EAST RUTHERFORD, N.J., March 14 /PRNewswire-FirstCall/ -- Cambrex
Corporation (NYSE: CBM) reports fourth quarter and full year 2006 results
for the period ended December 31, 2006.
(Logo: http://www.newscom.com/cgi-bin/prnh/20000613/CAMBREXLOGO )
Highlights
-- Sold Bio Businesses to Lonza for $460 million in first quarter 2007;
Bio Businesses results included within Continuing Operations
-- Sold Cork and Landen businesses to ICIG in fourth quarter 2006; Cork
and Landen results included within Discontinued Operations
-- Cambrex now consists of Human Health business (excluding Cork and
Landen) and Corporate infrastructure
-- Human Health (excluding Cork and Landen) sales increased 7.5% and
operating profit increased 3.2% during fourth quarter 2006
-- Annualized cost of reduced Corporate infrastructure to reach $17.5
million by the end of the year
Strategic Alternatives and Basis of Reporting Pursuant to its
evaluation of strategic alternatives during 2006, Cambrex sold its two
businesses in Cork, Ireland and Landen, Belgium during the fourth quarter
of 2006, both previously reported within its Human Health segment. Cambrex
also divested its Bioproducts and Biopharma business segments (the "Bio
Businesses") on February 6, 2007. The results from the Cork and Landen
businesses are included within Discontinued Operations for all periods
presented in this release and the results of the Bio Businesses are
included within Continuing Operations for all periods presented, as
required by GAAP. Cambrex will begin to report the Bio Businesses as
Discontinued Operations during the first quarter of 2007.
As previously announced, the Company expects to use the proceeds from
the sale of the Bio Businesses along with funds borrowed under a new credit
facility, assuming such facility can be arranged with favorable terms, to
pay a special dividend of $13.50 to $14.50 per share.
Consistent with prior earnings releases, Adjusted (non-GAAP) results
are used throughout this press release and the accompanying tables to
better reflect the underlying results of operations for the periods
presented. A reconciliation of GAAP results to Adjusted (non-GAAP) results
can be found in the unaudited financial tables included in this press
release.
Human Health and Corporate Segments
The Human Health business, which now excludes Cork and Landen, provides
products and services to accelerate the development and commercialization
of branded and generic small molecule therapeutics, and is comprised of
four world-class manufacturing and research facilities (Charles City, Iowa;
Karlskoga, Sweden; Milan, Italy, and the Center of Technical Excellence in
North Brunswick, New Jersey).
Fourth Quarter 2006
Sales in the Human Health segment increased 7.5% in the fourth quarter
2006 to $66.0 million versus $61.4 million last year. After a favorable
currency impact of 4.8%, the improvement was due primarily to increased
demand for branded active pharmaceutical ingredients (APIs) partially
offset by decreased sales of certain generic APIs.
Fourth quarter 2006 Human Health Adjusted gross margin decreased to
33.4% from 35.3% in the fourth quarter 2005, primarily due to pricing
pressures on certain APIs and increased production costs. Foreign currency
unfavorably impacted Adjusted gross margin by 0.7 of a percentage point in
the fourth quarter 2006. Fourth quarter 2006 Human Health operating profit
increased to $12.9 million versus Adjusted operating profit of $12.6
million in the fourth quarter 2005 due to higher sales offset by a lower
gross margin percentage versus the same period last year. Operating
expenses were flat versus prior year. Foreign exchange had a negligible
impact on Human Health Adjusted operating profit during the fourth quarter
2006.
Corporate operating expenses during the fourth quarter 2006 were $12.8
million, compared to $9.2 million during the fourth quarter 2005. Adjusted
operating expenses for Corporate for the fourth quarter 2006 were $8.3
million versus $5.5 million in the fourth quarter of 2005. The increase
primarily reflects increased legal, bonus, and audit expenses.
Full Year 2006
Sales in the Human Health segment increased 5.9% to $236.7 million
during 2006 from $223.6 million in 2005 due to an increase in the number of
custom development projects and greater demand for generic APIs partially
offset by decreased sales of certain branded APIs. Foreign currency
favorably impacted sales growth by 0.5 of a percentage point during 2006.
Human Health Adjusted gross margin during 2006 decreased to 35.4% compared
to 38.6% in 2005, reflecting increased production costs and pricing
pressures on certain products. Foreign currency unfavorably impacted
Adjusted gross margin by 1.1 percentage points during 2006. Human Health
operating profit for 2006 was $49.2 million, or 20.8% of sales, versus an
Adjusted operating profit of $51.0 million, or 22.8% of sales, in 2005 due
to lower gross margins described above offset by reductions in operating
expenses. Foreign currency unfavorably impacted Adjusted Human Health
operating margin as a percentage of sales by 1.1 percentage points in 2006.
Corporate operating expenses for 2006 were $37.4 million, compared to
$25.9 million during the 2005. Adjusted Corporate operating expenses during
2006 were $28.8 million, compared to $22.7 million during the previous
year. The increase is primarily due to an increase in legal fees, bonus
expense, and audit fees, as well as benefits related to stock appreciation
rights in 2005 that did not recur in 2006.
James A. Mack, Chairman, President, and CEO of Cambrex commented: "We
achieved growth in our Human Health segment during 2006 despite the demands
of the strategic alternatives process. We are confident that prevailing
market forces will lead to more outsourcing of custom development and
commercial manufacturing for branded APIs as well as greater demand for
generic APIs. In 2007 we will focus on continued cost reductions, the
implementation of strategic capital investments to increase capacity at
each of our manufacturing facilities, strengthening and building upon our
proprietary taste masking and other technologies, and restructuring the
corporate cost center."
Bioproducts and Biopharma Segments
As previously announced, Cambrex completed the sale of the Bio
Businesses to Lonza AG during February 2007. As a result, Cambrex will
begin to report the Bio Businesses as Discontinued Operations during the
first quarter of 2007.
Bioproducts
The Bioproducts segment includes products and services for research and
therapeutic applications. Bioproducts sales in the fourth quarter 2006
increased 15.4% to $41.4 million, including a 3.7% favorable impact from
foreign currency, reflecting growth in most product categories. Fourth
quarter 2006 gross margin was nearly flat at 50.4% versus Adjusted gross
margin of 50.6% in the fourth quarter 2005. Foreign currency favorably
impacted Bioproducts gross margin by 0.7 of a percentage point in the
fourth quarter 2006. Bioproducts Adjusted operating profit margin during
the fourth quarter of 2006 was 14.6% of sales versus 15.4% during the
fourth quarter of 2005 due to increased operating expenses. Foreign
currency favorably impacted Bioproducts operating profit margin by 0.6 of a
percentage point in the fourth quarter 2006.
Full year 2006 Bioproducts sales increased 9.1% to $163.1 million,
including a 0.4% favorable impact from foreign currency, versus $149.5
million in 2005. Gross margin for 2006 decreased to 51.7% versus an
Adjusted gross margin of 52.6% in the full year 2005 due to higher
production costs. Foreign currency favorably impacted Bioproducts gross
margin by 0.8 of a percentage point in 2006. Bioproducts Adjusted operating
profit margin during 2006 was nearly flat at 17.8% versus 17.9% in 2005.
Foreign currency favorably impacted Bioproducts operating profit margin by
0.7 of a percentage point in 2006.
Biopharma
The Biopharma segment consists of the Company's contract
biopharmaceutical process development and manufacturing business. Sales in
the fourth quarter 2006 increased 22.2% to $17.0 million versus $14.0
million in the fourth quarter 2005. Fourth quarter 2006 Biopharma gross
margin improved to 23.6% versus an Adjusted gross margin of 8.2% in the
fourth quarter 2005. Fourth quarter 2006 Biopharma operating profit was
$1.7 million versus an Adjusted operating loss of $2.1 million in the
fourth quarter 2005. The improved gross margin and operating profit results
were a result of higher suite and process development fees. Foreign
currency had no impact on Biopharma sales, gross margin or operating profit
margin.
Full year 2006 Biopharma sales were $52.5 million versus $41.7 million
in 2005, a 25.9% increase. Biopharma gross margin during 2006 improved to
6.2% compared to an Adjusted gross margin of -7.6% in the previous year.
Biopharma operating loss during 2006 was $6.1 million versus an Adjusted
operating loss of $14.1 million in 2005.
Consolidated Results
Fourth Quarter 2006
On a GAAP basis, Cambrex reported income from continuing operations of
$0.6 million, or $0.02 per diluted share, compared to a loss of $97.6
million, or $3.66 per diluted share, in the fourth quarter 2005. Excluding
certain items included in the attached GAAP to Adjusted (non-GAAP)
reconciliation tables, Adjusted fourth quarter 2006 net income was $6.7
million, or $0.25 per diluted share. On a comparable basis, Adjusted fourth
quarter 2005 net income was $5.4 million, or $0.20 per diluted share.
Sales increased 11.9% to $124.4 million in the fourth quarter 2006,
including a 3.9% favorable impact from foreign currency, from $111.2
million in the fourth quarter 2005, reflecting improved sales performance
across all business segments. Gross margins for the fourth quarter 2006
increased to 37.7% from 36.5% in the fourth quarter 2005 primarily due to
improved sales in the Biopharma segment partially offset by higher
production costs within Bioproducts and declines in Human Health gross
margins described earlier in this release. Foreign currency unfavorably
impacted consolidated gross margin by 0.1 percentage point in the fourth
quarter 2006.
During the fourth quarter 2006, Adjusted operating profit was $12.4
million versus $10.4 million during the same period in 2005. This is due to
increased profitability within all operating segments of the business
offset by an increase in corporate expenses explained earlier in this
release.
Full Year 2006 Consolidated Results
On a GAAP basis, the Company reported a loss from continuing operations
of $1.2 million, or $0.05 loss per diluted share, compared to a loss of
$83.2 million, or $3.15 per diluted share, in 2005. Excluding certain items
included in the attached GAAP to Adjusted (non-GAAP) reconciliation tables,
2006 net income was $17.6 million, or $0.65 per diluted share. Excluding
certain items included in the attached GAAP to Adjusted (non-GAAP)
reconciliation tables, net income was $17.7 million, or $0.67 per diluted
share in 2005.
Sales increased 9.0% to $452.3 million in 2006, including a 0.4%
favorable impact from foreign currency, from $414.8 million in 2005,
reflecting improved sales performance across all business segments. Gross
margins during 2006 decreased to 37.9% from an Adjusted gross margin of
39.0% in the previous year primarily due to improved sales in the Biopharma
segment partially offset by higher production costs within Bioproducts and
reductions in Human Health gross margins described earlier in this release.
Foreign currency unfavorably impacted consolidated gross margin by 0.3 of a
percentage point in 2006.
During 2006, Adjusted operating profit was $43.2 million, versus $40.9
million in 2005 reflecting increased profits in Bioproducts and an
improvement in Biopharma, offset by a decrease in Human Health operating
profit and higher corporate expenses, both described earlier in this
release.
Fourth Quarter and Full Year 2006 Consolidated Interest and Tax
Expenses
Net interest expense in the fourth quarter 2006 was $2.3 million, which
was flat compared to the same period last year. For the full year 2006,
Adjusted net interest expense decreased to $8.6 million from $9.8 million
during 2005 reflecting lower average debt offset by higher interest rates.
The Adjusted tax rate in the fourth quarter 2006 was 34.6% compared to
33.3% in the fourth quarter of 2005. The Adjusted full year tax rate in
2006 was 49.2% compared to 42.9% in 2005. The difference in the Adjusted
tax rate is due to geographic shifts in income between the periods. Since
the Company is currently not recording any tax benefit for U.S. and certain
European losses, the consolidated effective tax rate has been and is
expected to be highly volatile.
Fourth Quarter and Full Year 2006 Capital Expenditures, Depreciation,
and
Amortization
For the combined Human Health and Corporate cost centers, capital
expenditures and depreciation were $13.3 million and $4.4 million,
respectively, during the fourth quarter 2006 compared to $5.4 million of
capital expenditures and $4.6 million of depreciation in the fourth quarter
of 2005. Full year 2006 combined Human Health and Corporate cost center
capital expenditures and depreciation were $29.0 million and $19.0 million,
respectively, compared to $19.3 million of capital expenditures and $19.9
million of depreciation during 2005. The combined Human Health and
Corporate cost centers had negligible amortization expenses during the past
two years.
For the entire Company, consolidated capital expenditures,
depreciation, and amortization for the fourth quarter 2006 were $17.0
million, $7.0 million, and $0.5 million compared to $11.6 million, $7.6
million, and $0.5 million in the fourth quarter 2005, respectively. For the
full year 2006, capital expenditures, depreciation, and amortization were
$42.6 million, $29.3 million, and $2.2 million, respectively, compared to
$37.2 million, $30.8 million, and $2.2 million in 2005.
Guidance
Sales growth during 2007 within the Human Health segment is expected to
be within the range of 5% to 10% and operating profit is expected to be in
the range of $50 to $55 million. The Company expects to restructure the
corporate office during 2007 and achieve an annualized run rate of $17.5
million in operating expenses by the end of 2007. Significant charges will
be incurred during 2007 related to change in control, retention, and
severance arrangements pursuant to the strategic alternatives process that
resulted in the sale of the Bio Businesses and our Cork, Ireland and
Landen, Belgium businesses. The Company expects to provide an update on its
corporate restructuring later in the year.
For 2007, capital expenditures and depreciation for continuing
operations are currently expected to be approximately $30 to $33 million
and $21 to $23 million, respectively.
Full year and quarterly effective tax rates will continue to be highly
sensitive to the geographic mix of income or losses.
The financial information contained in this press release is unaudited,
subject to revision and should not be considered final until the 2006 Form
10- K is filed with the US Securities and Exchange Commission.
Conference Call and Webcast
The Conference Call to discuss fourth quarter and full year 2006
earnings will begin at 8:30 a.m. Eastern Time on Thursday, March 15, 2007
and last approximately 45 minutes. Those wishing to participate should call
1-888-634- 4003 for Domestic, and 1-706-634-6653 for International. Please
use pass code 9914932 and call approximately 10 minutes before the start
time. The Conference Call will also be webcast in the Investor Relations
section of the Cambrex website located at http://www.cambrex.com. The
webcast will be available for approximately thirty (30) days following the
call.
A replay of the Conference Call will be available approximately two
hours after the completion of the call through the end of business day,
Thursday, March 22, 2007 by calling 1-800-642-1687 for Domestic, and
1-706-645-9291 for International. Please use pass code 9914932 to access
the replay.
Forward Looking Statements
This news release may contain "forward-looking statements" within the
meaning of the Private Securities Litigation Reform Act of 1995 and Rule
3b-6 under the Securities Exchange Act of 1934, as amended, including,
without limitation, statements regarding expected performance, especially
expectations with respect to sales, research and development expenditures,
earnings per share, capital expenditures, acquisitions, divestitures,
collaborations, or other expansion opportunities. These statements may be
identified by the fact that words such as "expects", "anticipates",
"intends", "estimates", "believes" or similar expressions are used in
connection with any discussion of future financial and/or operating
performance. Any forward-looking statements are qualified in their entirety
by reference to the risk factors discussed in the Company's periodic
reports filed with the SEC. Any forward- looking statements contained
herein are based on current plans and expectations and involve risks and
uncertainties that could cause actual outcomes and results to differ
materially from current expectations including, but not limited to, global
economic trends, pharmaceutical outsourcing trends, competitive pricing or
product developments, government legislation and/or regulations
(particularly environmental issues), tax rate, interest rate, technology,
manufacturing and legal issues, changes in foreign exchange rates,
performance of minority investments, uncollectible receivables, loss on
disposition of assets, cancellation or delays in renewal of contracts, lack
of suitable raw materials or packaging materials, the Company's ability to
receive regulatory approvals for its products, the outcome of the
evaluation of strategic alternatives, the availability of financing on
favorable terms in order to fund the portion of the special dividend that
is not being funded from proceeds of the sale and whether the Company's
estimates set forth in the definitive proxy statement filed January 4, 2007
with respect to its earnings and profits utilized to calculate taxes on the
Bio Businesses divestiture in 2007 will be correct. Any forward-looking
statement speaks only as of the date on which it is made, and the Company
undertakes no obligation to publicly update any forward-looking statement,
whether as a result of new information, future events or otherwise. New
factors emerge from time to time and it is not possible for us to predict
which new factors will arise. In addition, we cannot assess the impact of
each factor on the Company's business or the extent to which any factor, or
combination of factors, may cause actual results to differ materially from
those contained in any forward-looking statements.
For further details and a discussion of these and other risks and
uncertainties, investors and security holders are cautioned to review the
definitive proxy statement, the Cambrex 2005 Annual Report on Form 10-K,
including the Forward-Looking Statement section therein, and other filings
with the SEC, including the Current Reports on Form 8-K.
About Cambrex
Cambrex provides products and services to accelerate the development
and commercialization of branded and generic small molecule therapeutics.
The Company currently employs approximately 850 worldwide. For more
information, please visit http://www.cambrex.com.
CAMBREX CORPORATION
Adjusted Statement of Profit and Loss - Non-GAAP*
For the Quarters Ended December 31, 2006 and 2005
(in thousands)
2006 2005
% of % of
Amount Sales Amount Sales
Gross Sales $124,435 100.0% $111,193 100.0%
Commissions and Allowances 694 0.6% (467) -0.4%
Net Sales 123,741 99.4% 111,660 100.4%
Other Revenues 1,740 1.4% 685 0.6%
Net Revenue 125,481 100.8% 112,345 101.0%
Cost of Sales 78,548 63.1% 71,362 64.1%
Gross Profit 46,933 37.7% 40,983 36.9%
Operating Expenses
Sales and Marketing Expense 8,943 7.2% 8,627 7.8%
Research and Development Expense 5,158 4.1% 5,485 4.9%
Administrative Expense 19,922 16.0% 15,944 14.3%
Amortization 504 0.4% 519 0.5%
Total Operating Expenses 34,527 27.7% 30,575 27.5%
Operating Profit 12,406 10.0% 10,408 9.4%
Other Expenses
Interest - Other 2,330 1.9% 2,270 2.0%
Other Income, net (134) -0.1% (31) 0.0%
Total Other Expenses 2,196 1.8% 2,239 2.0%
Income Before Taxes 10,210 8.2% 8,169 7.4%
Income Tax Provision 3,531 2.8% 2,720 2.5%
Net Income $6,679 5.4% $5,449 4.9%
Basic Earnings per Share
Net Income $0.25 $0.20
Diluted Earnings per Share
Net Income $0.25 $0.20
Weighted Average Shares Outstanding
Basic 27,108 26,654
Diluted 27,252 26,683
* Refer to the GAAP to Adjusted (Non-GAAP) Reconciliation.
CAMBREX CORPORATION
Statement of Profit and Loss - GAAP
For the Quarters Ended December 31, 2006 and 2005
(in thousands)
2006 2005
% of % of
Amount Sales Amount Sales
Gross Sales $124,435 100.0% $111,193 100.0%
Commissions and Allowances 694 0.6% (467) -0.4%
Net Sales 123,741 99.4% 111,660 100.4%
Other Revenues 1,740 1.4% 685 0.6%
Net Revenue 125,481 100.8% 112,345 101.0%
Cost of Sales 78,548 63.1% 71,790 64.5%
Gross Profit 46,933 37.7% 40,555 36.5%
Operating Expenses
Sales and Marketing Expense 8,943 7.2% 8,634 7.8%
Research and Development
Expense 5,285 4.2% 5,501 4.9%
Administrative Expense 24,438 19.7% 19,716 17.7%
Asset Impairments - 0.0% 82,383 74.1%
Amortization 504 0.4% 519 0.5%
Total Operating Expenses 39,170 31.5% 116,753 105.0%
Operating Profit/(Loss) 7,763 6.2% (76,198) -68.5%
Other Expenses
Interest - Other 2,330 1.9% 2,270 2.0%
Other Expense/(Income), net 1,341 1.0% (31) 0.0%
Total Other Expenses 3,671 2.9% 2,239 2.0%
Income/(Loss) Before Taxes 4,092 3.3% (78,437) -70.5%
Income Tax Provision 3,531 2.8% 19,122 17.2%
Income/(Loss) from Continuing
Operations $561 0.5% $(97,559) -87.7%
Loss from Discontinued
Operations, Net of Tax (25,928) -20.9% (24,021) -21.6%
Net Loss $(25,367) -20.4% $(121,580) -109.3%
Basic Loss per Share
Income/(Loss) from Continuing
Operations $0.02 $(3.66)
Loss from Discontinued
Operations, Net of Tax $(0.96) $(0.90)
Net Loss $(0.94) $(4.56)
Diluted Loss per Share
Income/(Loss) from Continuing
Operations $0.02 $(3.66)
Loss from Discontinued
Operations, Net of Tax $(0.95) $(0.90)
Net Loss $(0.93) $(4.56)
Weighted Average Shares Outstanding
Basic 27,108 26,654
Diluted 27,252 26,654
CAMBREX CORPORATION
Adjusted Statement of Profit and Loss - Non-GAAP*
For the Years Ended December 31, 2006 and 2005
(in thousands)
2006 2005
% of % of
Amount Sales Amount Sales
Gross Sales $452,255 100.0% $414,761 100.0%
Commissions and Allowances 1,955 0.4% 2,649 0.6%
Net Sales 450,300 99.6% 412,112 99.4%
Other Revenues 5,174 1.1% 6,358 1.5%
Net Revenue 455,474 100.7% 418,470 100.9%
Cost of Sales 284,125 62.8% 256,640 61.9%
Gross Profit 171,349 37.9% 161,830 39.0%
Operating Expenses
Sales and Marketing Expense 33,435 7.4% 33,310 8.0%
Research and Development Expense 19,399 4.3% 21,407 5.2%
Administrative Expense 73,111 16.1% 63,955 15.4%
Amortization 2,159 0.5% 2,237 0.5%
Total Operating Expenses 128,104 28.3% 120,909 29.1%
Operating Profit 43,245 9.6% 40,921 9.9%
Other Expenses
Interest - Other 8,645 1.9% 9,786 2.4%
Other (Income)/Expense, net (21) 0.0% 47 0.0%
Total Other Expenses 8,624 1.9% 9,833 2.4%
Income Before Taxes 34,621 7.7% 31,088 7.5%
Income Tax Provision 17,025 3.8% 13,340 3.2%
Net Income $17,596 3.9% $17,748 4.3%
Basic Earnings per Share
Net Income $0.66 $0.67
Diluted Earnings per Share
Net Income $0.65 $0.67
Weighted Average Shares Outstanding
Basic 26,816 26,456
Diluted 26,932 26,581
* Refer to the GAAP to Adjusted (Non-GAAP) Reconciliation.
CAMBREX CORPORATION
Statement of Profit and Loss - GAAP
For the Years Ended December 31, 2006 and 2005
(in thousands)
2006 2005
% of % of
Amount Sales Amount Sales
Gross Sales $452,255 100.0% $414,761 100.0%
Commissions and Allowances 1,955 0.4% 2,649 0.6%
Net Sales 450,300 99.6% 412,112 99.4%
Other Revenues 5,174 1.1% 6,358 1.5%
Net Revenue 455,474 100.7% 418,470 100.9%
Cost of Sales 284,125 62.8% 258,345 62.3%
Gross Profit 171,349 37.9% 160,125 38.6%
Operating Expenses
Sales and Marketing Expense 33,435 7.4% 33,340 8.0%
Research and Development Expense 21,190 4.7% 21,469 5.2%
Administrative Expense 81,718 18.0% 67,681 16.3%
Asset Impairments - 0.0% 82,383 19.9%
Amortization 2,159 0.5% 2,237 0.5%
Total Operating Expenses 138,502 30.6% 207,110 49.9%
Operating Profit/(Loss) 32,847 7.3% (46,985) -11.3%
Other Expenses
Interest - Other 13,917 3.1% 9,786 2.4%
Other Expense, Net 1,454 0.3% 47 0.0%
Total Other Expenses 15,371 3.4% 9,833 2.4%
Income/(Loss) Before Taxes 17,476 3.9% (56,818) -13.7%
Income Tax Provision 18,721 4.2% 26,413 6.4%
Loss from Continuing Operations $(1,245) -0.3% $(83,231) -20.1%
Loss from Discontinued
Operations, Net of Tax (28,627) -6.3% (27,227) -6.5%
Loss before Cumulative Effect of a
Change in Accounting Principle (29,872) -6.6% (110,458) -26.6%
Cumulative Effect of a Change in
Accounting Principle (228) -0.1% - 0.0%
Net Loss $(30,100) -6.7% $(110,458) -26.6%
Basic Loss per Share
Loss from Continuing Operations $(0.05) $(3.15)
Loss from Discontinued
Operations, Net of Tax $(1.06) $(1.03)
Cumulative Effect of a Change in
Accounting Principle $(0.01) $-
Net Loss $(1.12) $(4.18)
Diluted Loss per Share
Loss from Continuing Operations $(0.05) $(3.15)
Loss from Discontinued
Operations, Net of Tax $(1.06) $(1.03)
Cumulative Effect of a Change in
Accounting Principle $(0.01) $-
Net Loss $(1.12) $(4.18)
Weighted Average Shares Outstanding
Basic 26,816 26,456
Diluted 26,816 26,456
CAMBREX CORPORATION
Gross Sales, Gross Profit & Operating Profit by Segment
For the Quarters Ended December 31, 2006 and 2005
(in thousands)
Fourth Quarter 2006
Adjusted
Gross Gross Adjusted
Gross Profit - Profit - GP%-
Sales GAAP GP% Non-GAAP* Non-GAAP*
Bioproducts $41,378 $20,859 50.4% $20,859 50.4%
Biopharma 17,048 4,019 23.6% 4,019 23.6%
Human Health 66,009 22,055 33.4% 22,055 33.4%
Corporate - - -
Total $124,435 $46,933 37.7% $46,933 37.7%
Fourth Quarter 2006
Adjusted
Operating Operating Adjusted
Profit/(loss) - OP% Profit/(loss) - OP%-
GAAP GAAP Non-GAAP* Non-GAAP*
Bioproducts $5,919 14.3% $6,046 14.6%
Biopharma 1,720 10.1% 1,720 10.1%
Human Health 12,899 19.5% 12,899 19.5%
Corporate (12,775) (8,259)
Total $7,763 6.2% $12,406 10.0%
Fourth Quarter 2005
Adjusted
Gross Gross Adjusted
Gross Profit - Profit - GP%-
Sales GAAP GP% Non-GAAP* Non-GAAP*
Bioproducts $35,860 $17,956 50.1% $18,135 50.6%
Biopharma 13,951 989 7.1% 1,150 8.2%
Human Health 61,382 21,610 35.2% 21,698 35.3%
Corporate - - -
Total $111,193 $40,555 36.5% $40,983 36.9%
Fourth Quarter 2005
Adjusted
Operating Operating Adjusted
Profit/(loss) - OP% Profit/(loss) - OP%-
GAAP GAAP Non-GAAP* Non-GAAP*
Bioproducts $5,235 14.6% $5,520 15.4%
Biopharma (84,700) -607.1% (2,140) -15.3%
Human Health 12,427 20.2% 12,554 20.5%
Corporate (9,160) (5,526)
Total $(76,198) -68.5% $10,408 9.4%
Gross Sales Comparison
4Q06 4Q05
Gross Gross Change Change
Sales Sales $ %
Bioproducts $41,378 $35,860 $5,518 15.4%
Biopharma 17,048 13,951 3,097 22.2%
Human Health 66,009 61,382 4,627 7.5%
Total $124,435 $111,193 $13,242 11.9%
* Refer to the GAAP to Adjusted (Non-GAAP) Reconciliation.
CAMBREX CORPORATION
Gross Sales, Gross Profit & Operating Profit by Segment
For the Years Ended December 31, 2006 and 2005
(in thousands)
Twelve Months 2006
Adjusted
Gross Gross Adjusted
Gross Profit - Profit - GP%-
Sales GAAP GP% Non-GAAP* Non-GAAP*
Bioproducts $163,119 $84,350 51.7% $84,350 51.7%
Biopharma 52,477 3,236 6.2% 3,236 6.2%
Human Health 236,659 83,763 35.4% 83,763 35.4%
Corporate - - -
Total $452,255 $171,349 37.9% $171,349 37.9%
Twelve Months 2006
Adjusted
Operating Operating Adjusted
Profit/(loss) - OP% Profit/(loss) - OP%-
GAAP GAAP Non-GAAP* Non-GAAP*
Bioproducts 27,196 16.7% $28,987 17.8%
Biopharma (6,062) -11.6% (6,062) -11.6%
Human Health 49,157 20.8% 49,157 20.8%
Corporate (37,444) (28,837)
Total 32,847 7.3% $43,245 9.6%
Twelve Months 2005
Adjusted
Gross Gross Adjusted
Gross Profit - Profit - GP%-
Sales GAAP GP% Non-GAAP* Non-GAAP*
Bioproducts $149,498 $77,908 52.1% $78,619 52.6%
Biopharma 41,698 (3,811) -9.1% (3,160) -7.6%
Human Health 223,565 86,028 38.5% 86,371 38.6%
Corporate - - -
Total $414,761 $160,125 38.6% $161,830 39.0%
Twelve Months 2005
Adjusted
Operating Operating Adjusted
Profit/(loss) - OP% Profit/(loss) - OP%-
GAAP GAAP Non-GAAP* Non-GAAP*
Bioproducts $25,670 17.2% $26,800 17.9%
Biopharma (97,245) -233.2% (14,148) -33.9%
Human Health 50,512 22.6% 51,010 22.8%
Corporate (25,922) (22,741)
Total $(46,985) -11.3% $40,921 9.9%
Gross Sales Comparison
2006 2005
Gross Gross Change Change
Sales Sales $ %
Bioproducts $163,119 $149,498 $13,621 9.1%
Biopharma 52,477 41,698 10,779 25.9%
Human Health 236,659 223,565 13,094 5.9%
Total $452,255 $414,761 $37,494 9.0%
* Refer to the GAAP to Adjusted (Non-GAAP) Reconciliation.
***
CAMBREX CORPORATION
GAAP to Adjusted (Non-GAAP) Reconciliation - Net Income
For the Quarters and Twelve Months Ended December 31, 2006 and 2005
Fourth Quarter Fourth Quarter
2006 2005
Net Diluted Diluted
Income EPS Net Income EPS
Income/(loss) from continuing
operations $561 $0.02 $(97,559) $(3.66)
Evaluation of strategic alternatives
(recorded in Admin. Expense) 4,516 0.17 -- --
Cutanogen related costs (R&D Expense) 127 0.00 -- --
Write-down of investment in equity
securities (Other Expense) 1,475 0.05
Executive severance (Admin. Expense) -- -- 4,223 0.16
Increase in tax valuation allowance and
related items (Tax Provision) -- -- 16,402 0.61
Asset impairments -- -- 82,383 $3.09
Adjusted Net Income - Non-GAAP $6,679 $0.25 $5,449 $0.20
Twelve Months Twelve Months
2006 2005
Net Diluted Diluted
Income EPS Net Income EPS
Loss from continuing operations $(1,245) $(0.05) $(83,231) $(3.15)
Evaluation of strategic alternatives
(Admin. Expense) 8,607 0.32 -- --
Cutanogen milestone and related costs
(R&D Expense) 1,791 0.07 -- --
Senior note prepayment expenses
(Interest Expense) 5,272 0.20 -- --
Write-down of investment in equity
securities (Other Expense) 1,475 0.05
Increase in tax valuation allowance and
related items (Tax Provision) 1,696 0.06 16,402 0.62
Executive severance (Admin. Expense) -- -- 4,223 0.16
Asset impairments -- -- 82,383 3.10
Increase in environmental reserve
(Admin. Expense) -- -- 1,300 0.05
Benefit from Swedish tax item (Tax
Provision) -- -- (3,329) (0.13)
Adjusted Net Income - Non-GAAP $17,596 $0.65 $17,748 $0.67
CAMBREX CORPORATION
GAAP to Adjusted (Non-GAAP) Reconciliation - Operating Profit by Segment
For the Quarters and Twelve Months Ended December 31, 2006 and 2005
Fourth Quarter 2006
Human
Bioproducts Biopharma Health Corporate Total
Operating Profit - As
Reported $5,919 $1,720 $12,899 $(12,775) $7,763
Evaluation of strategic
alternatives -- -- -- 4,516 4,516
Cutanogen related costs 127 -- -- -- 127
Adjusted Operating Profit
- Non-GAAP $6,046 $1,720 $12,899 $(8,259) $12,406
Fourth Quarter 2005
Human
Bioproducts Biopharma Health Corporate Total
Operating Profit - As
Reported $5,235 $(84,700) $12,427 $(9,160) $(76,198)
Asset impairments -- 82,383 -- -- 82,383
Executive severance -- -- -- 4,223 4,223
Change in allocation
methodology 285 177 127 (589) --
Adjusted Operating Profit
- Non-GAAP $5,520 $(2,140) $12,554 $(5,526) $10,408
Twelve Months 2006
Human
Bioproducts Biopharma Health Corporate Total
Operating Profit - As
Reported $27,196 $(6,062) $49,157 $(37,444) $32,847
Evaluation of strategic
alternatives -- -- -- 8,607 8,607
Cutanogen milestone and
related costs 1,791 -- -- -- 1,791
Adjusted Operating Profit
- Non-GAAP $28,987 $(6,062) $49,157 $(28,837) $43,245
Twelve Months 2005
Human
Bioproducts Biopharma Health Corporate Total
Operating Profit - As
Reported $25,670 $(97,245) $50,512 $(25,922) $(46,985)
Asset impairments -- 82,383 -- -- 82,383
Executive severance -- -- -- 4,223 4,223
Increase in environmental
reserve -- -- -- 1,300 1,300
Change in allocation
methodology 1,130 714 498 (2,342) --
Adjusted Operating Profit
- Non-GAAP $26,800 $(14,148) $51,010 $(22,741) $40,921
Note: The change in allocation methodology reflects certain medical
benefit expenses in the fourth quarter and twelve months 2006 GAAP and
2005 Non-GAAP results that were reclassified from operating segments to
Corporate Administrative Expense to better reflect costs reported in the
operating segments.
CAMBREX CORPORATION
GAAP to Adjusted (Non-GAAP) Reconciliation - Operating Expenses
For the Quarters and Twelve Months Ended December 31, 2006 and 2005
Fourth Quarter
2006 2005
Operating Expenses - GAAP $39,170 $116,753
Evaluation of strategic alternatives (4,516) --
Cutanogen related costs (127) --
Asset impairments -- (82,383)
Executive severance -- (4,223)
Change in allocation methodology -- 428
Adjusted Operating Expenses - Non-
GAAP $34,527 $30,575
Twelve Months
2006 2005
Operating Expenses - GAAP $138,502 $207,110
Evaluation of strategic alternatives (8,607) --
Cutanogen milestone and related costs (1,791) --
Asset impairments -- (82,383)
Executive severance -- (4,223)
Increase in environmental reserve -- (1,300)
Change in allocation methodology -- 1,705
Adjusted Operating Expenses - Non-
GAAP $128,104 $120,909
Note: The change in allocation methodology reflects certain medical
benefit expenses in fourth quarter and twelve months 2006 GAAP and 2005
Non-GAAP results that were reclassified from operating segments to
Corporate Administrative Expense to better reflect costs reported in the
operating segments.
CAMBREX CORPORATION
GAAP to Adjusted (Non-GAAP) Reconciliation - Administrative Expense
For the Quarters and Twelve Months Ended December 31, 2006 and 2005
Fourth Quarter
2006 2005
Administrative Expense - GAAP $24,438 $19,716
Evaluation of strategic alternatives (4,516) --
Executive severance -- (4,223)
Change in allocation methodology -- 451
Adjusted Administrative Expense -
Non-GAAP $19,922 $15,944
Twelve Months
2006 2005
Administrative Expense - GAAP $81,718 $67,681
Evaluation of strategic alternatives (8,607) --
Executive severance -- (4,223)
Increase in environmental reserve -- (1,300)
Change in allocation methodology -- 1,797
Adjusted Administrative Expense -
Non-GAAP $73,111 $63,955
Note: The change in allocation methodology reflects certain medical
benefit expenses in fourth quarter and twelve months 2006 GAAP and 2005
Non-GAAP results that were reclassified from operating segments to
Corporate Administrative Expense to better reflect costs reported in the
operating segments.
CAMBREX CORPORATION
Consolidated Balance Sheet
As of December 31, 2006 and 2005
(in thousands)
December 31, December 31,
Assets 2006 2005
Cash and Cash Equivalents $33,746 $45,342
Trade Receivables, net 74,012 69,283
Inventories, net 94,601 81,080
Assets of Discontinued Operations -
Short Term -- 18,913
Other Current Assets 22,391 14,908
Total Current Assets 224,750 229,526
Property, Plant and Equipment, Net 227,024 201,784
Goodwill and Other Intangibles 148,209 145,603
Assets of Discontinued Operations -
Long Term -- 29,574
Other Non-Current Assets 6,393 5,985
Total Assets $606,376 $612,472
Liabilities and Stockholders' Equity
Trade Accounts Payable $42,246 $33,720
Accrued Expenses and Other Current
Liabilities 64,888 50,368
Liabilities of Discontinued
Operations - Short Term -- 6,231
Total Current Liabilities 107,134 90,319
Long-term Debt 162,371 186,819
Deferred Tax Liabilities 30,219 26,976
Liabilities of Discontinued
Operations - Long Term -- 7,921
Other Non-Current Liabilities 60,006 57,186
Total Liabilities $359,730 $369,221
Stockholders' Equity $246,646 $243,251
Total Liabilities and Stockholders'
Equity $606,376 $612,472
SOURCE Cambrex Corporation
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Related links:
http://www.cambrex.com/
Photo Notes:http://www.newscom.com/cgi-bin/prnh/20000613/CAMBREXLOGO
AP Archive: http://photoarchive.ap.org
PRN Photo Desk, photodesk@prnewswire.com
CONTACT:
Gregory P. Sargen, Vice President & CFO,
+1-201-804-3055, gregory.sargen@cambrex.com, or Bob Thomson,
Director, Investor Relations, +1-201-804-3047,
bob.thomson@cambrex.com, both of Cambrex Corporation
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