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8-K - 8-K - Lantheus Medical Imaging, Inc. | d884198d8k.htm |
Exhibit 99.1
FOR RELEASE 4:00 PM EASTERN
WEDNESDAY, MARCH 4, 2015
CONTACTS: | ||
Linda Lennox | Meara Murphy | |
Office: 978-671-8854 | Office: 978-671-8508 | |
Cell: 908-627-3424 | Cell: 617-794-1045 |
Lantheus Medical Imaging Reports 2014 Fourth Quarter
and Full Year Financial Results
Fourth quarter worldwide revenue increases 7% as-reported and 9% constant currency; strong DEFINITY® performance driven by continued market adoption and share gains
Fourth quarter Adjusted EBITDA increases 28% to $19.4 million; Company posts full year Adjusted EBITDA of $70.8 million
No. BILLERICA, Mass. (March 4, 2015) Lantheus Medical Imaging, Inc. (Lantheus or the Company), a wholly-owned operating subsidiary of parent company Lantheus MI Intermediate, Inc. and a global leader in developing, manufacturing, selling and distributing innovative diagnostic imaging agents, today reported financial results for its fourth quarter and full year ended December 31, 2014.
Worldwide revenue for the fourth quarter of 2014 totaled $77.0 million, representing a 7% increase as-reported and a 9% increase on a constant-currency basis over $71.7 million reported for the fourth quarter of 2013.
The Company reported quarterly GAAP-earnings profitability during the fourth quarter of 2014 with net income totaling $300,000, an improvement of $12.6 million over a net loss of $12.3 million reported for the fourth quarter of 2013.
Net income for the fourth quarter of 2014 included $1.2 million of non-cash costs associated with the Companys previously-announced campus consolidation initiative. Net loss for the fourth quarter of 2013 included a $15.4 million non-cash charge for the write-down of certain intangibles, an $8.9 million credit for a special recovery from a manufacturer and a $0.4 million gain on a land sale.
The Companys fourth quarter 2014 net income, as adjusted for the above items, totaled $1.5 million, an improvement of $7.6 million, compared to a net loss of $6.1 million for the fourth quarter of 2013. The attached financial tables include a reconciliation of U.S. GAAP to as-adjusted results.
The Companys fourth quarter Adjusted EBITDA, as defined in the GAAP to non-GAAP reconciliation provided later in this release, was $19.4 million, increasing by 28% from $15.2 million in the same quarter of the prior year.
Jeff Bailey, President and CEO commented, We are very pleased with our fourth quarter results and our strong finish to what has been an excellent year for Lantheus. Consistent with the themes weve experienced throughout 2014, our fourth quarter performance reflects continued, solid revenue growth and operating margin expansion, as well as sequential and year-over-year improvement in Adjusted EBITDA. Our strong quarterly sales performance for DEFINITY was driven by our continued success in expanding the appropriate use of contrast in cardiac echo procedures, while also growing our respective market share. With solid U.S. performances from all major product lines, our U.S. revenue growth accelerated to 12% during the fourth quarter, driving our adjusted operating and EBITDA margins to 17% and 25%, respectively.
Mr. Bailey continued, The improvement in our business fundamentals and operational efficiencies over the last two years is significant and provides a solid foundation as we enter 2015. Looking ahead, we are focused on a number of strategic and tactical objectives intended to further strengthen our business, our operating profile, and our ability to meet and exceed the needs of our customers. We look forward to pursuing these initiatives while creating additional opportunities to further improve our business and financial results.
For the full year of 2014, worldwide revenue totaled $301.6 million, representing a 6% increase on an as-reported and an 8% increase on a constant-currency basis over $283.7 million reported for 2013. On a GAAP basis, the Company reported a net loss of $1.2 million for 2014, an improvement of $60.5 million over the net loss of $61.7 million for 2013. Full year GAAP results included the aforementioned fourth-quarter items and a $6.8 million write-down of land during the third quarter of 2013. Adjusted for those items, the Company achieved positive full year 2014 net income totaling $41,000, compared to a net loss of $48.7 million for 2013. The Companys full year 2014 Adjusted EBITDA totaled $70.8 million, an improvement of $32.4 million over the $38.4 million reported for 2013. The attached financial tables include a reconciliation of U.S. GAAP to as-adjusted results.
Conference Call
As previously announced, the Company will host a conference call starting at 4:30 p.m. (Eastern Time) today. To access the live conference call via telephone, please dial 1-866-578-5771 (U.S. callers) or 1-617-213-8055 (international callers) and provide passcode 92067003. A live audio webcast of the call also will be available on the homepage of the Companys website at www.lantheus.com. A replay of the telephone conference call and audio webcast will be available from approximately 8:30 p.m. ET on March 4, 2015 through midnight on April 1, 2015. To access a replay of the conference call, dial 1-888-286-8010 (U.S. callers) or 1-617-801-6888 (international callers), and provide passcode 55732560. A replay of this conference call will also be available in the Investor Relations section of our website located at www.lantheus.com.
The conference call may include a discussion of non-GAAP financial measures. Reference is made to the most directly comparable GAAP financial measures, the reconciliation of the differences between the two financial measures, and the other information included in this press release, our Form 8-K filed with the SEC today, or otherwise available in the Investor Relations section of our website located at www.lantheus.com.
Non-GAAP Financial Measures
The Company uses non-GAAP financial measures, such as net sales excluding the impact of foreign currency, net income, as adjusted, EBITDA and Adjusted EBITDA. The Companys management believes that the presentation of these measures provides useful information to investors. These measures may assist investors in evaluating the Companys operations, period over period. The measures may exclude such items which may be highly variable, difficult to predict and of a size that could have substantial impact on the Companys reported results of operations for a period. Management uses these and other non-GAAP measures internally for evaluation of the performance of the business, including the allocation of resources and the evaluation of results relative to employee performance compensation targets. Investors should consider these non-GAAP measures only as a supplement to, not as a substitute for or as superior to, measures of financial performance prepared in accordance with GAAP.
Safe Harbor for Forward-Looking and Cautionary Statements
This press release contains forward-looking statements. Such forward-looking statements are subject to risks and uncertainties that may be described from time to time in the Companys filings with the Securities and Exchange Commission. Readers are cautioned not to place undue reliance on the forward-looking statements contained herein, which speak only as of the date hereof. The Company undertakes no obligation to publicly update any forward-looking statement, whether as a result of new information, future developments or otherwise, except as may be required by law.
About Lantheus Medical Imaging, Inc. and Lantheus MI Intermediate, Inc.
Lantheus Medical Imaging, Inc., a wholly-owned operating subsidiary of parent company, Lantheus MI Intermediate, Inc., is a global leader in developing, manufacturing, selling and distributing innovative diagnostic imaging agents. Lantheus provides a broad portfolio of products, which are primarily used for the diagnosis of cardiovascular diseases. Key products include the echocardiography contrast agent DEFINITY® Vial for (Perflutren Lipid Microsphere) Injectable Suspension; TechneLite® (Technetium Tc99m Generator), a technetium-based generator that provides the essential medical isotope used in nuclear medicine procedures; and Xenon Xe 133 Gas (Xenon 133), an inhaled radiopharmaceutical imaging agent used to evaluate pulmonary function and for imaging the lungs.
Lantheus has more than 500 employees worldwide with headquarters in North Billerica, Massachusetts, and offices in Puerto Rico, Canada and Australia.
Tables Follow
Lantheus MI Intermediate, Inc. and subsidiaries
Consolidated Statements of Operations
(dollars in thousands unaudited)
Three Months Ended December 31, |
Year Ended December 31, |
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2014 | 2013 | 2014 | 2013 | |||||||||||||
Revenues |
$ | 76,969 | $ | 71,668 | $ | 301,600 | $ | 283,672 | ||||||||
Cost of goods sold |
44,208 | 61,787 | 176,081 | 206,311 | ||||||||||||
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Gross profit |
32,761 | 9,881 | 125,519 | 77,361 | ||||||||||||
Operating expenses: |
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Sales and marketing expenses |
7,889 | 7,961 | 35,116 | 35,227 | ||||||||||||
General and administrative expenses |
8,357 | 7,481 | 34,921 | 33,159 | ||||||||||||
Research and development expenses |
4,715 | 5,031 | 13,673 | 30,459 | ||||||||||||
Impairment of land |
| (382 | ) | | 6,406 | |||||||||||
Proceeds from manufacturer |
| (8,876 | ) | | (8,876 | ) | ||||||||||
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Total operating expenses |
20,961 | 11,215 | 83,710 | 96,375 | ||||||||||||
Operating income (loss) |
11,800 | (1,334 | ) | 41,809 | (19,014 | ) | ||||||||||
Interest expense, net |
(10,557 | ) | (10,488 | ) | (42,261 | ) | (42,811 | ) | ||||||||
Other income (expense), net |
626 | 267 | 478 | 1,161 | ||||||||||||
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Income (loss) before income taxes |
1,869 | (11,555 | ) | 26 | (60,664 | ) | ||||||||||
Provision for income taxes |
1,569 | 747 | 1,195 | 1,014 | ||||||||||||
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Net income (loss) |
$ | 300 | $ | (12,302 | ) | $ | (1,169 | ) | $ | (61,678 | ) | |||||
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Lantheus MI Intermediate, Inc. and subsidiaries
Consolidated Sales Analysis
(dollars in thousands unaudited)
Three Months Ended December 31, |
Year Ended December 31, |
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2014 | 2013 | % change | 2014 | 2013 | % change | |||||||||||||||||||
U.S. |
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DEFINITY |
25,080 | 21,744 | 15.3 | % | 93,848 | 76,539 | 22.6 | % | ||||||||||||||||
TechneLite |
20,719 | 19,544 | 6.0 | % | 82,321 | 80,609 | 2.1 | % | ||||||||||||||||
Xenon |
9,023 | 7,970 | 13.2 | % | 36,542 | 32,086 | 13.9 | % | ||||||||||||||||
Cardiolite |
1,353 | 1,288 | 5.0 | % | 3,268 | 8,612 | (62.1 | )% | ||||||||||||||||
Other |
5,537 | 4,603 | 20.3 | % | 20,541 | 15,793 | 30.1 | % | ||||||||||||||||
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Total U.S. |
$ | 61,712 | $ | 55,149 | 11.9 | % | $ | 236,520 | $ | 213,639 | 10.7 | % | ||||||||||||
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International |
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DEFINITY |
545 | 418 | 30.4 | % | 1,912 | 1,555 | 23.0 | % | ||||||||||||||||
TechneLite |
2,691 | 2,548 | 5.6 | % | 11,267 | 11,586 | (2.8 | )% | ||||||||||||||||
Xenon |
1 | 5 | (80.0 | )% | 7 | 39 | (82.1 | )% | ||||||||||||||||
Cardiolite |
3,305 | 4,110 | (19.6 | )% | 15,555 | 17,525 | (11.2 | )% | ||||||||||||||||
Other |
8,715 | 9,438 | (7.7 | )% | 36,339 | 39,328 | (7.6 | )% | ||||||||||||||||
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Total International |
$ | 15,257 | $ | 16,519 | (7.6 | )% | $ | 65,080 | $ | 70,033 | (7.1 | )% | ||||||||||||
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Worldwide |
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DEFINITY |
25,625 | 22,162 | 15.6 | % | 95,760 | 78,094 | 22.6 | % | ||||||||||||||||
TechneLite |
23,410 | 22,092 | 6.0 | % | 93,588 | 92,195 | 1.5 | % | ||||||||||||||||
Xenon |
9,024 | 7,975 | 13.2 | % | 36,549 | 32,125 | 13.8 | % | ||||||||||||||||
Cardiolite |
4,658 | 5,398 | (13.7 | )% | 18,823 | 26,137 | (28.0 | )% | ||||||||||||||||
Other |
14,252 | 14,041 | 1.5 | % | 56,880 | 55,121 | 3.2 | % | ||||||||||||||||
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Total Revenues |
$ | 76,969 | $ | 71,668 | 7.4 | % | $ | 301,600 | $ | 283,672 | 6.3 | % | ||||||||||||
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Lantheus MI Intermediate, Inc. and subsidiaries
Supplemental Sales Information
(unaudited)
December 31, 2014 Quarter-to-Date Sales Growth/(Decline) | ||||||||||||||||||||
Domestic As Reported |
Intl Constant Currency |
Intl As Reported |
Total Constant Currency |
Total As Reported |
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Products |
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DEFINITY |
15 | % | 41 | % | 30 | % | 16 | % | 16 | % | ||||||||||
TechneLite |
6 | % | 13 | % | 6 | % | 7 | % | 6 | % | ||||||||||
Xenon |
13 | % | (71 | )% | (80 | )% | 13 | % | 13 | % | ||||||||||
Cardiolite |
5 | % | (14 | )% | (20 | )% | (10 | )% | (14 | )% | ||||||||||
Other |
20 | % | (2 | )% | (8 | )% | 5 | % | 2 | % | ||||||||||
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Total Revenues |
12 | % | (2 | )% | (8 | )% | 9 | % | 7 | % | ||||||||||
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December 31, 2014 Year-to-Date Sales Growth/(Decline) | ||||||||||||||||||||
Domestic As Reported |
Intl Constant Currency |
Intl As Reported |
Total Constant Currency |
Total As Reported |
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Products |
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DEFINITY |
23 | % | 31 | % | 23 | % | 23 | % | 23 | % | ||||||||||
TechneLite |
2 | % | 3 | % | (3 | )% | 2 | % | 2 | % | ||||||||||
Xenon |
14 | % | (82 | )% | (82 | )% | 14 | % | 14 | % | ||||||||||
Cardiolite |
(62 | )% | (7 | )% | (11 | )% | (25 | )% | (28 | )% | ||||||||||
Other |
30 | % | (3 | )% | (8 | )% | 7 | % | 3 | % | ||||||||||
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Total Revenues |
11 | % | (2 | )% | (7 | )% | 8 | % | 6 | % | ||||||||||
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Lantheus MI Intermediate, Inc. and subsidiaries
Reconciliation of Net Sales to Net Sales Excluding the Impact of Foreign Currency
(dollars in thousands unaudited)
Three Months Ended December 31, 2014 |
Year Ended December, 2014 |
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International Net Sales |
Total Net Sales |
International Net Sales |
Total Net Sales |
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Net sales, as reported |
$ | 15,257 | $ | 76,969 | $ | 65,080 | $ | 301,600 | ||||||||
Currency impact as compared to prior period |
991 | 991 | 3,461 | 3,461 | ||||||||||||
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Net sales, excluding the impact of foreign currency |
$ | 16,248 | $ | 77,960 | $ | 68,541 | $ | 305,061 | ||||||||
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Lantheus MI Intermediate, Inc. and subsidiaries
Reconciliation of As Reported Results to Non-GAAP Financial Measures
(dollars in thousands unaudited)
Three Months Ended December 31, |
Year Ended December 31, |
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2014 | 2013 | 2014 | 2013 | |||||||||||||
Net Income (loss) |
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Net income (loss), as reported |
$ | 300 | $ | (12,302 | ) | $ | (1,169 | ) | $ | (61,678 | ) | |||||
Reconciling items impacting Gross Profit: |
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Intangible Impairment |
| 15,440 | | 15,440 | ||||||||||||
Reconciling items impacting Operating Expenses: |
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Proceeds from Manufacturer |
| (8,876 | ) | | (8,876 | ) | ||||||||||
Campus Consolidation Costs |
1,210 | | 1,210 | | ||||||||||||
Impairment of Land |
| (382 | ) | | 6,406 | |||||||||||
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Net income (loss), as adjusted |
$ | 1,510 | $ | (6,120 | ) | $ | 41 | $ | (48,708 | ) | ||||||
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Net income (loss), as adjusted, as a percentage of net sales |
2.0 | % | (8.5 | )% | 0.0 | % | (17.2 | )% | ||||||||
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Lantheus MI Intermediate, Inc. and subsidiaries
Reconciliation of As Reported Results to Non-GAAP Financial Measures
(dollars in thousands unaudited)
Three Months Ended December 31, |
Year Ended December 31, |
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2014 | 2013 | 2014 | 2013* | |||||||||||||
EBITDA |
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Net income (loss), as reported |
$ | 300 | $ | (12,302 | ) | $ | (1,169 | ) | $ | (61,678 | ) | |||||
Interest expense, net |
10,557 | 10,488 | 42,261 | 42,811 | ||||||||||||
Provision (benefit) for income taxes |
977 | 312 | 441 | (127 | ) | |||||||||||
Depreciation |
3,387 | 2,221 | 9,901 | 9,336 | ||||||||||||
Amortization of intangible assets |
2,275 | 3,991 | 9,123 | 16,447 | ||||||||||||
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EBITDA |
17,496 | 4,710 | 60,557 | 6,789 | ||||||||||||
Reconciling items impacting EBITDA: |
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Non-cash stock-based compensation |
249 | (157 | ) | 1,031 | 578 | |||||||||||
Legal fees relating to business interruption claim |
186 | 108 | 1,113 | 660 | ||||||||||||
Asset write-off |
107 | 18,091 | 1,257 | 28,349 | ||||||||||||
Severance and recruiting costs |
306 | 270 | 818 | 5,239 | ||||||||||||
Sponsor fee and other |
248 | 260 | 1,020 | 1,457 | ||||||||||||
New manufacturer costs |
771 | 751 | 4,959 | 4,164 | ||||||||||||
Proceeds from manufacturer |
| (8,876 | ) | | (8,876 | ) | ||||||||||
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Adjusted EBITDA |
$ | 19,363 | $ | 15,157 | $ | 70,775 | $ | 38,360 | ||||||||
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Adjusted EBITDA as a percentage of net sales |
25.2 | % | 21.1 | % | 23.5 | % | 13.5 | % | ||||||||
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* | Previously presented as excluding Proceeds from manufacturer as an Adjusted EBITDA reconciling item, resulting in 2013 Adjusted EBITDA of $47,236. Presentation of 2013 Adjusted EBITDA has been modified to allow better go-forward comparability by including Proceeds from manufacturer as an Adjusted EBITDA reconciling item, resulting in 2013 Adjusted EBITDA of $38,360. |
Lantheus MI Intermediate, Inc. and subsidiaries
Reconciliation of Free Cash Flow
(dollars in thousands unaudited)
Three Months Ended | Year Ended | |||||||||||||||
December 31, 2014 |
December 31, 2013 |
December 31, 2014 |
December 31, 2013 |
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Net cash provided by (used in) operating activities |
$ | (3,875 | ) | $ | (3,856 | ) | $ | 11,573 | $ | (15,678 | ) | |||||
Capital expenditures |
(2,834 | ) | (1,299 | ) | (8,137 | ) | (5,010 | ) | ||||||||
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Free cash flow |
$ | (6,709 | ) | $ | (5,155 | ) | $ | 3,436 | $ | (20,688 | ) | |||||
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Lantheus MI Intermediate, Inc. and subsidiaries
Condensed Consolidated Balance Sheets
(dollars in thousands unaudited)
December 31, 2014 |
December 31, 2013 |
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Assets |
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Current assets: |
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Cash and cash equivalents |
$ | 17,817 | $ | 16,669 | ||||
Accounts receivable, net |
41,540 | 38,910 | ||||||
Inventory |
15,582 | 18,310 | ||||||
Income tax receivable |
247 | 325 | ||||||
Deferred tax assets |
256 | 18 | ||||||
Other current assets |
3,739 | 3,087 | ||||||
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Total current assets |
79,181 | 77,319 | ||||||
Property, plant and equipment, net |
96,014 | 97,653 | ||||||
Capitalized software development costs, net |
2,421 | 1,470 | ||||||
Intangibles, net |
27,191 | 34,998 | ||||||
Goodwill |
15,714 | 15,714 | ||||||
Deferred financing costs |
7,349 | 9,639 | ||||||
Deferred tax assets |
328 | 15 | ||||||
Other long-term assets |
19,318 | 22,577 | ||||||
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Total assets |
$ | 247,516 | $ | 259,385 | ||||
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Liabilities and stockholders deficit |
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Current liabilities: |
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Line of credit |
$ | 8,000 | $ | 8,000 | ||||
Accounts payable |
15,665 | 18,103 | ||||||
Accrued expenses and other liabilities |
24,579 | 25,492 | ||||||
Deferred tax liability |
152 | 57 | ||||||
Deferred revenue |
132 | 3,979 | ||||||
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Total current liabilities |
48,528 | 55,631 | ||||||
Asset retirement obligation |
7,435 | 6,385 | ||||||
Long-term debt, net |
399,280 | 399,037 | ||||||
Deferred tax liability |
247 | 12 | ||||||
Other long-term liabilities |
32,995 | 35,408 | ||||||
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Total liabilities |
488,485 | 496,473 | ||||||
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Stockholders deficit |
(240,969 | ) | (237,088 | ) | ||||
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Total liabilities and stockholders deficit |
$ | 247,516 | $ | 259,385 | ||||
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