Andrx Reports Fourth Quarter 2004 and Full Year Financial Results.FORT LAUDERDALE Fort Lauderdale (lô`dərdāl), residential, commercial, and resort city (1990 pop. 149,377), seat of Broward co., SE Fla., on the Atlantic coast; settled around a fort built (c.1837) in the Seminole War, inc. 1911. , Fla. -- Andrx Corporation (Nasdaq:ADRX ADRX Andrx Corporation (stock symbol) ) ("Andrx" or the "Company") today announced its financial results for the three months and year ended December 31, 2004. Andrx's financial results and other important matters are extensively detailed in Andrx's Form 10-K Form 10-K A report required by the SEC from exchange-listed companies that provides for annual disclosure of certain financial information. Form 10-K See 10-K. , which is being filed today with the U.S. Securities and Exchange Commission ("SEC"). This press release and Andrx's Form 10-K are available on the Company's website at http://www.andrx.com (Investor Relations/SEC filings).
Financial Highlights
(dollars in thousands, except share and per share amounts)
Three months ended
December 31, Increase
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2004 2003 $ %
----------- ---------- ------ -----
Total revenues $290,042 $281,684 $8,358 3.0%
Income from operations $19,979 $18,935 $1,044 5.5%
Net income $20,752 $15,603 $5,149 33.0%
Diluted earnings per share $0.28 $0.21 $0.07 33.3%
Diluted weighted average shares
outstanding 73,378,000 72,994,000
Year ended
December 31, Increase
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2004 2003 $ %
----------- ----------- ------- -----
Total revenues $1,145,087 $1,046,338 $98,749 9.4%
Income from operations $88,065 $67,867 $20,198 29.8%
Net income $65,659 $48,177 $17,482 36.3%
Diluted earnings per share $0.89 $0.66 $0.23 34.8%
Diluted weighted average shares
outstanding 73,530,000 72,655,000
--Revenue from distributed products increased $8.7 million, or 5.1%, to $181.4 million, compared to $172.6 million in the fourth quarter of 2003. Revenue from distributed products for 2004 increased $19.2 million, or 2.9%, to $676.3 million, compared to $657.1 million for 2003. --Revenue from generic products decreased $6.4 million, or 7.5%, to $79.6 million, compared to $86.0 million for the fourth quarter of 2003. Revenue from generic products for 2004 increased $89.4 million, or 35%, to $344.4 million, compared to $255.0 million for 2003. --Revenue from brand products increased $6.9 million, or 42.7% to $22.9 million, compared to $16.0 million for the fourth quarter of 2003. Revenue from brand products for 2004 increased $30.8 million, or 66.0%, to $77.4 million, compared to $46.6 million for 2003. --Revenue from licensing and royalties decreased $0.3 million, or 4.9%, to $6.1 million, compared to $6.4 million for the fourth quarter of 2003. Fourth quarter 2004 revenues consisted primarily of a reversal of $3.3 million as a result of the settlement of our dispute with Kremers Urban Development Company ("KUDCo") regarding their $6.3 million allocation to us related to their litigation An action brought in court to enforce a particular right. The act or process of bringing a lawsuit in and of itself; a judicial contest; any dispute. When a person begins a civil lawsuit, the person enters into a process called litigation. settlement with Mylan Laboratories, Inc. in the 2004 second quarter. We also received our regular profit share of $1.3 million for the quarter. Revenue from licensing and royalties for 2004 decreased $33.3 million, or 41.6%, to $46.8 million, compared to $80.1 million for 2003, primarily as a result of our decreased revenues from the sale of KUDCo's generic version of Prilosec(R). The $68.5 million decline in revenues from KUDCo was partially offset by $33.2 million in revenues from our Exclusivity Agreement with Impax Laboratories, Inc. and Teva Pharmaceuticals Curacao, N.V. related to generic Wellbutrin SR(R)/Zyban(R). --Net income was $20.8 million, or $0.28 diluted earnings per share diluted earnings per share An earnings measure calculated by dividing net income less preferred stock dividends for a period by the average number of shares of common stock that would be outstanding if all convertible securities were converted into shares of , for the fourth quarter of 2004, compared to $15.6 million, or $0.21 diluted earnings per share, for the fourth quarter of 2003. The fourth quarter of 2003 included pretax pre·tax adj. Existing before tax deductions: pretax income. pretax adj [profit] → vor (Abzug der) Steuern net gains of $4.8 million, primarily related to the sale of Armstrong Pharmaceuticals. Net income for 2004 was $65.7 million, or $0.89 diluted earnings per share, compared to $48.2 million, or $0.66 diluted di·lute tr.v. di·lut·ed, di·lut·ing, di·lutes 1. To make thinner or less concentrated by adding a liquid such as water. 2. To lessen the force, strength, purity, or brilliance of, especially by admixture. net income per share, for 2003. Net income for the 2004 fourth quarter and full year benefited from a $7.9 million change in accrued ac·crue v. ac·crued, ac·cru·ing, ac·crues v.intr. 1. To come to one as a gain, addition, or increment: interest accruing in my savings account. 2. tax contingencies as a result of our acceptance of the Internal Revenue Service's proposed settlement related to its audits of our 1999 through 2002 tax returns. --Cash, cash equivalents, and short and long-term investments available-for-sale totaled $210.1 million as of December 31, 2004. --Capital expenditures were $15.1 million for the 2004 fourth quarter and $88.3 million for the year ended December 31, 2004, and are estimated at approximately $51 million for 2005. Capital expenditures are mainly for facilities, machinery and equipment that will essentially double the Company's Florida manufacturing facilities' capacity by the 2005 second quarter. --In January 2005, our Board of Directors announced it had approved a plan to divest To deprive or take away. Divest is usually used in reference to the relinquishment of authority, power, property, or title. If, for example, an individual is disinherited, he or she is divested of the right to inherit money. or seek other strategic alternatives for our brand pharmaceutical business, realigning our business strategy to focus on formulation formulation /for·mu·la·tion/ (for?mu-la´shun) the act or product of formulating. American Law Institute Formulation development of controlled-release pharmaceuticals and distribution. As a result of this determination, we terminated our agreement with Pfizer Inc. for Cardura(R) XL, received a refund of the $10 million we paid to Pfizer in connection with that agreement, and entered into a definitive agreement with First Horizon Pharmaceuticals Corporation for the sale of certain rights and assets related to our Fortamet(R) and Altoprev(R) products. We anticipate completing this transaction in the 2005 second quarter. Andrx's Chief Executive Officer, Thomas P. Rice, said: "Our 2004 fourth quarter financial results were driven by the strong performance of our distribution business, which generated a sequential quarterly increase of $23.2 million in revenues. For the year, we continued to improve our manufacturing efficiencies and quality processes, which will benefit our operations for the years to come, and we launched nine generic products, filed 14 Abbreviated New Drug Applications abbreviated new drug application Pharmacology An application made in the US by a pharmaceutical company requesting authority to market a 'new' drug for which both its therapeutic indications and formulation were previously approved by the FDA in another similar , and received four tentative and 10 final approvals from the FDA FDA abbr. Food and Drug Administration FDA, n.pr See Food and Drug Administration. FDA, n.pr the abbreviation for the Food and Drug Administration. . We are also very pleased that we were able to enter into agreements with First Horizon for our Fortamet and Altoprev products, representing another step forward in the execution of our overall strategy to focus on our core competencies A core competency is something that a firm can do well and that meets the following three conditions specified by Hamel and Prahalad (1990):
Conference Call & Live Web Cast
Date: Thursday, March 10, 2005
Time: 8:00 AM ET
Live Webcast: http://www.andrx.com, link to Investor Relations/IR
Events
About Andrx Corporation: We are a pharmaceutical company that: --develops, manufactures and commercializes generic versions of controlled-release, niche and immediate-release pharmaceutical products, including oral contraceptives Oral Contraceptives Definition Oral contraceptives are medicines taken by mouth to help prevent pregnancy. They are also known as the Pill, OCs, or birth control pills. ; and --distributes pharmaceuticals, primarily generics, which have been commercialized by others, as well as our own, primarily to independent pharmacies An independent pharmacy is a retail pharmacy that is not directly affiliated with any chain pharmacy, such as CVS/pharmacy, Walgreens or Eckerd. However, owners of independent pharmacies will often form alliances with other independents and use their power in numbers to bargain for , pharmacy chains, pharmacy buying groups and physicians' offices. We also commercialize brand pharmaceuticals that, in some instances, use our proprietary controlled-release drug delivery technologies. On March 2, 2005, we entered into agreements with First Horizon Pharmaceutical Corporation for the sale and licensing of certain rights and assets related to our two main brand products, Altoprev and Fortamet. The closing of the transaction, which is subject to certain customary conditions including clearance under the Hart-Scott-Rodino Antitrust Improvements Act The Hart-Scott-Rodino Antitrust Improvements Act of 1976 (Public Law 94-435, known commonly as the HSR Act) is a set of amendments to the antitrust laws of the United States, principally the Clayton Antitrust Act. The HSR Act was signed into law by President Gerald R. , is expected to occur by May 2005. Forward-looking statements forward-looking statement A projected financial statement based on management expectations. A forward-looking statement involves risks with regard to the accuracy of assumptions underlying the projections. (statements which are not historical facts) in this release are made pursuant to the safe harbor Safe Harbor 1. A legal provision to reduce or eliminate liability as long as good faith is demonstrated. 2. A form of shark repellent implemented by a target company acquiring a business that is so poorly regulated that the target itself is less attractive. provisions of the Private Securities Litigation Reform Act The Private Securities Litigation Reform Act of 1995 (PSLRA) implemented several significant substantive changes affecting certain cases brought under the federal securities laws, including changes related to pleading, discovery, liability, class representation and awards fees and of 1995. For this purpose, any statements contained herein or which are otherwise made by or on behalf of Andrx that are not statements of historical fact may be deemed to be forward-looking statements. Without limiting the generality gen·er·al·i·ty n. pl. gen·er·al·i·ties 1. The state or quality of being general. 2. An observation or principle having general application; a generalization. 3. of the foregoing, words such as "may," "will," "to," "plan," "expect," "believe," "anticipate," "intend," "could," "would," "estimate," or "continue" or the negative or other variations thereof or comparable terminology are intended to identify forward-looking statements. Investors are cautioned that all forward-looking statements involve risk and uncertainties, including but not limited to, our dependence on a relatively small number of products; licensing revenues; the timing and outcome of patent, antitrust Antitrust The antitrust laws apply to virtually all industries and to every level of business, including manufacturing, transportation, distribution, and marketing. They prohibit a variety of practices that restrain trade. and other litigation and future product launches; whether we will be awarded any marketing exclusivity period and, if so, the precise dates thereof; government regulation generally; competition; manufacturing capacities, safety issues, output and quality processes; our ability to develop and successfully commercialize new products; the loss of revenues from existing products; development and marketing expenses that may not result in commercially successful products; our inability to obtain, or the high cost of obtaining, licenses for third party technologies; the operating losses operating loss The excess of operating expenses over revenue. As with operating income, operating losses exclude revenues and expenses from operations that are not considered a regular part of the business. Also called deficit. Compare operating income. that will be incurred by our brand business while we are attempting to dispose of To determine the fate of; to exercise the power of control over; to fix the condition, application, employment, etc. of; to direct or assign for a use. See also: Dispose such business; the consolidation or loss of customers; our relationship with our suppliers; the success of our joint ventures; difficulties in integrating, and potentially significant charges associated with, acquisitions of technologies, products and businesses; our inability to obtain sufficient supplies and/or active pharmaceuticals from key suppliers; the impact of sales returns and allowances; product liability claims; rising costs and limited availability When customers of the PSTN make telephone calls, they commonly make use of a telecommunications network called a switched-circuit network. In a switched-circuit network, devices known as switches are used to connect the caller to the callee. of product liability and other insurance; the loss of key personnel; failure to comply with environmental laws; and the absence of certainty regarding the receipt of required regulatory approvals or the timing or terms of such approvals. Actual results may differ materially from those projected in a forward-looking statement. We are also subject to other risks detailed herein or detailed from time to time in our filings with the Securities and Exchange Commission. We disclaim dis·claim v. dis·claimed, dis·claim·ing, dis·claims v.tr. 1. To deny or renounce any claim to or connection with; disown. 2. To deny the validity of; repudiate. 3. any intent or obligation to update the forward-looking statements as expressly required by law. This release and additional information about Andrx Corporation are also available on the Internet at: http://www.andrx.com. |
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