Financial Results at the Upper End of 2013 Guidance
Conference call and webcast (in English) today at 2:00pm CET (1:00pm GMT/8:00am EST)
MARTINSRIED / MUNICH, Germany, Feb. 28, 2014 (GLOBE NEWSWIRE) -- MorphoSys AG (FSE: MOR; Prime Standard Segment, TecDAX; OTC: MPSYY) today announced financial results for the year ending 31 December 2013. Group revenues from continuing operations amounted to EUR 78.0 million and earnings before interest and taxes (EBIT) reached EUR 9.9 million. The consolidated net profit amounted to EUR 13.3 million, translating into earnings per share (EPS) of EUR 0.54. On 31 December 2013, the Company held liquid funds and marketable securities, as well as other financial assets, in the amount of EUR 390.7 million, compared to EUR 135.7 million on 31 December 2012.
Operational Highlights
- MorphoSys signed a global licensing agreement with GlaxoSmithKline for the future development of the anti-GM-CSF antibody MOR103. This contract provides for secured and performance-related payments of up to EUR 445 million as well as tiered double-digit royalties on net sales.
- MorphoSys signed a global development alliance with Celgene for the anti-CD38 antibody MOR202. Under the terms of the agreement, the companies will co-develop MOR202, with MorphoSys bearing one third of development costs and Celgene the remainder. The total potential value of all development, regulatory and sales milestones in the transaction is EUR 628 million, not including a 50:50 profit share in Europe and tiered, double digit royalties in the rest of the world.
- MorphoSys completed the sale of AbD Serotec to Bio-Rad for a total consideration of approximately EUR 53 million. Through this transaction, MorphoSys sharpened its focus on the core, therapeutic business.
- MorphoSys and Heptares agreed to cooperate in the development of therapeutic antibodies against G-protein-coupled receptors (GPCRs). This cooperation will support access to new target molecules for therapeutic antibodies based on the Ylanthia library.
- The phase 1/2a trial of the anti-CD19 antibody MOR208 in chronic lymphocytic leukemia (CLL) was completed. The final trial results showed an acceptable safety profile with an overall response rate of approximately 30%. Additionally, MorphoSys began phase 2 trials with MOR208 in non-Hodgkin's lymphoma (NHL) and in acute lymphoblastic B-cell leukemia (B-ALL), and supported an investigator-sponsored phase 2 trial in CLL.
- In October 2013, MorphoSys's partner, Novartis, began a phase 2/3 clinical trial with the HuCAL antibody bimagrumab (BYM338) in sporadic inclusion body myositis. Bimagrumab received FDA breakthrough therapy designation in August 2013.
- As of February 2014, MorphoSys's partnered and proprietary clinical pipeline comprises 20 unique antibody molecules, which are being evaluated in more than 40 clinical trials. MorphoSys's total pipeline of partnered and proprietary antibodies comprises 81 antibodies, including two in pivotal studies, namely bimagrumab (Novartis) and gantenerumab (Roche).
"The effort and investment that have gone into our proprietary portfolio over the past several years paid off nicely in 2013. Through licensing agreements with GlaxoSmithKline and Celgene, we demonstrated our ability to develop drug candidates from target molecule to lucrative partnership. These advances were the main drivers of the Company's value in 2013," stated Dr. Simon Moroney, Chief Executive Officer of MorphoSys AG. "Clinical data from the ongoing MOR202 and MOR208 trials, as well as from numerous partnered programs, plus activities which will strengthen our proprietary portfolio even further, will be the key events to watch for in the year to come."
Financial Highlights
- MorphoSys carried out a capital increase from authorized capital, securing gross proceeds of approximately EUR 84 million. The proceeds will be used to fund the clinical development of MOR208 and MOR202, to fund potential acquisitions of new businesses, complementary technologies and products as well as to initiate, advance and/or accelerate the development of other proprietary programs.
- On 31 December 2013, the Company held liquid funds and marketable securities, as well as other financial assets, in the amount of EUR 390.7 million (compared to 31 December 2012: EUR 135.7 million).
| In EUR million* | 2013 | 2012 | Q4 2013 | Q4 2012 |
| Continuing Operations: | ||||
| Group Revenues | 78.0 | 51.9 | 14.4 | 16.5 |
| Total Operating Expenses | 67.9 | 49.8 | 18.8 | 12.2 |
| Other Income/Expenses | (0.1) | 0.3 | (0.3) | 0.1 |
| Earnings Before Interest and Taxes (EBIT) | 9.9 | 2.5 | (4.7) | 4.4 |
| Profit/(Loss) from Continuing Operations | 7.4 | 2.4 | (3.5) | 3.2 |
| Profit/(Loss) from Discontinued Operations | 6.0 | (0.4) | 0 | (0.1) |
| Consolidated Net Profit | 13.3 | 1.9 | (3.5) | 3.2 |
| Total EPS (diluted) in Euro | 0.54 | 0.08 | - | - |
* Differences due to rounding
"The progress in our proprietary and partnered pipeline is also reflected in our financial results. The proceeds from our newly formed alliances with GlaxoSmithKline and Celgene, the sale of AbD Serotec, and our capital raise in September contributed to a rise in our cash and investments to approximately EUR 390 million," commented Jens Holstein, Chief Financial Officer of MorphoSys AG. "We intend to develop MOR202 and MOR208 as broadly and as quickly as possible, in the case of MOR202 in cooperation with our partner Celgene. We also want to intensify our early-stage research activities and we aim to in-license additional programs and/or acquire assets. Our progress in 2013 has shown that investing in proprietary programs creates value and this will be a continuous priority in the years ahead."
Financial Review for the Fiscal Year 2013 (IFRS)
Result from Continuing Operations
Group revenues from continuing operations for the full year 2013 increased by 50% to EUR 78.0 million (2012: EUR 51.9 million). Revenues in the Partnered Discovery segment included EUR 48.0 million in funded research and licensing fees (2012: EUR 42.7 million) and EUR 3.0 million in success-based payments (2012: EUR 1.9 million). The increase versus the previous year is driven by the fully paid-up license payment from Bio-Rad for a non-exclusive license for HuCAL in research and diagnostic applications in connection with the sale of the AbD Serotec business unit. The Proprietary Development segment achieved revenues of EUR 26.9 million (2012: EUR 7.0 million). In comparison to the previous year, this increase was mainly driven by the recognition of an upfront payment as part of the out-licensing of the MOR103 program to GlaxoSmithKline, and by the pro-rata recognition of an upfront payment under the contract covering the co-development of MOR202 with Celgene.
Total operating expenses from continuing operations for the full year 2013 increased by 36 % to EUR 67.9 million (2012: EUR 49.8 million). The increase in operating expenses of EUR 18.1 million was mainly caused by greater investment in proprietary research and development (R&D) as well as higher selling, general and administrative (S, G&A) costs. Total research and development expenses (R&D) rose by EUR 11.5 million to EUR 49.2 million in 2013 (2012: EUR 37.7 million). The increase in R&D expenses mainly resulted from higher costs for external laboratory services and higher personnel expenses. Investment in proprietary research and development, including technology development, amounted to EUR 31.7 million (2012: EUR 21.7 million). S, G&A expenses rose to EUR 18.8 million (2012: EUR 12.1 million). The increase is mainly driven by higher personnel expenses and expenses for third-party services. Non-cash charges related to stock-based compensation are embedded in R&D and S, G&A expenses and amounted to EUR 5.1 million (2012: EUR 1.3 million). The rise is primarily due to an adjustment of the long-term incentive programs for the years 2011 and 2012, and new incentive programs granted in 2013.
Earnings before interest and taxes (EBIT) from continuing operations amounted to EUR 9.9 million (2012: EUR 2.5 million). Partnered Discovery showed a segment EBIT of EUR 25.4 million (2012: EUR 23.0 million), while the Proprietary Discovery segment reported an EBIT of EUR -0.5 million (2012: EUR -11.0 million).
Other income and expenses, finance income and expenses including taxes resulted in an expense of EUR 2.7 million (2012: income of EUR 0.2 million). For the full year 2013, MorphoSys realized a net profit from continuing operations of EUR 7.4 million compared to a net profit of EUR 2.4 million in the previous year. The resulting diluted earnings per share from continuing operations for the year 2013 amounted to EUR 0.30 (2012: EUR 0.10).
Results from Discontinued Operations
The sale of the research and diagnostic antibody segment AbD Serotec to Bio-Rad Laboratories, Inc., was completed on 10 January 2013. The results from discontinued operations therefore reflect only the first ten days of the first quarter. Revenues from discontinued operations amounted to EUR 0.6 million (2012: EUR 17.7 million).
Total operating costs from discontinued operations reached EUR 2.3 million (2012: EUR 18.1 million), including cost of goods sold (COGS) in the amount of EUR 0.2 million (2012: EUR 6.2 million) as well as transaction-related costs in the amount of EUR 1.8 million.
During 2013, EBIT from discontinued operations after deduction of all attributable transaction costs amounted to EUR -1.7 million (2012: EUR -0.6 million). In connection with the deconsolidation of the AbD segment, a disposal gain of EUR 8.0 million was accounted for, resulting in a profit before taxes of EUR 6.3 million (2012: loss of EUR 0.6 million). The net profit from discontinued operations amounted to EUR 6.0 million (2012: net loss of EUR 0.4 million).
Results for the Group
The total Group net profit reached EUR 13.3 million (2012: EUR 1.9 million). The resulting Group earnings per share amounted to EUR 0.54 (2012: EUR 0.08).
On 31 December 2013, the Company held liquid funds and marketable securities, as well as other financial assets (reported in the balance sheet under cash and cash equivalents; available for sale financial assets; bonds, available for sale and other receivables), in the amount of EUR 390.7 million, compared to EUR 135.7 million on 31 December 2012. Net cash inflow from operations in 2013 amounted to EUR 89.1 million (2012: EUR 1.8 million). The number of issued shares at 31 December 2013 was 26,220,882, compared to 23,358,228 shares at 31 December 2012.
Fourth Quarter of 2013 (IFRS)
Results from Continuing Operations
In the fourth quarter of 2013, the Company generated revenues from continuing operations in the amount of EUR 14.4 million, compared to EUR 16.5 million in the same quarter of 2012. Total operating expenses amounted to EUR 18.8 million in Q4, compared to EUR 12.2 million in the same quarter of 2012. The increase of operating expenses was mainly due to higher personnel expenses as well as expenses for third party services. The EBIT amounted to EUR -4.7 million (Q4 2012: EUR 4.4 million). Net loss for the fourth quarter 2013 was EUR 3.5 million, compared to a net profit of EUR 3.2 million in the fourth quarter of 2012.
Results for the Group
For the fourth quarter of 2013, Group net loss amounted to EUR 3.5 million (Q4 2012: net profit of EUR 3.2 million).
Outlook for 2014
MorphoSys's main goals for 2014 are the expansion and advancement of its therapeutic antibody pipeline and the further development and exploitation of its technology platforms. Consequently, MorphoSys intends to invest larger amounts of its liquidity in those activities. In comparison to 2013, which was impacted by one-time payments for MOR103, MOR202 and for a license to BioRad in connection with the sale of AbD Serotec, Group revenues will decrease in 2014. MorphoSys anticipates total Group revenues of EUR 58 million to EUR 63 million and anticipates an EBIT in the range of EUR -11 to EUR -16 million in 2014. Investments in proprietary products and technologies will amount to EUR 36 million to EUR 41 million, not including expenses for additional development programs, which might be in-licensed during 2014.
Consolidated Financial Statements 2013 (IFRS) are available on our website:
http://www.morphosys.com/FinancialReports
MorphoSys will hold its conference call and webcast today to present the Annual Financial Results 2013 and the Outlook 2014.
Dial-in number for the analyst conference call (in English) at 02:00 pm CET; 01:00 pm GMT; 08:00 am EST (listen-only):
Germany: +49 (0) 89 2444 32975
For UK residents: +44 (0) 20 3003 2666
For US residents: +1 202 204 1514
Please dial in 10 minutes before the beginning of the conference.
In addition, MorphoSys offers participants the opportunity to follow the presentation through a simultaneous slide presentation online at http://www.morphosys.com.
A live webcast, slides, webcast replay and transcript will be made available at http://www.morphosys.com.
Approximately two hours after the press conference, a slide-synchronized audio replay of the conference will be available on http://www.morphosys.com.
About MorphoSys:
MorphoSys developed HuCAL, the most successful antibody library technology in the pharmaceutical industry. By successfully applying this and other patented technologies, MorphoSys has become a leader in the field of therapeutic antibodies, one of the fastest-growing drug classes in human healthcare.
Together with its pharmaceutical partners, MorphoSys has built a therapeutic pipeline of more than 80 human antibody drug candidates for the treatment of cancer, rheumatoid arthritis, and Alzheimer's disease, to name just a few. With its ongoing commitment to new antibody technology and drug development, MorphoSys is focused on making the healthcare products of tomorrow. MorphoSys is listed on the Frankfurt Stock Exchange under the symbol MOR. For regular updates about MorphoSys, visit http://www.morphosys.com.
HuCAL®, HuCAL GOLD®, HuCAL PLATINUM®, CysDisplay®, RapMAT®, arYla®, Ylanthia® and 100 billion high potentials® are registered trademarks of MorphoSys AG.
Slonomics® is a registered trademark of Sloning BioTechnology GmbH, a subsidiary of MorphoSys AG.
This communication contains certain forward-looking statements concerning the MorphoSys group of companies. The forward-looking statements contained herein represent the judgment of MorphoSys as of the date of this release and involve risks and uncertainties. Should actual conditions differ from the Company's assumptions, actual results and actions may differ from those anticipated. MorphoSys does not intend to update any of these forward-looking statements as far as the wording of the relevant press release is concerned.
For more information, please contact:
MorphoSys AG
Dr. Claudia Gutjahr-Löser
Head of Corporate Communications & IR
Mario Brkulj
Associate Director Corporate Communications & IR
Alexandra Goller
Specialist Corporate Communications & IR
Jessica Rush
Specialist Corporate Communications & IR
Tel: +49 (0) 89 / 899 27-404
investors@morphosys.com
Media Release (PDF) http://hugin.info/130295/R/1765314/598968.pdf
Consolidated Financial Statements (IFRS) 2013 http://hugin.info/130295/R/1765314/598970.pdf
HUG#1765314