Patheon, a leading provider of contract development and manufacturing services to the global pharmaceutical industry, announced today full year and fourth quarter results for fiscal 2012.
For the full year:
- Revenues were $749.1m versus $700.0m last year, an increase of 7%. Excluding the $50.3m benefit from the contract cancellation recorded last year, revenue would have increased by 15.3%
- Gross profit for the year was $159.3m compared to $131.8m last year, an increase of 20.9%. Excluding the $50.3m benefit from the contract cancellation recorded last year, gross profit would have increased by 95.5% percent
- The loss before discontinued operations was $106.4m compared to a loss before discontinued operations of $15.8m last year. The increase was primarily due to the asset impairment charge of $57.9m related to the wind down of the Swindon, UK facility recorded in the second quarter, and the $36.6m Canadian tax valuation reserve recorded on the company’s Canadian deferred tax asset in the fourth quarter of fiscal 2012
- Adjusted EBITDA was $71.1m compared to $66.4m last year, an increase of 7.1%. Excluding the $50.3m benefit from the contract cancellation recorded last year, Adjusted EBITDA would have increased by $55.0m
For the fourth quarter:
- Revenues were $210.0m versus $181.6m in the same period last year. Excluding currency fluctuations, revenues would have been approximately 18.7% higher than the same period last year
- Gross profit was $55.4m compared to $33.5m in the same period last year
- The loss before discontinued operations was $23.0m compared to a loss before discontinued operations of $9.8m in the same period last year. The fourth quarter of fiscal 2012 includes the $36.6m Canadian tax valuation reserve discussed above
- Adjusted EBITDA was $35.9m compared to $14.5m in the same period last year
"We had strong revenue growth throughout the year, and we believe the flow through to Adjusted EBITDA was excellent," said James C Mullen, Patheon’s Chief Executive Officer. "Our progress with the core business positioned us to acquire Banner and we are excited to welcome our Banner colleagues to Patheon. We look forward to continued success in executing our strategy in 2013."
Full Year and Fourth Quarter Operating Results from Continuing Operations
Revenues were $749.1m for fiscal 2012 versus $700.0m in the same period last year, an increase of 7.0%. Excluding the impact of foreign exchange, revenue would have increased by 10.1%.
Commercial manufacturing ("CMO") revenues for fiscal 2012 were $610.7m up from $572.6m for fiscal 2011, an increase of 6.7%. Excluding the $50.3m benefit from the contract cancellation recorded last year, revenue would have increased by 17.0%. Pharmaceutical Development Services ("PDS") revenues for fiscal 2012 were $138.4m up from $127.4m for fiscal 2011.
Revenues in the fourth quarter were $210.0m up from $181.6m for the same period last year. Excluding currency fluctuations, revenues would have been approximately 18.7% higher than the same period of the prior year.
CMO revenues for the fourth quarter were $172.7m up from $146.9m for the same period last year, an increase of 17.6%. PDS revenues for the fourth quarter fiscal 2012 were $37.5m up from $34.9m for the same period last year, an increase of 7.4%.
Gross profit for fiscal 2012 was $159.3m up from $131.8m in the same period last year. Excluding the $50.3m benefit from the contract cancellation recorded last year, gross profit would have increased by $77.8 million. The increase in gross profit was primarily due to higher revenue and an improved gross profit margin of 21.3% for fiscal 2012 versus 18.8% for fiscal 2011. The increase of gross profit was due to savings from our Operational Excellence and Procurement initiatives, a decrease in depreciation expense and the impact of higher volumes.
Gross profit for the fourth quarter was $55.4m up from $33.5m in the same period last year. The increase in gross profit was primarily due to higher revenue and an improved gross profit margin of 26.4% versus 18.5% for the fourth quarter of fiscal 2011. The increase in gross profit margin was due to savings from our Operational Excellence and Procurement initiatives, a decrease in depreciation expense and the impact of higher volumes.
The loss before discontinued operations for fiscal 2012 was $106.4m or 82.4¢ per share, both basic and diluted, compared to a loss before discontinued operations of $15.8m or 12.2¢ per share, both basic and diluted, in fiscal 2011. The loss before discontinued operations for fourth quarter was $23.0m or 17.8¢ per share, both basic and diluted, compared to a loss before discontinued operations of $9.7m or 7.5¢ per share, both basic and diluted, in fiscal 2011.
Included in the loss before discontinued operations for fiscal 2012 was the asset impairment charge of $57.9m recorded in the second quarter related to the Swindon, UK facility wind down, as well as the $36.6m Canadian tax valuation reserve recorded on the company’s net Canadian tax assets in the fourth quarter of fiscal 2012. If our Canadian legal entity returns to sustained profitability in future periods the valuation allowance may be reversed.
At the end of fiscal 2012, Patheon had liquidity of $93.8m from cash and cash equivalents of $39.4m and $64.4m from available lines of credit.
2013 Outlook
Patheon recently announced the close of the acquisition of Banner and expects to provide further guidance on the outlook for the combined company in connection with its regularly scheduled earnings call for the first quarter of fiscal 2013.
Conference Call and Webcast Information
Patheon will host a conference call and live internet webcast, along with a slide presentation, today (December 17, 2012) at 8:30 a.m. Eastern Time. Interested parties are invited to access the conference call, via telephone, toll free at 1-888-231-8191 (US, including Puerto Rico) and 1-647-427-7450 (Canada and International). Listeners are encouraged to dial in five to fifteen minutes in advance to avoid delays. Interested parties may access the accompanying slide presentation and live internet webcast of the conference call on Patheon’s company website at http://ir.patheon.com/events.cfm.
A telephone replay of the conference call will be available between December 17, 2012 and December 24, 2012 by dialing 1-855-859-2056 (toll free) or 1-403-451-9481, and by entering identification number 73696786, followed by the number key. The internet webcast and slide presentation will be archived at http://ir.patheon.com/events.cfm.