United Therapeutics Corporation Reports Third Quarter 2012 Financial Results

 United Therapeutics Corporation Reports Third Quarter 2012 Financial Results

- Total Revenues of $242.5 million

- Earnings per Share of $1.52 per Basic Share or $1.46 per Diluted Share

- Earnings Before Non-Cash Charges of $2.93 per Basic Share, or $2.82 per
Diluted Share

PR Newswire

SILVER SPRING, Md., Nov. 1, 2012

SILVER SPRING, Md., Nov. 1, 2012 /PRNewswire/ -- United Therapeutics
Corporation (NASDAQ: UTHR) today announced its financial results for the third
quarter ended September30, 2012.

"It is certainly gratifying to see us closely approach, for the first time, a
revenue run rate of one billion dollars per year," said Martine Rothblatt,
Ph.D., United Therapeutics' Chairman and Chief Executive Officer. "Our free
cash flow enables us to continue investing in new therapies such as once-daily
injectable treprostinil and once-monthly refillable implantable treprostinil
that hold great promise for positively transforming the lives of patients with
pulmonary arterial hypertension."

Total revenues for the quarter ended September30, 2012 were $242.5 million,
up from $201.7 million for the quarter ended September30, 2011.Net income
for the quarter ended September30, 2012 was $78.1 million or $1.52 per basic
share, compared to $84.4 million or $1.45 per basic share for the same quarter
in 2011. Gross margin from sales was $212.9 million for the quarter ended
September30, 2012, compared to $178.3 million for the same quarter last
year.Earnings before non-cash charges[1] ^ for the quarter ended
September30, 2012 were $150.9 million, compared to $100.8 million for the
same quarter in 2011.

Financial Results for the Three Months Ended September 30, 2012

Revenues

The table below summarizes the components of net revenues (dollars in
thousands):

                          Three Months Ended      Percentage
                          September 30,           Change
                          2012        2011
Cardiopulmonary products:
Remodulin                 $ 120,811   $ 114,918   5.1     %
Tyvaso                    88,302      66,330      33.1    %
Adcirca                   31,804      19,772      60.9    %
Other                     1,551       722         114.8   %
Total net revenues        $ 242,468   $ 201,742   20.2    %

Revenues for the quarter ended September30, 2012 increased by $40.7 million,
compared to the same quarter in 2011. The growth in product revenues reflects
the continuing increase in the number of patients being treated with our
products.

[1] See definition of earnings before non-cash charges, a non-GAAP financial
measure, and a reconciliation of net income to earnings before non-cash
charges below.

Expenses

The table below summarizes research and development expense by major project
and non-project components (dollars in thousands):

                                       Three Months Ended
                                       September 30,         Percentage Change
                                       2012       2011
Project and non-project component:
Cardiopulmonary                        $ 43,823   $ 74,125   (40.9)      %
Share-based compensation expense       11,816     (22,966)   151.4       %
(benefit)
Other                                  9,516      8,274      15.0        %
Total research and development expense $ 65,155   $ 59,433   9.6         %

Cardiopulmonary. The $30.3 million decrease in cardiopulmonary program
expenses for the quarter ended September30, 2012, compared to the same
quarter in 2011, corresponded to a decrease in expenses related to fees
incurred under licensing agreements.

Share-based compensation. The increase in share-based compensation of $34.8
million for the quarter ended September30, 2012, compared to the same quarter
in 2011, resulted from the appreciation in the price of our common stock
during the quarter ended September30, 2012, compared to the decline in our
stock price during the same quarter in 2011.

The table below summarizes selling, general and administrative expense by
major categories (dollars in thousands):

                                       Three Months Ended
                                       September 30,         Percentage Change
                                       2012       2011
Category:
General and administrative             $ 32,924   $ 24,972   31.8       %
Sales and marketing                    17,229     15,822     8.9        %
Share-based compensation expense       18,473     (24,138)   176.5      %
(benefit)
Total selling, general and             $ 68,626   $ 16,656   312.0      %
administrative expense

General and administrative. The increase in general and administrative
expenses of $8.0 million for the quarter ended September30, 2012 compared to
the same quarter in 2011 was driven by increases in: (1) grants to
unaffiliated, not-for-profit organizations that provide financial assistance
to patients suffering from pulmonary arterial hypertension and (2)
depreciation and operating expenses as a result of the expansion of our
corporate headquarters in Maryland and our facilities in North Carolina.

Share-based compensation. The increase in share-based compensation of $42.6
million for the quarter ended September30, 2012, compared to the same quarter
in 2011, corresponded to the appreciation in the price of our common stock
during the quarter ended September30, 2012, compared to the decline in our
stock price during the same quarter in 2011.

Other Income (Expenses)

Other income, net was $27.8 million for the quarter ended September30, 2012,
compared to other expenses, net of $4.7 million for the same quarter in 2011.
The $32.5 million increase in other income (expense), net resulted largely
from the recognition of an approximately $31.0 million gain relating to an
insurance settlement.

Income Taxes

The provision for income taxes was $30.4 million for the quarter ended
September30, 2012, compared to $17.6 million for the same quarter in 2011.
The increase in the provision for income taxes reflects an increase in pre-tax
earnings for the quarter ended September30, 2012 compared to the same quarter
in 2011 and an increase in the estimated annual effective tax rate to 31
percent as of September30, 2012 from 28 percent as of September30, 2011. The
increase in the estimated annual effective tax rate for 2012 reflects
primarily a decrease in estimated business tax credits to be generated from
operations as compared to September30, 2011.

2012 Revenue Guidance

We reaffirm our 2012 full-year revenue guidance for our three commercial
products (Remodulin®, Tyvaso® and Adcirca®), as we continue to expect related
revenues to fall within a range of 5% above or below $875 million for 2012.

Earnings Before Non-Cash Charges

Earnings before non-cash charges is defined as net income, adjusted for the
following non-cash charges, as applicable: (1) interest; (2) income taxes; (3)
license fees; (4)depreciation and amortization; (5) impairment charges; and
(6) share-based compensation (stock option, share tracking award and employee
stock purchase plan expense).

A reconciliation of net income to earnings before non-cash charges is
presented below (in thousands, except per share data):

                                                      Three Months Ended
                                                      September 30,
                                                      2012        2011
Net income, as reported                               $ 78,111    $ 84,398
Adjust for non-cash charges:
Interest expense                                      4,384       5,416
Income tax expense                                    30,382      17,641
License fees                                          —           41,332
Depreciation and amortization                         6,915       4,991
Impairment charges                                    —           (5,366)
Share-based compensation expense (benefit)            31,145      (47,609)
Earnings before non-cash charges                      $ 150,937   $ 100,803
Earnings before non-cash charges per share:
Basic                                                 $ 2.93      $ 1.73
Diluted                                               $ 2.82      $ 1.65
Weighted average number of common shares outstanding:
Basic                                                 51,514      58,321
Diluted                                               53,590      61,210

Conference Call

We will host a half-hour teleconference on Thursday, November1, 2012, at
9:00a.m. Eastern Time. The teleconference is accessible by dialing
1-877-351-5881, with international callers dialing 1-970-315-0533. A
rebroadcast of the teleconference will be available for one week by dialing
1-855-859-2056, with international callers dialing 1-404-537-3406 and using
access code 34857915.

This teleconference is also being webcast and can be accessed via our website
at http://ir.unither.com/events.cfm.

About United Therapeutics

United Therapeutics Corporation is a biotechnology company focused on the
development and commercialization of unique products to address the unmet
medical needs of patients with chronic and life-threatening conditions.

Non-GAAP Financial Information

This press release contains a financial measure, earnings before non-cash
charges, that does not comply with United States generally accepted accounting
principles (GAAP). This measure supplements our financial results prepared in
accordance with GAAP as reported below.

We use earnings before non-cash charges to assist us in: (1)planning,
including the preparation of our annual operating budget; (2) allocating
resources in an effort to enhance the financial performance of our business;
(3)evaluating the effectiveness of our operational strategies; and (4)
assessing our capacity to fund capital expenditures and expand our business.
We believe this non-GAAP financial measure improves investors' understanding
of our financial results by excluding certain expenses that we do not consider
when evaluating and comparing the performance of our core operations and
making operating decisions. In addition, we have historically reported
earnings before non-cash charges to investors, and believe the inclusion of
this non-GAAP financial measure provides investors with a consistent method of
comparison to historical periods. However, there are limitations in the use of
this non-GAAP financial measure in that it excludes certain operating expenses
that are recurring in nature. In addition, our calculation of this non-GAAP
financial measure may differ from the methodology used by other companies. The
presentation of this non-GAAP financial measure should not be considered in
isolation or as a substitute for our financial results prepared in accordance
with GAAP. A reconciliation of net income, the most directly comparable GAAP
financial measure, to earnings before non-cash charges can be found in the
table above under the heading, Earnings Before Non-Cash Charges.

Forward-looking Statements

Statements included in this press release that are not historical in nature
are "forward-looking statements" within the meaning of the Private Securities
Litigation Reform Act of 1995. Forward-looking statements include, among
others, our expectations about future operating results, including our revenue
guidance for 2012, and the potential benefits of new therapies such as
once-daily injectable treprostinil and once-monthly refillable implantable
treprostinil. These forward-looking statements are subject to certain risks
and uncertainties, such as those described in our periodic reports filed with
the Securities and Exchange Commission, that could cause actual results to
differ materially from anticipated results.Consequently, such forward-looking
statements are qualified by the cautionary statements, cautionary language and
risk factors set forth in our periodic reports and documents filed with the
Securities and Exchange Commission, including our most recent Annual Report on
Form10-K, Quarterly Reports on Form10-Q, and Current Reports on Form8-K. We
claim the protection of the safe harbor contained in the Private Securities
Litigation Reform Act of 1995 for forward-looking statements. We are providing
this information as of the date of this press release, and assume no
obligation to update or revise the information contained in this press release
whether as a result of new information, future events or any other reason.
[uthr-g]

Remodulin and Tyvaso are registered trademarks of United Therapeutics
Corporation.

Adcirca is a registered trademark of Eli Lilly and Company.



UNITED THERAPEUTICS CORPORATION
CONSOLIDATED STATEMENTS OF OPERATIONS
(In thousands, except per share data)


                                Three Months Ended      Nine Months Ended
                                September 30,           September 30,
                                2012        2011        2012        2011
                                (Unaudited)             (Unaudited)
Revenues:
Net product sales               $ 240,917   $ 201,020   $ 665,692   $ 546,784
Other                           1,551       722         6,567       1,221
Total revenues                  242,468     201,742     672,259     548,005
Operating expenses:
Research and development        65,155      59,433      135,911     131,379
Selling, general and            68,626      16,656      161,673     98,775
administrative
Cost of product sales           27,968      22,676      81,632      63,577
Total operating expenses        161,749     98,765      379,216     293,731
Operating income                80,719      102,977     293,043     254,274
Other (expense) income:
Interest income                 1,138       1,016       3,225       2,520
Interest expense                (4,384)     (5,416)     (12,149)    (16,256)
Equity loss in affiliate        (48)        (43)        (110)       (110)
Other, net                      31,068      (278)       31,710      (1,301)
Total other (expense) income,   27,774      (4,721)     22,676      (15,147)
net
Income from continuing          108,493     98,256      315,719     239,127
operations before income taxes
Income tax expense              (30,382)    (17,641)    (94,532)    (65,073)
Income from continuing          78,111      80,615      221,187     174,054
operations
Discontinued operations:
Income from discontinued        —           —           —           7
operations, net of tax
Gain on disposal of
discontinued operations, net of —           3,783       —           618
tax
Income from discontinued        —           3,783       —           625
operations
Net income                      $ 78,111    $ 84,398    $ 221,187   $ 174,679
Net income per common share:
Basic
Continuing operations           $ 1.52      $ 1.38      $ 4.20      $ 3.00
Discontinued operations         0.00        0.07        0.00        0.01
Net income per basic common     $ 1.52      $ 1.45      $ 4.20      $ 3.01
share
Diluted
Continuing operations           $ 1.46      $ 1.32      $ 4.11      $ 2.80
Discontinued operations         0.00        0.06        0.00        0.01
Net income per diluted common   $ 1.46      $ 1.38      $ 4.11      $ 2.81
share
Weighted average number of
common shares outstanding:
Basic                           51,514      58,321      52,626      58,087
Diluted                         53,590      61,210      53,849      62,062



SELECTED CONSOLIDATED BALANCE SHEET DATA
September 30, 2012
(Unaudited, in thousands)


Cash, cash equivalents and marketable securities (excluding         $ 752,341
restricted amounts of $5.3 million)
Total assets                                                        1,647,492
Total liabilities and common stock subject to repurchase            586,661
Total stockholders' equity                                          1,060,831



SOURCE United Therapeutics Corporation

Website: http://www.unither.com
Contact: Andrew Fisher, +1-202-483-7000, Afisher@unither.com