AMRI reports $50.2 million total revenue for third quarter 2011

Published on November 9, 2011 at 1:41 AM · No Comments

AMRI (NASDAQ: AMRI) today reported financial and operating results for the third quarter ended September 30, 2011.

“The recently signed agreements with NIH and Lilly underscore the significant progress we are making in establishing broader, strategic long-term customer relationships across all segments of our business. We believe additional opportunities exist for multi-year partnership deals in discovery, development and large-scale services from the biopharmaceutical community.”

Highlights include:

  • Signed multi-year agreements with Eli Lilly and Company and the National Institutes of Health (NIH) / National Institute of Neurological Disorders and Stroke (NINDS) to provide drug discovery services
  • 17% growth in Large-Scale Manufacturing
  • 8% growth in Development/Small-Scale Manufacturing
  • AMRI to cease all activities related to its internal R&D programs, excluding its generic program, saving approximately $7 million in operating expenses in 2012; Company will immediately wind down programs to focus efforts only on partnering/out-licensing opportunities

Third Quarter 2011 Results

Total revenue for the third quarter of 2011 was $50.2 million, essentially flat with results reported in the third quarter of 2010.

Total contract revenue for the third quarter of 2011 was $43.8 million, an increase of 2% compared to total contract revenue of $42.9 million reported in the third quarter of 2010. Total contract revenue encompasses revenue from AMRI's Discovery Services, Development and Small-Scale Manufacturing, and Large-Scale Manufacturing business components.

  • Discovery Services contract revenue for the third quarter was $8.9 million, a decrease of 29% from $12.5 million in 2010
  • Development/Small-Scale Manufacturing contract revenue for the third quarter was $9.2 million, an increase of 8% from $8.5 million in 2010
  • Large-Scale Manufacturing contract revenue for the third quarter was $25.7 million, an increase of 17% from $21.9 million in 2010

Recurring royalties in the third quarter of 2011 were $6.5 million, a decrease of 17% from $7.7 million in the third quarter of 2010. AMRI earns royalties from worldwide sales of the non-sedating antihistamine Allegra® (Telfast® outside the United States), as well as certain generic and OTC forms of Allegra®, for patents relating to the active ingredient in Allegra®.

Net loss under U.S. GAAP was $(5.9) million, or $(0.19) per basic and diluted share in the third quarter of 2011, compared to a net loss of $(9.9) million, or $(0.33) per basic and diluted share for the third quarter of 2010. Net loss, as adjusted was $(5.7) million, or $(0.19) per basic and diluted share.

Year-to-Date

Total revenue for the nine-month period ended September 30, 2011 was $161.1 million, an increase of $11.6 million or 8% compared to $149.4 million for the same period in 2010.

Total contract revenue for the first nine months of 2011 was $130.2 million, an increase of $7.7 million or 6% from $122.5 million for the same period in 2010.

  • Contract revenue for Discovery Services in the nine-month period ended September 30, 2011 was $28.5 million, a decrease of 23% from $37.0 million in 2010
  • Contract revenue for Development/Small-Scale Manufacturing in the nine-month period ended September 30, 2011 was $28.7 million, an increase of 16% from $24.7 million in 2010
  • Contract revenue for Large-Scale Manufacturing in the nine-month period ended September 30, 2011 was $73.0 million, an increase of 20% compared to $60.8 million in the nine-month period ended September 30, 2010

Recurring royalties from Allegra® for the first nine months of 2011 were $27.9 million, an increase of 3% compared to royalty revenue of $26.9 million in 2010.

Total revenue for the nine months ended September 30, 2011 includes milestone revenue of $3.0 million resulting from the company's 2005 licensing agreement with Bristol-Myers Squibb Company.

Net loss under U.S. GAAP for the nine months ended September 30, 2011 was $(7.9) million or $(0.26) per basic and diluted share, compared to net loss of $(13.8) million or $(0.44) per basic and diluted for the nine months ended September 30, 2010. Adjusted net loss for the nine months ended September 30, 2011 was $(6.7) million or $(0.22) per basic and diluted share.

For a reconciliation of net (loss) income and (loss) earnings per diluted share as reported to adjusted net income and earnings per diluted share for the 2011 and 2010 reporting periods, please see Table 1 at the end of this press release.

AMRI Chairman, President and CEO Thomas E. D'Ambra said, "The recently signed agreements with NIH and Lilly underscore the significant progress we are making in establishing broader, strategic long-term customer relationships across all segments of our business. We believe additional opportunities exist for multi-year partnership deals in discovery, development and large-scale services from the biopharmaceutical community.

"Regarding our Burlington facility, our investments of significant time and resources at this site have proven effective. We have received encouraging news from the FDA, and have resumed both clinical and commercial production activities at the site. As a result of this progress, we believe we will close the year with a much stronger platform for global growth in 2012 and beyond. Now, more than ever, our customers are focused on pipeline development and commercialization of biologics - such as vaccines and other injectibles - as part of their global business strategy, which further supports our commitment to operational improvements in Burlington," added Dr. D'Ambra.

"Given the current economic and market environment, it is more important than ever to maximize our flexibility to adapt to whatever market conditions we may face in the most efficient and effective manner. Therefore, although regrettable, by the end of 2011, we will cease all internal R&D activities directed to new compounds and focus our efforts on partnering or out-licensing all existing compounds in our proprietary pipeline. In addition, we are in the process of a thorough review of our global organization to determine additional opportunities to increase efficiencies. We are taking a measured approach and anticipate actions taken will create a leaner company with improved liquidity and a greater ability to achieve profitability," said Dr. D'Ambra.

Liquidity and Capital Resources

At September 30, 2011, AMRI had cash, cash equivalents and marketable securities of $20.0 million, compared to $41.5 million at December 31, 2010.

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