United Therapeutics Corporation Reports First Quarter 2011 Financial Results
"I'm very pleased that we are cruising at a two-thirds of a billion dollar revenue run rate, up almost 30% from a year ago," remarked
Total revenues for the quarter ended
(1) See definition of earnings before non-cash charges, a non-GAAP financial measure, and a reconciliation of net income to earnings before non-cash charges below.
Financial Results for the Three Months Ended
Revenues
The table below summarizes the components of net revenues (dollars in thousands):
Three Months Ended March 31, Percentage 2011 2010 Change Cardiopulmonary products: Remodulin$103,205 $95,769 7.8% Tyvaso 47,695 24,884 91.7% Adcirca 11,318 4,979 127.3% Telemedicine services and products 3,107 2,966 4.8% Other 294 282 4.3% Total net revenues$165,619 $128,880 28.5%
Revenues for the quarter ended
The table below summarizes research and development expense by major project and non-project components (dollars in thousands):
Three Months Ended March 31, Percentage 2011 2010 Change Project and non-project component: Cardiopulmonary$23,744 $17,400 36.5% Share-based compensation 14,841 10,536 40.9% Other 9,445 6,935 36.2% Total research and development expense$48,030 $34,871 37.7%
Cardiopulmonary. The increase in expenses related to our cardiopulmonary projects for the quarter ended
Share-based compensation. The increase in share-based compensation for the quarter ended
Other. The increase in other research and development expenses for the quarter ended
The table below summarizes selling, general and administrative expense by major categories (in thousands):
Three Months Ended March 31, Percentage 2011 2010 Change Category: General and administrative$22,268 $17,113 30.1% Sales and marketing 15,061 10,293 46.3% Share-based compensation 21,906 19,471 12.5% Total selling, general and administrative expense$59,235 $46,877 26.4%
General and administrative. The increase in general and administrative expenses for the quarter ended
Sales and marketing. The increase in sales and marketing expenses for the quarter ended
Share-based compensation. The increase in share-based compensation for the quarter ended
2011-2013 Revenue Guidance
We currently expect full-year revenues from our three commercial products (Remodulin, Tyvaso and Adcirca) to fall within a range of 5% above or below
These expectations do not include projected revenues from oral treprostinil or our other investigative products. Guidance for 2012 and 2013 is subject to greater variability and uncertainty than the guidance for 2011. As a result, we anticipate reaffirming or updating all of these expectations on an annual basis when we present full-year results, and reaffirming or updating current-year guidance when we present our quarterly results.
Earnings Before Non-Cash Charges
Earnings before non-cash charges is defined as net income, adjusted for the following non-cash charges, as applicable: (1) interest; (2) income taxes; (3) license fees; (4) depreciation and amortization; (5) impairment charges; and (6) share-based compensation (stock option and share tracking award expense).
A reconciliation of net income to earnings before non-cash charges is presented below (in thousands, except per share data):
Three Months Ended March 31, 2011 2010 Net income, as reported$16,390 $18,929 Adjust for non-cash charges: Interest expense 5,413 4,687 Income tax expense 10,436 9,752 License fees - - Depreciation and amortization 5,809 4,570 Impairment charges (1) 5,814 - Share-based compensation 36,856 30,125 Earnings before non-cash charges$80,718 $68,063 Earnings before non-cash charges per share: Basic$1.40 $1.24 Diluted$1.29 $1.13 Weighted average number of common shares outstanding: Basic 57,753 54,769 Diluted 62,623 60,019 (1) Includes a$5.3 million non-cash loss recognized in connection with the sale ofMedicomp, Inc. , our wholly owned telemedicine subsidiary, onMarch 31, 2011 .
Conference Call
We will host a half-hour teleconference on
This teleconference is also being webcast and can be accessed via our website at http://ir.unither.com/events.cfm.
About
Non-GAAP Financial Information
This press release contains a financial measure, earnings before non-cash charges, that does not comply with
We use earnings before non-cash charges to assist us in: (1) planning, including the preparation of our annual operating budget; (2) allocating resources to enhance the financial performance of our business; (3) evaluating the effectiveness of our operational strategies; and (4) evaluating our capacity to fund capital expenditures and expand our business. We believe this non-GAAP financial measure enhances investors' understanding of our financial results by excluding certain expenses that we do not consider when evaluating and comparing the performance of our core operations and making operating decisions. In addition, we have historically reported earnings before non-cash charges to investors, and believe the inclusion of this non-GAAP financial measure provides investors with a consistent method of comparison to historical periods. However, there are limitations in the use of this non-GAAP financial measure in that it excludes certain operating expenses that are recurring in nature. In addition, our calculation of this non-GAAP financial measure may differ from the methodology used by other companies. The presentation of this non-GAAP financial measure should not to be considered in isolation or as a substitute for our financial results prepared in accordance with GAAP. A reconciliation of net income, the most directly comparable GAAP financial measure, to earnings before non-cash charges can be found in the table above under the heading, Earnings Before Non-Cash Charges.
Forward-looking Statements
Statements included in this press release that are not historical in nature are "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements include, among others, our expectations about future operating results and the demand for our products, including specifically, our guidance for annual revenues in 2011, 2012 and 2013, as well as statements regarding our progress toward the development of an oral prostacyclin therapy and the timing of unblinding our FREEDOM-M and FREEDOM-C2 studies. These forward-looking statements are subject to certain risks and uncertainties, such as those described in our periodic reports filed with the
Remodulin and Tyvaso are registered trademarks of
Adcirca is a registered trademark of Eli Lilly and Company.
UNITED THERAPEUTICS CORPORATION CONSOLIDATED STATEMENTS OF OPERATIONS (In thousands, except per share data) Three Months Ended March 31, 2011 2010 (Unaudited) Revenues: Net product sales$162,243 $125,675 Service sales 3,082 2,923 License fees 294 282 Total revenues 165,619 128,880 Operating expenses: Research and development 48,030 34,871 Selling, general and administrative 59,235 46,877 Cost of product sales 19,754 13,736 Cost of service sales 1,717 1,150 Total operating expenses 128,736 96,634 Income from operations 36,883 32,246 Other income (expense): Interest income 666 944 Interest expense (5,413) (4,687) Equity loss in affiliate (37) (47) Other, net (5,273) 225 Total other (expense) income, net (10,057) (3,565) Income before income tax 26,826 28,681 Income tax expense (10,436) (9,752) Net income$16,390 $18,929 Net income per common share: Basic$0.28 $0.35 Diluted$0.26 $0.32 Weighted average number of common shares outstanding: Basic 57,753 54,769 Diluted 62,623 60,019
SELECTED CONSOLIDATED BALANCE SHEET DATAMarch 31, 2011 (Unaudited, In thousands) Cash, cash equivalents and marketable securities (excluding restricted amounts of$5.1 million )$824,622 Total assets 1,485,404 Total liabilities and common stock subject to repurchase 561,195 Total stockholders' equity 924,209
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