NORTHVALE, N.J., Feb. 14, 2012 (GLOBE NEWSWIRE) -- Elite Pharmaceuticals, Inc. (OTCBB:ELTP), a specialty pharmaceutical company dedicated to developing and commercializing generic and branded oral controlled release products announced results for the fiscal third quarter ended December 31, 2011.
Consolidated revenues for the quarter ended December 31, 2011 increased by 86% as compared with revenues from the prior quarter ending September 31, 2011. This increase is the result of the continued growth of the phentermine product launched earlier this year and the launch of the Lodrane D® products during this quarter. The company achieved a 117% increase in manufacturing revenues and a 234% increase in contract product development fees, but offset by an 80% decrease in royalty revenues which resulted from the removal of the extended release Lodrane products from the market in August 2011. Loss from operations decreased to $430k this quarter from a loss of $592k the previous quarter.
On a year to date basis, consolidated revenues through the first 3 fiscal quarters decreased by 42%, from $3.1 million last year to $1.8 million for the first nine months of this fiscal year. Revenue streams, while expanding, have not yet offset the revenues earned last year from the extended release Lodrane® products discontinued at the beginning of this fiscal year. The loss of this revenue stream has been the primary factor in the increased operating losses sustained by Elite this year. Last year, Elite achieved an operating profit of $72k for the 3rd quarter, and a nine month operating loss of $155k. This year, Elite's operating losses for the 3rd quarter and nine months were $430k and $1.4million, respectively.
Elite expects revenues from the products launched this year to continue to grow and its contract product development activities to continue at current levels. Elite anticipates an expansion in revenues from the contract manufacture of generic methadone, first shipped in January 2012, and from the launch of Elite's recently approved Hydromorphone product.
GAAP net income, including non-cash revenues and expenses relating to the accounting treatment of preferred share derivatives and the fair value of warrant derivatives, was $8.8 million, or $0.03 basic net income per share and $0.02 fully diluted net income per share.
Cash flow from operations for the first nine months of fiscal 2012 was a negative $789k, compared to a positive operating cash flow of $318k for the comparable period last year. Net cash flow for the first nine months, inclusive of cash used in investing and financing activities, was a negative $1.3million. Cash as of December 31, 2011 was $569k.
Chairman & CEO Jerry Treppel states that "our business and strategic plans as we discussed in our prior earnings calls are proceeding as expected. Our revenues from our newly launched products will continue to grow aided by the launch of additional new products. Beginning to utilize our new manufacturing space, increased batch size production, and start up of our packaging line, should all increase profitability in the coming quarters. It remains our corporate goal to achieve positive cash flow on an operating basis as soon as practicable. Additionally, we are working diligently to complete the Socius capital raise transaction so we can aggressively pursue our R&D objectives."
The Company will host a conference call to discuss the results of operations and provide an update on recent business developments on Wednesday, February 15, 2011 at 2:00 PM 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 February 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 | ||
| ASSETS | ||
|
December 31, 201 (Unaudited) |
March 31, 201 (Audited) |
|
| CURRENT ASSETS | ||
| Cash and cash equivalents | $568,691 | $1,825,858 |
| Accounts receivable, (net of allowance for doubtful accounts of zero) | 483,311 | 571,667 |
| Inventories (net of allowance of $93,338 and $ 1,047,456, respectively) | 431,400 | 616,362 |
| Prepaid expenses and other current assets | 58,798 | 133,472 |
| Total current assets | 1,542,200 | 3,147,359 |
| PROPERTY AND EQUIPMENT, net of accumulated depreciation and amortization of $4,542,590 and $4,189,618, respectively | 4,243,604 | 4,118,274 |
| INTANGIBLE ASSETS – net of accumulated amortization of zero | 629,963 | 597,556 |
| OTHER ASSETS | ||
| Investment in Novel Laboratories Inc. | 3,329,322 | 3,329,322 |
| Security deposits | 14,913 | 28,377 |
| Restricted cash – debt service for EDA bonds | 333,246 | 291,420 |
| EDA Bond offering costs, net of accumulated amortization | ||
| of $89,497 and $78,898, respectively | 264,955 | 275,554 |
| Total other assets | 3,942,436 | 3,924,673 |
| TOTAL ASSETS | $10,349,203 | $11,787,862 |
| LIABILITIES AND STOCKHOLDERS' DEFICIT | ||
| December 31, 2011 (Unaudited) | March 31, 2011 (Audited) | |
| CURRENT LIABILITIES | ||
| EDA Bonds payable | $3,385,000 | $3,385,000 |
| Short term loans and current portion of long-term debt | 10,257 | 13,105 |
| Accounts payable and accrued expenses | 1,227,152 | 935,797 |
| Customer Deposits | -- | 39,400 |
| Deferred Revenues – Current | 13,333 | 13,333 |
| Preferred share derivative interest payable | 86,326 | 282,680 |
| Total Current Liabilities | 4,722,068 | 4,669,315 |
| LONG TERM LIABILITIES | ||
| Deferred Revenues | 168,891 | 178,890 |
| Other long term liabilities | 78,379 | 75,463 |
| Derivative Liability – Preferred Shares | 10,646,711 | 14,192,329 |
| Derivative Liability – Warrants | 9,043,464 | 10,543,145 |
| Total Long-Term Liabilities | 19,937,445 | 24,989,827 |
| Total Liabilities | 24,659,513 | 29,659,142 |
| COMMITMENTS AND CONTINGENCIES: | ||
| STOCKHOLDERS' DEFICIT | ||
| Common Stock – par value of $0.001, Authorized 355,516,558 | ||
| Issued and outstanding – 264,830,735 shares and 180,545,657 shares, respectively | 264,831 | 180,546 |
| Additional paid-in capital | 108,645,839 | 97,116,044 |
| Accumulated deficit | (122,914,139) | (114,861,029) |
| Treasury stock, at cost (100,000 common shares) | (306,841) | (306,841) |
| Total Stockholders' Deficit | (14,310,310) | (17,871,280) |
| TOTAL LIABILITIES AND STOCKHOLDERS' DEFICIT | $10,349,203 | $11,787,862 |
| ELITE PHARMACEUTICALS, INC. AND SUBSIDIARIES | ||
| CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS | ||
|
Three Months Ended December 31, |
||
|
2011 (unaudited) |
2010 (unaudited) |
|
| REVENUES: | ||
| Manufacturing Revenues | $170,099 | $ 901,653 |
| Royalties and Profit Splits | 20,127 | 231,742 |
| Lab Fee Revenues | 319,712 | 92,902 |
| Total Revenues | 509,938 | 1,226,297 |
| Cost of Revenues | 156,590 | 641,524 |
| Gross Profit | 353,348 | 584,773 |
| OPERATING EXPENSES | ||
| Research and Development | 386,430 | 179,525 |
| General and Administrative | 288,416 | 315,537 |
| Non-cash compensation through issuance of stock options and warrants | 6,113 | 7,580 |
| Depreciation and amortization | 103,339 | 9,200 |
| Total Operating Expenses | 784,298 | 511,842 |
| LOSS FROM OPERATIONS | (430,950) | 72,931 |
| OTHER INCOME / (EXPENSES): | ||
| Interest expense | (57,138) | (58,059) |
| Change in fair value of outstanding warrant derivatives | 4,586,076 | 2,064,745 |
| Change in fair value of preferred share derivatives | 4,749,332 | 4,156,097 |
| Interest expense attributable to dividends accrued to preferred share derivative liabilities | (86,325) | (306,440) |
| Total Other Income / (Expense) | 9,191,945 | 5,856,343 |
| INCOME BEFORE PROVISION FOR INCOME TAXES | 8,760,995 | 5,929,274 |
| Provision for Income Taxes | -- | 1,062 |
| NET INCOME ATTRIBUTABLE TO COMMON SHAREHOLDERS | $ 8,760,995 | $ 5,928,212 |
| NET INCOME PER SHARE | ||
| BASIC | $ 0.03 | $ 0.06 |
| DILUTED | $ 0.02 | $ 0.02 |
| WEIGHTED AVERAGE NUMBER OF COMMON SHARES OUTSTANDINGS | ||
| BASIC | 262,067,348 | 96,873,523 |
| DILUTED | 427,037,498 | 307,830,425 |
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 also manufactures Lodrane D® and receives royalties for Lodrane D®, an allergy product partnered with ECR Pharmaceuticals ("ECR"), a wholly owned subsidiary of Hi-Tech Pharmacal ("Hi-Tech"). 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.
The Elite Pharmaceuticals, Inc. logo is available at http://www.globenewswire.com/newsroom/prs/?pkgid=8737
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.