-- Total net revenue increases to CHF 146.4 million, up 45
percent compared to Q1 2004
-- Expanding PAH market results in strong Tracleer(r) sales
of CHF 139.8 million
-- Operating profit up 121 percent to CHF 43.7 million
-- Revised 2005 guidance with higher revenue and higher profit
ALLSCHWIL/BASEL, Switzerland, April 21, 2005 (PRIMEZONE) -- Actelion Ltd (SWX:ATLN) today announced its financial results for the first quarter of 2005. With total net revenue of CHF 146.4 million (Q1 2004: CHF 101.1 m) and operating expenses (including Cost Of Goods Sold) of CHF 102.7 million (Q1 2004: 81.3 m), the company reported an operating profit of CHF 43.7 million (Q1 2004: CHF 19.8 m).
The net profit for the quarter was CHF 42.1 million (Q1 2004: CHF 27.7 m including CHF 9.6 m one-time gain from the disposal of Hesperion). On a fully diluted basis, earnings per share (EPS) for the first quarter of 2005 improved to CHF 1.82, compared to CHF 1.20 in Q1 2004. The gross cash position as at 31 March 2005 was CHF 293.4 million(31 December 2004: CHF 300.3 million).
Jean-Paul Clozel, MD, Chief Executive Officer commented: "Tracleer(r) sales continue to grow, the result of both long-term clinical data and Actelion's ongoing educational efforts to enhance PAH awareness. Actelion is leading the expansion of the PAH market, as we further strengthen our efforts to advance PAH care with Tracleer(r) as the cornerstone therapy."
Jean-Paul Clozel concluded: "Actelion will continue to grow the PAH market by conducting five major clinical studies to evaluate Tracleer use in early diagnosed patients, children, combination with sildenafil, sickle-cell related PAH, and chronic thrombo-embolic pulmonary hypertension (CTEPH). Actelion is also continuing to make Tracleer(r) available in new markets, with Japan imminent."
Andrew J. Oakley, Chief Financial Officer commented: "Tracleer(r) sales growth is exceeding our expectations. Accordingly, I expect that Actelion will report both higher total net revenue and -- also a consequence of an assumed delayed fair value accounting for employee stock options -- substantially higher operating profit than previously guided. This higher level of both revenues and operating profit has also resulted in the accelerated recognition of deferred tax assets, further accelerating net profit growth."
Financial result overview -- Table Q1 2005 vs. Q1 2004 In CHF thousands Result Q1 2005 Result Q1 2004 Variance in % Net Revenues 146'353 101'053 45'300 +45 Operating Expenses 102'687 81'299 21'388 +26 Operating Profit 43'666 19'754 23'912 +121 Net Profit 42'110 27'715 14'395 +52 Basic EPS in CHF 1.90 1.27 0.63 +50 Diluted EPS in CHF 1.82 1.20 0.62 +52 Cash & cash equivalents 293'367 283'409 9'958 +4 The full financial statements for the first quarter 2005 can be found on http://www.actelion.com.
Strong top line growth
In the first quarter of 2005, Actelion had total net revenue of CHF 146.4 million (Q1 2004: 101.1 m). On a quarter-to-quarter basis, total net revenue increased by 12 percent (Q4 2004: 130.4 m).
Contract revenues in Q1 2005 amounted to CHF 4.2 million (Q1 2004: 3.2 m). On a quarter-to-quarter basis, contract revenues were 8 percent lower (Q4 2004: 4.5 m), the result of a change in the recognition period for Merck milestone payments in relation to the Global Renin Alliance.
For the Full Year 2005, Actelion now expects total net revenue to reach between CHF 580 and CHF 600 million, compared to between CHF 560 and CHF 580 million as previously guided.
Focus on productivity of new Tracleer(r) territory managers
In Q1 2005, Tracleer(r) sales were CHF 139.8 million (Q1 2004: CHF 97.1 m). On a quarter-to-quarter basis, Tracleer(r) sales increased by 13 percent (Q4 2004: 123.8 m). A proportion of this CHF 16 million increase can be attributed to buying pattern variations, as the company filled one large order in very late March.
At the end of March 2005, Tracleer(r) was marketed in 21 countries worldwide, including all major pharmaceutical markets except Japan. In early April, the Japanese Authorities granted formal approval for Tracleer(r) in all forms of Pulmonary Arterial Hypertension (WHO class III and IV). Tracleer(r) is expected to become commercially available in Japan by early June 2005, following the conclusion of currently ongoing reimbursement discussions.
Regulatory and/or reimbursement reviews are ongoing in many other countries, such as the 10 new EU member states, Brazil, Turkey as well as in several South East Asian countries.
Christian Chavy, President Business Operations, commented: "Since early 2005, we have substantially more Tracleer(r) territory managers active in the field connecting the rapidly growing number of prescribing physicians with expert centers. We are carefully monitoring our sales force productivity in order to evaluate if another increase will maintain or further accelerate Tracleer(r) growth."
In the first quarter of 2005, Zavesca(r) sales reached CHF 2.4 million. (Q1 2004: CHF 0.8 m). On a quarter-to-quarter basis, Zavesca(r) sales increased by 14 percent (Q4 2004: 2.1 m). Zavesca(r) is commercially available in the United States and in most European markets.
Expenditure in-line with company expectation
In Q1 2005, operating expenses were CHF 102.7 million (Q1 2004: CHF 81.3 m). Compared to the previous quarter, this represents a decrease of 6 percent (Q4 2004: CHF 108.7 m), the result of seasonally lower marketing and advertising costs. Also, development expenditures started from a lower cost base, as the result of the discontinuation of the VERITAS program in November 2004.
For the Full Year 2005, Actelion expects total operating expenses (including costs of goods sold) to reach between CHF 450 million and CHF 480 million, approximately CHF 15 million less than previously guided, taking into account the potential impact of the recent SEC announcement delaying the application of FAS 123R (fair value accounting of employee stock options) from 1 July 2005 to 1 January 2006.
In Q1 2005, research and development expenses were CHF 32.0 million (Q1 2004: CHF 29.1 m). Compared to the previous quarter, this represents a decrease of 16 percent (Q4 2004: CHF 38.2 m) mainly due to the discontinuation in November 2004 of the VERITAS program evaluating tezosentan in Acute Heart Failure.
With the ongoing expansion of research activities and multiple clinical trials either about to or already enrolling patients, R&D expenditures for the full year 2005 are expected to reach between CHF 165 million and CHF 175 million.
In Q1 2005, marketing and advertising costs were CHF 26.9 million (Q1 2004: CHF 19.9 m). Compared to the previous quarter (Q4 2004: CHF 31.8 m), this represents a decrease of 15 percent, the direct result of seasonally low conference activity.
In Q1 2005 selling, general and administrative expenses amounted to CHF 28.9 million (Q1 2004: CHF 21.8 m). Compared to the previous quarter selling, general and administrative expenses increased by 13 percent (Q4 2004: CHF 25.6 m). This increase is due to the addition of around 50 territory managers promoting Tracleer(r). Marketing and Advertising together with selling, general and administrative expenses for the full year 2005 are expected to reach between CHF 230 million and CHF 250 million.
Strong operating profit
In the first quarter of 2005, Actelion had an operating profit of CHF 43.7 million (Q1 2004: CHF 19.8 m). Q1 2005 operating profit was 101 percent higher than the previous quarter (Q4 2004: CHF 21.7 m).
For the Full Year 2005, Actelion expects the operating profit to reach between CHF 120 and CHF 130 million, compared to previous guidance of between CHF 85 million andCHF 95 million.
Non-operating items and cash
The Net Profit for the first quarter 2005 amounted to CHF 42.1 million (Q1 2004: 27.7 m, with CHF 9.6 m from the one-time gain from the disposal of Hesperion). This includes interest income of CHF 0.6 million, interest expense of CHF 0.01 million, a non-cash convertible bond charge of CHF 1.9 million and other financial expense -- predominantly related to non-cash currency hedge valuations -- of CHF 1.3 million.
In Q1 2005, the net income tax benefit was CHF 1.1 million, as higher than expected revenues and operating profit resulted in earlier than anticipated recognition of deferred tax assets. As a further consequence of this earlier than anticipated recognition, Actelion now expects the overall tax rate for the full year 2005 to reach between 10 and 14 percent, compared to previous guidance of between 15 and 18 percent.
Net profit increased by 83 percent compared to the previous quarter (Q4 2004: 23.1 m).
As at 31 March 2005, the company held gross cash and cash equivalents of CHF 293.4 million (31 December 2004: CHF 300.3 million). The company generated cash from operations in the first quarter of 2005 of CHF 27.3 million.
Research and Development programs on track -- RAPIDS-2 ahead of schedule
At Actelion's Media and Analyst Day on 24th February 2005, the company provided a full update on its Development program. All projects are on or ahead of schedule. One study, the RAPIDS-2 trial evaluating safety and efficacy of bosentan (Tracleer(r)) for the prevention and treatment of scleroderma-related Digital Ulcerations is now expected to report in Q3 2005, one quarter earlier than expected.
New Actelion senior management structure
With immediate effect, Actelion has made changes to its senior management structure to both better support sales of existing products while providing additional focus on future growth opportunities.
Christian Chavy, in his new position as President Business Operations, is now leading all Business Operations worldwide, bringing together all affiliate operations with the two global marketing functions, Strategic Marketing and Medical Marketing. Before assuming his new role, Christian Chavy was leading Actelion's affiliate operations in Europe, Latin America, Africa and the Middle East. He joined Actelion in 2001.
Simon Buckingham, in his new position as President Corporate and Business Development, is assuming leadership for strategic planning, business development, merger & acquisitions and portfolio management. Before assuming his new role, Simon Buckingham was leading Actelion's affiliate operations in North America and Asia-Pacific. He joined Actelion in 2000.
The company has also formed the Actelion Executive Committee (AEC), replacing the previous Business Executive Board. It also nominated Roland Haefeli, Head of Investor Relations and Public Affairs, as the seventh member of the Executive Committee. Roland Haefeli joined the company in his current role in 2001.
The seven members of the Actelion Executive Committee are:
Jean-Paul Clozel, Chief Executive Officer Andrew J. Oakley, Chief Financial Officer Simon Buckingham, Head Corporate and Business Development Christian Chavy, Head Business Operations Louis de Lassence, Head of Corporate Services Roland Haefeli, Head of Investor Relations and Public Affairs Isaac Kobrin, Head of Clinical Development For documentation purposes -- table Q1 2005 vs. Q4 2004 In CHF thousands Results Q1 2005 Results Q4 2004 Variance in % Net Revenues 146'353 130'363 15'990 +12 Operating Expenses 102'687 108'667 -5'980 -6 Operating Profit 43'666 21'696 21'970 +101 Net Profit 42'110 23'069 19'041 +83 Basic EPS in CHF 1.90 1.04 0.86 +83 Diluted EPS in CHF 1.82 1.00 0.82 +82 Cash & cash equivalents 293'367 300'336 -6'969 -2
Actelion Ltd
Actelion Ltd is a biopharmaceutical company with its corporate headquarter in Allschwil/Basel, Switzerland. Actelion's first drug Tracleer(r), an orally available dual endothelin receptor antagonist, has been approved as a therapy for pulmonary arterial hypertension. Actelion markets Tracleer(r) through its own subsidiaries in key markets worldwide, including the United States (based in South San Francisco), the European Union as well as Canada, Australia and Switzerland. Actelion, founded in late 1997, is a leading player in innovative science related to the endothelium -- the single layer of cells separating every blood vessel from the blood stream. Actelion focuses on the discovery, development and marketing of innovative drugs for significant unmet medical needs. Actelion shares are traded on the SWX Swiss Exchange (ticker symbol: ATLN).
For further information please contact:
Actelion Ltd, Gewerbestrasse 16, CH-4123 Allschwil
Investor Contact Roland Haefeli +41 61 565 64 58
+1 650 624 6936
Media Contact Peter Engel +41 61 565 66 28
+1 650 624 6996
http://www.actelion.com
Conference Call
Actelion will host an Investor Conference Call and discussion/Q&A on Thursday, 21 April 2005, 15.30 CET / 09.30 a.m. EST / 14.30 GMT
Dial: +41 (0) 91 610 56 00 (Europe)
+1 (1) 866 291 41 66 (U.S.)
+44 207 107 06 11 (U.K.)
Webcast -- Live and replay on demand
Actelion webcasts its Investor Conference Call. On the Web, you may either follow the call live or have the call replayed later on demand.
To access the webcast live, simply visit the link on our homepage http://www.actelion.com 5-10 minutes before the conference is due to start.
Approximately 60 minutes after the call has ended, the archived investor webcast will be available for replay through our homepage. After 5 May 2005 it will be stored under Investors/Past Events.