EAST RUTHERFORD, N.J., Oct. 30 /PRNewswire-FirstCall/ -- Cambrex
Corporation (NYSE: CBM) reports third quarter 2006 results for the period
ended September 30, 2006.
(Logo: http://www.newscom.com/cgi-bin/prnh/20000613/CAMBREXLOGO )
Adjusted Diluted Earnings per Share were $0.06 in the third quarter
2006 compared to $0.05 Adjusted Diluted Earnings per Share reported in the
third quarter 2005. Third quarter 2006 GAAP Diluted Earnings per Share were
($0.15) compared to break-even in the third quarter 2005.
Consistent with our 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. Third quarter 2006 Adjusted financial results exclude costs
related to a Goodwill Impairment charge ($0.08 Diluted Earnings per Share),
the evaluation of strategic alternatives ($0.06 Diluted Earnings per
Share), a small amount of cost related to the Cutanogen acquisition, and
increases in tax reserves related to prior years returns recently prepared
or under audit ($0.06 Diluted Earnings per Share). The third quarter 2005
financial results exclude an increase in an environmental reserve for an
idle property ($0.05 Diluted Earnings per Share). In addition to the
aforementioned items, certain employee medical benefit expenses in the 2005
Non-GAAP results were reclassified from segment Cost of Sales and Operating
Expenses to Corporate Administrative Expenses to better reflect actual
costs incurred within the operating segments and are included in the
GAAP/Non-GAAP reconciliation tables. A reconciliation of GAAP results to
Adjusted (Non-GAAP) results can be found in the unaudited financial tables
included in this press release.
Third quarter 2006 sales revenue increased 8.3% to $113.2 million from
$104.5 million in the third quarter 2005 due to increases in all three
segments (Bioproducts, Biopharma and Human Health). Foreign currency
effects accounted for 2.2% of this increase.
Third quarter 2006 Adjusted Gross Profit increased 5.2% to $39.2
million from $37.3 million during the third quarter 2005, reflecting the
increase in sales partially offset by a decline in Adjusted Gross Margin to
34.6% versus 35.6% last year. Foreign currency favorably impacted Gross
Margin by 0.8 percentage point versus last year. Third quarter 2006 GAAP
Gross Profit was $39.2 million, or 34.6% of sales, compared to $36.8
million, or 35.2% of sales, in the third quarter 2005.
Third quarter 2006 Adjusted Operating Profit decreased 5.6% to $7.0
million, or 6.2% of sales in the third quarter 2006, from $7.4 million, or
7.1% of sales in the third quarter 2005, due to increased Administrative
Expenses partially offset by higher Gross Profit and lower Sales and
Marketing Expense. Third quarter 2006 GAAP Operating Profit was $3.1
million, or 2.7% of sales in the third quarter 2006, compared to $6.1
million, or 5.9% of sales, in the third quarter 2005.
Third quarter 2006 Adjusted Income before Taxes decreased 3.7% to $4.5
million from $4.7 million in the third quarter 2005 due to lower Operating
Profit partially offset by lower Interest Expense. Third quarter 2006 GAAP
Income before Taxes was $0.5 million compared to $3.4 million in the third
quarter 2005.
Strategic Alternatives
As part of its evaluation of strategic alternatives, Cambrex announced
on October 24th that it had entered into a definitive stock purchase
agreement to sell its Bioproducts and Biopharma businesses to Lonza Group
AG for total cash consideration of $460 million. The Company expects to
realize net proceeds, after paying taxes and transaction-related advisor
fees, of approximately $450 million. Following the repayment of outstanding
debt and assuming the arrangement of new lines of credit of $125 to $150
million on favorable terms, Cambrex plans to pay stockholders a special
dividend of $13.50 to $14.50 per share. Additionally, Cambrex announced on
October 20th that it had entered into an agreement to sell its subsidiaries
based in Cork, Ireland and Landen, Belgium to International Chemical
Investors II S.A. (ICIG), for nominal consideration.
James A. Mack, Chairman, President and Chief Executive Officer of
Cambrex Corporation, said, "We are pleased to announce the successful
completion of this important phase of our strategic review. After a
thorough and deliberate process, our Board of Directors determined that the
sale of Bioproducts and Biopharma to Lonza and the sale of Cork and Landen
to ICIG represent the most compelling means for realizing value for Cambrex
stockholders. In addition to receiving a substantial cash dividend,
stockholders can look forward to additional benefits from their continuing
investment in a streamlined Cambrex focused on pharmaceutical services.
Consistent with our fiduciary duties, we will also continue to evaluate
strategic opportunities for the Human Health business as they arise."
Business Segment Results
Bioproducts
The Bioproducts segment includes products and services for research and
therapeutic applications. Bioproducts Sales in the third quarter 2006
increased 10.1% to $39.3 million from $35.7 million in the third quarter
2005 primarily due to higher sales in rapid microbial detection products
and cell therapy services. Foreign currency effects accounted for 1.9% of
the increase in Bioproducts sales.
Third quarter 2006 Bioproducts Adjusted Gross Margin was 49.2%, down
from Adjusted Gross Margin of 52.2% in the third quarter 2005. The GAAP
Gross Margin was 49.2% in the third quarter 2006 versus 51.7% during the
previous year. The decline in Gross Margin was due to changes in product
mix and increased production costs partially offset by the positive effect
of foreign currency translation of 1.2%.
Third quarter 2006 Bioproducts Adjusted Operating Profit increased
23.1% to $6.5 million in the third quarter 2006 versus $5.3 million in the
third quarter 2005 due to higher Gross Profit and lower Operating Expenses.
Adjusted Operating Profit Margins increased to 16.6% of sales in the third
quarter 2006 from 14.9% in the third quarter 2005. Foreign currency
increased Adjusted Operating Profit Margins by 2.4% of Sales. Third quarter
2006 Bioproducts GAAP Operating Profit Margin was 16.3% versus 14.1% in the
third quarter 2005.
Biopharma
The Biopharma segment consists of the Company's contract
biopharmaceutical process development and manufacturing business. Biopharma
Sales in the third quarter 2006 increased 38.5% to $11.6 million from $8.4
million in the third quarter 2005, reflecting an increase in both suite
fees and process development work.
Third quarter 2006 Biopharma Adjusted Gross Margin improved to -1.4%
from -23.6% in the third quarter 2005 due to increased suite fees and
process development work. Third quarter 2006 Biopharma GAAP Gross Margin
was -1.4% versus -25.5% in the third quarter 2005.
Third quarter 2006 Biopharma Adjusted Operating Loss narrowed to $2.4
million from $4.2 million in the third quarter 2005 primarily due to
improved Gross Profit. On a GAAP basis, the Biopharma Operating Loss was
$2.4 million compared with $4.4 million reported for the third quarter of
the previous year. Foreign currency did not impact the Biopharma segment
financial results.
Human Health
The Human Health segment consists of small molecule active
pharmaceutical ingredients (APIs), advanced intermediates and other
products derived from organic chemistry. Human Health Sales in the third
quarter 2006 increased 3.1% to $62.3 million from $60.4 million in the
third quarter 2005. This sales growth resulted from increased generic API
volumes and a 2.7% positive impact of foreign currency partially offset by
decreased demand for certain proprietary products, advanced intermediates
and feed additives.
Third quarter 2006 Human Health Adjusted Gross Margin decreased to
32.1% from 34.1% in the third quarter 2005, principally due to shifts in
product mix. Third quarter 2006 Human Health GAAP Gross Margin was 32.1%
versus 33.9% in the third quarter 2005.
Third quarter 2006 Human Health Adjusted Operating Profit decreased to
$9.9 million versus $11.5 million in the previous year due to lower Gross
Profit and higher R&D and Administrative Expenses. Foreign currency effects
increased Adjusted Operating Profit Margins by 0.6%. Third quarter 2006
Human Health GAAP Operating Profit was $7.8 million versus $11.3 million in
the third quarter of 2005.
Third Quarter 2006 Adjusted and GAAP Consolidated Operating, Interest
and Tax Expenses
Third quarter 2006 Adjusted Operating Expenses increased $2.4 million
to $32.2 million, or 28.4% of sales, from $29.8 million, or 28.5% of sales,
in the third quarter 2005 primarily due to higher Administrative Expenses
partially offset by lower Sales and Marketing Expense. Third quarter 2006
GAAP Operating Expenses were $36.1 million, or 31.9% of sales, versus $30.7
million, or 29.3% of sales, in the third quarter 2005. Foreign currency had
a nominal effect on Operating Expenses during the quarter.
Adjusted and GAAP Sales and Marketing Expense in the third quarter 2006
decreased to $7.7 million, or 6.8% of sales, from $8.5 million, or 8.1% of
sales in the third quarter 2005, primarily due to lower spending in
Bioproducts and Human Health.
Adjusted Research and Development Expense for the third quarter 2006
increased to $5.0 million, or 4.4% of sales compared to $4.8 million, or
4.6% of sales, in the third quarter 2005 due to increased spending in Human
Health. On a GAAP basis, Research and Development Expense during the third
quarter 2006 increased to $5.1 million from $4.9 million during the same
period in the previous year.
Adjusted Administrative Expense in the third quarter 2006 increased to
$19.0 million, or 16.8% of sales, from $16.0 million, or 15.3% of sales, in
the third quarter 2005 principally due to higher legal and audit fees.
Third quarter 2006 GAAP Administrative Expense was $20.8 million, or 18.4%
of sales, versus $16.8 million, or 16.0% of sales, in the third quarter
2005.
During the third quarter 2006, a $2.1 million goodwill impairment
charge ($0.08 Diluted Earnings per Share) was recorded within the Human
Health segment related to its Landen, Belgium site, which, as discussed in
the Strategic Alternatives section above, was sold during October 2006.
Adjusted and GAAP Net Interest Expense in the third quarter 2006
decreased to $2.5 million from $2.8 million in the third quarter 2005 due
to lower borrowings partially offset by higher interest rates. The average
interest rate in the third quarter 2006 was 6.1% versus 5.8% in the same
period last year.
The Adjusted effective tax rate in the third quarter 2006 decreased to
66.2% of pre-tax income versus 73.1% in the third quarter 2005 due to the
geographic mix of income in the quarter.
Capital Expenditures and Depreciation for the third quarter 2006 were
$8.8 million and $8.4 million, respectively, compared to $9.9 million and
$8.9 million in the third quarter 2005, respectively.
Guidance
Due to the recently announced divestitures, the company has
discontinued guidance on Consolidated Cambrex, and is providing guidance on
its Human Health segment excluding the Cork and Landen facilities that were
recently sold. The Company is providing full year 2006 guidance for Human
Health excluding Cork and Landen of Sales of $235 - 240 million, Operating
Profit of $47 - 53 million, Depreciation and Amortization of $18 - 20
million, and Capital Expenditures of approximately $25 million. This
guidance does not reflect Cambrex Corporate operating expenses.
The financial information contained in this press release is unaudited,
subject to revision and should not be considered final until the third
quarter 2006 Form 10-Q is filed with the U.S. Securities and Exchange
Commission.
Proxy Statement
Cambrex Corporation plans to file with the SEC and mail to its
stockholders a Proxy Statement in connection with a special meeting of
stockholders to be called to approve the Bioproducts and Biopharma
transaction. The Proxy Statement will contain important information about
Cambrex Corporation, the transaction and related matters. Investors and
security holders are urged to read the Proxy Statement carefully when it is
available. Investors and security holders will be able to obtain free
copies of the Proxy Statement and other documents filed with the SEC by
Cambrex Corporation through the web site maintained by the SEC at
http://www.sec.gov. In addition, investors and security holders will be able to
obtain free copies of the Proxy Statement from Cambrex Corporation by
contacting Peter Thauer, Senior Vice President, General Counsel and
Secretary, Cambrex Corporation, One Meadowlands Plaza, 15th Floor, East
Rutherford, NJ, Phone: 201-804-3005.
Participants in the Solicitation
Cambrex Corporation and its executive officers and directors may be
deemed, under SEC rules, to be participants in the solicitation of proxies
from Cambrex Corporation's stockholders with respect to the proposed
Bioproducts and Biopharma transaction. Information regarding the executive
officers and directors of Cambrex Corporation is included in its definitive
Proxy Statement for its 2006 annual meeting filed with the SEC on June 9,
2006. More detailed information regarding the identity of potential
participants, and their direct or indirect interests, by securities,
holdings or otherwise, will be set forth in the Proxy Statement to be filed
with the SEC in connection with the proposed Bioproducts and Biopharma
transaction.
Conference Call and Webcast
The Conference Call to discuss third quarter 2006 earnings will begin
at 8:30 a.m. Eastern Time on Tuesday, October 31, 2006 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 the pass code 8114526 and call approximately 10 minutes prior to start
time. A webcast is available from the Investor Relations section on the
Cambrex website located at http://www.cambrex.com and can be accessed for
approximately a month following the call. A telephone replay of the
conference call will be available through Tuesday, November 7, 2006 by
calling 1-800-642-1687 for domestic and +1-706- 645-9291 for international.
Please use the pass code 8114526 to access the replay.
Forward Looking Statements
This news release contains "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, 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 events and financial and operating
performance. The 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, and lack of
suitable raw materials or packaging materials, the possibility that the
value of the acquisition of PermaDerm(TM) cultured skin may not be realized
or that our plans to obtain a Humanitarian Device Exemption, completion of
clinical trials and commercialization of PermaDerm cultured skin in the
United States may not be successful, the Company may not receive regulatory
approval for its products, the outcome of the evaluation of strategic
alternatives, the satisfaction of the conditions to closing set forth in
the stock purchase agreement with Lonza and 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.
For further details and a discussion of these and other risks and
uncertainties, investors are cautioned to review the Cambrex 2005 Annual
Report on Form 10-K, including the Forward-Looking Statement section
therein, and other filings with the Securities and Exchange Commission,
including the Current Report on Form 8-K filed on October 24, 2006. The
Company undertakes no obligation to publicly update any forward-looking
statement, whether as a result of new information, future events or
otherwise.
About Cambrex
Cambrex is a global, diversified life sciences company dedicated to
providing products and services to accelerate and improve the discovery and
commercialization of human therapeutics. The Company employs approximately
1,800 worldwide. For more information, please visit http://www.cambrex.com.
CAMBREX CORPORATION
Adjusted Statement of Profit and Loss - Non-GAAP*
For the Quarters Ended September 30, 2006 and 2005
(in thousands)
2006 2005
% of % of
Amount Sales Amount Sales
Gross Sales $113,205 100.0% $104,500 100.0%
Commissions and Allowances 459 0.4% 1,031 1.0%
Net Sales 112,746 99.6% 103,469 99.0%
Other Revenues 1,253 1.1% 1,116 1.1%
Net Revenue 113,999 100.7% 104,585 100.1%
Cost of Sales 74,797 66.1% 67,332 64.5%
Gross Profit 39,202 34.6% 37,253 35.6%
Operating Expenses
Sales and Marketing Expense 7,662 6.8% 8,461 8.1%
Research and Development Expense 4,988 4.4% 4,846 4.6%
Administrative Expense 19,025 16.8% 16,000 15.3%
Amortization 508 0.4% 511 0.5%
Total Operating Expenses 32,183 28.4% 29,818 28.5%
Operating Profit 7,019 6.2% 7,435 7.1%
Other Expenses
Interest - Other 2,540 2.2% 2,801 2.7%
Other Income, net (9) 0.0% (25) 0.0%
Total Other Expenses 2,531 2.2% 2,776 2.7%
Income Before Taxes 4,488 4.0% 4,659 4.4%
Income Tax Provision 2,970 2.7% 3,407 3.2%
Net Income $1,518 1.3% $1,252 1.2%
Basic Earnings per Share
Net Income $0.06 $0.05
Diluted Earnings per Share
Net Income $0.06 $0.05
Weighted Average Shares Outstanding
Basic 26,752 26,418
Diluted 26,871 26,548
* Refer to the GAAP to Adjusted (Non-GAAP) Reconciliation.
CAMBREX CORPORATION
Statement of Profit and Loss - GAAP
For the Quarters Ended September 30, 2006 and 2005
(in thousands)
2006 2005
% of % of
Amount Sales Amount Sales
Gross Sales $113,205 100.0% $104,500 100.0%
Commissions and Allowances 459 0.4% 1,031 1.0%
Net Sales 112,746 99.6% 103,469 99.0%
Other Revenues 1,253 1.1% 1,116 1.1%
Net Revenue 113,999 100.7% 104,585 100.1%
Cost of Sales 74,797 66.1% 67,763 64.9%
Gross Profit 39,202 34.6% 36,822 35.2%
Operating Expenses
Sales and Marketing Expense 7,662 6.8% 8,468 8.1%
Research and Development Expense 5,115 4.5% 4,862 4.7%
Administrative Expense 20,759 18.4% 16,846 16.0%
Goodwill Impairment 2,092 1.8% - 0.0%
Amortization 508 0.4% 511 0.5%
Total Operating Expenses 36,136 31.9% 30,687 29.3%
Operating Profit 3,066 2.7% 6,135 5.9%
Other Expenses
Interest - Other 2,540 2.2% 2,801 2.7%
Other Income, net (9) 0.0% (25) 0.0%
Total Other Expenses 2,531 2.2% 2,776 2.7%
Income Before Taxes 535 0.5% 3,359 3.2%
Income Tax Provision 4,666 4.1% 3,407 3.2%
Net Loss $(4,131) -3.6% $(48) 0.0%
Basic Earnings per Share
Net Loss $(0.15) $(0.00)
Diluted Earnings per Share
Net Loss $(0.15) $(0.00)
Weighted Average Shares Outstanding
Basic 26,752 26,418
Diluted 26,752 26,418
CAMBREX CORPORATION
Adjusted Statement of Profit and Loss - Non-GAAP*
For the Nine Months Ended September 30, 2006 and 2005
(in thousands)
2006 2005
% of % of
Amount Sales Amount Sales
Gross Sales $356,389 100.0% $331,133 100.0%
Commissions and Allowances 1,632 0.5% 3,696 1.1%
Net Sales 354,757 99.5% 327,437 98.9%
Other Revenues 3,398 1.0% 5,827 1.7%
Net Revenue 358,155 100.5% 333,264 100.6%
Cost of Sales 231,260 64.9% 211,633 63.9%
Gross Profit 126,895 35.6% 121,631 36.7%
Operating Expenses
Sales and Marketing Expense 24,827 7.0% 25,211 7.6%
Research and Development Expense 14,944 4.2% 16,555 5.0%
Administrative Expense 55,834 15.6% 50,734 15.3%
Amortization 1,482 0.4% 1,718 0.5%
Total Operating Expenses 97,087 27.2% 94,218 28.4%
Operating Profit 29,808 8.4% 27,413 8.3%
Other Expenses
Interest - Other 6,916 2.0% 8,282 2.5%
Other Expense, net 107 0.0% 72 0.0%
Total Other Expenses 7,023 2.0% 8,354 2.5%
Income Before Taxes 22,785 6.4% 19,059 5.8%
Income Tax Provision 12,302 3.5% 9,966 3.1%
Net Income $10,483 2.9% $9,093 2.7%
Basic Earnings per Share
Net Income $0.39 $0.34
Diluted Earnings per Share
Net Income $0.39 $0.34
Weighted Average Shares Outstanding
Basic 26,718 26,389
Diluted 26,822 26,550
* Refer to the GAAP to Adjusted (Non-GAAP) Reconciliation.
CAMBREX CORPORATION
Statement of Profit and Loss - GAAP
For the Nine Months Ended September 30, 2006 and 2005
(in thousands)
2006 2005
% of % of
Amount Sales Amount Sales
Gross Sales $356,389 100.0% $331,133 100.0%
Commissions and Allowances 1,632 0.5% 3,696 1.1%
Net Sales 354,757 99.5% 327,437 98.9%
Other Revenues 3,398 1.0% 5,827 1.7%
Net Revenue 358,155 100.5% 333,264 100.6%
Cost of Sales 231,260 64.9% 212,910 64.3%
Gross Profit 126,895 35.6% 120,354 36.3%
Operating Expenses
Sales and Marketing Expense 24,827 7.0% 25,233 7.6%
Research and Development Expense 16,608 4.7% 16,601 5.0%
Administrative Expense 59,925 16.7% 50,689 15.3%
Goodwill Impairment 2,092 0.6% - 0.0%
Amortization 1,482 0.4% 1,718 0.5%
Total Operating Expenses 104,934 29.4% 94,241 28.4%
Operating Profit 21,961 6.2% 26,113 7.9%
Other Expenses
Interest - Other 12,188 3.5% 8,282 2.5%
Other Expense, net 107 0.0% 72 0.0%
Total Other Expenses 12,295 3.5% 8,354 2.5%
Income Before Taxes 9,666 2.7% 17,759 5.4%
Income Tax Provision 13,998 3.9% 6,637 2.0%
(Loss)/Earnings before Cumulative
Effect of a Change in Accounting
Principle $(4,332) -1.2% $11,122 3.4%
Cumulative Effect of a Change in
Accounting Principle (228) -0.1% - 0.0%
Net (Loss)/Income $(4,560) -1.3% $11,122 3.4%
Basic Earnings per Share
(Loss)/Earnings before Cumulative
Effect of a Change in Accounting
Principle $(0.16) $0.42
Cumulative Effect of a Change in
Accounting Principle $(0.01) $-
Net (Loss)/Income $(0.17) $0.42
Diluted Earnings per Share
(Loss)/Earnings before Cumulative
Effect of a Change in Accounting
Principle $(0.16) $0.42
Cumulative Effect of a Change in
Accounting Principle $(0.01) $-
Net (Loss)/Income $(0.17) $0.42
Weighted Average Shares Outstanding
Basic 26,718 26,389
Diluted 26,718 26,550
CAMBREX CORPORATION
Gross Sales, Gross Profit & Operating Profit by Segment
For the Quarters Ended September 30, 2006 and 2005
(in thousands)
Third Quarter 2006
Adjusted Adjusted
Gross GP%-
Gross Gross Profit - Non-
Sales Profit GP% Non-GAAP* GAAP*
Bioproducts $39,326 $19,363 49.2% $19,363 49.2%
Biopharma 11,615 (165) -1.4% (165) -1.4%
Human Health 62,264 20,004 32.1% 20,004 32.1%
Corporate - - -
Total $113,205 $39,202 34.6% $39,202 34.6%
Adjusted
Operating
Operating Profit Adjusted
Profit/ (loss) OP%-
(loss) OP% Non- Non-
GAAP GAAP GAAP* GAAP*
Bioproducts $6,415 16.3% $6,542 16.6%
Biopharma (2,422) -20.9% (2,422) -20.9%
Human Health 7,804 12.5% 9,896 15.9%
Corporate (8,731) (6,997)
Total $3,066 2.7% $7,019 6.2%
Third Quarter 2005
Adjusted Adjusted
Gross GP%-
Gross Gross Profit - Non-
Sales Profit GP% Non-GAAP* GAAP*
Bioproducts $35,729 $18,481 51.7% $18,663 52.2%
Biopharma 8,385 (2,137) -25.5% (1,977) -23.6%
Human Health 60,386 20,478 33.9% 20,567 34.1%
Corporate - -
Total $104,500 $36,822 35.2% $37,253 35.6%
Adjusted
Operating
Operating Profit Adjusted
Profit/ (loss) OP%-
(loss) OP% Non- Non-
GAAP GAAP GAAP* GAAP*
Bioproducts $5,024 14.1% $5,313 14.9%
Biopharma (4,368) -52.1% (4,193) -50.0%
Human Health 11,343 18.8% 11,473 19.0%
Corporate (5,864) (5,158)
Total $6,135 5.9% $7,435 7.1%
Gross Sales Comparison
3Q06 3Q05
Gross Gross Change Change
Sales Sales $ %
Bioproducts $39,326 $35,729 $3,597 10.1%
Biopharma 11,615 8,385 3,230 38.5%
Human Health 62,264 60,386 1,878 3.1%
Total $113,205 $104,500 $8,705 8.3%
* Refer to the GAAP to Adjusted (Non-GAAP) Reconciliation.
CAMBREX CORPORATION
Gross Sales, Gross Profit & Operating Profit by Segment
For the Nine Months Ended September 30, 2006 and 2005
(in thousands)
Nine Months 2006
Adjusted Adjusted
Gross GP%-
Gross Gross Profit - Non-
Sales Profit GP% Non-GAAP* GAAP*
Bioproducts $121,740 $63,491 52.2% $63,491 52.2%
Biopharma 35,429 (783) -2.2% (783) -2.2%
Human Health 199,220 64,187 32.2% 64,187 32.2%
Corporate - - -
Total $356,389 $126,895 35.6% $126,895 35.6%
Adjusted
Operating
Operating Profit Adjusted
Profit/ (loss) OP%-
(loss) OP% Non- Non-
GAAP GAAP GAAP* GAAP*
Bioproducts $21,449 17.6% $23,113 19.0%
Biopharma (7,782) -22.0% (7,782) -22.0%
Human Health 32,413 16.3% 34,505 17.3%
Corporate (24,119) (20,028)
Total $21,961 6.2% $29,808 8.4%
Nine Months 2005
Adjusted Adjusted
Gross GP%-
Gross Gross Profit - Non-
Sales Profit GP% Non-GAAP* GAAP*
Bioproducts $113,638 $59,952 52.8% $60,484 53.2%
Biopharma 27,747 (4,800) -17.3% (4,310) -15.5%
Human Health 189,748 65,202 34.4% 65,457 34.5%
Corporate - - -
Total $331,133 $120,354 36.3% $121,631 36.7%
Adjusted
Operating
Operating Profit Adjusted
Profit/ (loss) OP%-
(loss) OP% Non- Non-
GAAP GAAP GAAP* GAAP*
Bioproducts $20,499 18.0% $21,344 18.8%
Biopharma (12,545) -45.2% (12,008) -43.3%
Human Health 34,373 18.1% 34,743 18.3%
Corporate (16,214) (16,666)
Total $26,113 7.9% $27,413 8.3%
Gross Sales Comparison
2006 2005
Gross Gross Change Change
Sales Sales $ %
Bioproducts $121,740 $113,638 $8,102 7.1%
Biopharma 35,429 27,747 7,682 27.7%
Human Health 199,220 189,748 9,472 5.0%
Total $356,389 $331,133 $25,256 7.6%
* Refer to the GAAP to Adjusted (Non-GAAP) Reconciliation.
CAMBREX CORPORATION
GAAP to Adjusted (Non-GAAP) Reconciliation - Net Income
For the Quarters and Nine Months Ended September 30, 2006 and 2005
Third Quarter 2006 Third Quarter 2005
Net Net
(Loss)/ Diluted (Loss)/ Diluted
Income EPS Income EPS
Net Loss- GAAP $(4,131) $(0.15) $(48) $(0.00)
Goodwill impairment 2,092 0.08 - -
Evaluation of strategic alternatives
(recorded in Admin. Expense) 1,734 0.06 - -
Cutanogen related costs (R&D Expense) 127 0.00 - -
Tax expense related to prior years
returns (Tax Provision) 1,696 0.06 - -
Increase in Environmental Reserve
(Admin. Expense) - - 1,300 0.05
Adjusted Net Income - Non-GAAP $1,518 $0.06 $1,252 $0.05
Nine Months 2006 Nine Months 2005
Net
(Loss)/ Diluted Net Diluted
Income EPS Income EPS
(Loss)/Earnings before Cumulative
Effect of a change in Accounting
Principle $(4,332) $(0.16) $11,122 $0.42
Goodwill impairment 2,092 0.08 - -
Evaluation of strategic alternatives
(Admin. Expense) 4,091 0.15 - -
Cutanogen milestone and related costs
(R&D Expense) 1,664 0.06 - -
Senior note prepayment expenses
(Interest Expense) 5,272 0.20 - -
Tax expense related to prior years
returns (Tax Provision) 1,696 0.06 - -
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 $10,483 $0.39 $9,093 $0.34
Note: The cumulative effect of a change in accounting principle reflects
the implementation of FAS 123(R). Under FAS 123(R), the Company is
now required to measure stock appreciation rights (SARs) at fair
market value.
CAMBREX CORPORATION
GAAP to Adjusted (Non-GAAP) Reconciliation - Operating Profit by Segment
For the Quarters and Nine Months Ended September 30, 2006 and 2005
Third Quarter 2006
Human
Bioproducts Biopharma Health Corporate Total
Operating Profit - As
Reported $6,415 $(2,422) $7,804 $(8,731) $3,066
Evaluation of strategic
alternatives - - - 1,734 1,734
Goodwill impairment - - 2,092 - 2,092
Cutanogen related costs 127 - - - 127
Adjusted Operating Profit -
Non-GAAP $6,542 $(2,422) $9,896 $(6,997) $7,019
Third Quarter 2005
Human
Bioproducts Biopharma Health Corporate Total
Operating Profit - As
Reported $5,024 $(4,368) $11,343 $(5,864) $6,135
Increase in environmental
reserve - - - 1,300 1,300
Change in allocation
methodology 289 175 130 (594) -
Adjusted Operating Profit -
Non-GAAP $5,313 $(4,193) $11,473 $(5,158) $7,435
Nine Months 2006
Human
Bioproducts Biopharma Health Corporate Total
Operating Profit - As
Reported $21,449 $(7,782) $32,413 $(24,119) $21,961
Evaluation of strategic
alternatives - - - 4,091 4,091
Goodwill impairment - - 2,092 - 2,092
Cutanogen milestone and
related costs 1,664 - - - 1,664
Adjusted Operating Profit
- Non-GAAP $23,113 $(7,782) $34,505 $(20,028) $29,808
Nine Months 2005
Human
Bioproducts Biopharma Health Corporate Total
Operating Profit - As
Reported $20,499 $(12,545) $34,373 $(16,214) $26,113
Increase in environmental
reserve - - - 1,300 1,300
Change in allocation
methodology 845 537 370 (1,752) -
Adjusted Operating Profit
- Non-GAAP $21,344 $(12,008) $34,743 $(16,666) $27,413
Note: The change in allocation methodology reflects certain medical
benefit expenses in third quarter and nine 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 Nine Months Ended September 30, 2006 and 2005
Third Quarter
2006 2005
Operating Expenses - GAAP $36,136 $30,687
Evaluation of strategic alternatives (1,734) -
Goodwill impairment (2,092) -
Cutanogen related costs (127) -
Increase in environmental reserve - (1,300)
Change in allocation methodology - 431
Adjusted Operating Expenses - Non-
GAAP $32,183 $29,818
Nine Months
2006 2005
Operating Expenses - GAAP $104,934 $94,241
Evaluation of strategic alternatives (4,091) -
Goodwill impairment (2,092) -
Cutanogen milestone and related costs (1,664) -
Increase in environmental reserve - (1,300)
Change in allocation methodology - 1,277
Adjusted Operating Expenses - Non-
GAAP $97,087 $94,218
Note: The change in allocation methodology reflects certain medical
benefit expenses in third quarter and nine 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 Nine Months Ended September 30, 2006 and 2005
Third Quarter
2006 2005
Administrative Expense - GAAP $20,759 $16,846
Evaluation of strategic alternatives (1,734) -
Increase in environmental reserve - (1,300)
Change in allocation methodology - 454
Adjusted Administrative Expense -
Non-GAAP $19,025 $16,000
Nine Months
2006 2005
Administrative Expense - GAAP $59,925 $50,689
Evaluation of strategic alternatives (4,091) -
Increase in environmental reserve - (1,300)
Change in allocation methodology - 1,345
Adjusted Administrative Expense -
Non-GAAP $55,834 $50,734
Note: The change in allocation methodology reflects certain medical
benefit expenses in third quarter and nine 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 September 30, 2006 and December 31, 2005
(in thousands)
September 30, December 31,
Assets 2006 2005
Cash and Cash Equivalents $34,458 $45,932
Trade Receivables, net 66,910 74,425
Inventories, net 110,840 93,617
Other Current Assets 15,050 15,552
Total Current Assets 227,258 229,526
Property, Plant and Equipment, Net 239,812 229,410
Goodwill and Other Intangibles 147,100 147,551
Other Non-Current Assets 6,414 5,985
Total Assets $620,584 $612,472
Liabilities and Stockholders' Equity
Trade Accounts Payable $36,617 $38,813
Accrued Expenses and Other Current
Liabilities 55,186 53,333
Total Current Liabilities 91,803 92,146
Long-term Debt 181,723 186,819
Deferred Tax Liabilities 29,131 28,543
Other Non-Current Liabilities 64,772 61,713
Total Liabilities $367,429 $369,221
Stockholders' Equity $253,155 $243,251
Total Liabilities and Stockholders'
Equity $620,584 $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
http://www.prnewswire.com/comp/134219.html /
CONTACT:
Luke M. Beshar, Executive Vice President &
CFO, +1-201-804-3010, luke.beshar@cambrex.com, or Bob Thomson,
Director, Investor Relations, +1-201-804-3047,
bob.thomson@cambrex.com
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