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Repligen Reports Second Quarter 2015 Financial Results

20:00 EDT 5 Aug 2015 | Globe Newswire

Product Sales Increase 38% to a Record $21.5 Million 
 
Conference Call and Webcast Today at 8:30 a.m. ET 

WALTHAM, Mass., Aug. 06, 2015 (GLOBE NEWSWIRE) -- Repligen Corporation (NASDAQ:RGEN), a life sciences company focused on bioprocessing technology leadership, today reported financial results for the second quarter and six-month (year-to-date) periods ended June 30, 2015. Below are the Company’s performance highlights, followed by updated financial guidance for the year 2015 and access information for today’s webcast and conference call.

Second Quarter and Year-to-Date Financial Highlights 

  • Product revenue for the second quarter of 2015 was $21.5 million compared to $15.6 million for the second quarter of 2014, an increase of 38% which includes a negative impact of 11% from foreign currency translation. For the six-month period, product revenue was $42.3 million compared to $29.9 million for the same period in 2014, an increase of 41%. Total revenue for year-to-date 2015 was comprised entirely of bioprocessing revenue. For the same period in 2014, total revenue was $31.9 million, which included an upfront payment of $2.0 million from BioMarin Pharmaceutical Inc. under our therapeutic asset purchase agreement.
     
  • Product gross margin reached 60.0% for the second quarter of 2015 and 60.6% for the six-month period of 2015. This compares to 57.1% for the second quarter of 2014 and 56.5% for the first six months of 2014.
     
  • Product gross profit for the second quarter of 2015 was $12.9 million compared to product gross profit of $8.9 million for the second quarter of 2014, an increase of 45%.  For the six-month period in 2015, product gross profit was $25.6 million compared to $16.9 million for same period in 2014, an increase of 52%.
     
  • Operating income for the second quarter of 2015 was $4.6 million compared to operating income of $3.1 million for the second quarter of 2014. Operating income for the second quarter was impacted by the recognition of $0.8 million in contingent consideration expense based on the high probability of the Company achieving a 2015 sales milestone for the Alternating Tangential Flow (ATF) System, as predefined in the Company’s asset purchase agreement with Refine Technology, LLC.  Operating income for the six-month period in 2015 was $8.6 million, including $1.9 million of contingent consideration expense related to ATF System sales, compared to $8.4 million for the same period in 2014, which included $2.0 million of royalty and other revenue.
     
  • Net income for the second quarter of 2015 was $3.6 million, or $0.11 per diluted share, compared to $2.8 million, or $0.09 per diluted share, for the second quarter of 2014.  Net income for the six-month period of 2015 was $6.5 million, or $0.19 per diluted share, compared to $7.1 million, or $0.22 per diluted share, for the same period in 2014. These net income figures include the aforementioned impact of contingent consideration in 2015 and royalty and other income in 2014.
     
  • EBITDA (Non-GAAP)[1] was $5.5 million for the second quarter of 2015 compared to $4.1 million during the second quarter of 2014. For the year-to-date periods, EBITDA was $10.8 million in 2015 compared to $10.3 million in 2014. These EBITDA figures included the aforementioned impact of contingent consideration in 2015 and royalty and other income in 2014.


Total operating expenses for the three-month period ended June 30, 2015 were $16.8 million compared to $12.4 million for the same period in 2014, an increase of $4.4 million. The increase in total operating expense included a $1.9 million increase in cost of product revenue associated with higher product sales, $0.8 million in contingent consideration expense based on the high probability of achieving 2015 sales milestones for the ATF System and a $1.9 million increase in sales, general and administrative (SG&A) expense. The increase in SG&A expense is due primarily to costs related to the expansion of staffing, systems and facilities to support current and future growth. 

Tony J. Hunt, President and CEO of Repligen said, “During the second quarter, increased demand for our Protein A affinity ligands and ATF Systems were key drivers of revenue growth and gross margin expansion. We are very encouraged by the uptake in ATF Systems since our acquisition of the technology in June of last year. As we enter the second half of what has been a very strong year to date, we are raising our full year guidance and are confident that our focus on growth and our commitment to bioprocessing technology leadership will continue to drive value for our customers and investors.”

Financial Guidance for 2015

Based on our second quarter results and expectations for the remainder of 2015, we are revising our financial guidance as summarized below. This guidance for the year 2015 is based on expectations for our existing business and does not include the impact on our revenue and expenses of potential milestone payments, the financial impact of potential bioprocessing acquisitions or future fluctuations in foreign currency exchange rates. 

  • Revenue guidance for the year 2015 is $78-$82 million, an increase from our previous guidance of $75-$78 million. Our revenue projection for 2015 is comprised exclusively of bioprocessing product sales and reflects 29%-36% sales growth, an increase from our previous guidance of 24%-29% growth. This guidance includes an estimated negative adjustment to sales growth of approximately 8% to accommodate the impact of foreign currency translation at current exchange rates.

  • Product gross margin for the year 2015 is expected to be 56%-58%, consistent with our previous guidance.

  • Operating expenses for the year 2015 are expected to be $65-$67 million, an increase of $3 million from our previous guidance of $62-$64 million. This increase is driven by an increase in cost of goods related to higher anticipated product sales as well as product mix, a $1 million increase in expected SG&A expense and higher contingent consideration based on the achievement of ATF System sales milestones.

  • Total income from operations for the year 2015 is expected to be $14-$16 million, and net income is expected to be $10-$12 million, consistent with our previous guidance.


Conference Call  

Repligen will host a conference call and webcast today, August 6, 2015 at 8:30 a.m. ET, to discuss second quarter 2015 financial results and business updates. The live call can be accessed by dialing toll-free (844) 835-7432 for domestic callers or (404) 537-3372 for international callers. Dial-in participants must provide the passcode 91950805. In addition, a webcast will be accessible via the Investor Relations section of Repligen’s website www.repligen.com; see Events & Presentations. Both the conference call and webcast will be archived for a period of time following the live event. The replay dial-in numbers are (855) 859-2056 for domestic callers and (404) 537-3406 for international callers. Replay listeners must provide the passcode 91950805.

Non-GAAP Financial Measures

In this release, the Company is reporting earnings before interest, taxes, depreciation and amortization (EBITDA). EBITDA is a non-GAAP financial measure and should not be viewed as an alternative to GAAP measures of performance. The Company has provided a reconciliation of GAAP net income to EBITDA at the end of this release. The Company believes that the use of this non-GAAP measure better enables management and investors to benchmark its results against historical performance and the performance of peers and to evaluate acquisition and other investment opportunities.

About Repligen Corporation

Repligen Corporation (NASDAQ:RGEN) is a life sciences company focused on the development and commercialization of high-value consumable products used in the process of manufacturing biological drugs. Our bioprocessing products are sold to major life sciences and biopharmaceutical companies worldwide. We are the leading manufacturer of Protein A affinity ligands, a critical component of Protein A media that is used to separate and purify monoclonal antibody therapeutics. Our ATF System and our growth factor products are used to increase product yield during the fermentation stage of biologic drug manufacturing. In addition, we developed and market an innovative line of “ready-to-use” chromatography columns under our OPUS® brand that we deliver pre-packed with our customers’ choice of purification media. Repligen’s corporate headquarters are in Waltham, MA (USA) and our manufacturing facilities are located in Waltham, MA and Lund, Sweden.

[1] See Reconciliation of GAAP Net Income to Non-GAAP EBITDA chart at the end of this release

The following constitutes a “Safe Harbor” statement under the Private Securities Litigation Reform Act of 1995: This press release contains forward-looking statements, which are made pursuant to the safe harbor provisions of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Investors are cautioned that statements in this press release which are not strictly historical statements, constitute forward-looking statements, including, without limitation, express or implied statements or guidance regarding future financial performance and position, including cash and investment position, the future demand for our bioprocessing products, objectives for future operations, our receipt of any future payments under the terms of our agreement with BioMarin, our contingent payment obligations under the terms of our agreement with Refine, plans and objectives for product development and acquisitions, our market share and product sales and other statements identified by words like “believe,” “expect,” “may,” “will,” “should,” “seek,” “anticipate,” or “could” and similar expressions. Such   forward-looking statements are subject to a number of risks and uncertainties that could cause actual results to differ materially from those anticipated, including, without limitation, risks associated with: our ability to successfully grow our bioprocessing business, including as a result of acquisition, commercialization or partnership opportunities; our ability to develop and commercialize products and the market acceptance of our products; reduced demand for our products that adversely impacts our future revenues, cash flows, results of operations and financial condition; the success of current and future collaborative or supply relationships, including our agreement with BioMarin; our ability to compete with larger, better financed bioprocessing, pharmaceutical and biotechnology companies; our ability to optimize manufacturing process; our compliance with all Food and Drug Administration and EMEA regulations; our volatile stock price; and other risks detailed in Repligen’s Annual Report on Form 10-K on file with the Securities and Exchange Commission and the other reports that Repligen periodically files with the Securities and Exchange Commission. Actual results may differ materially from those Repligen contemplated by these forward-looking statements. These forward looking statements reflect management’s current views and Repligen does not undertake to update any of these forward-looking statements to reflect a change in its views or events or circumstances that occur after the date hereof except as required by law.




REPLIGEN CORPORATION 
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME 
(Unaudited) 
         
  Three months ended June 30,   Six months ended June 30,  
  2015   2014   2015   2014  
Revenue:        
Product revenue$  21,457,267  $  15,551,077  $  42,273,543  $  29,885,764  
Royalty and other revenue   -     -     -     1,991,166  
Total revenue   21,457,267     15,551,077     42,273,543     31,876,930  
Operating expenses:        
Cost of product revenue   8,586,147     6,671,581     16,659,051     13,006,645  
Cost of royalty revenue   -     -     -     -  
Research and development   1,251,576     1,430,133     2,819,150     2,631,123  
Selling, general and administrative   6,242,275     4,325,834     12,266,801     7,709,444  
Contingent consideration - fair value adjustments   768,556     17,700     1,880,930     116,020  
Total operating expenses   16,848,554     12,445,248     33,625,932     23,463,232  
Income from operations   4,608,713     3,105,829     8,647,611     8,413,698  
Investment income   19,012     84,920     55,597     186,736  
Interest expense    (7,788)    (12,780)    (16,829)    (26,865) 
Other (expense) income   (268,549)    65,280     (136,518)    67,785  
                 
Income before income taxes   4,351,388     3,243,249     8,549,861     8,641,354  
Income tax provision   738,831     417,827     2,007,817     1,538,829  
                 
Net income $  3,612,557  $  2,825,422  $  6,542,044  $  7,102,525  
                 
Earnings per share:        
Basic$  0.11  $  0.09  $  0.20  $  0.22  
Diluted$  0.11  $  0.09  $  0.19  $  0.22  
                 
Weighted average shares outstanding:        
Basic   32,870,473     32,233,694     32,827,536     32,098,269  
Diluted   33,670,696     33,076,384     33,581,682     32,963,554  
                 
Comprehensive income (loss)$  5,054,633  $  1,372,701  $  4,118,142  $  5,508,834  
         
         
Balance Sheet Data:June 30, 2015 December 31, 2014     
Cash, cash equivalents and marketable securities*$  64,390,336  $  62,003,443      
Working capital   77,441,580     70,263,229      
Total assets   137,344,655     128,293,234      
Long-term obligations   3,296,446     5,879,013      
Accumulated deficit   (74,345,164)    (80,887,208)     
Stockholders' equity   118,222,538     111,731,808      
         
  *does not include restricted cash       
         

 

 

 

REPLIGEN CORPORATION
RECONCILIATION OF GAAP NET INCOME TO NON-GAAP EBITDA
   
   
 Three months ended June 30, Six months ended June 30,
  2015   2014   2015   2014 
         
GAAP NET INCOME 3,612,557   2,825,422   6,542,044   7,102,525 
   
Non-GAAP Adjustments:   
 Investment Income (19,012)  (84,920)  (55,597)  (186,736)
 Interest Expense 7,788   12,780   16,829   26,865 
 Tax Provision 738,831   417,827   2,007,817   1,538,829 
 Depreciation 744,586   648,057   1,494,659   1,285,344 
 Amortization 399,550   315,147   800,972   570,268 
         
NON-GAAP EBITDA 5,484,299   4,134,313   10,806,724   10,337,095 
         

 

 

 

Contact:
Sondra S. Newman
Senior Director Investor Relations
Repligen Corporation
(781) 419-1881
snewman@repligen.com

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