2005
period. The 2006 GAAP net losses for the fourth quarter and the full
year included a $72.1 million asset impairment charge related to the
company's Retavase(R) product.
-- Non-GAAP net income for the full year 2006 was $56.0 million, or $0.48
per diluted share. The incremental revenues recognized in 2006 as a
result of the discontinuation of the Roche collaborations accounted for
$25.5 million of the company's non-GAAP net income, or $0.22 per
diluted share. Non-GAAP net income was $19.8 million, or $0.18 per
diluted share, for the full year 2005. Non-GAAP net income for the
fourth quarter of 2006 was $6.1 million compared to non-GAAP net income
of $7.6 million in the fourth quarter of 2005.
-- Cash flow generated from operating activities for the full year 2006
was $78.8 million, compared with $31.6 million for the full year 2005.
Cash, cash equivalents, marketable securities and restricted cash and
investments totaled approximately $426.3 million at December 31, 2006
compared to $333.9 million at December 31, 2005.
"During 2006, we achieved robust revenue growth while growing non-GAAP
income significantly during our first full year operating as a commercial
organization," said Mark McDade, chief executive officer, PDL BioPharma.
"Looking forward in 2007, we intend to increase investment in R&D with the
aim of building sustainable, long-term stockholder value, while continuing
to grow our product and royalty revenues and non-GAAP income. We have an
exciting slate of business and clinical milestones to accomplish this year,
and we're quite focused on continuing to push ahead commercially and
executing on our pipeline plans."
Revenues
Total revenues consist of product sales, royalties and license,
collaboration and other revenues.
-- For the full year 2006, net product sales increased to $165.7 million
from $122.1 million in 2005. Results for the 2005 period included
approximately nine months of sales since the company began marketing
Cardene(R) I.V., Retavase and IV Busulfex(R) subsequent to acquiring
the rights to these products in March 2005. Net product sales in the
fourth quarter of 2006 were $48.1 million. Net product sales for the
fourth quarter of 2005 totaled $39.0 million, of which $36.8 million
was attributable to the company's three current commercial products.
Fourth quarter and full year 2006 net sales by product compared to the
prior periods are summarized below (dollars in millions):
Three Months Ended Twelve Months Ended
December 31, December 31,
_______________________ _______________________
2006 2005 % change 2006 2005**
__________________________________________________________
Cardene $31.8 $23.9 33% $109.7 $62.1
Retavase 9.0 7.1 27 30.8 32.7
IV Busulfex 7.2 5.8 23 24.1 17.4
__________________________________________________________
Total marketed
products 48.1 36.8 31 164.6 112.3
Off-patent
products* -- 2.2 -100 1.1 9.8
__________________________________________________________
Total product
sales, net $48.1 $39.0 23% $165.7 $122.1
==========================================================
* Off-patent products were divested during the first quarter of 2006.
** Results for the 2005 period reflect approximately nine months of
sales. As such, percentage changes comparing full year 2005 and 2006 are
not meaningful and are not included.
-- Royalty revenues for the full year 2006 increased 42 percent to $184.3
million from $130.1 million in the prior year. Royalty revenues for
the fourth quarter of 2006 increased 31 percent to $43.8 million,
compared with $33.4 million in the comparable period in 2005. Royalty
revenues during the fourth quarter of 2006 reflect royalties PDL
received based on worldwide net sales of eight antibody products
licensed under PDL's antibody humanization patents: Avastin(R),
Herceptin(R), Xolair(R), Raptiva(R) and Lucentis(R) antibody products
from Genentech, Inc.; Synagis(R) antibody product from MedImmune, Inc.;
Tysabri(R) antibody product from Elan Pharmaceuticals, Inc.; and
Mylotarg(R) antibody product from Wyeth.
-- License, collaboration and other revenues for the full year 2006
increased to $64.8 million from $28.4 million for the full year 2005.
License, collaboration and other revenues during the fourth quarter of
2006 increased to $16.0 million from $11.3 million in the same period
of 2005. License, collaboration and other revenues for the full year
2006 and the fourth quarter included approximately $25.5 million and
$6.7 million, respectively, in revenues that would have been deferred
to subsequent years, but that were recognized in the respective periods
as a result of the discontinuation of the Roche collaborations for the
development of daclizumab in both asthma and transplant maintenance.
The increase in license, collaboration and other revenues for the full
year 2006 as compared to 2005 was also due to an increase in R&D
services related to the company's collaborations.
Costs and Expenses
For the full year 2006, total costs and expenses were $548.7 million,
compared with $445.7 million for the full year 2005. For the fourth quarter
of 2006, total costs and expenses were $198.9 million, compared with $118.8
million in the fourth quarter of 2005. On a non-GAAP basis, total costs and
expenses for 2006 were $358.8 million compared to $260.8 million for the
prior year. On a non-GAAP basis, total costs and expenses in the fourth
quarter of 2006 were $101.7 million compared to $76.1 million in the fourth
quarter of 2005.
-- Cost of product sales was $86.3 million for the full year 2006, an
increase from $60.3 million in 2005. Non-GAAP cost of product sales,
which excludes amortization of product rights, was $43.2 million for
the full year 2006 compared to $24.8 million in the comparable 2005
period. These increases were primarily because the 2006 period
included 12 months of product sales while the 2005 period only included
approximately nine months. As a percentage of net product sales, non-
GAAP cost of product sales for the full year 2006 increased to 26
percent compared to 20 percent for the full year 2005. This increase
was due to certain charges incurred in 2006 related to the manufacture
of the Retavase product and a lower effective outbound royalty payment
rate related to sales of Cardene I.V. in 2005.
-- Research and development (R&D) expenses increased to $260.7 million for
the full year 2006, compared with $172.0 million for 2005. On a
non-GAAP basis, R&D expenses for the full year 2006 were $211.6
million, an increase over the $155.6 million reported in the same
period in the prior year. These increases were due primarily to higher
clinical development expenses, particularly for the company's Nuvion(R)
antibody product and daclizumab, as well as increased research and
preclinical expenses.
-- Selling, general and administrative (SG&A) expenses were $120.9 million
for the full year 2006, compared with $82.4 million for the prior
period. Non-GAAP SG&A expenses were $103.9 million in 2006 compared to
$80.3 million in the prior year comparable period. These increases
were primarily due to the company's continued investment in its sales,
sales support and marketing infrastructure to support commercial
operations, as well as the fact that the company did not have a
commercial organization for the full 12 months of 2005.
-- Total costs and expenses for the full year 2006 and fourth quarter
included a $72.1 million asset impairment charge related to the
Retavase product, which was the result of reduced net cash flow
expectations for the product. Total asset impairment charges for the
full year 2006 were $74.7 million and other-acquisition-related charges
for the same period were $6.2 million. For the full year 2005, total
costs and expenses included asset impairment charges of $31.3 million,
other acquisition-related charges of $20.3 million and an acquired in-
process research and development charge of $79.4 million.
2007 Financial Outlook
The following statements are based on current expectations as of
February 21, 2007, and PDL undertakes no obligation to update this
information. These statements are forward-looking and do not include the
potential impact of additional collaborations, material licensing
arrangements or other strategic transactions. Additional financial
considerations for 2007 will be discussed on the company's February 21
investor conference call.
-- PDL anticipates total revenues for 2007 of approximately $450 million
to $500 million, including $200 million to $220 million in net product
sales and $220 million to $240 million in royalty revenues. Revenue
guidance also includes licensing and collaboration revenues of
approximately $30 million to $40 million, of which approximately $5.2
million is related to the accelerated recognition of revenues that
would have been deferred to subsequent years but that is expected to be
recognized in 2007 as a result of the discontinuation of the Roche
collaboration for the development of daclizumab in transplant
maintenance.
-- On a non-GAAP basis, PDL anticipates total costs and expenses for 2007
as follows: cost of product sales of approximately 25 percent as a
percentage of net product sales; research and development expenses of
approximately $255 million to $275 million; and selling, general and
administrative expenses of approximately $100 million to $110 million.
Higher total operating expenses anticipated for 2007 reflect an
increase in planned R&D activities and costs associated with the
company's planned relocation of its corporate headquarters during the
second half of 2007.
-- For the full year 2007, PDL anticipates non-GAAP net income of $45
million to $65 million or, on a diluted per share basis, $0.38 to
$0.54, based on a weighted average number of diluted shares outstanding
for the year of approximately 120 million. The incremental revenues
related to the Roche discontinuation are expected to account for $5.2
million of non-GAAP net income, or $0.04 per diluted share, in 2007.
Excluding the incremental revenues recognized as a result of the
discontinuation of the Roche collaborations, PDL anticipates 2007 non-
GAAP net income of $39.8 million to $59.8 million, a significant
increase over the $30.4 million on the same basis for the full year
2006.
-- PDL anticipates capital expenditures of approximately $110 million for
the full year 2007, approximately 80 percent of which is associated
with the build-out of the company's new corporate headquarters in
Redwood City, California.
This forward-looking non-GAAP guidance excludes certain expenses based
on current estimates for the full year 2007, including stock-based
compensation expenses of $24 million to $27 million; depreciation of
property and equipment of $35 million to $38 million; amortization of
intangible assets of approximately $35 million; interest income and
expense, net of $2 million to $4 million and income tax expense of
approximately $1 million. This forward- looking non-GAAP guidance also
excludes other acquisition-related charges; however, these amounts are not
reasonably quantifiable at this time because they depend upon future
events. Additionally, this guidance excludes any impact from potential new
collaborations or strategic transactions into which PDL may enter. If PDL
completes a significant collaboration or strategic transaction, PDL expects
it would update its guidance, if necessary, at the next earnings call after
the transaction to reflect the expected impact in 2007. Other items that
could affect the reconciliation between GAAP and non- GAAP results cannot
be estimated at this time because they depend upon future events.
Non-GAAP Financial Information
The non-GAAP financial measures in this press release exclude
depreciation of property and equipment, stock-based compensation expense,
amortization of intangible assets, asset impairment charges, interest
income and other, net, interest expense, income taxes and certain other
items that would otherwise be included if measured in accordance with
generally accepted accounting principles (GAAP). PDL believes that the
non-GAAP financial measures presented in this press release are useful for
investors because these measures provide added insight into PDL's
performance by focusing on results generated by its ongoing operations. In
addition, PDL uses these non-GAAP financial measures when assessing the
performance of its ongoing operations, in making resource allocation
decisions and for planning and forecasting. PDL also considers these
non-GAAP results in awarding bonus and other incentive compensation to its
employees, including management. The non-GAAP financial measures should be
considered as a supplement to, not as a substitute for, or superior to, the
measures of financial performance prepared in accordance with GAAP. A
description of the non-GAAP financial measures for the periods presented
and a reconciliation of this information to the GAAP financial measures are
included in the attached financial tables.
Forward-looking Statements
This press release contains forward-looking statements involving risks
and uncertainties and PDL's actual results may differ materially from
those, express or implied, in the forward-looking statements. These
forward-looking statements include PDL's expectations regarding financial
results, the continuation of existing collaborative agreements and the
timing of clinical developments as well as other statements regarding PDL's
expectations. Factors that may cause differences between current
expectations and actual results include, but are not limited to, the
following: changes in PDL's development plans; unexpected litigation or
other disputes; continued contraction of and competition in the
thrombolytics market in which PDL's Retavase product is sold; factors
affecting the clinical timelines of PDL's development products such as
PDL's ability to timely contract with clinical sites, enrollment rates and
availability of clinical materials; fluctuations in sales; unexpected
factors that arise that could cause PDL to reduce its expectations
regarding the value of goodwill or other intangible assets and take an
impairment charge; changes in the market due to alternative treatments or
other actions by competitors; and variability in expenses particularly on a
quarterly basis, due, in principal part, to total headcount of the
organization and the timing of expenses. In addition, PDL's revenues depend
on the success and timing of sales of PDL's licensees, including in
particular the continued success of Genentech, Inc.'s Avastin and Herceptin
antibody products as well as the seasonality of sales of Synagis antibody
product from MedImmune, Inc. In addition, quarterly revenues may be
impacted by PDL's ability to maintain and increase its revenues from its
co-development agreement with Biogen Idec. PDL's net income will be
affected by state and federal taxes, and its revenues and expenses would be
affected by new collaborations, execution of material patent licensing
agreements or other strategic transactions. Further, there can be no
assurance that results from completed and ongoing clinical studies will be
successful or that ongoing or planned clinical studies will be completed or
initiated on the anticipated schedules. Other factors that may cause PDL's
actual results to differ materially from those expressed or implied in the
forward-looking statements in this press release are discussed in PDL's
filings with the Securities and Exchange Commission (SEC), including the
"Risk Factors" sections of its annual and quarterly reports filed with the
SEC. Copies of PDL's filings with the SEC may be obtained at the
"Investors" section of PDL's website at http://www.pdl.com. PDL expressly
disclaims any obligation or undertaking to release publicly any updates or
revisions to any forward-looking statements contained herein to reflect any
change in PDL's expectations with regard thereto or any change in events,
conditions or circumstances on which any such statements are based for any
reason, except as required by law, even as new information becomes
available or other events occur in the future. All forward-looking
statements in this press release are qualified in their entirety by this
cautionary statement.
About PDL BioPharma
PDL BioPharma, Inc. is a biopharmaceutical company focused on
discovering, developing and commercializing innovative therapies for severe
or life- threatening illnesses. Commercially focused in the acute-care
hospital setting, PDL markets and sells its portfolio of leading products
in the United States and Canada. A pioneer of antibody humanization
technology, PDL promotes this technology through licensing agreements and
clinical development of its own diverse pipeline of investigational
compounds. PDL's research platform centers on the discovery and development
of antibodies to treat cancer and autoimmune diseases. For more
information, please visit http://www.pdl.com.
NOTE: PDL BioPharma and the PDL BioPharma logo are considered
trademarks and Cardene, Busulfex and Nuvion are registered U.S. trademarks
of PDL BioPharma, Inc.; PDL BioPharma, Inc. has a license from Centocor to
use the trademark Retavase, which is a registered U.S. trademark.
Herceptin, Avastin, Lucentis and Raptiva are registered U.S. trademarks of
Genentech, Inc. Xolair is a registered trademark of Novartis AG. Synagis is
a registered trademark of MedImmune, Inc. Mylotarg is a registered
trademark of Wyeth. Tysabri is a registered trademark of Elan
Pharmaceuticals, Inc.
PDL BIOPHARMA, INC.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(in thousands, except per share amounts)
(unaudited)
Three Months Ended Twelve Months Ended
December 31, December 31,
2006 2005 2006 2005
REVENUES:
Product sales, net $48,051 $39,012 $165,701 $122,106
Royalties 43,753 33,373 184,277 130,068
License, collaboration
and other 16,038 11,268 64,792 28,395
Total revenues 107,842 83,653 414,770 280,569
COSTS AND EXPENSES:
Cost of product sales 24,418 16,776 86,292 60,257
Research and
development 65,397 46,959 260,660 172,039
Selling, general and
administrative 36,689 28,119 120,856 82,386
Acquired in-process
research and
development -- -- -- 79,417
Other acquisition-
related charges 289 10,876 6,199 20,349
Asset impairment
charges 72,094 16,044 74,650 31,269
Total costs and
expenses 198,887 118,774 548,657 445,717
Operating loss (91,045) (35,121) (133,887) (165,148)
Interest income and
other, net 5,268 2,781 17,704 9,616
Interest expense (3,605) (2,655) (13,070) (10,177)
Loss before
income taxes (89,382) (34,995) (129,253) (165,709)
Income tax expense
(benefit) 326 (899) 767 868
Net loss $(89,708) $(34,096) $(130,020) $(166,577)
NET LOSS PER SHARE:
Basic and diluted $(0.78) $(0.31) $(1.14) $(1.60)
Weighted average
shares -- basic
and diluted 114,403 111,571 113,571 104,326
In addition to the consolidated financial statements presented in
accordance with GAAP, PDL uses non-GAAP measures of operating performance,
which are adjusted from results based on GAAP to exclude depreciation of
property and equipment; stock-based compensation expense; amortization of
intangible assets; interest income and other, net; interest expense; income
taxes and certain other miscellaneous items. PDL believes that the non-GAAP
results provide added insight into its performance by focusing on results
generated by its ongoing operations. PDL uses the non-GAAP results when
assessing the performance of its ongoing operations, in making resource
allocation decisions and for planning and forecasting. Additionally, PDL
considers these non-GAAP results in awarding bonus and other incentive
compensation to its employees, including management. The non-GAAP financial
measures should be considered as a supplement to, not as a substitute for,
or superior to, the measures of financial performance prepared in
accordance with GAAP. Investors are encouraged to review the reconciliation
of the non-GAAP financial measures to their most directly comparable GAAP
financial measures.
PDL BIOPHARMA, INC.
NON-GAAP CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (1)
(in thousands, except per share amounts)
(unaudited)
Three Months Ended Twelve Months Ended
December 31, December 31,
2006 2005 2006 2005
REVENUES:
Product sales, net $48,051 $39,012 $165,701 $122,106
Royalties 43,753 33,373 184,277 130,068
License, collaboration
and other 16,038 11,268 64,792 28,395
Total revenues 107,842 83,653 414,770 280,569
COSTS AND EXPENSES:
Cost of product sales 13,151 6,214 43,234 24,823
Research and
development 55,214 42,589 211,648 155,643
Selling, general and
administrative 33,352 27,298 103,935 80,292
Non-GAAP costs
and expenses 101,717 76,101 358,817 260,758
Non-GAAP net income $6,125 $7,552 $55,953 $19,811
NON-GAAP NET INCOME
PER SHARE:
Basic $0.05 $0.07 $0.49 $0.19
Weighted average
shares -- basic 114,403 111,571 113,571 104,326
Diluted $0.05 $0.06 $0.48 $0.18
Weighted average
shares --
diluted (2) 117,552 116,514 117,447 109,222
(1) These non-GAAP condensed consolidated statements of operations
exclude depreciation of property and equipment; stock-based compensation
expense; amortization of intangible assets; interest income and other, net;
interest expense; income taxes and certain other miscellaneous items that
were not classified in the foregoing categories and are identified below.
During the three months ended December 31, 2006, the miscellaneous
excluded items consisted of (a) other acquisition-related charges of $0.3
million related to the operations of ESP Pharma Holding Company, Inc. prior
to the Company's acquisition of ESP Pharma on March 23, 2005, primarily
product returns, as well as returns of Retavase for sales made prior to the
Company's acquisition of the rights to the product from Centocor, Inc. on
the same date and (b) an asset impairment charge of $72.1 million to record
the impairment of an intangible asset related to the Retavase product
rights. During the three months ended December 31, 2005, the miscellaneous
excluded items consisted of (a) other acquisition-related charges of $10.9
million and (b) asset impairment charges of $16.0 million, which consisted
of $15.8 million related to the write-off of the Company's option to
re-acquire rights to manufacture and market Zenapax for acute renal
transplant rejection and $0.2 million related to the impairment of the
off-patent branded products, originally acquired from ESP Pharma, that the
Company sold in the first quarter of 2006.
During the year ended December 31, 2006, the miscellaneous excluded
items consisted of (a) other acquisition-related charges of $6.2 million,
(b) asset impairment charges of $74.7 million, (c) a $5.6 million charge
incurred in connection with the Company's acquisition in September 2006 of
certain Cardene-related rights from Roche and (d) a $4.1 million charge for
payments to Wyeth in consideration of Wyeth's consent to the Company's
transfer of the Company's rights to the off-patent branded products. During
the year ended December 31, 2005, the miscellaneous excluded items
consisted of (a) other acquisition-related charges of $20.3 million, (b)
asset impairment charges of $31.3 million and (c) a $79.4 million charge
for acquired in-process research and development related to the ESP Pharma
acquisition.
(2) These weighted average shares exclude the impact of 12.4 million
shares and 10.6 million shares of common stock underlying the convertible
notes the Company issued in July 2003 and February 2005, respectively.
PDL BIOPHARMA, INC.
RECONCILIATION OF NON-GAAP CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
TO GAAP
(in thousands, except per share amounts)
(unaudited)
Three Months Ended December 31, 2006
Adjustments
Depreciation Stock-
Amortization of Based GAAP
of Other Property Compen- Results
Non-GAAP Intangible Excluded and sation As
Results Assets Items Equipment Expenses Reported
REVENUES:
Product sales,
net $48,051 $-- $-- $-- $-- $48,051
Royalties 43,753 -- -- -- -- 43,753
License,
collaboration
and other 16,038 -- -- -- -- 16,038
Total revenues 107,842 -- -- -- -- 107,842
COSTS AND EXPENSES:
Cost of product
sales 13,151 11,267 -- -- -- 24,418
Research and
development 55,214 412 -- 6,433 3,338 65,397
Selling, general
and
administrative 33,352 -- -- 841 2,496 36,689
Non-GAAP costs
and expenses 101,717
Depreciation of
property and
equipment -- -- 7,274 (7,274) -- --
Stock-based
compensation -- -- 5,834 -- (5,834) --
Acquired in-process
research and
development -- -- -- -- -- --
Other acquisition-
related charges -- -- 289 -- -- 289
Asset impairment
charge -- -- 72,094 -- -- 72,094
Total costs
and expenses 11,679 85,491 -- -- 198,887
Operating loss (11,679) (85,491) -- -- (91,045)
Interest income
and other, net -- -- 5,268 -- -- 5,268
Interest expense -- -- (3,605) -- -- (3,605)
Income (loss)
before income
taxes 6,125 (11,679) (83,828) -- -- (89,382)
Income tax expense -- -- 326 -- -- 326
Net income
(loss) $6,125 $(11,679)$(84,154) $-- $-- $(89,708)
NET INCOME (LOSS)
PER SHARE:
Basic $0.05 $(0.78)
Weighted average
shares -
basic 114,403 114,403
Diluted $0.05 $(0.78)
Weighted average
shares -
diluted 117,552 114,403
Three Months Ended December 31, 2005
Adjustments
Depreciation Stock-
Amortization of Based GAAP
of Other Property Compen- Results
Non-GAAP Intangible Excluded and sation As
Results Assets Items Equipment Expenses Reported
REVENUES:
Product sales,
net $39,012 $-- $-- $-- $-- $39,012
Royalties 33,373 -- -- -- -- 33,373
License,
collaboration
and other 11,268 -- -- -- -- 11,268
Total revenues 83,653 -- -- -- -- 83,653
COSTS AND EXPENSES:
Cost of product
sales 6,214 10,562 -- -- -- 16,776
Research and
development 42,589 487 -- 3,841 42 46,959
Selling, general
and
administrative 27,298 -- -- 404 417 28,119
Non-GAAP costs
and expenses 76,101
Depreciation of
property and
equipment -- -- 4,245 (4,245) -- --
Stock-based
compensation -- -- 459 -- (459) --
Acquired in-process
research and
development -- -- -- -- -- --
Other acquisition-
related charges -- -- 10,876 -- -- 10,876
Asset impairment
charges 16,044 16,044
Total costs
and expenses 11,049 31,624 -- -- 118,774
Operating loss (11,049) (31,624) -- -- (35,121)
Interest income and
other, net -- -- 2,781 -- -- 2,781
Interest expense -- -- (2,655) -- -- (2,655)
Income (loss)
before income
taxes 7,552 (11,049) (31,498) -- -- (34,995)
Income tax benefit -- -- (899) -- -- (899)
Net income
(loss) $7,552 $(11,049)$(30,599) $-- $-- $(34,096)
NET INCOME (LOSS)
PER SHARE:
Basic $0.07 $(0.31)
Weighted average
shares -
basic 111,571 111,571
Diluted $0.06 $(0.31)
Weighted average
shares -
diluted 116,514 111,571
PDL BIOPHARMA, INC.
RECONCILIATION OF NON-GAAP CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS TO
GAAP
(in thousands, except per share amounts)
(unaudited)
Twelve Months Ended December 31, 2006
Adjustments
Depreciation Stock-
Amortization of Based GAAP
of Other Property Compen- Results
Non-GAAP Intangible Excluded and sation As
Results Assets Items Equipment Expenses Reported
REVENUES:
Product sales,
net $165,701 $-- $-- $-- $-- $165,701
Royalties 184,277 -- -- -- -- 184,277
License,
collaboration
and other 64,792 -- -- -- -- 64,792
Total revenues 414,770 -- -- -- -- 414,770
COSTS AND EXPENSES:
Cost of product
sales 43,234 43,058 -- -- -- 86,292
Research and
development 211,648 1,798 5,621 27,983 13,610 260,660
Selling, general
and
administrative 103,935 -- 4,123 2,834 9,964 120,856
Non-GAAP costs
and expenses 358,817
Depreciation of
property and
equipment -- -- 30,817 (30,817) -- --
Stock-based
compensation -- -- 23,574 -- (23,574) --
Acquired in-process
research and
development -- -- -- -- -- --
Other acquisition-
related charges -- -- 6,199 -- -- 6,199
Asset impairment
charges -- -- 74,650 -- -- 74,650
Total costs
and expenses 44,856 144,984 -- -- 548,657
Operating loss (44,856)(144,984) -- -- (133,887)
Interest income
and other, net -- -- 17,704 -- -- 17,704
Interest expense -- -- (13,070) -- -- (13,070)
Income (loss)
before income
taxes 55,953 (44,856)(140,350) -- -- (129,253)
Income tax expense -- -- 767 -- -- 767
Net income
(loss) $55,953 $(44,856)$(141,117) $-- $-- $(130,020)
NET INCOME (LOSS)
PER SHARE:
Basic $0.49 $(1.14)
Weighted average
shares -
basic 113,571 113,571
Diluted $0.48 $(1.14)
Weighted average
shares -
diluted 117,447 113,571
Twelve Months Ended December 31, 2005
Adjustments
Depreciation Stock-
Amortization of Based GAAP
of Other Property Compen- Results
Non-GAAP Intangible Excluded and sation As
Results Assets Items Equipment Expenses Reported
REVENUES:
Product sales,
net $122,106 $-- $-- $-- $-- $122,106
Royalties 130,068 -- -- -- -- 130,068
License,
collaboration
and other 28,395 -- -- -- -- 28,395
Total revenues 280,569 -- -- -- -- 280,569
COSTS AND EXPENSES:
Cost of product
sales 24,823 35,434 -- -- -- 60,257
Research and
development 155,643 2,109 -- 14,029 258 172,039
Selling, general
and
administrative 80,292 14 -- 1,367 713 82,386
Non-GAAP costs
and expenses 260,758
Depreciation of
property and
equipment -- -- 15,396 (15,396) -- --
Stock-based
compensation -- -- 971 -- (971) --
Acquired in-process
research and
development -- -- 79,417 -- -- 79,417
Other acquisition-
related charges -- -- 20,349 -- -- 20,349
Asset impairment
charges 31,269 31,269
Total costs
and expenses 37,557 147,402 -- -- 445,717
Operating loss (37,557)(147,402) -- -- (165,148)
Interest income
and other, net -- -- 9,616 -- -- 9,616
Interest expense -- -- (10,177) -- -- (10,177)
Income (loss)
before income
taxes 19,811 (37,557)(147,963) -- -- (165,709)
Income tax expense -- -- 868 -- -- 868
Net income
(loss) $19,811 $(37,557)$(148,831) $-- $-- $(166,577)
NET INCOME (LOSS)
PER SHARE:
Basic $0.19 $(1.60)
Weighted average
shares -
basic 104,326 104,326
Diluted $0.18 $(1.60)
Weighted average
shares -
diluted 109,222 104,326
PDL BIOPHARMA, INC.
CONDENSED CONSOLIDATED BALANCE SHEET DATA
(in thousands)
(unaudited)
December 31, December 31,
2006 2005
Cash, cash equivalents, marketable securities
and restricted cash and investments $426,285 $333,922
Total assets $1,141,893 $1,163,154
Total stockholders' equity $467,541 $526,065
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOW DATA
(in thousands)
(unaudited)
Twelve Months Ended
December 31,
2006 2005
Net loss $(130,020) $(166,577)
Adjustments to reconcile net loss to
net cash provided by operating activities 177,191 168,362
Changes in assets and liabilities 31,599 29,765
Net cash provided by operating activities $78,770 $31,550
SOURCE PDL BioPharma, Inc.
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Related links:
http://www.pdl.com/
CONTACT:
Ami Knoefler, Corporate and Investor
Relations, +1-510-284-8851, or ami.knoefler@pdl.com, or Jean
Suzuki, Corporate Relations, +1-510-574-1550, or
jean.suzuki@pdl.com, both of PDL BioPharma, Inc.
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