Emergent BioSolutions Reports Financial Results for Third Quarter and Nine Months Ended September 30, 2020 and Updates Full Year 2020 Guidance – Yahoo…

Posted: November 5, 2020 at 4:55 pm

GAITHERSBURG, Md., Nov. 05, 2020 (GLOBE NEWSWIRE) -- Emergent BioSolutions Inc. (NYSE: EBS) today reported financial results for the three and nine months ended September 30, 2020 and updated its full year 2020 guidance.

Over the last 22 years, Emergent has built a solid business founded on demonstrable strengths in partnering, manufacturing, and integrating value-added M&A, said Robert G. Kramer, president and chief executive officer of Emergent BioSolutions. The strength of our core business and the accelerated growth of our contract development and manufacturing unit validate our strategy to pursue leadership positions across the public health threat market. Our diverse product and service portfolio gives us continued confidence in executing our strategy, delivering on our commitments to our partners and customers, and creating value for our shareholders.

FINANCIAL HIGHLIGHTS (unaudited)

(in millions)

Q3 2020

Q3 2019

$ Change

% Change

Total Revenues

$385.2

$311.8

$73.4

24%

Net Income

$39.5

$43.2

($3.7)

(9)%

Adjusted Net Income (1)

$119.0

$64.8

$54.2

84%

Adjusted EBITDA (1)

$168.1

$106.4

$61.7

58%

(in millions)

YTD 2020

YTD 2019

$ Change

% Change

Total Revenues

$972.4

$745.7

$226.7

30%

Net Income

$119.7

$7.6

$112.1

*

Adjusted Net Income (1)

$225.1

$69.6

$155.5

*

Adjusted EBITDA (1)

$339.5

$145.4

$194.1

*

* % change is greater than 100%

SELECT Q3 2020 BUSINESS ACCOMPLISHMENTS

Completed an offering of $450 million in aggregate principal amount 3.875% Senior Unsecured Notes due in 2028. The Company utilized the proceeds from the offering to repay $353 million outstanding under its revolving credit facility with the remainder to be utilized for general corporate purposes.

Announced the initiation of a Phase 3 clinical trial sponsored by the National Institutes of Health to evaluate the safety, tolerability, and efficacy of hyperimmune globulin products, including the Company's COVID-19 Human Immune Globulin (COVID-HIG), as a potential treatment in adult patients hospitalized with COVID-19.

Announced U.S. Food and Drug Administration (FDA) approval of the shelf life extension of NARCAN (naloxone HCl) Nasal Spray from 24 months to 36 months.

Secured approximately $60 million in new business and existing project extensions across development services, drug substance manufacturing, and drug product manufacturing towards the Company's contract development and manufacturing (CDMO) portfolio.

2020 FINANCIAL PERFORMANCE (unaudited)

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(I) Quarter Ended September 30, 2020 (Q3)

Revenues

Total Revenues

For Q3 2020, total revenues were $385.2 million, an increase of $73.4 million as compared to 2019. Total revenues reflect an increase in contract development and manufacturing services revenues partially offset by a decrease in product sales and contracts and grants revenues.

Product Sales

For Q3 2020, product sales were $202.2 million, a decrease of $54.0 million or 21% as compared to 2019. Other product sales increased due to increased sales of BAT[Botulism Antitoxin Heptavalent (A, B, C, D, E, F, G) - (Equine)] and VIGIV [Vaccinia Immune Globulin Intravenous (Human)] offset by a decline in sales of travel health vaccines.

(in millions)

Three Months Ended September 30,

2020

2019

% Change

Product Sales

NARCAN Nasal Spray

$88.8

$75.0

18%

Anthrax vaccines

$73.9

$40.3

83%

ACAM2000

$1.0

$112.1

(99)%

Other

$38.5

$28.8

34%

Total Product Sales

$202.2

$256.2

(21)%

Contract Development and Manufacturing (CDMO) Services

For Q3 2020, revenue from the Companys contract development and manufacturing operations was $157.1 million, an increase of $137.1 million as compared to 2019. The increase is largely due to the contribution of arrangements across development, drug substance manufacturing, and drug product manufacturing services with industry and government customers.

Contracts and Grants

For Q3 2020, revenue from the Companys development-based contracts and grants was $25.9 million, a decrease of $9.7 million as compared to 2019. The decrease primarily reflects the completion of development activities associated with the AV7909 product candidate in 2019, partially offset by recent new development awards related to the Company's COVID-19 product candidates.

Operating Expenses

Cost of Product Sales and Contract Development and Manufacturing (CDMO) Services

For Q3 2020, cost of product sales and contract development and manufacturing services was $149.0 million, an increase of $41.0 million or 38% as compared to 2019. The increase is primarily due to a charge of $29.9 million associated with contingent consideration liabilities due to the increased expectation that the Company will meet its final sales milestone for NARCAN Nasal Spray, a charge of $13.8 million related to a write-down of inventory balances due to the expected expiration of a portion of the Company's travel health vaccines, and an increase in volume in CDMO services offset by a decline in volume of product sales.

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Emergent BioSolutions Reports Financial Results for Third Quarter and Nine Months Ended September 30, 2020 and Updates Full Year 2020 Guidance - Yahoo...

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