Mylan Reports Record Quarterly Earnings of $0.33 Per Diluted Share; Record Revenues and Net Earnings also Reported, as well as Another Record Quarter for the Generic Segment.Business Editors/Health/Medical Writers PITTSBURGH--(BUSINESS WIRE)--Oct. 29, 2003 Mylan Laboratories Inc. (NYSE NYSE See: New York Stock Exchange :MYL MYL Mind Your Language MYL Made You Laugh MYL Miss You Lots MYL Meet You Later MYL Miss You Loads ) Quarterly Financial Highlights -- Record 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 of $0.33 ($0.50 on a pre-split basis). -- Net revenues increased 13% to a record $360.1 million. -- Net earnings increased 34% to a record $91.3 million. -- A three-for-two stock split was effected on October October: see month. 8, 2003. Mylan Laboratories Inc. (NYSE:MYL) today announced financial results for the second quarter ended September September: see month. 30, 2003, which included record diluted earnings per share, net revenues and net earnings. The quarter was driven by a strong performance from the Generic Generic Describes the characteristics and/or experience of the total universe of a coupon of MBS sector type; that is, in contrast to a specific pool or collateral group, as in a specific CMO issue. Segment which contributed net revenues of $299.5 million, a record quarter for that segment, as well as improved results from the Brand Segment. Overall, revenues for the second quarter increased 13% to $360.1 million from $319.5 million a year ago. Diluted earnings per share for the second quarter were $0.33 compared to $0.24 for the second quarter of fiscal 2003, an increase of 38%. For the six months ended September 30, 2003, diluted earnings per share were $0.63 compared to $0.46 in the same prior year period, an increase of 37%. Included in the results for the six months ended September 30, 2003 are gains on legal settlements which amounted, net of tax, to approximately ap·prox·i·mate adj. 1. Almost exact or correct: the approximate time of the accident. 2. $0.05 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. All share and per share amounts in this press release have been adjusted to reflect the three-for-two stock split which was effected on October 8, 2003. Net earnings for the quarter increased 34% to $91.3 million from $68.2 million in the same prior year period. For the six months, net earnings increased 35% to $175.1 million in fiscal 2004, compared to $130.1 million in fiscal 2003. "We achieved the best quarter in the Company's history," commented 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. J. Coury, Vice Chairman and Chief Executive Officer. "Clearly the strength of the quarter was driven by our Generic business and the recent launch of omeprazole omeprazole /omep·ra·zole/ (o-mep´ra-zol) an inhibitor of gastric acid secretion used in the treatment of dyspepsia , gastroesophageal reflux disease, disorders of gastric hypersecretion, and peptic ulcer, including that associated with . While omeprazole has been a focus of recent attention, it is just one of a number of opportunities that we see contributing to our current and future success, and is a continuation continuation - continuation passing style of our commitment to bring to the market quality and affordable products." Second quarter net revenues for the Generic Segment increased 9% or $25.2 million, which included $68.6 million from products launched subsequent to September 30, 2002, largely due to omeprazole. Brand Segment net revenues for the second quarter were $60.6 million, an increase of 34% or $15.3 million from the same prior year period. For the six months ended September 30, 2003, net revenues increased 16% or $96.5 million to $691.5 million from $595.0 million for the six months ended September 30, 2002. Generic Segment revenues were $554.7 million, an increase of 9% over the same prior year period, while Brand Segment revenues increased 61% to $136.8 million.
Segment Information
-------------------
Three Months Ended Six Months Ended
September 30, September 30,
------------------------ ------------------------
2003 2002 Change 2003 2002 Change
Net Revenues (in
millions):
Generic Segment $299.5 $274.3 9% $554.7 $509.9 9%
Brand Segment 60.6 45.3 34% 136.8 85.1 61%
------- ------- ------- -------
Total $360.1 $319.5 13% $691.5 $595.0 16%
Generic Segment Net revenues for the quarter increased 9% or $25.2 million to $299.5 million from $274.3 million for the same prior year period. This increase is the result of $68.6 million from products launched subsequent to September 30, 2002, largely due to omeprazole, offset in part by changes in the portfolio mix. Gross profit for the quarter increased $29.3 million to $169.2 million from $139.9 million, while earnings from operations increased $26.4 million to $147.1 million from $120.7 million in the same prior year period. The increase in earnings from operations was driven primarily by the higher gross profit, partially offset by increased research and development expense from the continued expansion of the development platform. For the six months ended September 30, 2003, net revenues increased $44.8 million or 9% to $554.7 million from $509.9 million. New products launched subsequent to September 30, 2002 contributed net revenues of $74.4 million. Gross profit for the year-to-date Year-to-date (YTD) The period beginning at the start of the calendar year up to the current date. period was $307.7 million compared to $264.4 million in fiscal 2003, an increase of $43.3 million. Operating income Operating Income The profit realized from a business' own operations. Notes: This would not include income from things such as investments in other firms. Also referred to as operating profit or recurring profit. for the six month period increased by 17% or $37.6 million to $264.7 million from $227.1 million. The increase in operating income was driven by the increased gross profit partially offset by higher research and development expenses. Brand Segment For the second quarter, the Brand Segment reported net revenues of $60.6 million, an increase of 34% or $15.3 million from $45.3 million in the same prior year period. Over 50% of the increase in Brand Segment net revenues resulted from Amnesteem, which was launched in late fiscal 2003, with the remainder attributable attributable emanating from or pertaining to attribute. attributable proportion see attributable risk (below). attributable risk to growth in the existing portfolio of products. Gross profit for the second quarter increased $11.6 million or 43% to $38.5 million from $26.9 million. Earnings from operations were $11.7 million compared to $1.1 million in the same quarter of the prior year. The increase was primarily attributable to the increase in gross profit. For the six months ended September 30, 2003, net revenues increased 61% or $51.7 million to $136.8 million from $85.1 million. Amnesteem accounted for approximately 70% of this increase. The remainder of the increase was the result of continued growth in the existing product portfolio. Gross profit for the first six months of fiscal 2004 was $77.5 million, an increase of $27.5 million or 55% from $50.0 million in fiscal 2003. Earnings from operations were $21.5 million compared to $0.7 million. The improvement in earnings from operations was the result of increased gross profit partially offset by higher research and development expenses, primarily due to on-going Adj. 1. on-going - currently happening; "an ongoing economic crisis" ongoing current - occurring in or belonging to the present time; "current events"; "the current topic"; "current negotiations"; "current psychoanalytic theories"; "the ship's current position" studies related to nebivolol Nebivolol is a highly cardioselective vasodilatory beta1 receptor blocker used in treatment of hypertension. In most countries, this medication is available only by prescription. . Corporate/Other General and administrative expenses for the second quarter of fiscal 2004 were $24.7 million, an increase of $7.8 million from the same prior year period. For the six months ended September 30, 2003, general and administrative expenses were $46.7 million, an increase of $18.6 million from the same prior year period. The increases for both the three and six month periods were primarily due to increased legal costs and other costs related to the Company's continued investment in its infrastructure. Other income for the second quarter was $7.4 million which included a gain of $5.0 million on the sale of an office building. For the year-to-date period, other income was $10.5 million compared to $3.6 million in fiscal 2003. Fiscal 2004 Earnings Guidance Mylan reaffirms its fiscal 2004 earnings guidance of $1.11 to $1.18 per diluted share ($1.67 to $1.77 per diluted share on a pre-split basis). Conference Call and Live Webcast Mylan will host a conference call and live webcast to discuss its second quarter earnings on Thursday Thursday: see week. , October 30, at 10:00 a.m. ET. The dial-in number to access the live call is 719-457-2629. In addition to the live call, a replay will be available from approximately noon ET on October 30, through noon ET on November November: see month. 6, and can be accessed by dialing 719-457-0820 with access pass code 731067. To access the live webcast, go to Mylan's Web site at www.mylan.com and click on the webcast icon at least 15 minutes before the call is to begin to register and download To receive a file transmitted over a network. In any communications session, "download" means receive, and "upload" means send. The download/upload often implies a big/little scenario, in which data is being downloaded from the "big" server into the "little" user's computer. or install any necessary audio software. If you are unable to listen to the live webcast, please access www.mylan.com at any time within seven days to listen to a replay of the webcast. 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. This press release includes statements that constitute "forward-looking statements," including with regard to the Company's opportunities and future success; the Company's commitment to bring quality and affordable products to the market; and the Company's fiscal 2004 earnings guidance. These statements 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. Because such statements inherently involve risks and uncertainties, actual future results may differ materially from those expressed or implied Inferred from circumstances; known indirectly. In its legal application, the term implied is used in contrast with express, where the intention regarding the subject matter is explicitly and directly indicated. by such forward-looking statements. Factors that could cause or contribute to such differences include, but are not limited to: -- the Company's ability to successfully develop, license or otherwise acquire and introduce new products on a timely basis in relation to competing product introductions; -- the Company's ability to obtain required 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. approvals for new products on a timely basis; -- uncertainties regarding continued market acceptance of and demand for the Company's products; -- the Company's periodic dependence on a relatively small group of products as a significant source of its net revenue or net income; -- the effects of vigorous competition on commercial acceptance of the Company's products and their pricing; -- the high cost and uncertainty associated with compliance with extensive regulation of the pharmaceutical industry; -- the significant research and development expenditures the Company makes to develop products, the commercial success of which is uncertain; -- the possible loss of business from the Company's concentrated customer base; -- the potential costs and product introduction delays that may result from use of legal, 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. and legislative strategies by the Company's competitors COMPETITORS, French law. Persons who compete or aspire to the same office, rank or employment. As an English word in common use, it has a much wider application. Ferriere, Dict. de Dr. h.t. ; -- the Company's dependence on third-party suppliers and distributors for the raw materials, particularly the chemical compound(s) which produces the desired therapeutic effect, 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. the Company uses to manufacture its products; -- the possible negative effects of any interruption INTERRUPTION. The effect of some act or circumstance which stops the course of a prescription or act of limitation's. 2. Interruption of the use of a thing is natural or civil. of manufacturing of the Company's generic products at its principal facility; -- the effects of consolidation of the Company's customer base; -- uncertainties regarding patent, intellectual and other proprietary property protections; -- the expending of substantial resources associated with 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. involving patent or other intellectual property protection of competing products; -- possible reductions in reimbursement Reimbursement Payment made to someone for out-of-pocket expenses has incurred. rates for pharmaceutical products; -- possible negative effect on product pricing of current or future legislative or regulatory programs; -- the Company's exposure to lawsuits and contingencies Contingencies (ISSN 1048-9851) is the bimonthly magazine of the American Academy of Actuaries, providing a large and diverse readership with general interest and technical articles on a wide range of issues related to the actuarial profession. associated with its business; -- uncertainties regarding the Company's performance under indemnification Indemnification Used in insurance policy agreements as to compensation for damage or loss. In the context of corporate governance, Director Indemnification uses the bylaws and/or charter to indemnify officers and directors from certain legal expenses and judgements resulting from clauses in certain material agreements; -- the Company's exposure to risks inherent in acquisitions or joint ventures; -- the Company's ability to attract and retain key personnel; -- possible adverse effects resulting from any significant decline in the value of securities that the Company holds or from uninsured losses of funds; -- uncertainties and matters beyond the control of management, which could affect the Company's earnings guidance, as well as the subjectivity sub·jec·tive adj. 1. a. Proceeding from or taking place in a person's mind rather than the external world: a subjective decision. b. inherent in any probability probability, in mathematics, assignment of a number as a measure of the "chance" that a given event will occur. There are certain important restrictions on such a probability measure. weighted analysis underlying the Company's assumptions and estimates with respect to the future; and -- inherent uncertainties involved in the estimates and judgments used in the preparation of financial statements 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 GAAP GAAP See: Generally Accepted Accounting Principles GAAP See generally accepted accounting principles (GAAP). and related standards. The cautionary statements referred to above should be considered in connection with any subsequent written or oral forward-looking statements that may be made by the Company or by persons acting on its behalf and in conjunction conjunction, in astronomy conjunction, in astronomy, alignment of two celestial bodies as seen from the earth. Conjunction of the moon and the planets is often determined by reference to the sun. with its periodic SEC filings. In addition, please refer to the cautionary statements and risk factors in Item I of the Company'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. for the year ended March 31, 2003, as well as those contained in the Company's Form 10-Q Form 10-Q See 10-Q. for the period ended June June: see month. 30, 2003. The Company undertakes no duty to update its forward-looking statements, even though its situation may change in the future. Mylan Laboratories Inc. is a leading pharmaceutical company with four subsidiaries, Mylan Pharmaceuticals Inc., Mylan Technologies Inc., UDL UDL Universal Design for Learning UDL Universitat de Lleida (Spain) UDL Universal Data Link UDL Urban Debate League UDL Uniformly Distributed Load (mechanics, building trade) UDL User Defined Logic Laboratories, Inc. and Bertek Pharmaceuticals Inc., that develop, manufacture and market an extensive line of generic and proprietary products. For more information about Mylan, visit www.mylan.com.
MYLAN LABORATORIES INC. AND SUBSIDIARIES
Condensed Consolidated Statements of Earnings
(unaudited; in thousands, except per share amounts)
Three Months Ended Six Months Ended
September September September September
30, 2003 30, 2002 30, 2003 30, 2002
---------- ---------- ---------- ----------
Net revenues $ 360,060 $ 319,539 $ 691,468 $ 595,012
Cost of sales 152,352 152,807 306,331 280,678
---------- ---------- ---------- ----------
Gross profit 207,708 166,732 385,137 314,334
Operating expenses:
Research and development 23,946 20,169 48,685 37,012
Selling and marketing 17,274 16,538 35,110 33,425
General and
administrative 32,312 25,030 61,920 44,251
Litigation settlements - - (21,669) -
---------- ---------- ---------- ----------
Total operating expenses 73,532 61,737 124,046 114,688
---------- ---------- ---------- ----------
Earnings from operations 134,176 104,995 261,091 199,646
Other income, net 7,428 1,613 10,533 3,601
---------- ---------- ---------- ----------
Earnings before income
taxes 141,604 106,608 271,624 203,247
Provision for income
taxes 50,326 38,379 96,483 73,169
---------- ---------- ---------- ----------
Net earnings $ 91,278 $ 68,229 $ 175,141 $ 130,078
========== ========== ========== ==========
Earnings per common
share:
Basic $ 0.34 $ 0.24 $ 0.65 $ 0.46
========== ========== ========== ==========
Diluted $ 0.33 $ 0.24 $ 0.63 $ 0.46
========== ========== ========== ==========
Weighted average common
shares:
Basic 268,644 282,064 269,432 282,727
========== ========== ========== ==========
Diluted 276,424 285,248 276,276 285,448
========== ========== ========== ==========
MYLAN LABORATORIES INC. AND SUBSIDIARIES
Condensed Consolidated Balance Sheets
(unaudited; in thousands)
Sept. 30, March 31,
2003 2003
------------ ------------
Assets:
Current assets:
Cash and cash equivalents $ 194,145 $ 258,902
Marketable securities 444,207 427,904
Accounts receivable, net 232,479 187,587
Inventories 290,742 237,777
Other current assets 113,770 116,041
------------ ------------
Total current assets 1,275,343 1,228,211
Non-current assets 525,029 517,012
------------ ------------
Total assets $ 1,800,372 $ 1,745,223
============ ============
Liabilities:
Current liabilities $ 227,636 $ 265,771
Non-current liabilities 39,411 33,120
------------ ------------
Total liabilities 267,047 298,891
Total shareholders' equity 1,533,325 1,446,332
------------ ------------
Total liabilities and shareholders' equity $ 1,800,372 $ 1,745,223
============ ============
MYLAN LABORATORIES INC. AND SUBSIDIARIES
Segment Results
(unaudited; in thousands)
Three Months Ended Six Months Ended
September September September September
30, 2003 30, 2002 30, 2003 30, 2002
---------- ---------- ---------- ----------
Consolidated:
Net revenues $ 360,060 $ 319,539 $ 691,468 $ 595,012
Cost of sales 152,352 152,807 306,331 280,678
---------- ---------- ---------- ----------
Gross profit 207,708 166,732 385,137 314,334
Research and development 23,946 20,169 48,685 37,012
Selling and marketing 17,274 16,538 35,110 33,425
General and
administrative 32,312 25,030 61,920 44,251
Litigation settlements - - (21,669) -
---------- ---------- ---------- ----------
Earnings from
operations $ 134,176 $ 104,995 $ 261,091 $ 199,646
========== ========== ========== ==========
Generic Segment:
Net revenues $ 299,483 $ 274,281 $ 554,711 $ 509,926
Cost of sales 130,271 134,409 247,044 245,571
---------- ---------- ---------- ----------
Gross profit 169,212 139,872 307,667 264,355
Research and development 14,154 10,873 27,641 20,887
Selling and marketing 2,761 2,551 5,517 5,299
General and
administrative 5,164 5,701 9,855 11,099
---------- ---------- ---------- ----------
Earnings from
operations $ 147,133 $ 120,747 $ 264,654 $ 227,070
========== ========== ========== ==========
Brand Segment:
Net revenues $ 60,577 $ 45,258 $ 136,757 $ 85,086
Cost of sales 22,081 18,398 59,287 35,107
---------- ---------- ---------- ----------
Gross profit 38,496 26,860 77,470 49,979
Research and development 9,792 9,296 21,044 16,125
Selling and marketing 14,513 13,987 29,593 28,126
General and
administrative 2,468 2,450 5,371 5,015
---------- ---------- ---------- ----------
Earnings from
operations $ 11,723 $ 1,127 $ 21,462 $ 713
========== ========== ========== ==========
Corporate/Other:
General and
administrative $ 24,680 $ 16,879 $ 46,694 $ 28,137
Litigation settlements - - (21,669) -
---------- ---------- ---------- ----------
Loss from operations $ (24,680) $ (16,879) $ (25,025) $ (28,137)
========== ========== ========== ==========
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