ChiRex Inc.'s second quarter net income increases to 10 cents per share.WELLESLEY Wellesley, town (1990 pop. 26,615), Norfolk co., E Mass., a residential suburb SW of Boston; settled 1660, inc. 1881. Its many educational institutions include several private preparatory schools, Babson College, and Wellesley College. , Mass.--(BUSINESS WIRE)--July 23, 1996--ChiRex Inc. (Nasdaq: CHRX), the newly formed chiral chi·ral adj. Of or relating to the structural characteristic of a molecule that makes it impossible to superimpose it on its mirror image. chi·ral chemistry business and pharmaceutical fine chemical manufacturer, posted second quarter net income of $1.1 million, or 10 cents per share Cents per share The amount of a mutual fund's dividend or capital gains distributions that a shareholder will receive for each share owned. . This is a 29% increase on the combined net incomes of the two pre-merger companies (Sterling Organics and SepraChem) of $0.8 million, or 7 cents per share, for the same period last year. The increase in net income has been driven by the combination of increased production of higher-margin products and the selective elimination of lower-margin customer supply arrangements. Excluding expenses unique to the post-merger company consisting of $288,000 of goodwill, interest expense of $379,000 and a $350,000 loss at InNova Pharmaceuticals, second quarter net income would be 18 cents per share. ChiRex's joint venture company, InNova Pharmaceuticals, returned a loss for the second quarter of 1996 as a result of process development and ANDA ANDA abbr. abbreviated new drug application preparation costs, in advance of the expected revenue stream. Total revenues for the second quarter were $22.0 million, as compared to $21.8 million for the second quarter of last year. Gross profit for the second quarter rose to $4.9 million from $2.4 million, and the gross profit margin Gross profit margin Gross profit divided by sales, which is equal to each sales dollar left over after paying for the cost of goods sold. gross profit margin A measure calculated by dividing gross profit by net sales. improved to 22.3% from 11.2%. The improvement in gross profit margin is attributable attributable emanating from or pertaining to attribute. attributable proportion see attributable risk (below). attributable risk to the change in product mix. Operating profit Operating profit (or loss) Revenue from a firm's regular activities less costs and expenses and before income deductions. operating profit See operating income. for the second quarter rose to $3.0 million from $1.2 million, a movement in operating profit margin Operating profit margin The ratio of operating profit to net sales. to 13.7% from 5.6%. Robert Robert, Henry Martyn 1837-1923. American army engineer and parliamentary authority. He designed the defenses for Washington, D.C., during the Civil War and later wrote Robert's Rules of Order (1876). Noun 1. L. Bratzler, Ph.D., Chairman and Chief Executive Officer of ChiRex, said, "I am pleased with the progress made during the last quarter towards establishing ChiRex as the preferred supplier of pharmaceutical fine chemicals to major pharmaceutical houses. Our combination of leading chiral chemistry technology with world class cGMP cGMP 3'5' cyclic guanosine monophosphate; essential in regulation of sodium channels of the retina. Decrease in cGMP concentration leads to hyperpolarization of the retinal membrane. manufacturing facilities is being greeted with increased demand for our products." Bratzler went on to say, "Sales of (R)-DHPG Dane Dane n. 1. A native or inhabitant of Denmark. 2. A person of Danish ancestry. [Middle English Dan, from Old Norse Danr. Salt, a fine chemical used in the manufacture of semi-synthetic antibiotics Antibiotics Definition Antibiotics may be informally defined as the subgroup of anti-infectives that are derived from bacterial sources and are used to treat bacterial infections. , are running ahead of plan. We have also commenced tonnage TONNAGE, mar. law. The capacity of a ship or vessel. 2. The act of congress of March 2, 1799, s. 64, 1 Story's L. U. S. 630, directs that to ascertain the tonnage of any ship or vessel, the surveyor, &c. sales of (R,S)-ketoprofen, the active ingredient An active ingredient, also active pharmaceutical ingredient (or API), is the substance in a drug that is pharmaceutically active. Some medications may contain more than one active ingredient. in the recently approved OTC OTC See: Over-the-counter. OTC See over-the-counter market (OTC). pain relief products, Actron and Orudis KT Noun 1. Orudis KT - nonsteroidal anti-inflammatory drug (trade names Orudis or Orudis KT or Oruvail) ketoprofen, Orudis, Oruvail nonsteroidal anti-inflammatory, nonsteroidal anti-inflammatory drug, NSAID - an anti-inflammatory drug that does not contain . Ketoprofen ketoprofen (kē'təprō`fĭn), nonsteroidal anti-inflammatory drug (NSAID) with anti-inflammatory, analgesic, and fever-reducing effects, used to relieve the symptoms of headaches, arthritis, and painful menstruation. is an example of ChiRex using its proprietary manufacturing technology to develop a new product entry into an expanding market." "In response to the increased demand for other new products, we have embarked on a program to immediately expand our R&D and Business Development personnel by 25%. The official opening of our new $13.5 million R&D Center and Pilot Plant in June June: see month. was attended by representatives from over 20 major pharmaceutical companies. These facilities are unsurpassed in the industry and should help us respond quickly to increased customer needs. We continue to invest in technology, and I am pleased to report that a chiral technology patent was issued in the last quarter, bringing the total number of issued US patents under which ChiRex has the right and license to use and practice technology to 38 with an additional 16 applications still pending." ChiRex Inc. specializes in the development, manufacture and marketing of pharmaceutical fine chemicals and, through its joint venture, InNova Pharmaceuticals, formulated for·mu·late tr.v. for·mu·lat·ed, for·mu·lat·ing, for·mu·lates 1. a. To state as or reduce to a formula. b. To express in systematic terms or concepts. c. generic drugs generic drug, a drug sold or prescribed under the nonproprietary name of its active ingredients or under a generally descriptive name rather than under a brand or trade name. . ChiRex currently produces over 50 pharmaceutical chemicals in its world-class world-class adj. 1. Ranking among the foremost in the world; of an international standard of excellence; of the highest order: a world-class figure skater. 2. cGMP manufacturing facilities and is a world leader in chiral chemical technology. -0- Editors Note: Attention: A conference call will be held on Wednesday Wednesday: see week. , July July: see month. 24th, 1996 at 8:00 a.m. (EST EST electroshock therapy. EST abbr. electroshock therapy ). To participate, dial (913) 661-0896. -0-
ChiRex Inc.
Consolidated Income Statement
(unaudited)
(in thousands of US Dollars, except EPS)
Three months to June Six months to June
1996 1995(a) 1996 1995(a)
Sales 21,694 21,693 44,173 45,801 Licence & Royalty 282 141 605 282 Total Revenues 21,976 21,834 44,778 46,083 Cost of Sales (17,086) (19,390) (36,372) (40,676) Gross Profit 4,890 2,444 8,406 5,407 % of Total Revenues 22.3% 11.2% 18.8% 11.7% Selling, Gen & Admin (1,155) (437) (1,896) (1,605) R & D (725) (781) (1,403) (1,498) Operating Profit 3,010 1,226 5,107 2,304 % of Total Revenues 13.7% 5.6% 11.4% 5.0%
Goodwill (288) 0 (348) 0
Other income/(expense) (86) (1) (139) 339
(374) (1) (487) 339
EBIT 2,636 1,225 4,620 2,643 Interest (379) 0 (1,111) 0 Profit before Tax 2,257 1,225 3,509 2,643 Tax (814) (379) (1,245) (799) Profit After Tax 1,443 846 2,264 1,844 Dividends 0 0 (217) 0 Equity Income/(Loss) (350) 0 (350) 0 Net Income 1,093 846 1,697 1,844 Shares Outstanding 11,245 11,245 11,245 11,245 E.P.S. $0.097 $0.075 $0.151 $0.164 EBITDA 4,982 2,963 8,812 6,504 % of Total Revenues 22.7% 13.6% 19.7% 14.1%
Less Non-Recurring
Charges :
Pre Acq
ChiRex(Holdings)
Ltd Losses 0 149
Stock Options 0 (5,286)
In-Process Development 0 (5,790)
Fair Value of
Inventory Uplift
(net) (929) (1,204)
(929) (12,131)
Net Income 164 (10,434) (Adj for non-recurring charges) E.P.S. $0.015 $(0.928) (a) For purposes of financial comparison, 1995 results are based on the pre-merger combination of the income statements of Sterling Organics and SepraChem Inc. -0-
CHIREX INC.
CONSOLIDATED BALANCE SHEETS
(unaudited)
(in thousands of US Dollars)
June 30 December 31
1996 1995
ASSETS
ChiRex Inc. Crossco (157) SepraChem
Limited Inc.
Current Assets: Cash and cash equivalents $ 5,812 $ 7,845 $ 0 Trade and other receivables 11,770 8,335 546 Inventories 20,124 18,547 193 Other current assets 2,283 366 1,646 Total current assets 39,989 35,093 2,385 Property, plant and equipment, net 58,460 44,868 307 Intangible assets, net 28,556 0 0 Total Assets $127,005 $79,961 $2,692 LIABILITIES AND STOCKHOLDERS' EQUITY Current Liabilities: Accounts payable $ 9,413 $ 5,374 $ 0 Accrued expenses 10,769 7,881 0 Income taxes payable 1,279 996 0 Deferred Income Taxes 0 0 0 Current portion of long-term debt 0 660 0 Total current liabilities 21,461 14,911 0 Long-term debt 11,625 40,304 0 Deferred Income taxes 7,042 3,453 0 Deferred Income 3,365 2,962 0 Accrued Expenses 0 4,425 0 Total liabilities 43,493 66,055 0 Cumulative redeemable preferred stock at redemption value 0 13,541 0 Stockholders' equity: Common Stock 108 173 80 Additional paid-in capital 94,745 1,560 5,064 Retained earnings (12,342) (1,201) (2,452) Cumulative translation adjustment 1,001 (167) 0 Total stockholders' equity 83,512 365 2,692 Total liabilities and stockholders' equity $127,005 $79,961 $2,692 -0-
CHIREX INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS
(unaudited)
(in thousands of US Dollars)
Six Months Ended
June 30
1996 1995
Chirex Inc. Sterling SepraChem
Organics Inc.
Cash flows from
operating activities:
Net income/(loss) to
common shareholders $(10,430) $2,581 $(735)
Add back: Depreciation
& Amortization 2,396 3,937 74
Goodwill 348 0 0
Amortization of Fixed
Asset Uplift 166 0 0
Inventory Uplift release 1,792 0 0
Write-off of in-process
research and development 5,790 0 0
Compensation related
to stock options 5,286 0 0
Changes in assets
and liabilities:
Receivables (1,813) (2,788) 466
Inventories (84) (681) (251)
Other current assets (2,265) (251) (204)
Accounts payable and accrued
liabilities 2,789 5,228 0
Income taxes payable 768 1,400 (450)
Other noncurrent assets
and liabilities (329) 210 0
Net cash provided from operations 4,414 9,636 (1,100) Cash flows from investing activities: Capital expenditures (1,545) (6,259) 0 Acquisition of businesses (net of cash acquired) (35,047) 0 0 Net cash (used in) investing activities (36,592) (6,259) 0 Cash flows from financing activities: Increase in short-term debt 0 0 1,100 Long-term debt activity (including current portion): Borrowings 11,475 0 0 Repayments (53,598) 0 0 Proceeds from the issuance of common stock 80,022 0 0 Net cash provided from financing activities 37,899 0 1,100 Effect of exchange rate changes on cash 90 (49) 0 Net increase in cash 5,811 3,328 0 Cash at beginning of period 1 (622) 0 Cash at end of period $5,812 $2,706 $0 -0- CONTACT: Robert L. Bratzler, Ph.D. Chairman and Chief Executive Officer Michael Michael, archangel Michael (mī`kəl) [Heb.,=who is like God?], archangel prominent in Christian, Jewish, and Muslim traditions. In the Bible and early Jewish literature, Michael is one of the angels of God's presence. A. Griffith Griffith, town (1990 pop. 17,916), Lake co., extreme NW Ind.; inc. 1904. It is primarily a residential town in the Chicago metropolitan area. Manufactures include metal products, chemicals, and electronic equipment. Vice President and Chief Financial Officer (617) 431-2200 |
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