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ALLERGAN REPORTS FOURTH QUARTER AND 1991 YEAR END OPERATING RESULTS FOURTH QUARTER EVENTS SUPPORT STRATEGIC DIRECTION FOR THE 1990s

ALLERGAN REPORTS FOURTH QUARTER AND 1991 YEAR END OPERATING RESULTS
 FOURTH QUARTER EVENTS SUPPORT STRATEGIC DIRECTION FOR THE 1990s
 IRVINE, Calif., Jan. 28 /PRNewswire/ -- Allergan Inc. (NYSE:AGN) today announced sales of $227.5 million for the fourth quarter of 1991 ending on December 31. This represents an increase of 6.3 pct over the fourth quarter of 1990. Net earnings for the fourth quarter were $27.9 million, an increase of 10 pct over 1990. Sales for the full year were $839.3 million, which is 5.7 pct up over 1990. The impact of foreign exchange on sales for the fourth quarter was $7 million unfavorable. Excluding this impact, sales growth for the quarter was 9 pct. The impact of foreign exchange upon sales for the full year was negligible. A net loss of $59.5 million was incurred for the year as a result of a nonrecurring charge recorded in the third quarter. Net earnings for the year excluding the nonrecurring charge were $89.1 million or 9 pct greater than 1990. In the fourth quarter, the company completed the divestiture of its Humphrey Instruments division, which is presented in the company's financial results as a discontinued operation. Earnings per share for the fourth quarter and full year were $0.41 and $(0.89), respectively. Excluding the nonrecurring charge, earnings per share for the full year would have been $1.33. Allergan's Board of Directors approved a fourth quarter dividend of $0.09 per share, payable March 10, 1992, to stockholders of record on February 17, 1992.
 Commenting on the changes in the fourth quarter and full year, William C. Shepherd, President and Chief Executive Officer said, "1991 was a productive year for the company. Although sales growth was modest, our efforts in the areas of cost containment led to improved margins which helped us achieve our earnings objectives. Our positive cash flow resulted in net debt of $17.7 million at year end. We implemented our organizational realignment and took some major steps toward reducing our selling, general and administrative expenses. We sold our diagnostic instrument business to Carl Zeiss of Germany. Our decision to reduce investments in the contact lens business fundamentally relates to resource allocation; our investments will be focused on opportunities that are more closely aligned with our core strengths and that enhance shareholder value. We increased our investment in Research and Development (R&D) and focused more attention on licensing, acquisition and strategic alliance opportunities."
 Worldwide Business Performance
 Worldwide sales for the specialty pharmaceutical businesses (eye and skin care) were $354.2 million for the full year 1991 -- a $43.6 million or 14.0 pct increase over 1990. Ophthalmic pharmaceutical sales were $317.7 million for the full year 1991, representing a $40.3 million or 14.5 pct increase over 1990 results. Non-U.S. sales grew slightly faster than domestic sales. Included in the ophthalmic pharmaceutical sales, OCULINUM/BOTOX injectable was $12.6 million or 100 pct increase over 1990 results. Sales for Allergan Herbert, the skin care division, were $36.5 million for the full year 1991. Excluding manufacturing contracts, sales increased 14 pct over 1990 results. Allergan Herbert's top three products GRIS-PEG tablets, ELIMITE cream, and NAFTIN cream represent over 50 pct of the division's sales and increased approximately 35 pct over 1990 results, but were offset by a decline in PHOTOPLEX sunscreen sales due to a slow market and a decline in contract manufacturing.
 Worldwide sales for the ophthalmic surgical business were $108.2 million for the full year 1991 -- a $2.9 million or 2.6 pct decrease over 1990. The sales growth was limited in the U.S. market due to accelerated intraocular lens (IOL) price erosion. ARRAY, a true multifocal IOL, is in clinical trials in Japan, Canada, Europe and the U.S. It has been implanted in 50 patients in the U.S. and over 100 patients in Europe. In the U.S., patients will be followed for one year before expanded clinicals can begin. Product launches in certain European markets are planned for 1992.
 Worldwide sales for the contact lens wear business were $376.9 million for the full year 1991 -- a $4.2 million or 1.1 pct increase over 1990. Domestic lens wear sales were down from 1990 results. Conditions within the U.S. contact lens wear market continue to be adversely impacted by lack of growth in contact lens new fits and competitive pressure, including disposable and frequent replacement lenses and the acceptance of one-bottle disinfection systems. UltraCare, Allergan's one-step hydrogen peroxide disinfection system, was filed with the FDA for U.S. marketing approval in December 1990. A one-bottle "cold chemical" disinfection system for soft contact lenses has been filed with the FDA for U.S. marketing approval and should be launched in certain foreign markets in 1992.
 Product Pipeline Update
 Shepherd commented on Allergan's investment of $74.5 million on R&D projects in 1991, an increase of $5.5 million over 1990. "This increased investment in research, development, in-licensing and acquisition activities is to fund future technologies and products in specialty pharmaceuticals, ophthalmic surgical devices and contact lens wear products. A tangible symbol of this commitment can be seen in the progress being made on our new R&D building. Construction on this $40 million 153,000 square foot state-of-the-art facility is ahead of schedule."
 Specialty Pharmaceuticals Products
 ACULAR (AGN191578), ophthalmic topical ketorolac, is in the later stages of FDA review for relief of ocular itching and inflammation from allergic conjunctivitis.
 OCULINUM/BOTOX (AGN191622), an injectable for cervical dystonia, a debilitating condition that can cause the head to become locked to one side as a result of neck muscle spasms, was filed with the FDA for U.S. marketing approval last March. Phase III clinical trials began last December for dynamic contractions of leg muscles associated with juvenile cerebral palsy.
 OFLOX (AGN190442), a topical ofloxacin used for ophthalmic infection, was filed with the FDA for U.S. marketing approval almost two years ago.
 BETAGAN/PROPINE combination formulation (AGN101291-A-L/AGN102208) for chronic treatment of glaucoma, a sight threatening eye disorder typically associated with increased pressure in the eye that could lead to blindness, is in extended Phase III clinical trials in the U.S.
 Alpha-2 Agonist (AGN190342), for the chronic treatment of glaucoma as an inflow suppressant, is in Phase III clinical trials in the U.S.
 Prostaglandin compounds, for the chronic treatment of glaucoma working by outflow regulation, are in preclinical trials in the U.S.
 OCUFEN (AGN101289), used for cystoid macular edema (CME) prevention, recently completed Phase III clinical trials in the U.S. and an application for U.S. marketing approval is expected to be filed with the FDA in February.
 Topical Retinoid (AGN190168), one of Allergan's developed and patented compounds, has shown promising activity in Phase II clinical trials both for acne, an inflammatory disease of sebaceous glands and hair follicles, and for psoriasis, a chronic skin disease characterized by inflammation of the skin and the hyper-growth development of white, scaly patches.
 SKINOREN (AGN191861), a prescription product for acne, is marketed in Europe by Schering A.G. and licensed to Allergan Herbert for Canada and the U.S. markets. SKINOREN is in Phase III clinical trials in the U.S. and will soon be filed in Canada.
 A Super "Soft" Topical Steroid (AGN191743), licensed from Syntex, is being developed for psoriasis, atopic dermatitis or other steroid- responsive dermatoses. Preclinical studies indicate equivalency to current super potent steroids at the disease site, but with potential for reduced side effects.
 Ophthalmic Surgical Products
 ARRAY, a true multifocal IOL, is in clinical trials in Japan, Canada, Europe and the U.S.
 Contact Lens Wear Products
 A one-bottle "cold chemical" disinfection system for soft contact lenses has been filed with the FDA for U.S. marketing approval and should be launched in certain foreign markets in 1992.
 An improved one-bottle disinfection system is scheduled to begin clinical trials during the first half of 1992. This system is designed to provide the superior efficacy of a hydrogen peroxide system with the convenience of the one-bottle systems on the market today.
 Additional Financial Details
 A major objective for the company in 1991 was to improve profitability during the period of slower sales growth as compared with prior years.
 The results of programs implemented to address this issue were evident throughout the year. In the fourth quarter of 1991, the company's gross profit margin, expressed as a ratio to sales, increased to 70.5 pct as compared with 66.1 pct for the fourth quarter of 1990. For the full year 1991, Allergan's gross profit margin was 69.9 pct as compared with 67.1 pct for 1990. This margin improvement reflects the positive results of various plant consolidation programs, expense controls, and product mix differences between the periods compared.
 Operating income for the fourth quarter increased 2 pct over the prior comparable quarter to $32.4 million. This includes the impact of $2.7 million in costs related to the company's reorganization and headcount reduction program. On a ratio to sales basis, the company's operating income margin expressed as a percent to sales, excluding the reorganization costs, improved to 15.4 pct from 14.9 pct in the fourth quarter of 1990. On an annual basis and adjusted for $8.1 million of reorganization costs, as well as the third quarter nonrecurring charge, the company's operating income margin improved to 15.6 pct from 13.9 pct.
 The company further leveraged earnings through lower net interest expense. This was the result of both favorable rate trends and continuing strong cash flow. Total debt at year-end 1991 was $145 million, which represents a $45 million reduction from year-end 1990 levels.
 Allergan, Inc., headquartered in Irvine, California, is a global provider of specialty therapeutic products, and is now expanding beyond skin care and its leadership position in eye care.
 The following tables represent unaudited condensed consolidated statements of income, condensed consolidated balance sheets, and a statement of sales by business segment.
 ALLERGAN, INC.
 Condensed Consolidated Statements of Income
 (Unaudited)
 in millions, Three Months Twelve Months
 except Ended December 31, Ended December 31,
 per share
 pct Inc pct Inc
 1991 1990 (Dec) 1991 1990 (Dec)
 Net Sales $227.5 $214.0 6 pct $839.3 $794.4 6 pct
 Costs and
 expenses
 Cost of sales 67.2 72.6 252.5 261.0
 Selling,
 general and
 administrative 105.8 90.7 389.4 353.8
 Research &
 development 22.1 18.8 74.5 69.0
 Nonrecurring
 charge - - 164.5 -
 Operating
 Income 32.4 31.9 2 pct (41.6) 110.6 --
 Interest and
 other, net 0.7 (4.3) (6.6) (11.0)
 Total costs
 and expenses 194.4 186.4 887.5 694.8
 Earnings from
 continuing
 operations
 before income
 taxes and
 minority
 interest 33.1 27.6 (48.2) 99.6
 Provision for
 income taxes 6.6 5.3 9.6 22.0
 Minority
 interest 0.8 - 3.6 -
 Earnings from
 continuing
 operations 25.7 22.3 15 pct (61.4) 77.6 --
 Discontinued
 operations:
 Earnings from
 operations,
 net of
 income taxes 1.7 3.0 1.4 3.8
 Gain on
 disposal,
 net of
 income taxes 0.5 - 0.5 -
 Net Earnings $ 27.9 $ 25.3 10 pct $(59.5) $ 81.4 --
 Net earnings per
 common share:
 Continuing
 operations $ 0.38 $ 0.33 $ (0.92) $ 1.15
 Discontinued
 operations
 Earnings
 from
 operations 0.02 0.05 0.02 0.06
 Gain on
 disposal 0.01 - 0.01 -
 $ 0.41 $ 0.38 $ (0.89) $ 1.21
 Weighted average
 number of
 common shares
 outstanding 67.6 67.3 67.2 67.4
 ALLERGAN, INC.
 Condensed Consolidated Balance Sheets
 (Unaudited)
 in millions December 31, December 31,
 1991 1990
 Assets
 Cash and equivalents $127.4 $ 84.4
 Trade receivables, net 164.6 189.6
 Inventories 93.1 122.7
 Other current assets 37.3 34.5
 Total current assets 422.4 431.2
 Property, plant and equipment, net 237.2 231.0
 Other noncurrent assets 174.0 284.9
 Total assets $833.6 $947.1
 Liabilities and stockholders' equity
 Notes payable $ 47.9 $ 42.1
 Accounts payable 48.0 53.7
 Accrued liabilities and income taxes 173.2 160.0
 Total current liabilities 269.1 255.8
 Long-term debt 97.2 148.0
 Other liabilities 11.4 19.4
 Minority interest 11.0 -
 Stockholders' equity 444.9 523.9
 Total liabilities and stockholders'
 equity $833.6 $947.1
 ALLERGAN, INC.
 Net Sales by Division
 (Unaudited)
 Three Months Twelve Months
 in millions Ended December 31, Ended December 31,
 1991 1990 1991 1990
 Specialty Pharmaceuticals
 Eye Care $ 85.8 $ 73.6 $317.7 $277.4
 Skin Care 12.4 12.3 36.5 33.2
 98.2 85.9 354.2 310.6
 Surgical 29.7 33.0 108.2 111.1
 Optical 99.6 95.1 376.9 372.7
 TOTAL NET SALES $227.5 $214.0 $839.3 $794.4
 Domestic 47 pct 52 pct 49 pct 54 pct
 International 53 pct 48 pct 51 pct 46 pct
 -0- 1/28/92
 /CONTACT: Shel Holtz (media), 714-752-4387, or 818-366-5296 (home), or Jeff D'Eliscu (investors), 714-752-4636, or 714-675-9475 (home), both of Allergan/ CO: Allergan Inc. ST: California IN: MTC SU: ERN


AL -- LA026 -- 4486 01/28/92 18:30 EST
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