Enzon Reports Fourth Quarter and Fiscal Year Results; Fourth Quarter Product Sales Increase 18% over Prior Year.BRIDGEWATER Bridgewater, town (1990 pop. 21,249), Plymouth co., E Mass.; inc. 1656. Manufacturing includes shoes and metal products. Its iron foundry industry dates from colonial times. Bridgewater State College and a state prison are there. , N.J. -- Enzon Pharmaceuticals, Inc. (Nasdaq: ENZN) reported today its results for the quarter and fiscal year (FY) ended June June: see month. 30, 2004. For the fourth quarter of FY 2004, the Company reported adjusted net income of $1.2 million or $0.03 per 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. share, compared with adjusted net income of $23.8 million or $0.55 per diluted share for the fourth quarter of FY 2003. The Company's adjusted net income for the fourth quarter of FY 2004 and FY 2003 exclude the impact of isolated non-cash, non-operating, transactions related to the mutual termination of its proposed merger with NPS NPS National Park Service NPS Naval Postgraduate School NPS Net Promoter Score (customer management) NPS Non-Point Source pollution NPS Native Plant Society NPS Norfolk Public Schools (Virginia) Pharmaceuticals, Inc. (NASDAQ: NPSP NPSP New Parent Support Program NPSP National Polio Surveillance Project (India) NPSP Native Plant Stewardship Program (Washington Native Plant Society) NPSP Nonparametric Statistical Package ) in June 2003. The Company's adjusted net income for the fourth quarter of FY 2004 also excludes a non-cash charge Non-Cash Charge A charge off, made by a company against earnings, that does not require an initial outlay of cash. Notes: Non-cash charges are typically against the depreciation, amortization, and depletion accounts on a company's balance sheet. related to the write-down Write-Down Reducing the book value of an asset because it is overvalued compared to the market value. Notes: This is usually reflected in the company's income statement as an expense, thereby reducing net income. of Enzon's investment in Micromet AG (private), which was made in April 2002 in the form of a convertible note that is due to Enzon in March 2006, and non-cash adjustments primarily related to an increase in the Company's valuation allowance for certain deferred tax assets. These items are detailed within a reconciliation table presented later in this release. On a reported basis, calculated in accordance Accordance is Bible Study Software for Macintosh developed by OakTree Software, Inc.[] As well as a standalone program, it is the base software packaged by Zondervan in their Bible Study suites for Macintosh. with U.S. generally accepted accounting principles The standard accounting rules, regulations, and procedures used by companies in maintaining their financial records. Generally accepted accounting principles (GAAP) provide companies and accountants with a consistent set of guidelines that cover both broad accounting (GAAP GAAP See: Generally Accepted Accounting Principles GAAP See generally accepted accounting principles (GAAP). ), the Company reported a net loss of $7.3 million or $0.17 per diluted share for the fourth quarter of FY 2004, as compared to net income of $40.6 million or $0.93 per diluted share for the fourth quarter of FY 2003. Enzon has reported adjusted net income because it believes that adjusted net income is indicative of the underlying operations of the business and is relevant to gaining an understanding of the Company's trends and potential future performance. "Fiscal 2004 has been a year of solid execution for Enzon with all elements of our business that we control performing at or ahead of our expectations," said Arthur Arthur, king of Britain: see Arthurian legend. Arthur king and hero of Scotland, Wales, and England. [Arthurian Legend: Parrinder, 28] See : Heroism J. Higgins Higgins may refer to: People with the surname Higgins:
Combined product sales for the Company's four internally marketed products (ABELCET(R), ONCASPAR(R), DEPOCYT(R), and ADAGEN(R)) increased by $4.2 million or 18% to $27.3 million compared with $23.0 million for the prior year's comparable quarter. The increase is primarily attributable attributable emanating from or pertaining to attribute. attributable proportion see attributable risk (below). attributable risk to increased ABELCET sales. For the fourth quarter of FY 2004, North American North American named after North America. North American blastomycosis see North American blastomycosis. North American cattle tick see boophilusannulatus. sales of ABELCET were $17.1 million compared with $14.2 million for the fourth quarter of FY 2003. Sales of ONCASPAR for the fourth quarter of FY 2004 increased by $1.0 million or 26% to $4.8 million compared with $3.8 for the fourth quarter of FY 2003. The increase was primarily driven by additional sales and marketing efforts to support ONCASPAR. Sales of DEPOCYT were $1.1 million for the fourth quarter of FY 2004, compared with $1.2 million for the fourth quarter of FY 2003. ADAGEN sales for the fourth quarter of FY 2004 increased to $4.3 million versus $3.8 million in the fourth quarter of FY 2003. During the quarter, the Company recorded $4.1 million in manufacturing revenue related to the ABELCET business compared with $3.2 million for the fourth quarter of FY 2003. Royalties for the fourth quarter of FY 2004 decreased by $8.8 million or 44% to $11.2 million compared with $20.0 million for the fourth quarter of FY 2003. Royalties are principally comprised of royalties from sales of PEG-INTRON marketed by Schering-Plough Schering-Plough Corporation (NYSE: SGP) is a pharmaceutical company which traces its history back to 1851 when Ernst Schering founded Schering AG in Germany. Following the entry of the United States into World War II in 1941, U.S. Corporation (NYSE NYSE See: New York Stock Exchange : SGP SGP Singapore (ISO Country code) SGP Schering-Plough (stock symbol) SGP Stability and Growth Pact SGP Southern Great Plains SGP Staatkundig Gereformeerde Partij SGP Speedway Grand Prix ). The decrease in royalties from the prior year is primarily due to the ongoing competition in the pegylated alpha interferon interferon (ĭn'tərfēr`ŏn), any of a group of proteins produced by cells in the body in response to an attack by a virus. A cell infected by a virus releases minute amounts of interferons, which attach themselves to neighboring cells, market. The Company's investment in research and development increased by $4.0 million or 65% to $10.1 million in the fourth quarter of FY 2004 compared with $6.1 million for the fourth quarter of FY 2003. The increase over the prior year is primarily attributable to the advancement of the Company's late-stage product pipeline, namely Pegamotecan, ATG ATG antithymocyte globulin. lymphocyte immune globulin (antithymocyte globulin equine, ATG, ATG equine, LIG) Atgam Pharmacologic class: Immunoglobulin Therapeutic class: Immunosuppressant Fresenius S Fresenius may mean:
TSX Transfer from Stack Pointer to Index TSX True Space Extension : IEX IEX Ion Exchange (chromatography) IEX Inter-Exchange Carrier ) for Onco TCS (Transportation Control System) A widely used integrated information system for railroad transportation developed by the Missouri Pacific Railroad Company in the late 1960s and early 1970s. It was later implemented by Union Pacific when the companies merged. , which will now be referred to by the new brand name Marqibo(TM) (vincristine sulfate vin·cris·tine sulfate n. The sulfate salt of a dimeric alkaloid obtained from a plant of the genus Vinca that exhibits antineoplastic activity similar to that of vinblastine sulfate and is used especially in the treatment of lymphocytic liposomes Liposomes Aqueous compartments enclosed by lipid bilayer membranes; liposomes are also known as lipid vesicles. Phospholipid molecules consist of an elongated nonpolar (hydrophobic) structure with a polar (hydrophilic) structure at one end. injection). Selling, general, and administrative expenses increased by $2.0 million or 21% to $11.8 million in the fourth quarter of FY 2004 versus $9.8 million for the fourth quarter of FY 2003. The increase over the prior year is primarily attributable to increased product promotional activities. During the fourth quarter of FY 2004, the Company recorded tax expense of approximately ap·prox·i·mate adj. 1. Almost exact or correct: the approximate time of the accident. 2. $4.3 million compared to a deferred tax benefit of $439,000 for the fourth quarter of FY 2003. The Company's cash and investments totaled $186.2 million as of June 30, 2004 compared with $153.3 million as of June 30, 2003. The increase in cash and investments was primarily the result of cash proceeds of $17.4 million related to the Company's sale of 880,075 shares of Nektar If you want to read about Czech Republic's beer Nektar. Nektar is a 1970s English progressive rock band based in Germany. History The band formed in Hamburg, Germany in 1969, members included Englishmen Roye Albrighton on guitars and vocals, Allan "Taff" Therapeutics therapeutics Treatment and care to combat disease or alleviate pain or injury. Its tools include drugs, surgery, radiation therapy, mechanical devices, diet, and psychiatry. (Nasdaq: NKTR) common stock during the quarter ended March 31, 2004 and positive cash flow provided by the Company's operations. These increases were partially offset by the payment of $12.0 million to Inex for acquired in-process research and development related to the acquisition of the North American commercialization rights to Marqibo(TM) in January January: see month. 2004. The following table reconciles the Company's adjusted net income to GAAP net income for the three months ended June 30, 2004 and 2003:
Three Months Ended
(in thousands)
------------------------
06/30/04 06/30/03
------------------------
GAAP net (loss) income ($7,312) $40,552
Adjusted net income data:
Add: write-down of carrying value of note 8,341 (1) ---
Less: other income, net (2,033)(2) (16,716)(4)
Add: tax provision 2,217 (3) ---
---------- -----------
Adjusted net income $1,213 $23,836
========== ===========
1 Adjusted net income for the fourth quarter of FY 2004 excludes the
write-down of Enzon's investment in Micromet AG, which was made in
April 2002 in the form of a convertible note that is due in March
2006. The Company based its decision to write-down the note pursuant
to GAAP due to uncertainty regarding the future realization of the
carrying value of the asset.
2 Adjusted net income for the fourth quarter of FY 2004 excludes tax-
adjusted investment income of $2.0 million related to the change in
the fair value of a derivative hedging instrument entered into as a
protective collar arrangement to reduce the Company's exposure
associated with its 1.5 million shares of NPS common stock
(discussed below).
3 Adjusted net income for the fourth quarter of FY 2004 excludes
non-cash adjustments totaling $2.2 million that are primarily
related to an increase in the Company's valuation allowance based on
Enzon's belief that it is likely that it may not be able to utilize
a portion of its research and development tax credits.
4 Adjusted net income for the fourth quarter of FY 2003 excludes tax-
adjusted other income related to the $36.0 million termination fee
paid to Enzon in the form of 1.5 million shares of NPS common
stock, related to the termination of the proposed merger between
Enzon and NPS in June 2003. The termination fee is net of costs
incurred related to the proposed merger.
The management of Enzon will be hosting a conference call today, August 17, 2004 at 5:00 PM EDT EDT abbr. Eastern Daylight Time EDT Eastern Daylight Time EDT n abbr (US) (= Eastern Daylight Time) → hora de verano de Nueva York EDT . All interested parties can access the live call using the following information: Domestic Dial-In Number: 877-405-4056 International Dial-In Number: 706-679-3931 Access Code: 9078442 Enzon's conference call will also be webcast in a "listen only" mode via the Internet Internet Publicly accessible computer network connecting many smaller networks from around the world. It grew out of a U.S. Defense Department program called ARPANET (Advanced Research Projects Agency Network), established in 1969 with connections between computers at the at http://audioevent.mshow.com/179837. Additionally, for those parties unable to listen at the time of Enzon's conference call, a rebroadcast will be available following the call from Tuesday Tuesday: see week. , August 17, 2004 at approximately 8:30 PM EDT. This rebroadcast will end on Tuesday, August 24, 2004 at midnight. The rebroadcast may be accessed using the following information: Domestic Dial-In Number: 800-642-1687 International Dial-In Number: 706-645-9291 Access Code: 9078442 About Enzon Enzon Pharmaceuticals is a biopharmaceutical company dedicated to the discovery, development and commercialization of therapeutics to treat life-threatening Adj. 1. life-threatening - causing fear or anxiety by threatening great harm; "a dangerous operation"; "a grave situation"; "a grave illness"; "grievous bodily harm"; "a serious wound"; "a serious turn of events"; "a severe case of pneumonia"; "a life-threatening diseases. The Company has developed or acquired a number of marketed products, including PEG-INTRON(R), marketed by Schering-Plough, and ABELCET(R), ONCASPAR(R), ADAGEN(R), and DEPOCYT(R), marketed in North America North America, third largest continent (1990 est. pop. 365,000,000), c.9,400,000 sq mi (24,346,000 sq km), the northern of the two continents of the Western Hemisphere. by Enzon's specialized spe·cial·ize v. spe·cial·ized, spe·cial·iz·ing, spe·cial·iz·es v.intr. 1. To pursue a special activity, occupation, or field of study. 2. sales force. Enzon's science-focused strategy includes an extensive drug development program that leverages the Company's macromolecular mac·ro·mol·e·cule n. A very large molecule, such as a polymer or protein, consisting of many smaller structural units linked together. Also called supermolecule. engineering technology platforms, including PEG peg 1. To fix the price of a new security issue during the issuance period through buying and selling it in the open market in order to ensure that the price in the secondary market will not fall below the offering price. modification and single-chain antibody antibody, protein produced by the immune system (see immunity) in response to the presence in the body of antigens: foreign proteins or polysaccharides such as bacteria, bacterial toxins, viruses, or other cells or proteins. (SCA (Single Connector Attachment) An 80-pin plug and socket used to connect peripherals. With a SCSI drive, it rolls three cables (power, data channel and ID configuration) into one connector for fast installation and removal. (R)) technologies. Internal research and development efforts are complemented by strategic transactions that provide access to additional products and technologies. Enzon has several drug candidates in various stages of development, independently and with partners, including Marqibo(TM) (formerly referred to as Onco TCS), for which a U.S. marketing application is currently being reviewed by 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. for the treatment of relapsed aggressive non-Hodgkin's lymphoma non-Hodg·kin's lymphoma n. Any of various malignant lymphomas characterized by the absence of Reed-Sternberg cells. Non-Hodgkin's lymphoma . Further information about Enzon and this press release can be found on the Company's web site at www.enzon.com. There are 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. contained herein that are not based on historical fact, including without limitation statements containing the words "believes," "may," "plans," "will," "estimates," "continue," "anticipates," "intends," "expects," and similar expressions. An example of this includes the quoted statement above regarding revenue growth, pipeline advancement and the identification of strategic opportunities. Such forward-looking statements involve known and unknown risks, uncertainties and other factors that may cause actual results, events or developments to be materially different from the future results, events or developments discussed above. Such factors include: the risk that Marqibo(TM) (formerly Onco TCS) may not receive regulatory reg·u·late tr.v. reg·u·lat·ed, reg·u·lat·ing, reg·u·lates 1. To control or direct according to rule, principle, or law. 2. approval from the FDA under Subpart Noun 1. subpart - a part of a part component part, part, portion, component, constituent - something determined in relation to something that includes it; "he wanted to feel a part of something bigger than himself"; "I read a portion of the manuscript"; "the H of the Food and Drug Act and the fact that any such approval, if granted, will include post approval commitments; the risks that any or all of Pegamotecan, SS1P and ATG Fresenius S will not successfully progress through clinical studies; and the risk that Enzon will not be able to successfully conclude any strategic transactions with third parties for the acquisition of rights to other products; as well as those described in Enzon'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. and Forms 10-Q on file with the SEC, such as: risks associated with Enzon's ability to successfully launch and market Marqibo(TM) and Enzon's ability to sustain profitability and positive cash flow; risks in obtaining and maintaining regulatory approval for indications and expanded indications for Enzon's products; risks regarding market acceptance of and continuing demand for Enzon's products; risks associated with the timing and results of clinical trials generally; and the impact of competitive products and pricing. These factors should be considered carefully and readers are cautioned not to place undue reliance on such forward-looking statements. All information in this press release is as of August 17, 2004 and the Company undertakes no duty to update this information. (Financial statements to follow)
Enzon Pharmaceuticals, Inc. and Subsidiaries
Consolidated Statements of Operations
Three Months ended June 30, 2004 and 2003
(In thousands, except per share data)
(Unaudited)
June 30, June 30,
2004 2003
-------------------
Revenues:
Net sales $27,258 $23,014
Manufacturing revenue 4,084 3,246
Royalties 11,246 20,024
Contract revenue 262 394
--------- -------
Total revenues 42,850 46,678
--------- -------
Costs and expenses:
Cost of sales and manufacturing revenues 11,792 10,662
Research and development expenses 10,058 6,083
Selling, general and administrative expenses 11,814 9,785
Amortization of acquired intangibles 3,358 3,923
Write-down of carrying value of investments 8,341 --
--------- -------
Total costs and expenses 45,363 30,453
--------- -------
Operating (loss) income (2,513) 16,225
--------- -------
Other income (expense):
Investment income, net 652 512
Interest expense (4,957) (4,957)
Other income 3,789 28,333
--------- -------
(516) 23,888
--------- -------
Income (loss) before taxes (3,029) 40,113
Tax provision (benefit) 4,283 (439)
--------- -------
Net (loss) income ($7,312) $40,552
========= =======
Basic (loss) earnings per common share ($0.17) $0.94
========= ========
Diluted (loss) earnings per common share ($0.17) $0.93
========= =======
Weighted average number of common shares
issued and outstanding - basic 43,394 43,264
========= =======
Weighted average number of common shares issued
and outstanding and dilutive potential common
shares outstanding 43,394 43,609
========= =======
Enzon Pharmaceuticals, Inc. and Subsidiaries
Consolidated Statements of Operations
Twelve months ended June 30, 2004 and 2003
(In thousands, except per share data)
(Unaudited)
June 30, June 30,
2004 2003
----- -----
Revenues:
Net sales $107,922 $59,264
Manufacturing revenue 12,911 8,742
Royalties 47,707 77,589
Contract revenue 1,031 811
--------- ---------
Total revenues 169,571 146,406
--------- ---------
Costs and expenses:
Cost of sales and manufacturing revenues 46,986 28,521
Research and development expenses 34,769 20,969
Acquired in-process research and development 12,000 --
Selling, general and administrative expenses 47,002 30,571
Amortization of acquired intangibles 13,432 9,211
Write-down of carrying value of investments 8,341 27,237
--------- ---------
Total costs and expenses 162,530 116,509
--------- ---------
Operating income 7,041 29,897
--------- ---------
Other income (expense):
Investment income, net 13,396 8,942
Interest expense (19,828) (19,828)
Other income 3,860 26,938
--------- ---------
(2,572) 16,052
--------- ---------
Income before taxes 4,469 45,949
Tax provision 1,592 223
--------- ---------
Net income $2,877 $45,726
========= =========
Basic earnings per common share $0.07 $1.06
========= =========
Diluted earnings per common share $0.07 $1.05
========= =========
Weighted average number of common shares
issued and outstanding - basic 43,350 43,116
========= =========
Weighted average number of common shares
issued and outstanding and dilutive potential
common shares outstanding 43,522 43,615
========= =========
Enzon Pharmaceuticals, Inc. and Subsidiaries
Consolidated Condensed Balance Sheets
June 30, 2004 and June 30, 2003
(In thousands, except share data)
(Unaudited)
June 30, June 30,
2004 2003
--------- ---------
Assets
Current assets:
Cash and short-term investments $118,652 $91,799
Accounts receivable, net 25,977 33,173
Inventory 11,215 11,786
Other current assets 13,402 16,089
--------- ---------
Total current assets 169,246 152,847
Property and equipment, net 34,859 32,593
--------- ---------
Other assets:
Marketable securities 67,582 61,451
Other long-term assets 465,034 481,675
--------- ---------
532,616 543,126
--------- ---------
Total assets $736,721 $728,566
========= =========
Liabilities and Stockholders' Equity
Current and other liabilities $47,435 $36,982
Notes payable 400,000 400,000
Stockholders' equity 289,286 291,584
--------- ---------
Total liabilities and stockholders' equity $736,721 $728,566
========= =========
Common shares outstanding 43,838 43,518
========= =========
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