Source: RECORDATI
RECORDATI ANNOUNCES GROWTH IN THE FIRST HALF 2019. REVENUES +6.8%, EBITDA(1) +7.4%, NET INCOME +6.1%
RECORDATI ANNOUNCES GROWTH IN THE FIRST HALF 2019. REVENUES +6.8%, EBITDA(1) +7.4%, NET INCOME +6.1%
·Consolidated revenues € 743.3 million, +6.8%.
·EBITDA (1) € 279.3 million, +7.4%
·Operating income € 242.6 million, +4.6%.
·Net income € 174.3 million, +6.1%.
·Net financial position (2): net debt of € 610.9 million.
·Shareholders’ equity € 1,071.4 million.
·Exclusive license for the commercialization of Juxtapid® in Japan.
·Subsequent events: Acquisition of global rights to Signifor®, Signifor® LAR® and osilodrostat.
·Revised full year 2019 targets
Milan, 30 July 2019 – The Board of Directors of Recordati S.p.A. approved the Group’s consolidated results for the first half 2019 prepared in accordance with the International Financial Reporting Standards (IAS/IFRS) and in particular as per IAS 34 requirements for interim reporting. These financial statements will be available today at the company’s offices and on the company’s website (www.recordati.com) and can also be viewed on the authorized storage system 1Info (www.1Info.it). The independent auditors’ report on the consolidated condensed half-year financial statements will be available within the legal deadline at the company’s offices and on the company’s website (www.recordati.com) and can also be viewed on the authorized storage system 1Info (www.1Info.it).
Financial highlights
- Consolidated revenues in the first half of 2019 are € 743.3 million, up by 6.8% compared to the same period of the preceding year. International sales grow by 6.9%.
- EBITDA (1), at 37.6% of sales, is € 279.3 million, an increase of 7.4% over the first half of 2018.
- Operating income, at 32.6% of sales, is € 242.6 million, an increase of 4.6% over the same period of the preceding year.
- Net income, at 23.4% of sales, is € 174.3 million, an increase of 6.1% over the first half of 2018.
- Net financial position (2) at 30 June 2019 records a net debt of € 610.9 million compared to net debt of € 588.4 million at 31 December 2018. Shareholders’ equity is € 1,071.4 million.
(1) Operating income before depreciation, amortization and write down of both tangible and intangible assets.
(2) Cash and short-term financial investments less bank overdrafts and medium/long-term loans which include the measurement at fair value of hedging derivatives.
Corporate development news
In February, Recordati signed a license agreement with Aegerion Pharmaceuticals Inc. for the exclusive rights to commercialize Juxtapid®, currently approved for the treatment of homozygous familial hypercholesterolemia (HoFH), in Japan. The agreement includes a right of first negotiation for product commercialization in Japan of any potential new indications that may be developed by Aegerion. Upon signing of the agreement an upfront payment of $ 25 million was paid to Aegerion, and a milestone of $ 5 million was paid in June. In 2018 sales of the product in Japan were of $ 10.8 million. Juxtapid® (lomitapide) is a microsomal triglyceride transfer protein inhibitor. Homozygous familial hypercholesterolemia is a serious, rare genetic disease that impairs the function of the receptor responsible for removing LDL-C (“bad” cholesterol) from the body. The addition of Juxtapid® to our portfolio of rare disease products in Japan is very important for the development of our recently established subsidiary in this country, given its potential for significant growth.
Recordati Rare Diseases, a worldwide leader in rare diseases and orphan drugs, announced that companies formerly operating under the name of Orphan Europe were recently renamed Recordati Rare Diseases, which is today the global brand of Recordati’s organization dedicated to treatments for rare diseases and orphan drugs.
On 12 July 2019 an agreement was signed with Novartis for the acquisition of worldwide rights to Signifor® and Signifor® LAR® for the treatment of Cushing’s disease and acromegaly in adult patients for whom surgery is not an option or for whom surgery has failed. Worldwide sales of Signifor® in 2018 were $ 72 million. The agreement also covers the acquisition of worldwide rights to osilodrostat (LCI699), an investigational innovative drug for the treatment of endogenous Cushing’s syndrome, for which marketing authorization applications have been filed in the European Union and in the USA. Upon completion of the transaction a consideration of $ 390 million will be due to Novartis. At closing, the consideration will be funded by existing liquidity and new debt facilities. The closing of the transaction is subject to customary conditions and regulatory clearances and is expected to take place in few months.
Management Comments
“The financial results obtained in the first half of the year confirm the continued growth of the Group”, declared Andrea Recordati, CEO. “Furthermore, important initiatives were undertaken aimed at growing our rare diseases business globally. In addition to the exclusive license to Juxtapid® in Japan, in July an agreement was signed for the acquisition of two products, Signifor® and Signifor® LAR®, as well as an innovative investigational drug, osilodrostat, for rare diseases in the area of endocrinology. This transaction is a key step in the achievement of our three-year business plan as we are very confident in the further growth opportunity of the Signifor® franchise and excited by the growth potential of osilodrostat on a worldwide basis. These two products together could generate annual peak sales in excess of $ 200 million,” continued Andrea Recordati. “Taking into account the acquisition of the new products, our full year 2019 targets were revised and we now expect to achieve sales ranging from € 1,460 million to € 1,480 million, an EBITDA of between € 535 and € 545 million, EBIT of between € 460 and € 470 million and net income of between € 330 and € 335 million.”
Conference call
Recordati will be hosting a conference call today 30 July 2019 at 4:00 pm Italian time (3:00 pm London time, 10:00 am New York time). The dial-in numbers are:
Italy +39 02 8058811, toll free 800 213 858
UK +44 1 212818003, toll free 800 0156384
USA +1 718 7058794, toll free 855 2656959
France +33 170918703
Germany +49 69 255114451
Callers are invited to dial-in 10 minutes before conference time. If conference operator assistance is required during the connection, please digit * followed by 0 or call +39 02 8061371. A recording of the conference call will be placed on the website www.recordati.com.
A set of slides which will be referred to during the call will be available on our website www.recordati.com under Investors/Company Presentations.
Recordati, established in 1926, is an international pharmaceutical group, listed on the Italian Stock Exchange (Reuters RECI.MI, Bloomberg REC IM, ISIN IT 0003828271), with a total staff of more than 4,100, dedicated to the research, development, manufacturing and marketing of pharmaceuticals. Headquartered in Milan, Italy, Recordati has operations throughout the whole of Europe, including Russia, Turkey, North Africa, the United States of America, Canada, Mexico, some South American countries, Japan and Australia. An efficient field force of medical representatives promotes a wide range of innovative pharmaceuticals, both proprietary and under license, in a number of therapeutic areas including a specialized business dedicated to treatments for rare diseases. Recordati is a partner of choice for new product licenses for its territories. Recordati is committed to the research and development of new specialties with a focus on treatments for rare diseases. Consolidated revenue for 2018 was € 1,352.2 million, operating income was € 442.2 million and net income was € 312.4 million.
For further information:
Recordati website: www.recordati.com
Investor Relations Media Relations
Marianne Tatschke Studio Noris Morano
(39)0248787393 (39)0276004736, (39)0276004745
e-mail: investorelations@recordati.it e-mail: norismorano@studionorismorano.com
Statements contained in this release, other than historical facts, are "forward-looking statements" (as such term is defined in the Private Securities Litigation Reform Act of 1995). These statements are based on currently available information, on current best estimates, and on assumptions believed to be reasonable. This information, these estimates and assumptions may prove to be incomplete or erroneous, and involve numerous risks and uncertainties, beyond the Company’s control. Hence, actual results may differ materially from those expressed or implied by such forward-looking statements. All mentions and descriptions of Recordati products are intended solely as information on the general nature of the company’s activities and are not intended to indicate the advisability of administering any product in any particular instance.
RECORDATI GROUP
Summary of consolidated results prepared in accordance with the
International Financial Reporting Standards (IFRS)
(thousands of €)
| INCOME STATEMENT | First half 2019 | First half 2018 | Change % |
| REVENUE | 743,253 | 696,054 | 6.8 |
| Cost of sales | (223,298) | (203,013) | 10.0 |
| GROSS PROFIT | 519,955 | 493,041 | 5.5 |
| Selling expenses | (183,884) | (172,793) | 6.4 |
| Research and development expenses | (59,757) | (53,627) | 11.4 |
| General & administrative expenses | (34,598) | (33,140) | 4.4 |
| Other income (expenses), net | 843 | (1,550) | n.s. |
| OPERATING INCOME | 242,559 | 231,931 | 4.6 |
| Financial income (expenses), net | (10,922) | (8,458) | 29.1 |
| PRE-TAX INCOME | 231,637 | 223,473 | 3.7 |
| Provision for income taxes | (57,363) | (59,285) | (3.2) |
| NET INCOME | 174,274 | 164,188 | 6.1 |
| Attributable to: | |||
| Equity holders of the parent | 174,252 | 164,164 | 6.1 |
| Minority interests | 22 | 24 | (8.3) |
| EARNINGS PER SHARE | |||
| Basic(1) | € 0.853 | € 0.801 | 6.5 |
| Diluted(2) | € 0.833 | € 0.785 | 6.1 |
| EBITDA(3) | 279,313 | 260,017 | 7,4 |
| (1) Earnings per share (EPS) are based on average shares outstanding during each year, 204,317,687 in 2019 and 205,053,284 in 2018, net of average treasury stock which amounted to 4,807,469 shares in 2019 and to 4,071,872 shares in 2018. (2) Diluted earnings per share is calculated taking into account stock options granted to employees. (3) Operating income before depreciation, amortization and write down of both tangible and intangible assets. | |||
| COMPOSITION OF REVENUE | First half 2019 | First half 2018 | Change % |
| Total revenue | 743,253 | 696,054 | 6.8 |
| Italy | 155,097 | 145,791 | 6.4 |
| International | 588,156 | 550,263 | 6.9 |
Pending the completion of independent audit.
RECORDATI GROUP
Summary of consolidated results prepared in accordance with the
International Financial Reporting Standards (IFRS)
(thousands of €)
| INCOME STATEMENT | Second Quarter 2019 | Second Quarter 2018 | Change % |
| REVENUE | 360,263 | 329,554 | 9.3 |
| Cost of sales | (106,832) | (93,725) | 14.0 |
| GROSS PROFIT | 253,431 | 235,829 | 7.5 |
| Selling expenses | (89,321) | (81,106) | 10.1 |
| Research and development expenses | (30,605) | (25,963) | 17.9 |
| General & administrative expenses | (17,344) | (16,768) | 3.4 |
| Other income (expenses), net | 388 | (592) | n.s. |
| OPERATING INCOME | 116,549 | 111,400 | 4.6 |
| Financial income (expenses), net | (6,931) | (3,602) | 92.4 |
| PRE-TAX INCOME | 109,618 | 107,798 | 1.7 |
| Provision for income taxes | (27,456) | (30,202) | (9.1) |
| NET INCOME | 82,162 | 77,596 | 5.9 |
| Attributable to: | |||
| Equity holders of the parent | 82,152 | 77,584 | 5.9 |
| Minority interests | 10 | 12 | (16.7) |
| EBITDA(1) | 135,374 | 125,644 | 7.7 |
| (1) Operating income before depreciation, amortization and write down of both tangible and intangible assets | |||
| COMPOSITION OF REVENUE | Second Quarter 2019 | Second Quarter 2018 | Change % |
| Total revenue | 360,263 | 329,554 | 9.3 |
| Italy | 72,874 | 66,865 | 9.0 |
| International | 287,389 | 262,689 | 9.4 |
Pending the completion of independent audit.
RECORDATI GROUP
Summary of consolidated results prepared in accordance with the
International Financial Reporting Standards (IFRS) - (thousands of €)
| ASSETS | 30.06.2019 | 31.12.2018 |
| Property, plant and equipment | 128,314 | 103,582 |
| Intangible assets | 695,643 | 672,462 |
| Goodwill | 579,167 | 579,557 |
| Equity investments | 27,050 | 20,773 |
| Non-current receivables | 6,024 | 5,860 |
| Deferred tax assets | 75,616 | 81,267 |
| TOTAL NON-CURRENT ASSETS | 1,511,814 | 1,463,501 |
| Inventories | 207,043 | 206,084 |
| Trade receivables | 297,253 | 245,742 |
| Other receivables | 31,398 | 38,462 |
| Other current assets | 10,150 | 5,193 |
| Fair value of hedging derivatives (cash flow hedge) | 8,067 | 6,414 |
| Short-term financial investments, cash and cash equivalents | 103,493 | 198,036 |
| TOTAL CURRENT ASSETS | 657,404 | 699,931 |
| TOTAL ASSETS | 2,169,218 | 2,163,432 |
| EQUITY AND LIABILITIES | 30.06.2019 | 31.12.2018 |
| Share capital | 26,141 | 26,141 |
| Capital in excess of par value | 83,719 | 83,719 |
| Treasury stock | (110,729) | (145,608) |
| Hedging reserve | (7,866) | (8,399) |
| Translation reserve | (152,703) | (154,146) |
| Other reserves | 51,162 | 43,081 |
| Retained earnings | 1,007,212 | 897,990 |
| Net income for the period | 174,252 | 312,376 |
| Interim dividend | 0 | (91,761) |
| GROUP SHAREHOLDERS’ EQUITY | 1,071,188 | 963,393 |
| Minority interest | 215 | 193 |
| SHAREHOLDERS’ EQUITY | 1,071,403 | 963,586 |
| Loans due after one year | 627,667 | 640,647 |
| Employees’ termination pay | 19,585 | 19,547 |
| Deferred tax liabilities | 45,856 | 45,653 |
| Other non-current liabilities | 3,257 | 3,257 |
| TOTAL NON-CURRENT LIABILITIES | 696,365 | 709,104 |
| Trade payables | 156,837 | 165,020 |
| Other payables | 80,900 | 85,534 |
| Tax liabilities | 23,847 | 42,149 |
| Other current liabilities | 16,459 | 19,359 |
| Provisions | 16,774 | 21,446 |
| Fair value of hedging derivatives (cash flow hedge) | 11,826 | 9,746 |
| Loans due within one year | 78,109 | 130,583 |
| Bank overdrafts | 16,698 | 16,905 |
| TOTAL CURRENT LIABILITIES | 401,450 | 490,742 |
| TOTAL EQUITY AND LIABILITIES | 2,169,218 | 2,163,432 |
Pending the completion of independent audit.
DECLARATION BY THE MANAGER RESPONSIBLE FOR PREPARING THE COMPANY’S FINANCIAL REPORTS
The manager responsible for preparing the company’s financial reports Fritz Squindo declares, pursuant to paragraph 2 of Article 154-bis of the Consolidated Law on Finance, that the accounting information contained in this press release corresponds to the documental results, books and accounting records.
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