Elite Pharmaceuticals, Inc. Reports Financial Results for the First Quarter Ended June 30, 2011

Revenues up 19% - Positive Operating Cash Flow -- Phentermine Launched


NORTHVALE, N.J., Aug. 16, 2011 (GLOBE NEWSWIRE) -- Elite Pharmaceuticals, Inc. (OTCBB:ELTP),a specialty pharmaceutical company dedicated to developing and commercializing oral controlled release product formulations and the manufacturing of generic pharmaceuticals, announced results for the quarter ended June 30, 2011.

Consolidated revenues were $1.0 million, an increase of 19% over last year's revenues of $0.8 million. Elite's operations generated $0.2 million in positive cash flow, compared with positive operating cash flows of $.1 million last year. The substantial increase in revenues and positive cash flow, were mostly derived from revenues earned from the launch of Elite's Phentermine 37.5mg tablets, and the manufacture, sale and lab services related to the Lodrane family of products, which were discontinued in April 2011. Consequently, management expects that revenues will show significant declines until new product launches and other revenue generating activities are able to replace lost Lodrane revenues.

Consolidated loss from operations was $(0.3 million) for the June 2011 quarter, compared with a loss from operations of $(0.1 million) in the prior year. The increased operating loss was primarily the result of the allocation of available resources from commercial operations to product development to replace the discontinued Lodrane family of products with new products and revenue streams.

GAAP net loss, including non-cash expenses relating to the accounting treatment of preferred share and warrant derivatives was $(30.7 million), compared to a GAAP net loss of $(4.8 million) in the prior year. The substantial increase in the GAAP Net Loss was the result of non-cash derivative expenses incurred a result of a significant increase in the closing price of ELTP shares at quarter end, as compared to the closing price as at the prior quarter's end.

Basic and diluted loss per common share was $(0.13) on a weighted average 232.0 million common shares outstanding, this June 2011 quarter, compared to a basic and diluted loss per common share of $(0.05) and a weighted average common shares outstanding of 87.1 million shares in the prior year.

Jerry Treppel, Chairman and CEO of Elite commented, "Everyone at Elite labors with the knowledge that much of their efforts of the past two years which engineered an unprecedented corporate turnaround, has been hampered by the loss of the Lodrane products. Nonetheless our employees are helping the company move forward to what we hope is an even brighter future." The Company will host a conference call to discuss the results of operations and provide an update on recent business developments on August 16, 2011 at 2:00 PM EDT. Company executives will also conduct a question and answer session following their remarks. 

To access the conference call:              

Domestic callers: (800) 346-7359

International callers: (973) 528-0008                                                                   

Conference Entry Code:   98840

A digital telephone replay will be available approximately one hour after the conclusion of the call for two weeks until August 30, 2011 by dialing:                              

Domestic callers: (800) 332-6854

International callers: (973) 528-0005

Conference entry code: 98840

 

 

Financial Statements

ELITE PHARMACEUTICALS, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
ASSETS
     
  June 30, 2011 March 31, 2011
  (Unaudited) (Audited)
CURRENT ASSETS    
Cash and cash equivalents $1,759,451 $1,825,858
Accounts receivable (net of allowance for doubtful accounts of zero) 513,532 571,667
Inventories (net of allowance of $942,337 and $ 494,425, respectively) 312,025 616,362
Prepaid expenses and other current assets 87,694 133,472
     
Total current assets 2,672,702 3,147,359
     
PROPERTY AND EQUIPMENT-net of accumulated depreciation and amortization of $4,311,020 and $3,838,297, respectively  4,231,512  4,118,274
     
INTANGIBLE ASSETS – net of accumulated amortization of zero 607,928 597,556
     
OTHER ASSETS    
Investment in Novel Laboratories Inc. 3,329,322 3,329,322
Security deposits 28,377 28,377
Restricted cash – debt service for EDA bonds 348,367 291,420
EDA Bond offering costs, net of accumulated amortization    
 of $82,431 and $68,300, respectively 272,021 275,554
     
Total other assets 3,978,087 3,924,673
     
TOTAL ASSETS $11,490,229 $11,787,862
   
   
LIABILITIES AND STOCKHOLDERS (DEFICIT)    
  June 30, 2011 March 31, 2011
  (Unaudited) (Audited)
CURRENT LIABILITIES    
EDA Bonds payable $3,385,000 $3,385,000
Short term loans and current portion of long-term debt 13,528 13,105
Accounts payable and accrued expenses 1,071,097 935,797
Customer deposits --- 39,400
Deferred revenues – current 13,333 13,333
Preferred share derivative interest payable 142,805 282,680
     
Total Current Liabilities 4,625,763 4,669,315
     
LONG TERM LIABILITIES    
Deferred Revenues 175,557 178,890
Long-term debt, less current portion 75,129 75,463
Derivative Liability – Preferred Shares 21,329,402 14,192,329
Derivative Liability – Warrants 24,126,576 10,543,145
     
Total Long-Term Liabilities 45,706,664 24,989,827
     
Total Liabilities 50,332,427 29,659,142
     
     
STOCKHOLDERS (DEFICIT)     
     
Common Stock – par value of $0.001, Authorized 355,516,558    
Issued and outstanding – 243,363,531 shares and 180,545,657 shares, respectively 243,364 180,546
     
Additional paid-in capital 106,815,734 97,116,044
     
Accumulated deficit (145,594,455) (114,861,029)
     
Treasury stock, at cost (100,000 common shares) (306,841) (306,841)
     
Total Stockholders (Deficit)  (38,842,198) (17,871,280)
     
TOTAL LIABILITIES AND STOCKHOLDERS (DEFICIT) EQUITY $11,490,229 $11,787,862
 
 
ELITE PHARMACEUTICALS, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
     
  Three Months Ended
June 30,
  2011
(Unaudited)
2010
(Unaudited)
REVENUES:    
Manufacturing Revenues $ 599,439 $ 567,069
Royalties and License Fees 310,031 181,034
Lab Fee Revenues 80,506 83,817
Total Revenues 989,976 831,920
     
Cost of Revenues 425,368 411,671
Gross Profit 564,608 420,249
     
OPERATING EXPENSES    
Research and Development 445,497 165,008
General and Administrative 324,596 258,321
Non-cash compensation through issuance of stock options and warrants 6,113 15,358
Depreciation and amortization 124,934 78,331
Total Operating Expenses 901,140 517,018
     
(LOSS) FROM OPERATIONS (336,532) (96,769)
     
OTHER INCOME / (EXPENSES):    
Interest expense, net (57,370) (58,069)
Change in fair value of outstanding warrant derivatives (13,583,430) 1,823,701
Change in fair value of preferred share derivatives (16,610,788) (6,074,338)
Interest expense attributable to dividends accrued to preferred share derivative liabilities (142,806) (363,919)
Total Other Income / (Expense) (30,394,394) (4,672,625)
     
(LOSS) BEFORE PROVISION FOR INCOME TAXES (30,730,926) (4,769,394)
     
Provision for Income Taxes 2,500 ---
     
(LOSS) ATTRIBUTABLE TO COMMON SHAREHOLDERS $(30,733,426) $(4,769,394)
     
BASIC AND DILUTED LOSS PER COMMON SHARE $ (0.13) $ (0.05)
     
WEIGHTED AVERAGE NUMBER OF COMMON SHARES OUTSTANDING 232,003,497 87,094,071
       

About Elite Pharmaceuticals, Inc.

Elite Pharmaceuticals, Inc. develops oral sustained and controlled release products. Elite's strategy includes assisting partner companies in the life cycle management of products, to improve off-patent drug products, and developing generic versions of controlled release drug products with high barriers to entry. Elite has four ANDA products partnered with TAGI Pharma; one ANDA has launched, two ANDAs are in the process of a manufacturing site transfer and an additional ANDA is currently under review by the FDA. Elite's lead pipeline products, ELI-216, a once-daily abuse resistant oxycodone, and ELI-154, a once-daily oxycodone, are novel sustained release oral formulations of opioids for the treatment of chronic pain, which address two of the limitations of existing oral opioids: the provision of consistent relief of baseline pain levels and deterrence of potential abuse. Elite also has partnered with Mikah Pharma to develop a new product and with Hi-Tech Pharmacal to develop an intermediate for a generic product. Elite operates a GMP and DEA registered facility for research, development, and manufacturing located in Northvale, NJ.

This news release contains forward-looking statements, including those related to the preliminary nature of the clinical program results and the potential for further product development, that involve known and unknown risks, delays, uncertainties and other factors not under the control of Elite, which may cause actual results, performance or achievements of the companies to be materially different from the results, performance or other expectations implied by these forward-looking statements. In particular, because substantial future testing will be required prior to approval, the results described above may not be supported by additional data or by the results of subsequent trials. These risks and other factors, including the timing or results of pending and future clinical trials, regulatory reviews and approvals by the Food and Drug Administration and other regulatory authorities, and intellectual property protections and defenses, are discussed in Elite's filings with the Securities and Exchange Commission such as the 10K, 10Q and 8K reports. Elite undertakes no obligation to update any forward-looking statements.



            

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