Elite Pharmaceuticals, Inc. Reports Financial Results for the Second Quarter of Fiscal 2013

Revenues From New Products Continue to Grow

        Print
| Source: Elite Pharmaceuticals, Inc.

NORTHVALE, N.J., Nov. 14, 2012 (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 fiscal second quarter ended September 30, 2012.

Consolidated revenues were $0.6 million for the quarter, an increase of 131% when compared to the comparable quarter of the prior year. This increase is the result of the continuing growth of the new revenue streams that have been created within the last eighteen months.

In addition, at the end of the quarter, Elite has received FDA approval for two new products, Phentermine 15mg capsules and Phentermine 30mg capsules although the launch of these products is dependent on resolution of the API issues discussed in our press release of October 12, 2012. Elite also currently has two products that are pending approval by the FDA for manufacturing transfer and a third undisclosed generic product under FDA review.

Consolidate loss from operations was $(0.5 million) for this quarter, compared with a loss from operations $(0.6 million) in the comparable quarter of the prior year. GAAP net income for the quarter, including non-cash expenses relating to the accounting treatment of preferred share and warrant derivatives was $1.0 million, compared to a GAAP net income of $13.9 million for the comparable quarter of the prior year, with the difference mostly being due to changes in the value of preferred shares and warrant derivatives. Basic earnings per share was $0.00, on a weighted average of 348.3 million common shares outstanding, compared to a basic earnings per common share of $0.06 and a weighted average common shares outstanding of 248.2 million in the comparable quarter of the prior year. Fully diluted earnings per share was $0.00, on a weighted average diluted shares of 505.8 million, compared to fully diluted earnings per share of $0.03 and a weighted average diluted shares of 454.2 million in the comparable quarter of the prior year. The increase in common shares outstanding is primarily due to conversion of preferred shares into common shares during the last 12 months.

Jerry Treppel, Chairman and CEO of Elite commented, "Our plan to increase revenues from product sales, which are inherently more stable and predictable than a milestone based revenue stream continues apace. We are in active discussions with our phentermine API supplier and are hopeful that a resolution can be reached, although we cannot predict if or when this might occur. We have manufactured larger batches of product in our new facility and begun limited packaging operations as well. We continue to move forward with the development of our abuse-resistant opioid products even as others in the field continue to have problems."  

The Company will host a conference call to discuss the results of operations and provide an update on recent business developments on Thursday, November 15, 2012 at 10:00 AM EST. 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 November 29, 2012 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
     
  September 30,
2012
(Unaudited)
March 31,
2012
(Audited)
ASSETS    
CURRENT ASSETS    
Cash and cash equivalents $ 207,343 $ 668,407
Accounts receivable (net of allowance for doubtful accounts of -0- and -0-, respectively) 562,943 396,847
Inventories (net of reserve of $93,338 and $93,338, respectively) 480,735 304,882
Prepaid expenses and other current assets 112,711 127,704
     
Total Current Assets 1,363,732 1,497,840
     
PROPERTY AND EQUIPMENT, net of accumulated depreciation of $4,888,414 and $4,659,670, respectively 4,172,280 4,284,786
     
INTANGIBLE ASSETS – net of accumulated amortization of $-0- and $-0--, respectively 666,163 642,848
     
OTHER ASSETS    
Investment in Novel Laboratories, Inc. 3,329,322 3,329,322
Security deposits 14,314 14,913
Restricted cash – debt service for EDA bonds 274,031 280,585
EDA bond offering costs, net of accumulated amortization of $100,429 and $93,339, respectively 254,023 261,423
     
Total Other Assets 3,871,690 3,886,243
     
TOTAL ASSETS $ 10,073,865  $10,311,717
     
LIABILITIES AND STOCKHOLDERS' DEFICIT    
CURRENT LIABILITIES    
EDA bonds payable $ 3,385,000 $ 3,385,000
Short term loans and current portion of long-term debt 206,636 13,316
Accounts payable and accrued expenses 1,128,346 1,066,494
Deferred revenues – current 13,333 13,333
Preferred share derivative interest payable 28,760 70,966
     
Total Current Liabilities 4,762,075 4,549,109
     
LONG TERM LIABILITIES    
Deferred revenues 158,889 165,558
Other long term liabilities 89,497 87,404
Derivative liability – preferred shares 11,917,323 8,506,106
Derivative liability – warrants 14,947,419 11,987,222
     
Total Long Term Liabilities 27,113,128 20,746,290
     
TOTAL LIABILITIES 31,875,203 25,295,399
     
STOCKHOLDERS' DEFICIT    
Common stock – par value $0.001, Authorized 690,000,000 shares Issued and outstanding – 349,664,279 shares and 331,649,728 shares, respectively 349,664 331,650
     
Additional paid-in-capital 117,547,328 114,910,812
     
Accumulated deficit (139,391,489) (129,919,303)
     
Treasury stock at cost (100,000 common shares) (306,841) (306,841)
     
TOTAL STOCKHOLDERS' DEFICIT (21,801,338) (14,983,682)
     
TOTAL LIABILITIES AND STOCKHOLDERS' DEFICIT $ 10,073,865  $10,311,717
 
ELITE PHARMACEUTICALS, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
         
  THREE MONTHS ENDED SIX MONTHS ENDED
  September 30, September 30,
  2012 2011 2012 2011
REVENUES        
Manufacturing Fees $ 466,020  $ 78,294 $ 845,716 $ 677,733
Royalties & Profit Splits 154,168 100,069 282,663 410,000
Lab Fee Revenues 14,329 95,769 84,693 176,275
         
Total Revenues 634,517 274,132 1,213,072 1,264,108
         
COSTS OF REVENUES 479,631 76,331 933,995 501,700
         
Gross Profit 154,886 197,801 279,077 762,408
         
OPERATING EXPENSES        
Research and Development 228,475 198,212 425,357 643,709
General and Administrative 401,174 476,897 766,135 801,494
Non-cash compensation through issuance of stock options 15,133 6,113 21,246 12,226
Depreciation and Amortization 25,372 108,181 67,370 233,115
         
Total Operating Expenses 670,154 789,403 1,280,108 1,690,544
         
(LOSS) FROM OPERATIONS (515,268) (591,602) (1,001,031) (928,136)
         
OTHER INCOME / (EXPENSES)        
Interest expense, net (61,247) (57,931) (119,784) (115,301)
Change in fair value of warrant derivatives 2,093,653 10,497,037 (2,995,081) (3,086,393)
Change in fair value of preferred share derivatives (187,383) 4,196,187 (4,830,866) (12,414,600)
Interest expense attributable to preferred share derivatives (28,823) (124,370) (83,901) (267,175)
Discount in Series E issuance attributable to beneficial conversion features (250,000) --- (437,500) ---
         
Total Other Income / (Expense) 1,566,200 14,510,923 (8,467,132) (15,883,469)
         
INCOME (LOSS) BEFORE PROVISION FOR INCOME TAXES 1,050,932 13,919,321 (9,468,163) (16,811,605)
         
PROVISION FOR INCOME TAXES 1,023 --- 4,023 2,500
         
NET INCOME (LOSS) ATTRIBUTABLE TO COMMON SHAREHOLDERS $ 1,049,909 $ 13,919,321 $ (9,472,186) $ (16,814,105)
         
NET (LOSS) PER SHARE        
Basic $ 0.00 $ 0.06 $ (0.03) $ (0.07)
Diluted   $ 0.00 $ 0.03 $ (0.03) $ (0.07)
         
WEIGHTED AVERAGE NUMBER OF COMMON SHARES OUTSTANDING        
Basic 348,298,807 248,247,253 342,712,859 240,189,326
Diluted 505,759,554 454,162,476 342,855,832 240,189,326

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 three commercial products being sold through a partner, one product produced for partners under contract manufacturing agreements, two additional products approved and pending launch, and three products under review, pending approval by the FDA.   Elite's lead pipeline products include abuse resistant opioids utilizing the company's patented proprietary technology, and a once-daily opioid. They are 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, with Hi-Tech Pharmacal to develop an intermediate for a generic product, and a Hong Kong based company to develop a branded product for the United States market and its territories. Elite operates a GMP and DEA registered facility for research, development, and manufacturing located in Northvale, NJ.

The Elite Pharmaceuticals, Inc. logo is available at http://www.globenewswire.com/newsroom/prs/?pkgid=8737

This news release contains "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. Including those related to the effects, if any, on future results, performance or other expectations that may have some correlation to the subject matter of this press release, readers are cautioned that such forward-looking statements involve risks and uncertainties including, without limitation, delays, uncertainties, inability to obtain necessary ingredients and other factors not under the control of Elite, which may cause actual results, performance or achievements of Elite to be materially different from the results, performance or other expectations that may be implied by these forward-looking statements These risks and other factors, including, without limitation, the timing or results of pending and future clinical trials, regulatory reviews and approvals by the Food and Drug Administration and other regulatory authorities, intellectual property protections and defenses, and the Company's ability to operate as a going concern, are discussed in Elite's filings with the Securities and Exchange Commission, including its reports on forms 10-K, 10-Q and 8-K. Elite undertakes no obligation to update any forward-looking statements.

For Elite Pharmaceuticals, Inc.
Dianne Will, Investor Relations, 518-398-6222

www.elitepharma.com