Theratechnologies Announces Financial Results for First Quarter of 2013
MONTREAL, CANADA -- (Marketwired) -- 04/11/13 -- Theratechnologies
Inc. (Theratechnologies) (TSX:TH) today announced its financial
results for the first quarter ended February 28, 2013.
First quarter financial highlights
-- Revenues of $1,799,000
-- Royalties of $884,000
-- Decrease in expenses for selling & market development, general &
administrative and R&D by 31.3 percent to $2,484,000 due to
-- Reversal of previous restructuring costs of $3,093,000
-- Net profit of $1,860,000
-- $17,905,000 in liquidities available at quarter-end
"Our financial results for the first quarter of 2013 demonstrate our
continued commitment towards becoming cash-neutral. We continue to
manage expenses very tightly as demonstrated by the signing of the
amended lease agreement which will translate into a cash disbursement
reduction of more than one million dollars a year. This is in
addition to a substantial reduction in overall spending," said Luc
Tanguay, President and Chief Executive Officer of Theratechnologies.
"At the same time, we continue to move our business plan forward by
regaining all commercialization rights for EGRIFTA(TM) in Europe,
working on the potential re-filing of EGRIFTA(TM) in Europe, filing
of an appeal in Canada and supporting our partner with regulatory
submissions in Latin America," concluded Luc Tanguay.
First Quarter Financial Results
The financial results presented in this press release are taken from
the Company's Management's Discussion and Analysis, or MD&A, and
unaudited consolidated financial statements for the period ended
February 28, 2013, which have been prepared in accordance with
International Financial Reporting Standards, or IFRS, as issued by
the International Accounting Standards Board, or IASB. The MD&A for
the first quarter ended February 28, 2013, and the unaudited
consolidated financial statements can be found at www.theratech.com,
www.sedar.com and www.sec.gov. Unless specified otherwise, all
amounts in this press release are in Canadian dollars. As used
herein, EGRIFTA(TM) refers to tesamorelin for the reduction of excess
abdominal fat in HIV-infected patients with lipodystrophy.
EGRIFTA(TM) is our trademark.
Our revenues are mainly sales of EGRIFTA(TM) to EMD Serono for
re-sale, royalties received from EMD Serono on U.S. sales to
customers, and research services, which include milestone payments
and the amortization of the initial payment received upon the closing
of the agreement with EMD Serono. Consolidated revenue for the three
months ended February 28, 2013 amounted to $1,799,000 compared to
$3,190,000 in the comparable period of fiscal 2012.
Revenue generated from the sale of goods for the three months ended
February 28, 2013 was $451,000 compared to $1,279,000 in the
comparable period in fiscal 2012, reflecting a lower selling price
and lower shipments to EMD Serono in the first quarter of 2013. The
lower selling price is the result of the introduction of the new
single-vial presentation of EGRIFTA(TM) in October 2012. While the
EGRIFTA(TM) selling price is now lower, our markup in percentage
terms remains unchanged. The lower volume reflects the fact that
shipments can vary significantly in the short term as a function of
EMD Serono's procurement policies.
Royalties were $884,000 in the three month-period ended February 28,
2013, compared to $841,000 in the three-month period ended February
29, 2012. The current-year period includes the royalties earned in
December 2012 and an estimate of the royalties earned in January and
February 2013. The prior-year period includes the royalties earned in
October, November and December 2011.
Revenue related to the amortization of the initial payment received
upon the closing of the EMD Serono Agreement was $464,000 for the
three-month period ended February 28, 2013, compared to $1,070,000 in
the comparable period of fiscal 2012. The lower amortization amount
in Fiscal 2013 reflects an extension made to the service period
attributed to the initial payment in order to allow sufficient time
for work that has yet to be completed
For the three-month period ended February 28, 2013, the cost of sales
of EGRIFTA(TM) amounted to $668,000 compared to $1,337,000 in the
comparable period of 2012. Cost of sales in the current period
includes costs related to implementing manufacturing corrective
measures required by the Brazilian regulatory authorities. Cost of
sales in the current-year also includes a loss of $192,000 which
occurred during the conversion of materials to finished goods in
January 2013. We are in the process of analyzing the cause and the
responsibility in regards to this event. In the interim, production
of EGRIFTA(TM) has been suspended until corrective measures are
implemented. Management and the third-party supplier are currently
working on corrective measures.
Research and development, or R&D, expenses, net of tax credits, for
the three-month period ended February 28, 2013 amounted to $1,455,000
compared to $1,313,000 in the comparable period of 2012. R&D expenses
in 2013 include our share of the costs of the two Phase 4 clinical
trials, and expenses associated with helping our commercial partners
to pursue regulatory approvals in their respective jurisdictions.
Selling and market development expenses for the three-month period
ended February 28, 2013 amounted to $62,000 compared to $261,000 in
the comparable period of 2012. With licensing agreements now in place
for EGRIFTA(TM) in major markets and the strong focus on becoming
cash neutral as soon as possible our selling and market development
activities are reduced to managing relationships with our existing
General and administrative expenses for the three-month period ended
February 28, 2013 amounted to $967,000 compared to $2,043,000 in the
comparable period of 2012. The expenses were considerably lower as a
result of the restructuring and adjustments to remuneration.
In the three-month period ended February 28, 2013, we reversed
restructuring costs in the amount of $3,093,000 compared to an
expenses of $6,058,000 in the comparable period of 2012. The
prior-year period costs were related to the restructuring in the
first quarter of 2012 and included an onerous lease provision of
$4,055,000. The lease amendment agreement triggered the reversal of
the remaining portion of the onerous lease provision in the amount of
$3,119,000 after deducting expenses related to the agreement.
Finance income for the three-month period ended February 28, 2013 was
$160,000 compared to $277,000 in the comparable period of 2012.
Interest revenues in 2013 were lower than 2012 due to the gradual
decline in the portfolio size as investments are liquidated to fund
Finance costs for the three months ended February 28, 2013 were
$40,000, whereas finance costs in the comparable period of 2012 were
a gain of $67,000 on positive foreign exchange fluctuations.
Taking into account the revenues and expenses described above, the
net profit for the three months ended February 28, 2013 amounted to
$1,860,000, compared to a net loss of $7,484,000 in the comparable
period of 2012. On a per share basis, the net profit for the
three-month period ended February 28, 2013 was $0.03 compared to a
net loss of $0.12 in the comparable period of 2012.
As at February 28, 2013, liquidities, which include cash and bonds,
amounted to $17,456,000 and tax credits and grants receivable
amounted to $449,000, for a total of $17,905,000 compared to
$20,924,000 at November 30, 2012.
Cash flows used in operating activities for the three-month period
ended February 28, 2013 amounted to $2,884,000 compared to $7,929,000
in the comparable period of 2012. The current-year period reflects a
$921,000 reduction in accounts payable and accrued liabilities.
Conference Call Details
A conference call will be held today at 8:30 a.m. (ET) to discuss the
results. The call will be hosted by Luc Tanguay, President and Chief
Executive Officer. The conference call will be open to questions from
financial analysts. Media and other interested individuals are
invited to participate in the call on a "listen-only" basis.
The conference call can be accessed by dialling 1-800-743-4304 (North
America) or 1-416-981-9000 (International). The conference call will
also be accessible via webcast at www.theratech.com. Audio replay of
the conference call will be available until April 25, 2013, by
dialling 1-800-558-5253 (North America) or 1-416-626-4100
(International) and by entering the playback code 21652962.
Theratechnologies (TSX:TH) is a biopharmaceutical company that
specializes in innovative therapeutic peptide products, with an
emphasis on growth-hormone releasing factor peptides. Further
information about Theratechnologies is available on the Company's
website at www.theratech.com, on SEDAR at www.sedar.com and on the
SEC's website at www.sec.gov.
This press release contains forward-looking statements and
forward-looking information, or, collectively, forward-looking
statements, within the meaning of applicable securities laws, that
are based on our management's belief and assumptions and on
information currently available to our management. You can identify
forward-looking statements by terms such as "may", "will", "should",
"could", "would", "outlook", "believe", "plan", "envisage",
"anticipate", "expect" and "estimate", or the negatives of these
terms, or variations of them. The forward-looking statements
contained in this press release include, but are not limited to,
statements regarding the regulatory approval of EGRIFTA(TM) in
various territories outside of the United States, the capacity of our
commercial partner in the United States to continue the
commercialization of EGRIFTA(TM) in that country, the capacity of our
commercial partners outside of the United States to commercialize
EGRIFTA(TM) in their respective territories, our capacity to become
cash neutral and to tightly control our expenses and our capacity to
re-file a marketing authorization application in Europe or in certain
European countries for EGRIFTA(TM).
Forward-looking statements are based upon a number of assumptions and
include, but are not limited to, the following: EGRIFTA(TM) will
receive approvals in various territories outside the United States,
no additional clinical studies will be required by regulatory
authorities outside of the Unites States to obtain these regulatory
approvals, EGRIFTA(TM) will be accepted by the marketplace in
territories outside of the United States and will be on the list of
reimbursed drugs by third-party payors in these territories, the
relationships with our commercial partners and third-party suppliers
will be conflict-free, such third-party suppliers will have enough
capacity to manufacture and supply EGRIFTA(TM) to meet demand and on
a timely basis, the prescription base in the United States for
EGRIFTA(TM) will continue to grow and no unexpected events resulting
in unplanned material expenses will occur.
Forward-looking statements are subject to a variety of risks and
uncertainties, many of which are beyond our control that could cause
our actual results to differ materially from those that are disclosed
in or implied by the forward-looking statements contained in this
press release. These risks and uncertainties include, but are not
limited to, the following: the risk that EGRIFTA(TM) is not approved
in all or some of the territories where our commercial partners have
filed and intend to file marketing authorization applications, the
risk that the royalties generated from sales of EGRIFTA(TM) in the
United States do not increase or that they decrease, the risk that
conflicts occur with our commercial partners jeopardizing the
commercialization of EGRIFTA(TM), the risk that the supply of
EGRIFTA(TM) to our commercial partners is delayed or suspended as a
result of problems with our third-party suppliers, including audits
by regulatory agencies, the risk that EGRIFTA(TM) is withdrawn from
the market as a result of defects or recalls, the risk that our
intellectual property is not adequately protected, the risk that even
if approved in territories outside of the United States, EGRIFTA(TM)
is not accepted in these marketplaces or is not on the list of
reimbursed drugs by third-party payors and the risk that unexpected
events occur resulting in unplanned material expenses.
We refer potential investors to the "Risks Factors" section of our
Annual Report on Form 20-F dated February 26, 2013 available at
www.sedar.com, www.sec.gov and www.theratech.com. The reader is
cautioned to consider these and other risks and uncertainties
carefully and not to put undue reliance on forward-looking
statements. Forward-looking statements reflect current expectations
regarding future events and speak only as of the date of this press
release and represent our expectations as of that date.
We undertake no obligation to update or revise the information
contained in this press release, whether as a result of new
information, future events or circumstances or otherwise, except as
may be required by applicable law.
NATIONAL Public Relations
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