Emergent BioSolutions Inc. (NYSE: EBS) today reported financial
results for the third quarter ended September 30, 2024.
"Through disciplined execution and steady,
measurable progress, Emergent's financial position is the strongest
it has been since 2021 as evidenced by our favorable third-quarter
results," said CEO Joe Papa. "We have successfully improved
efficiencies and refocused our operations related to customer
demand, generated value in our core medical countermeasures and
NARCAN® Nasal Spray businesses and refinanced our debt leading to
increased revenue and cash flow."
Papa continued, "Based on the success of our
efforts since the beginning of this year, we are officially
entering the turnaround phase of our multi-year transformation
plan, and we will be focused on driving profitable growth,
continued operational improvements and the generation of
sustainable value for shareholders. We believe ongoing public
health crises like the opioid overdose epidemic and mpox outbreak
underscore the need for Emergent's capabilities and expertise. It
is not if, but when, the next public health threat emerges, and we
believe we are uniquely qualified to help respond to protect,
enhance and save lives."
FINANCIAL HIGHLIGHTS(1)
Q3 2024 vs. Q3
2023
| ($ in millions, except per
share amounts) |
Q3 2024 |
Q3 2023 |
% Change |
|
Total Revenues |
$ |
293.8 |
|
$ |
270.5 |
|
9 |
% |
| Net Income (Loss) |
$ |
114.8 |
|
$ |
(263.4 |
) |
144 |
% |
| Net Income (Loss) per Diluted
Share |
$ |
2.06 |
|
$ |
(5.08 |
) |
141 |
% |
| Adjusted Net Income
(Loss)(2) |
$ |
76.2 |
|
$ |
(56.2 |
) |
236 |
% |
| Adjusted Net Income (Loss) per
Diluted Share(2) |
$ |
1.37 |
|
$ |
(1.09 |
) |
226 |
% |
| Adjusted EBITDA(2) |
$ |
105.3 |
|
$ |
19.8 |
|
432 |
% |
| Total Segment Gross Margin
%(2) |
|
57 |
% |
|
33 |
% |
|
| Total Segment Adjusted Gross
Margin %(2) |
|
59 |
% |
|
38 |
% |
|
| |
|
|
|
|
|
|
|
Year to Date (“YTD”)
2024 vs. YTD 2023
| ($ in millions, except per
share amounts) |
YTD 2024 |
YTD 2023 |
% Change |
|
Total Revenues |
$ |
848.9 |
|
$ |
772.7 |
|
10 |
% |
| Net Loss |
$ |
(159.3 |
) |
$ |
(711.0 |
) |
78 |
% |
| Net Loss per Diluted
Share |
$ |
(3.03 |
) |
$ |
(13.97 |
) |
78 |
% |
| Adjusted Net Loss(2) |
$ |
(14.7 |
) |
$ |
(273.0 |
) |
95 |
% |
| Adjusted Net Loss per Diluted
Share(2) |
$ |
(0.28 |
) |
$ |
(5.36 |
) |
95 |
% |
| Adjusted EBITDA(2) |
$ |
162.1 |
|
$ |
(25.7 |
) |
731 |
% |
| Total Segment Gross Margin
%(2) |
|
32 |
% |
|
31 |
% |
|
| Total Segment Adjusted Gross
Margin %(2) |
|
46 |
% |
|
33 |
% |
|
| |
|
|
|
|
|
|
|
SELECT Q3 2024 BUSINESS
UPDATES
- Secured a new Term Loan for $250 million with OHA Agency, LLC
as administrative agent.
- Closed on a new asset backed loan facility for $100 million
with Wells Fargo Bank, National Association.
- Received $75 million for the sale of our RSDL® (Reactive Skin
Decontamination Lotion) product to a subsidiary of SERB
Pharmaceuticals ("SERB"), subject to customary adjustments based on
inventory value at closing
- Completed the sale of the Baltimore-Camden manufacturing site
for $35 million, including customary post-closing adjustments
- Sold an underutilized warehouse at our Canton, MA facility for
$7 million
- Received $50 million in the third quarter related to the
resolution of the contractual dispute with Janssen Pharmaceuticals,
Inc.
- Earned $30 million development milestone payments from Bavarian
Nordic as part of the sale of the Travel Health Business
THIRD QUARTER 2024 FINANCIAL
PERFORMANCE(1)
Revenues
The Company uses the following categories in
discussing product/service level revenues:
- NARCAN® — comprises contributions from NARCAN®
Nasal Spray
- Anthrax MCM — comprises contributions from
CYFENDUS®, previously known as AV7909, BioThrax®, Anthrasil® and
Raxibacumab
- Smallpox MCM — comprises contributions from
ACAM2000®, VIGIV and TEMBEXA®
- Other Products — comprises contributions from
BAT® and RSDL®
- Bioservices — comprises service and lease
revenues from the Bioservices business
| ($ in millions) |
Q3 2024 |
Q3 2023 |
% Change |
| Product sales,
net:(3) |
|
|
|
|
NARCAN® |
$ |
95.3 |
$ |
142.1 |
(33)% |
|
Anthrax MCM |
|
11.4 |
|
32.9 |
(65)% |
|
Smallpox MCM |
|
132.7 |
|
24.7 |
437% |
|
Other Products |
|
30.1 |
|
50.1 |
(40)% |
|
Total Product sales, net |
$ |
269.5 |
$ |
249.8 |
8% |
| |
|
|
|
|
Bioservices: |
|
|
|
|
Services |
$ |
13.9 |
$ |
13.2 |
5% |
|
Leases |
|
0.4 |
|
1.0 |
(60)% |
|
Total Bioservices revenues |
$ |
14.3 |
$ |
14.2 |
1% |
| |
|
|
|
| Contracts and
grants |
$ |
10.0 |
$ |
6.5 |
54% |
| |
|
|
|
|
Total revenues |
$ |
293.8 |
$ |
270.5 |
9% |
Products Sales, net
NARCAN®
For Q3 2024, revenues from NARCAN® (naloxone
HCl) Nasal Spray decreased $46.8 million, or 33%, as compared
with Q3 2023. The decrease was primarily driven by the
discontinuation of prescription NARCAN® due to the launch of
over-the-counter (“OTC”) NARCAN® in the third quarter of 2023 and
lower Canadian retail sales, partially offset by higher sales of
OTC NARCAN®.
Anthrax MCM
For Q3 2024, revenues from Anthrax MCM products
decreased $21.5 million, or 65%, as compared with Q3 2023. The
decrease reflects the impact of timing of sales related to
CYFENDUS® and Anthrasil®, partially offset by an increase in
BioThrax® sales, due to timing. Anthrax vaccine product sales are
primarily made under annual purchase options exercised by the U.S.
government (the “USG”). Fluctuations in revenues result from the
timing of the exercise of annual purchase options, the timing of
USG purchases, the availability of governmental funding and the
Company’s delivery of orders that follow.
Smallpox MCM
For Q3 2024, revenues from Smallpox MCM products
increased $108.0 million, or 437%, as compared with Q3 2023.
The increase was primarily due to timing of USG purchases of
ACAM2000® and VIGIV. Fluctuations in revenues from Smallpox MCM
result from the timing of the exercise of annual purchase options
in the existing procurement contracts, the timing of USG purchases,
the availability of governmental funding and Company delivery of
orders that follow.
Other Products
For Q3 2024, revenues from Other Product sales
decreased $20.0 million, or 40%, as compared with Q3 2023. The
decrease was due to lower product sales of BAT®, due to timing of
deliveries, and lower product sales of RSDL®, which was sold to
SERB during the third quarter of 2024.
Bioservices Revenues
Services
For Q3 2024, revenues from Bioservices services
increased $0.7 million, or 5%, as compared with Q3 2023. The
increase was primarily attributable to an increase in production at
the Company’s Camden facility, prior to the sale of the facility to
Bora, partially offset by lower production at the Company’s Canton
and Winnipeg facilities.
Leases
For Q3 2024, revenues from Bioservices leases
decreased $0.6 million, or 60%, as compared with Q3 2023. The
decrease was related to the completion of a lease for a Bioservices
customer at our Canton facility, partially offset by new lease
revenue associated with SERB at our Winnipeg facility.
Contracts and Grants
For Q3 2024, revenues from contracts and grants
increased $3.5 million, or 54%, as compared with Q3 2023. The
increase was primarily due to timing of funding as well as an
increase related to work under the Ebanga™ program.
Operating Expenses
| ($ in millions) |
Q3 2024 |
Q3 2023 |
% Change |
|
Cost of Commercial product sales |
$ |
47.2 |
$ |
60.0 |
(21)% |
| Cost of MCM product sales |
|
54.0 |
|
72.5 |
(26)% |
| Cost of Bioservices |
|
21.4 |
|
44.3 |
(52)% |
| Research and development
(“R&D”) |
|
13.8 |
|
15.3 |
(10)% |
| Selling, general and
administrative (“SG&A”) |
|
76.6 |
|
86.0 |
(11)% |
| Amortization of intangible
assets |
|
16.3 |
|
16.3 |
—% |
| Goodwill impairment |
|
— |
|
218.2 |
(100)% |
|
Total operating expenses |
$ |
229.3 |
$ |
512.6 |
(55)% |
Cost of Commercial Product Sales
For Q3 2024, cost of Commercial Product sales
decreased $12.8 million, or 21%, as compared with Q3 2023. The
decrease was primarily due to lower prescription NARCAN® unit
volume, partially offset by higher OTC NARCAN® unit volume.
Cost of MCM Product Sales
For Q3 2024, cost of MCM Product sales decreased
$18.5 million, or 26%, as compared with Q3 2023. The decrease
was primarily due to lower sales of BAT® and CYFENDUS®, coupled
with lower allocations to Cost of MCM Product sales at our Bayview
facility. This decrease was partially offset by higher sales of
BioThrax® and ACAM2000®.
Cost of Bioservices
For Q3 2024, cost of Bioservices decreased
$22.9 million, or 52%, as compared with Q3 2023. The decrease
was primarily due to lower overhead and remediation costs related
to the sale of the Camden facility, coupled with a decrease in
overhead costs at our other Maryland facilities as a result of the
announced shutdowns and lower costs at our Canton facility. The
decrease was partially offset by an increase in production at our
Winnipeg facility.
Research and Development Expenses
For Q3 2024, R&D expenses decreased
$1.5 million, or 10%, as compared with Q3 2023. The decrease
was driven by a reduction in spend for certain funded and unfunded
projects, excluding Ebanga™. The decrease was partially offset by
an increase in funded R&D related to Ebanga™.
Selling, General and Administrative Expenses
For Q3 2024, SG&A expenses decreased
$9.4 million, or 11%, as compared with Q3 2023. The decrease
was primarily due to lower employee related expenses and
compensation as a result of restructuring initiatives during 2023
and 2024, coupled with a decrease in legal services fees for
disputes and other corporate initiatives. This decrease was
partially offset by the settlement charge related to the
stockholder litigation matter, net of expected insurance
proceeds.
Goodwill Impairment
For Q3 2024, Goodwill impairment decreased
$218.2 million as compared with Q3 2023. The decrease was due
to the Q3 2023 non-cash impairment charge to Goodwill in the MCM
Products reporting unit, which reduced the reporting unit’s
goodwill balance to zero.
ADDITIONAL FINANCIAL INFORMATION(1)
Capital Expenditures
| ($ in millions) |
Q3 2024 |
Q3 2023 |
% Change |
|
Capital expenditures |
$ |
5.8 |
|
$ |
12.6 |
|
(54)% |
| Capital expenditures as a % of
total revenues |
|
2 |
% |
|
5 |
% |
|
| |
|
|
|
|
|
|
|
For Q3 2024, capital expenditures decreased
largely due to lower product development activities across the
Company’s facilities.
SEGMENT INFORMATION
The Company manages the business with a focus on
three reportable segments: (1) the Commercial Products segment
consisting of our NARCAN® and other commercial products that were
sold as part of our travel health business in the second quarter of
2023; (2) the MCM Products segment consisting of the Anthrax - MCM,
Smallpox - MCM and Other products and (3) the services segment
(“Services”) consisting of our Bioservices business. The Company
evaluates the performance of these reportable segments based on
revenues and segment adjusted gross margin, which is a non-GAAP
financial measure. Segment revenue includes external customer
sales, but does not include inter-segment services. The Company
does not allocate contracts and grants revenue, R&D, SG&A,
amortization of intangible assets, interest and other income
(expense) or taxes to its evaluation of the performance of these
segments.
THIRD QUARTER 2024 SEGMENT
RESULTS
| ($ in
millions) |
Commercial Products |
|
Quarter Ended September 30, |
|
|
2024 |
|
|
2023 |
|
$ Change |
% Change |
|
Revenues |
$ |
95.3 |
|
$ |
142.1 |
|
$ |
(46.8 |
) |
(33)% |
| Cost of
sales |
|
47.2 |
|
|
60.0 |
|
|
(12.8 |
) |
(21)% |
| Gross
margin** |
$ |
48.1 |
|
$ |
82.1 |
|
$ |
(34.0 |
) |
(41)% |
| Gross margin
%** |
|
50 |
% |
|
58 |
% |
|
|
| |
|
|
|
|
| Segment adjusted gross
margin(2) |
$ |
48.1 |
|
$ |
82.1 |
|
$ |
(34.0 |
) |
(41)% |
| Segment adjusted gross
margin %(2) |
|
50 |
% |
|
58 |
% |
|
|
| |
|
|
|
|
|
** Gross margin is calculated as revenues less cost of sales. Gross
margin % is calculated as gross margin divided by revenues. |
| |
Commercial Products gross margin decreased $34.0
million, or 41%, to $48.1 million in the quarter, as compared with
$82.1 million in the prior year quarter. Commercial Products gross
margin percentage decreased seven percentage points to 50% for the
quarter ended September 30, 2024. The decrease was largely due to
an unfavorable price and volume mix in 2024 for NARCAN® products.
Commercial Products segment adjusted gross margin is consistent
with gross margin.
| ($ in
millions) |
MCM Products |
|
Quarter Ended September 30, |
|
|
2024 |
|
|
2023 |
|
$ Change |
% Change |
|
Revenues |
$ |
174.2 |
|
$ |
107.7 |
|
$ |
66.5 |
|
62% |
| Cost of
sales |
|
54.0 |
|
|
72.5 |
|
|
(18.5 |
) |
(26)% |
| Gross
margin** |
$ |
120.2 |
|
$ |
35.2 |
|
$ |
85.0 |
|
241% |
| Gross margin
%** |
|
69 |
% |
|
33 |
% |
|
|
| Add back: |
|
|
|
|
|
Changes in fair value of financial instruments |
$ |
— |
|
$ |
(1.1 |
) |
$ |
1.1 |
|
100% |
|
Restructuring costs |
|
4.9 |
|
|
5.0 |
|
|
(0.1 |
) |
(2)% |
|
Inventory step-up provision |
|
1.2 |
|
|
— |
|
|
1.2 |
|
NM |
| Segment adjusted gross
margin(2) |
$ |
126.3 |
|
$ |
39.1 |
|
$ |
87.2 |
|
223% |
| Segment adjusted gross
margin %(2) |
|
73 |
% |
|
36 |
% |
|
|
| |
|
|
|
|
|
** Gross margin is calculated as revenues less cost of sales. Gross
margin % is calculated as gross margin divided by revenues. |
|
NM - Not Meaningful |
|
|
MCM Products gross margin increased $85.0
million, or 241%, to $120.2 million in the quarter, as compared
with $35.2 million in the prior year quarter. MCM Products
gross margin percentage increased 36 percentage points to 69% for
the quarter ended September 30, 2024. The increase was largely due
to overall higher sales volumes with a favorable product mix
weighted more heavily to higher margin products coupled with lower
allocations to cost of MCM Product sales at our Bayview facility
and overall lower shutdown and overhead costs across our
facilities. MCM Product segment adjusted gross margin in the
current year period excludes the impact of non-cash items related
to the impact of restructuring costs of $4.9 million and
inventory step-up provision of $1.2 million.
| ($ in
millions) |
Services |
|
Quarter Ended September 30, |
|
|
2024 |
|
|
2023 |
|
$ Change |
% Change |
|
Revenues |
$ |
14.3 |
|
$ |
14.2 |
|
$ |
0.1 |
|
1 |
% |
| Cost of
services |
|
21.4 |
|
|
44.3 |
|
|
(22.9 |
) |
(52 |
)% |
| Gross
margin** |
$ |
(7.1 |
) |
$ |
(30.1 |
) |
$ |
23.0 |
|
76 |
% |
| Gross margin
%** |
(50 |
)% |
(212 |
)% |
|
|
| Add back: |
|
|
|
|
|
Restructuring costs |
|
0.1 |
|
|
8.1 |
|
|
(8.0 |
) |
(99 |
)% |
| Segment adjusted gross
margin(2) |
$ |
(7.0 |
) |
$ |
(22.0 |
) |
$ |
15.0 |
|
68 |
% |
| Segment adjusted gross
margin %(2) |
(49 |
)% |
(155 |
)% |
|
|
| |
|
|
|
|
|
** Gross margin is calculated as revenues less cost of services.
Gross margin % is calculated as gross margin divided by
revenues. |
Services gross margin increased $23.0 million,
or 76%, to $(7.1) million in the quarter, as compared with $(30.1)
million in the prior year quarter. Services gross margin percentage
increased 162 percentage points to (50)% for the quarter ended
September 30, 2024. The increase was primarily due to lower
overhead and remediation costs related to the sale of the Camden
facility coupled with lower costs at our Bayview facility. Services
segment adjusted gross margin in the current year period excludes
the impact of restructuring costs of $0.1 million.
YTD 2024 SEGMENT RESULTS
| |
Commercial Products |
| |
Nine Months Ended September 30, |
|
|
|
2024 |
|
|
2023 |
|
|
$ Change |
|
% Change |
|
| Revenues |
$ |
333.8 |
|
$ |
386.2 |
|
$ |
(52.4 |
) |
(14 |
)% |
| Cost of
sales |
|
152.7 |
|
|
160.2 |
|
|
(7.5 |
) |
(5 |
)% |
| Gross
margin** |
$ |
181.1 |
|
$ |
226.0 |
|
$ |
(44.9 |
) |
(20 |
)% |
| Gross margin
%** |
|
54 |
% |
|
59 |
% |
|
|
|
|
|
| |
|
|
|
|
|
|
|
|
|
|
|
| Segment adjusted gross
margin(2) |
$ |
181.1 |
|
$ |
226.0 |
|
$ |
(44.9 |
) |
(20 |
)% |
| Segment adjusted gross
margin %(2) |
|
54 |
% |
|
59 |
% |
|
|
|
|
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
** Gross margin is calculated as revenues less cost of sales. Gross
margin % is calculated as gross margin divided by revenues. |
Commercial Products gross margin decreased $44.9
million, or 20%, to $181.1 million for the nine months ended
September 30, 2024, as compared with $226.0 million for the nine
months ended September 30, 2023. Commercial Products gross margin
percentage decreased five percentage points to 54% in 2024. The
decrease was largely due to an unfavorable price and volume mix in
2024 for NARCAN® products, partially offset by the sale of the
products associated with our travel health business to Bavarian
Nordic. Commercial Products segment adjusted gross margin is
consistent with gross margin.
| ($ in
millions) |
MCM Products |
|
Nine Months Ended September 30, |
|
|
2024 |
|
|
2023 |
|
$ Change |
% Change |
|
Revenues |
$ |
393.0 |
|
$ |
309.2 |
|
$ |
83.8 |
|
27 |
% |
| Cost of
sales |
|
147.3 |
|
|
208.4 |
|
|
(61.1 |
) |
(29 |
)% |
| Gross
margin** |
$ |
245.7 |
|
$ |
100.8 |
|
$ |
144.9 |
|
144 |
% |
| Gross margin
%** |
|
63 |
% |
|
33 |
% |
|
|
| Add back: |
|
|
|
|
|
Changes in fair value of financial instruments |
$ |
0.6 |
|
$ |
(0.4 |
) |
$ |
1.0 |
|
250 |
% |
|
Inventory step-up provision |
|
1.2 |
|
|
1.9 |
|
|
(0.7 |
) |
(37 |
)% |
|
Restructuring costs |
|
7.5 |
|
|
7.0 |
|
|
0.5 |
|
7 |
% |
| Segment adjusted gross
margin(2) |
$ |
255.0 |
|
$ |
109.3 |
|
$ |
145.7 |
|
133 |
% |
| Segment adjusted gross
margin %(2) |
|
65 |
% |
|
35 |
% |
|
|
| |
|
|
|
|
|
** Gross margin is calculated as revenues less cost of sales. Gross
margin % is calculated as gross margin divided by revenues. |
|
NM - Not Meaningful |
MCM Products gross margin increased $144.9
million, or 144%, to $245.7 million for the nine months ended
September 30, 2024, as compared with $100.8 million for the nine
months ended September 30, 2023. MCM Products gross margin
percentage increased 29 percentage points to 63% for the nine
months ended September 30, 2024. The increase was largely due to
overall higher sales volumes with a favorable product mix weighted
more heavily to higher margin products coupled with lower
allocations to Cost of MCM Product sales at our Bayview facility
and lower shutdown related costs, a reduction in Trobigard® related
costs, due to the Trobigard® revocation, and realization of
previously adjusted inventory values. MCM Product segment adjusted
gross margin excludes the impact of restructuring costs of $7.5
million, inventory step-up provision of $1.2 million and changes in
fair value of financial instruments of $0.6 million.
| ($ in
millions) |
Services |
|
Nine Months Ended September 30, |
|
|
2024 |
|
|
2023 |
|
$ Change |
% Change |
|
Revenues |
$ |
97.5 |
|
$ |
57.7 |
|
$ |
39.8 |
|
69% |
| Cost of
services |
|
263.3 |
|
|
151.7 |
|
|
111.6 |
|
74% |
| Gross
margin** |
$ |
(165.8 |
) |
$ |
(94.0 |
) |
$ |
(71.8 |
) |
(76)% |
| Gross margin
%** |
(170 |
)% |
(163 |
)% |
|
|
| Add back: |
|
|
|
|
|
Settlement charges, net |
$ |
110.2 |
|
$ |
— |
|
$ |
110.2 |
|
NM |
|
Restructuring costs |
|
0.3 |
|
|
8.1 |
|
|
(7.8 |
) |
(96)% |
| Segment adjusted gross
margin(2) |
$ |
(55.3 |
) |
$ |
(85.9 |
) |
$ |
30.6 |
|
36% |
| Segment adjusted gross
margin %(2) |
(57 |
)% |
(149 |
)% |
|
|
| |
|
|
|
|
|
** Gross margin is calculated as revenues less cost of sales. Gross
margin % is calculated as gross margin divided by revenues. |
| NM - Not Meaningful |
|
|
|
|
Services gross margin decreased $71.8 million,
or 76%, to $(165.8) million for the nine months ended
September 30, 2024, as compared with $(94.0) million for the
nine months ended September 30, 2023. Services gross margin
percentage decreased 7 percentage points to (170)% for the nine
months ended September 30, 2024. The decrease was primarily due to
the Settlement Agreement with Janssen and resulting revenue and
write-down of related assets to net realizable value, coupled with
lower production at the Company's Canton facility. This decrease
was partially offset by an increase in production at the Camden
facility prior to the sale of the facility to Bora and a decrease
in overhead costs at our other Maryland facilities. Services
segment adjusted gross margin in the current year period excludes
the impact of segment settlement charge, net of $110.2 million and
restructuring costs of $0.3 million.
2024 FINANCIAL FORECAST
The Company provides the following updated
financial forecast for full year 2024, reflecting management's
expectations based on the most current information available.
Full Year 2024
|
METRIC($ in millions) |
Updated Range(as of
11/6/2024) |
Previous Range(as of
08/06/2024) |
Previous Range(as of
05/01/2024) |
Previous Range(as of
03/06/2024) |
| Total
revenues |
$1,065 - $1,125 |
$1,050 - $1,125 |
$1,000 - $1,100 |
$900 - $1,100 |
| Net loss |
$(203) - $(183) |
$(314) - $(274) |
$(148) - $(98) |
$(183) - $(133) |
| Adjusted net
loss(2) |
$(50) - $(30) |
$(115) - $(75) |
$(65) - $(15) |
$(130) - $(80) |
| Adjusted
EBITDA(2) |
$180 - $200 |
$140 - $180 |
$125 - $175 |
$50 - $100 |
| Total segment adjusted
gross margin %(2) |
43% - 45% |
42% - 45% |
44% - 47% |
40% - 45% |
| |
|
|
|
|
| Segment Level
Revenue(4) |
|
|
|
|
|
Commercial Products |
$420 - $430 |
$450 - $480 |
$460 - $500 |
$460 - $500 |
|
MCM Products |
$510 - $550 |
$455 - $490 |
$440 - $490 |
$340 - $490 |
|
Services(5) |
$105 - $110 |
$120 - $130 |
$70 - $80 |
$70 - $80 |
|
Key Assumptions($ and shares in millions) |
Updated Range(as of
11/6/2024) |
|
| Interest expense |
~$75 |
|
| R&D |
~7% of Revenue |
|
| Weighted avg. fully diluted
share count |
~53 |
|
| Capex |
~$25 |
|
| Depreciation &
amortization |
~$109 |
|
| |
|
|
FOOTNOTES
(1) All financial information included in this
release is unaudited.
(2) See “Non-GAAP Financial Measures” and the
"Reconciliation of Non-GAAP Financial Measures" tables for the
definitions and reconciliations of these non-GAAP financial
measures to the most closely related GAAP financial measures.
(3) Product sales, net are reported net of
variable consideration including returns, rebates, wholesaler fees
and prompt pay discounts in accordance with U.S. generally accepted
accounting principles.
(4) Our Commercial Products forecast consists
solely of NARCAN® Nasal Spray, as our Other Commercial Products,
including Vivotif® and Vaxchora®, were sold to Bavarian Nordic as
part of our travel health business in May 2023.
(5) Our Services revenue forecast includes
$50.0 million related to the Settlement Agreement with Janssen
and excludes revenues related to the Baltimore-Camden Facility
after August 20, 2024.
CONFERENCE CALL, PRESENTATION SUPPLEMENT AND WEBCAST
INFORMATION
Company management will host a conference call
at 5:00 pm eastern time today, November 6, 2024, to discuss
these financial results. The conference call and presentation
supplement can be accessed from the Company's website or through
the following:
By phoneTo join via telephone, please use the
following dial-in details:U.S. / New York: +1-646-968-2525U.S.
& Canada (Toll Free): +1-888-596-4144Conference ID: 5259189
By webcast Visit
https://edge.media-server.com/mmc/p/nm3oj8g9A replay of the call
can be accessed from the Emergent website.
ABOUT EMERGENT BIOSOLUTIONS INC.
At Emergent, our mission is to protect and
enhance life. We develop, manufacture, and deliver protections
against public health threats through a pipeline of innovative
vaccines and therapeutics. For over 25 years, we have been at work
defending people from things we hope will never happen—so that we
are prepared just in case they ever do. We do what we do because we
see the opportunity to create a better, more secure world. One
where preparedness empowers protection from the threats we face.
And peace of mind prevails. In working together, we envision
protecting or enhancing 1 billion lives by 2030. For more
information, visit our website and follow us on LinkedIn, Twitter,
and Instagram.
NON-GAAP FINANCIAL
MEASURES
In the accompanying analysis of financial
information, we sometimes use information derived from consolidated
and segment financial information that may not be presented in our
financial statements or prepared in accordance with generally
accepted accounting principles in the United States (“GAAP”).
Certain of these financial measures are considered not in
conformity with GAAP (“non-GAAP financial measures”) under the
United States Securities and Exchange Commission (“SEC”) rules.
Specifically, we have referred to the following non-GAAP financial
measures:
- Adjusted Net Income (Loss)
- Adjusted Net Income (Loss) per Diluted
Share
- Adjusted EBITDA
- Total Segment Revenues
- Total Segment Gross Margin
- Total Segment Gross Margin %
- Total Segment Adjusted Gross Margin
- Total Segment Adjusted Gross Margin %
- Segment Adjusted Gross Margin
- Segment Adjusted Gross Margin %
We define Adjusted Net Income (Loss) and
Adjusted Net Income (Loss) per Diluted Share, which are non-GAAP
financial measures, as net income (loss) and net income (loss) per
diluted share, respectively, excluding the impact of changes in
fair value of financial instruments, acquisition and
divestiture-related costs, severance and restructuring costs,
settlement charges, net, exit and disposal costs, impairment
charges, gain (loss) on sale of business, non-cash amortization
charges, contingent consideration milestones, and other income
(expense) items. We use Adjusted Net Income (Loss) for the purpose
of calculating Adjusted Net Income (Loss) per Diluted Share.
Management uses Adjusted Net Income (Loss) per Diluted Share to
assess total Company operating performance on a consistent basis.
We believe that these non-GAAP financial measures, when considered
together with our GAAP financial results and GAAP financial
measures, provide management and investors with an additional
understanding of our business operating results, including
underlying trends.
We define Adjusted EBITDA, which is a non-GAAP
financial measure, as consolidated net income (loss) before income
tax provision (benefit), interest expense, net, depreciation,
amortization of intangible assets, excluding the impact of changes
in fair value of financial instruments, acquisition and
divestiture-related costs, severance and restructuring costs,
settlement charges, net, exit and disposal costs, impairment
charges, gain (loss) on sale of business, non-cash amortization
charges, contingent consideration milestones and other income
(expense) items. We believe that this non-GAAP financial measure,
when considered together with our GAAP financial results and GAAP
financial measures, provides management and investors with a more
complete understanding of our operating results, including
underlying trends. In addition, EBITDA is a common alternative
measure of operating performance used by many of our competitors.
It is used by investors, financial analysts, rating agencies and
others to value and compare the financial performance of companies
in our industry, although it may be defined differently by
different companies. Therefore, we also believe that this non-GAAP
financial measure, considered along with corresponding GAAP
financial measures, provides management and investors with
additional information for comparison of our operating results with
the operating results of other companies.
We have included the definitions of Segment
Gross Margin and Segment Gross Margin %, which are GAAP financial
measures, below in order to more fully define the components of
certain non-GAAP financial measures presented in this press
release. We define Segment Gross Margin, as a segment's revenues,
less a segment's cost of sales or services. We define Segment Gross
Margin %, as Segment Gross Margin as a percentage of a segments
revenues. We define Segment Adjusted Gross Margin, which is a
non-GAAP financial measure as Segment Gross Margin excluding the
impact of restructuring costs, changes in the fair value of
financial instruments, settlement charges, net and inventory
step-up provision. We define Segment Adjusted Gross Margin %, which
is a non-GAAP financial measure, as Segment Adjusted Gross Margin
as a percentage of a segment's revenues.
We define Total Segment Revenues, which is a
non-GAAP financial measure, as our Total Revenues, less contracts
and grants revenue, which is also equal to the sum of the revenues
of our reportable operating segments. We define Total Segment Gross
Margin, which is a non-GAAP financial measure, as Total Segment
Revenues less our aggregate cost of sales or services. We define
Total Segment Gross Margin %, which is a non-GAAP financial
measure, as Total Segment Gross Margin as a percentage of Total
Segment Revenues. We define Total Segment Adjusted Gross Margin,
which is a non-GAAP financial measure, as Total Segment Gross
Margin, excluding the impact of restructuring costs, settlement
charges, net, changes in the fair value of financial instruments
and inventory step-up provision. We define Total Segment Adjusted
Gross Margin %, which is a non-GAAP financial measure, as Total
Segment Adjusted Gross Margin as a percentage of Total Segment
Revenues.
Non-GAAP financial measures are not defined in
the same manner by all companies and may not be comparable with
other similarly titled measures of other companies. The
determination of the amounts that are excluded from these non-GAAP
financial measures are a matter of management judgment and depend
upon, among other factors, the nature of the underlying expense or
income amounts. Non-GAAP financial measures should be considered in
addition to, but not as a substitute for or superior to, the
information contained in our Consolidated Statements of Operations
and Consolidated Statements of Cash Flows. Reconciliations of these
non-GAAP financial measures to the most directly comparable GAAP
financial measures are included in the financial tables
accompanying this press release.
SAFE HARBOR STATEMENT
This press release includes forward-looking
statements within the meaning of the Private Securities Litigation
Reform Act of 1995. All statements, other than statements of
historical fact, including statements regarding the future
performance of the Company or any of our businesses, our business
strategy, future operations, future financial position, future
revenues and earnings, our ability to achieve the objectives of our
restructuring initiatives and divestitures, including our future
results, projected costs, prospects, plans and objectives of
management, are forward-looking statements. We generally identify
forward-looking statements by using words like “anticipate,”
“believe,” “continue,” “could,” “estimate,” “expect,” “forecast,”
“future,” “goal,” “intend,” “may,” “plan,” “position,” “possible,”
“potential,” “predict,” “project,” “should,” “target,” “will,”
“would,” and similar expressions or variations thereof, or the
negative thereof, but these terms are not the exclusive means of
identifying such statements. Forward-looking statements are based
on our current intentions, beliefs, assumptions and expectations
regarding future events based on information that is currently
available. Readers should realize that if underlying assumptions
prove inaccurate or unknown risks or uncertainties materialize,
actual results could differ materially from our expectations.
Readers are, therefore, cautioned not to place undue reliance on
any forward-looking statement contained herein. Any such
forward-looking statement speaks only as of the date of this press
release, and, except as required by law, we do not undertake any
obligation to update any forward-looking statement to reflect new
information, events or circumstances.
There are a number of important factors that
could cause our actual results to differ materially from those
indicated by such forward-looking statements, including, among
others, the availability of USG funding for contracts related to
procurement of our medical countermeasure ("MCM") products,
including CYFENDUS® (Anthrax Vaccine Adsorbed (AVA) Adjuvanted),
previously known as AV7909, BioThrax® (Anthrax Vaccine Adsorbed),
and ACAM2000® (Smallpox (Vaccinia) Vaccine, Live) among others, as
well as contracts related to development of medical
countermeasures; the availability of government funding for our
other commercialized products, including
Ebanga™ (ansuvimab-zykl) and BAT® (Botulism Antitoxin
Heptavalent (A,B,C,D,E,F,G)-(Equine)); our ability to meet our
commitments to quality and compliance in all of our manufacturing
operations; our ability to negotiate additional USG procurement or
follow-on contracts for our MCM products that have expired or will
be expiring; the commercial availability and acceptance of
over-the-counter NARCAN® (naloxone HCl) Nasal Spray; the impact of
a generic and competitive marketplace on NARCAN® Nasal Spray and
future NARCAN® Nasal Spray sales; our ability to perform under our
contracts with the USG, including the timing of and specifications
relating to deliveries; our ability to provide Bioservices (as
defined below) for the development and/or manufacture of product
and/or product candidates of our customers at required levels and
on required timelines; the ability of our contractors and suppliers
to maintain compliance with current good manufacturing practices
and other regulatory obligations; our ability to negotiate further
commitments related to the collaboration and deployment of capacity
toward future commercial manufacturing under our existing
Bioservices contracts; our ability to collect reimbursement for raw
materials and payment of service fees from our Bioservices
customers; the results of pending government investigations and
their potential impact on our business; our ability to obtain final
court approval of the proposed settlement agreement relating to the
stockholder litigation, including our ability to satisfy the
conditions of the proposed settlement, and the source of funds to
be used to resolve the litigation, and the potential impact of the
settlement agreement, if approved, on our business; our ability to
comply with the operating and financial covenants required by our
term loan facility under a credit agreement, dated August 30, 2024,
our revolving credit facility under a credit agreement, dated
September 30, 2024, and our 3.875% Senior Unsecured Notes due 2028;
our ability to maintain adequate internal control over financial
reporting and to prepare accurate financial statements in a timely
manner; our ability to successfully manage our liquidity in order
to continue as a going concern; the procurement of our product
candidates by USG entities under regulatory authorities that permit
government procurement of certain medical products prior to FDA
marketing authorization, and corresponding procurement by
government entities outside the United States; our ability to
realize the expected benefits of the sale of our travel health
business to Bavarian Nordic, the sale of RSDL® to SERB
Pharmaceuticals and the sale of our drug product facility in
Baltimore-Camden to Bora Pharmaceuticals Injectables Inc.; the
impact of the organizational changes we announced in January 2023,
August 2023, May 2024 and August 2024; our ability to identify and
acquire companies, businesses, products or product candidates that
satisfy our selection criteria; the impact of cyber security
incidents, including the risks from the unauthorized access,
interruption, failure or compromise of our information systems or
those of our business partners, collaborators or other third
parties; the success of our commercialization, marketing and
manufacturing capabilities and strategy; and the accuracy of our
estimates regarding future revenues, expenses, capital requirements
and need for additional financing. The foregoing sets forth many,
but not all, of the factors that could cause actual results to
differ from our expectations in any forward-looking statement.
Readers should consider this cautionary statement, as well as the
risks identified in our periodic reports filed with the Securities
and Exchange Commission, when evaluating our forward-looking
statements.
Trademarks
Emergent®, BioThrax®, BaciThrax®, BAT®,
Trobigard®, Anthrasil®, CNJ-016®, ACAM2000®, NARCAN®, CYFENDUS®,
TEMBEXA® and any and all Emergent BioSolutions Inc. brands,
products, services and feature names, logos and slogans are
trademarks or registered trademarks of Emergent BioSolutions Inc.
or its subsidiaries in the United States or other countries. All
other brands, products, services and feature names or trademarks
are the property of their respective owners, including RSDL®
(Reactive Skin Decontamination Lotion), which was acquired by SERB
on July 31, 2024.
|
Investor ContactRich LindahlExecutive Vice
President, Chief Financial Officerlindahlr@ebsi.com |
Media ContactAssal HellmerVice President,
Communicationsmediarelations@ebsi.com |
| |
|
Emergent BioSolutions Inc. Consolidated
Balance Sheets(unaudited, in millions, except per
share data) |
| |
| |
September 30, |
|
December 31, |
|
|
2024 |
|
|
|
2023 |
|
| ASSETS |
|
|
|
| Current assets: |
|
|
|
|
Cash and cash equivalents |
$ |
149.9 |
|
|
$ |
111.7 |
|
|
Restricted cash |
|
6.5 |
|
|
|
— |
|
|
Accounts receivable, net |
|
121.3 |
|
|
|
191.0 |
|
|
Inventories, net |
|
322.7 |
|
|
|
328.9 |
|
|
Prepaid expenses and other current assets |
|
61.0 |
|
|
|
47.9 |
|
|
Total current assets |
|
661.4 |
|
|
|
679.5 |
|
|
|
|
|
|
|
Property, plant and equipment, net |
|
278.1 |
|
|
|
382.8 |
|
|
Intangible assets, net |
|
517.8 |
|
|
|
566.6 |
|
|
Other assets |
|
20.5 |
|
|
|
194.3 |
|
|
Total assets |
$ |
1,477.8 |
|
|
$ |
1,823.2 |
|
| |
|
|
|
| LIABILITIES AND
STOCKHOLDERS’ EQUITY |
|
|
|
| Current liabilities: |
|
|
|
|
Accounts payable |
$ |
82.1 |
|
|
$ |
112.2 |
|
|
Accrued expenses |
|
16.1 |
|
|
|
18.6 |
|
|
Accrued compensation |
|
63.3 |
|
|
|
74.1 |
|
|
Debt, current portion |
|
0.8 |
|
|
|
413.7 |
|
|
Other current liabilities |
|
67.6 |
|
|
|
32.7 |
|
|
Total current liabilities |
|
229.9 |
|
|
|
651.3 |
|
| |
|
|
|
|
Debt, net of current portion |
|
661.8 |
|
|
|
446.5 |
|
|
Deferred tax liability |
|
41.9 |
|
|
|
47.2 |
|
|
Other liabilities |
|
35.8 |
|
|
|
28.9 |
|
|
Total liabilities |
$ |
969.4 |
|
|
$ |
1,173.9 |
|
| |
|
|
|
| Stockholders’ equity: |
|
|
|
|
Preferred stock, $0.001 par value per share; 15.0 shares
authorized, no shares issued and outstanding |
|
— |
|
|
|
— |
|
|
Common stock, $0.001 par value per share; 200.0 shares authorized,
59.7 and 57.8 shares issued; 54.1 and 52.2 shares outstanding,
respectively. |
|
0.1 |
|
|
|
0.1 |
|
|
Treasury stock, at cost, 5.6 and 5.6 common shares,
respectively |
|
(227.7 |
) |
|
|
(227.7 |
) |
|
Additional paid-in capital |
|
924.4 |
|
|
|
904.4 |
|
|
Accumulated other comprehensive loss, net |
|
(7.3 |
) |
|
|
(5.7 |
) |
|
Accumulated deficit |
|
(181.1 |
) |
|
|
(21.8 |
) |
|
Total stockholders’ equity |
$ |
508.4 |
|
|
$ |
649.3 |
|
|
Total liabilities and stockholders’ equity |
$ |
1,477.8 |
|
|
$ |
1,823.2 |
|
| |
|
Emergent BioSolutions Inc. Consolidated
Statements of Operations(unaudited, in millions,
except per share data) |
| |
| |
Three Months Ended September 30, |
|
Nine Months Ended September 30, |
|
|
2024 |
|
|
|
2023 |
|
|
|
2024 |
|
|
|
2023 |
|
|
Revenues: |
|
|
|
|
|
|
|
|
Commercial Product sales |
$ |
95.3 |
|
|
$ |
142.1 |
|
|
$ |
333.8 |
|
|
$ |
386.2 |
|
| MCM Product sales |
|
174.2 |
|
|
|
107.7 |
|
|
|
393.0 |
|
|
|
309.2 |
|
|
Total Product sales, net |
|
269.5 |
|
|
|
249.8 |
|
|
|
726.8 |
|
|
|
695.4 |
|
| Bioservices: |
|
|
|
|
|
|
|
|
Services |
|
13.9 |
|
|
|
13.2 |
|
|
|
96.7 |
|
|
|
52.2 |
|
|
Leases |
|
0.4 |
|
|
|
1.0 |
|
|
|
0.8 |
|
|
|
5.5 |
|
|
Total Bioservices revenues |
|
14.3 |
|
|
|
14.2 |
|
|
|
97.5 |
|
|
|
57.7 |
|
| Contracts and grants |
|
10.0 |
|
|
|
6.5 |
|
|
|
24.6 |
|
|
|
19.6 |
|
|
Total revenues |
|
293.8 |
|
|
|
270.5 |
|
|
|
848.9 |
|
|
|
772.7 |
|
| |
|
|
|
|
|
|
|
| Operating
expenses: |
|
|
|
|
|
|
|
|
Cost of Commercial Product sales |
|
47.2 |
|
|
|
60.0 |
|
|
|
152.7 |
|
|
|
160.2 |
|
|
Cost of MCM Product sales |
|
54.0 |
|
|
|
72.5 |
|
|
|
147.3 |
|
|
|
208.4 |
|
|
Cost of Bioservices |
|
21.4 |
|
|
|
44.3 |
|
|
|
263.3 |
|
|
|
151.7 |
|
|
Research and development |
|
13.8 |
|
|
|
15.3 |
|
|
|
61.6 |
|
|
|
82.0 |
|
|
Selling, general and administrative |
|
76.6 |
|
|
|
86.0 |
|
|
|
247.2 |
|
|
|
278.7 |
|
|
Amortization of intangible assets |
|
16.3 |
|
|
|
16.3 |
|
|
|
48.8 |
|
|
|
49.4 |
|
|
Goodwill impairment |
|
— |
|
|
|
218.2 |
|
|
|
— |
|
|
|
218.2 |
|
|
Impairment of long-lived assets |
|
— |
|
|
|
— |
|
|
|
27.2 |
|
|
|
306.7 |
|
|
Total operating expenses |
|
229.3 |
|
|
|
512.6 |
|
|
|
948.1 |
|
|
|
1,455.3 |
|
| |
|
|
|
|
|
|
|
| Income (loss) from
operations |
|
64.5 |
|
|
|
(242.1 |
) |
|
|
(99.2 |
) |
|
|
(682.6 |
) |
| |
|
|
|
|
|
|
|
| Other income
(expense): |
|
|
|
|
|
|
|
|
Interest expense |
|
(8.3 |
) |
|
|
(19.7 |
) |
|
|
(56.2 |
) |
|
|
(66.2 |
) |
|
Gain (loss) on sale of business |
|
64.3 |
|
|
|
(0.7 |
) |
|
|
24.3 |
|
|
|
74.2 |
|
|
Other, net |
|
21.9 |
|
|
|
(3.4 |
) |
|
|
15.8 |
|
|
|
(2.1 |
) |
|
Total other income (expense), net |
|
77.9 |
|
|
|
(23.8 |
) |
|
|
(16.1 |
) |
|
|
5.9 |
|
| |
|
|
|
|
|
|
|
| Income (loss) before
income taxes |
|
142.4 |
|
|
|
(265.9 |
) |
|
|
(115.3 |
) |
|
|
(676.7 |
) |
| Income tax provision
(benefit) |
|
27.6 |
|
|
|
(2.5 |
) |
|
|
44.0 |
|
|
|
34.3 |
|
|
Net income (loss) |
$ |
114.8 |
|
|
$ |
(263.4 |
) |
|
$ |
(159.3 |
) |
|
$ |
(711.0 |
) |
| |
|
|
|
|
|
|
|
| Earnings (loss) per
common share |
|
|
|
|
|
|
|
|
Basic |
$ |
2.16 |
|
|
$ |
(5.08 |
) |
|
$ |
(3.03 |
) |
|
$ |
(13.97 |
) |
|
Diluted |
$ |
2.06 |
|
|
$ |
(5.08 |
) |
|
$ |
(3.03 |
) |
|
$ |
(13.97 |
) |
| |
|
|
|
|
|
|
|
| Shares used in
computing earnings (loss) per common share |
|
|
|
|
|
|
|
|
Basic |
|
53.1 |
|
|
|
51.8 |
|
|
|
52.6 |
|
|
|
50.9 |
|
|
Diluted |
|
55.6 |
|
|
|
51.8 |
|
|
|
52.6 |
|
|
|
50.9 |
|
| |
Nine Months Ended September 30, |
|
|
2024 |
|
|
|
2023 |
|
| Operating
Activities |
|
|
|
|
Net loss |
$ |
(159.3 |
) |
|
$ |
(711.0 |
) |
|
Adjustments to reconcile net loss to net cash provided by (used in)
operating activities: |
|
|
|
|
Share-based compensation expense |
|
13.7 |
|
|
|
19.1 |
|
|
Depreciation and amortization |
|
82.8 |
|
|
|
95.5 |
|
|
Change in fair value of contingent obligations, net |
|
0.6 |
|
|
|
(0.4 |
) |
|
Amortization of deferred financing costs |
|
5.2 |
|
|
|
15.6 |
|
|
Deferred income taxes |
|
(5.1 |
) |
|
|
(3.7 |
) |
|
Noncash gain on sale of business |
|
(32.2 |
) |
|
|
(74.2 |
) |
|
Change in fair value of warrant and forward liabilities |
|
(1.1 |
) |
|
|
— |
|
|
Goodwill impairment |
|
— |
|
|
|
218.2 |
|
|
Impairment of long-lived assets |
|
27.2 |
|
|
|
306.7 |
|
|
Loss on disposal of assets |
|
28.9 |
|
|
|
13.9 |
|
|
Other |
|
3.9 |
|
|
|
(5.0 |
) |
|
Changes in operating assets and liabilities: |
|
|
|
|
Accounts receivable |
|
52.7 |
|
|
|
(58.5 |
) |
|
Inventories |
|
(35.5 |
) |
|
|
(25.0 |
) |
|
Prepaid expenses and other assets |
|
146.3 |
|
|
|
(18.3 |
) |
|
Accounts payable |
|
(22.8 |
) |
|
|
17.7 |
|
|
Accrued expenses and other liabilities |
|
32.9 |
|
|
|
(30.2 |
) |
|
Long-term incentive plan accrual |
|
2.5 |
|
|
|
3.7 |
|
|
Accrued compensation |
|
(9.9 |
) |
|
|
(0.8 |
) |
|
Income taxes receivable and payable, net |
|
26.6 |
|
|
|
(3.5 |
) |
|
Contract liabilities |
|
(18.8 |
) |
|
|
1.8 |
|
|
Net cash provided by (used in) operating
activities |
|
138.6 |
|
|
|
(238.4 |
) |
| Investing
Activities |
|
|
|
|
Purchases of property, plant and equipment |
|
(21.2 |
) |
|
|
(40.2 |
) |
|
Proceeds from sale of property, plant and equipment |
|
7.6 |
|
|
|
— |
|
|
Milestone payment from prior asset acquisition |
|
— |
|
|
|
(6.3 |
) |
|
Proceeds from sale of business |
|
110.2 |
|
|
|
270.2 |
|
|
Net cash provided by investing activities |
|
96.6 |
|
|
|
223.7 |
|
| Financing
Activities |
|
|
|
|
Proceeds from the issuance of debt, net of lender fees |
|
219.0 |
|
|
|
— |
|
|
Proceeds allocated to warrants issued in conjunction with debt |
|
13.4 |
|
|
|
— |
|
|
Proceeds allocated to common stock issued in conjunction with
debt |
|
9.3 |
|
|
|
— |
|
|
Principal payments on term loan facility |
|
(198.2 |
) |
|
|
(160.7 |
) |
|
Proceeds from revolving credit facility |
|
65.0 |
|
|
|
— |
|
|
Principal payments on revolving credit facility |
|
(284.2 |
) |
|
|
(386.8 |
) |
|
Debt issuance costs |
|
(14.6 |
) |
|
|
— |
|
|
Proceeds from share-based compensation activity |
|
0.7 |
|
|
|
1.3 |
|
|
Taxes paid for share-based compensation activity |
|
(0.9 |
) |
|
|
(2.4 |
) |
|
Proceeds from at-the-market sale of stock, net of commissions and
expenses |
|
— |
|
|
|
8.2 |
|
|
Net cash used in financing activities: |
|
(190.5 |
) |
|
|
(540.4 |
) |
|
Effect of exchange rate changes on cash, cash equivalents and
restricted cash |
|
— |
|
|
|
0.3 |
|
|
Net change in cash, cash equivalents and restricted cash |
|
44.7 |
|
|
|
(554.8 |
) |
| Cash, cash equivalents and
restricted cash, beginning of period |
|
111.7 |
|
|
|
642.6 |
|
| Cash, cash equivalents and
restricted cash, end of period |
$ |
156.4 |
|
|
$ |
87.8 |
|
| Supplemental cash flow
disclosures: |
|
|
|
| Cash paid for interest |
$ |
55.8 |
|
|
$ |
56.5 |
|
| Cash paid for income
taxes |
$ |
35.5 |
|
|
$ |
38.3 |
|
| Non-cash investing and
financing activities: |
|
|
|
|
Purchases of property, plant and equipment unpaid at period
end |
$ |
1.6 |
|
|
$ |
9.2 |
|
|
Gain on extinguishments of debt |
$ |
0.6 |
|
|
$ |
— |
|
|
Issuance of common stock in conjunction with debt |
|
7.7 |
|
|
|
— |
|
| Reconciliation of cash
and cash equivalents and restricted cash: |
|
|
|
|
Cash and cash equivalents |
$ |
149.9 |
|
|
$ |
87.8 |
|
|
Restricted cash |
|
6.5 |
|
|
|
— |
|
|
Total |
$ |
156.4 |
|
|
$ |
87.8 |
|
| |
|
Emergent BioSolutions, Inc.Reconciliation
of Non-GAAP Financial MeasuresReconciliation of
Net Income (Loss) and Net Income (Loss) per Diluted Share to
Adjusted Net Income (Loss) and Adjusted Net Income (Loss) per
Diluted Share(1) |
| |
| ($ in millions,
except per share data) |
Three Months Ended September 30, |
|
Nine Months Ended September 30, |
|
|
|
2024 |
|
|
2023 |
|
|
|
2024 |
|
|
2023 |
|
Source |
|
Net income (loss) |
$ |
114.8 |
|
$ |
(263.4 |
) |
|
$ |
(159.3 |
) |
$ |
(711.0 |
) |
|
| Adjustments: |
|
|
|
|
|
|
|
Non-cash amortization charges |
$ |
9.7 |
|
$ |
21.9 |
|
|
$ |
54.0 |
|
$ |
65.0 |
|
Amortization of intangible
assets (IA), Other Income |
|
Impairments |
|
— |
|
|
218.2 |
|
|
|
27.2 |
|
|
524.9 |
|
Impairment of long-lived
assets and goodwill |
|
Severance and restructuring costs |
|
6.3 |
|
|
20.6 |
|
|
|
22.9 |
|
|
34.5 |
|
Cost of MCM Products, Cost of
Services, SG&A and R&D |
|
Inventory step-up provision |
|
1.2 |
|
|
— |
|
|
|
1.2 |
|
|
1.9 |
|
Cost of MCM Products |
|
Acquisition and divestiture costs |
|
— |
|
|
— |
|
|
|
— |
|
|
2.8 |
|
SG&A |
|
Exit and disposal costs |
|
— |
|
|
— |
|
|
|
13.3 |
|
|
6.1 |
|
R&D |
|
Loss (gain) on sale of business |
|
(64.3 |
) |
|
0.7 |
|
|
|
(24.3 |
) |
|
(74.2 |
) |
Other Income (Expense) |
|
Settlement charges, net |
|
10.0 |
|
|
— |
|
|
|
120.2 |
|
|
— |
|
Cost of Services and
SG&A |
|
Contingent consideration milestones |
|
(30.0 |
) |
|
— |
|
|
|
(30.0 |
) |
|
— |
|
Other Income (Expense) |
|
Changes in fair value of financial instruments |
|
(1.1 |
) |
|
(1.1 |
) |
|
|
(0.5 |
) |
|
(0.4 |
) |
Cost of MCM Products and Other
Income (Expense) |
|
Other expense (income), net items |
|
6.7 |
|
|
— |
|
|
|
9.8 |
|
|
— |
|
Other Income (Expense) |
|
Tax effect |
|
22.9 |
|
|
(53.1 |
) |
|
|
(49.2 |
) |
|
(122.6 |
) |
|
| Total adjustments: |
$ |
(38.6 |
) |
$ |
207.2 |
|
|
$ |
144.6 |
|
$ |
438.0 |
|
|
| Adjusted net income
(loss) |
$ |
76.2 |
|
$ |
(56.2 |
) |
|
$ |
(14.7 |
) |
$ |
(273.0 |
) |
|
| Net income (loss) per
diluted share |
$ |
2.06 |
|
$ |
(5.08 |
) |
|
$ |
(3.03 |
) |
$ |
(13.97 |
) |
|
| Adjustments: |
|
|
|
|
|
|
|
Non-cash amortization charges |
$ |
0.17 |
|
$ |
0.42 |
|
|
$ |
1.03 |
|
$ |
1.28 |
|
Amortization of IA, Other
Income (Expense) |
|
Impairments |
|
— |
|
|
4.21 |
|
|
|
0.52 |
|
|
10.31 |
|
Impairment of long-lived
assets |
|
Severance and restructuring costs |
|
0.12 |
|
|
0.40 |
|
|
|
0.44 |
|
|
0.68 |
|
Cost of MCM Products, Cost of
Services, SG&A and R&D |
|
Inventory step-up provision |
|
0.02 |
|
|
— |
|
|
|
0.02 |
|
|
0.04 |
|
Cost of MCM Products |
|
Acquisition and divestiture costs |
|
— |
|
|
— |
|
|
|
— |
|
|
0.06 |
|
SG&A |
|
Exit and disposal costs |
|
— |
|
|
— |
|
|
|
0.25 |
|
|
0.12 |
|
R&D |
|
Loss (gain) on sale of business |
|
(1.16 |
) |
|
0.01 |
|
|
|
(0.46 |
) |
|
(1.46 |
) |
Other Income (Expense) |
|
Settlement charges, net |
|
0.18 |
|
|
— |
|
|
|
2.29 |
|
|
— |
|
Cost of Services and
SG&A |
|
Contingent consideration milestones |
|
(0.54 |
) |
|
— |
|
|
|
(0.57 |
) |
|
— |
|
Other Income (Expense) |
|
Changes in fair value of financial instruments |
|
(0.02 |
) |
|
(0.02 |
) |
|
|
(0.01 |
) |
|
(0.01 |
) |
Cost of MCM Products and Other
Income (Expense) |
|
Other expense (income), net items |
|
0.12 |
|
|
— |
|
|
|
0.19 |
|
|
— |
|
Other Income (Expense) |
|
Tax effect |
|
0.42 |
|
|
(1.03 |
) |
|
|
(0.95 |
) |
|
(2.41 |
) |
|
| Total adjustments: |
$ |
(0.69 |
) |
$ |
3.99 |
|
|
$ |
2.75 |
|
$ |
8.61 |
|
|
| Adjusted net income
(loss) per diluted share |
$ |
1.37 |
|
$ |
(1.09 |
) |
|
$ |
(0.28 |
) |
$ |
(5.36 |
) |
|
| Diluted shares used in
computing Adjusted net income (loss) per diluted share |
|
55.6 |
|
|
51.8 |
|
|
|
52.6 |
|
|
50.9 |
|
|
| |
|
Emergent BioSolutions, Inc.Reconciliation
of Net Income (Loss) to Adjusted EBITDA(1) |
| |
| ($ in
millions) |
Three Months Ended September 30, |
|
Nine Months Ended September 30, |
|
|
2024 |
|
|
2023 |
|
|
|
2024 |
|
|
2023 |
|
|
Net income (loss) |
$ |
114.8 |
|
$ |
(263.4 |
) |
|
$ |
(159.3 |
) |
$ |
(711.0 |
) |
| Adjustments: |
|
|
|
|
|
|
Depreciation & amortization |
$ |
26.4 |
|
$ |
27.9 |
|
|
$ |
82.8 |
|
$ |
95.5 |
|
|
Income taxes |
|
27.6 |
|
|
(2.5 |
) |
|
|
44.0 |
|
|
34.3 |
|
|
Total interest expense, net |
|
7.7 |
|
|
19.4 |
|
|
|
54.8 |
|
|
59.9 |
|
|
Impairments |
|
— |
|
|
218.2 |
|
|
|
27.2 |
|
|
524.9 |
|
|
Inventory step-up provision |
|
1.2 |
|
|
— |
|
|
|
1.2 |
|
|
1.9 |
|
|
Changes in fair value of financial instruments |
|
(1.1 |
) |
|
(1.1 |
) |
|
|
(0.5 |
) |
|
(0.4 |
) |
|
Severance and restructuring costs |
|
6.3 |
|
|
20.6 |
|
|
|
22.9 |
|
|
34.5 |
|
|
Exit and disposal costs |
|
— |
|
|
— |
|
|
|
13.3 |
|
|
6.1 |
|
|
Acquisition and divestiture costs |
|
— |
|
|
— |
|
|
|
— |
|
|
2.8 |
|
|
Loss (gain) on sale of business |
|
(64.3 |
) |
|
0.7 |
|
|
|
(24.3 |
) |
|
(74.2 |
) |
|
Settlement charges, net |
|
10.0 |
|
|
— |
|
|
|
120.2 |
|
|
— |
|
|
Contingent consideration milestones |
|
(30.0 |
) |
|
— |
|
|
|
(30.0 |
) |
|
— |
|
|
Other expense (income), net items |
|
6.7 |
|
|
— |
|
|
|
9.8 |
|
|
— |
|
| Total adjustments |
$ |
(9.5 |
) |
$ |
283.2 |
|
|
$ |
321.4 |
|
$ |
685.3 |
|
| Adjusted
EBITDA |
$ |
105.3 |
|
$ |
19.8 |
|
|
$ |
162.1 |
|
$ |
(25.7 |
) |
| |
|
Emergent BioSolutions, Inc.Reconciliations
of Total Revenues to Total Segment Revenues and of Segment and
Total Segment Gross Margin and Gross Margin % to
Segment and Total Segment Adjusted Gross Margin and Adjusted Gross
Margin %(1) |
| |
| Three Months Ended
September 30, 2024(unaudited, in millions) |
Commercial Products |
MCM Products |
Services |
|
Total Segment |
Contracts & Grants |
Total Revenues |
|
Revenues |
$ |
95.3 |
|
$ |
174.2 |
|
$ |
14.3 |
|
|
$ |
283.8 |
|
$ |
10.0 |
$ |
293.8 |
| |
|
|
|
|
|
|
|
| Cost of sales or
services |
|
47.2 |
|
|
54.0 |
|
|
21.4 |
|
|
|
122.6 |
|
|
|
| |
|
|
|
|
|
|
|
| Gross
margin |
$ |
48.1 |
|
$ |
120.2 |
|
$ |
(7.1 |
) |
|
$ |
161.2 |
|
|
|
| Gross margin
% |
|
50 |
% |
|
69 |
% |
(50 |
)% |
|
|
57 |
% |
|
|
| |
|
|
|
|
|
|
|
| Add
back: |
|
|
|
|
|
|
|
|
Inventory step-up provision |
$ |
— |
|
$ |
1.2 |
|
$ |
— |
|
|
$ |
1.2 |
|
|
|
|
Restructuring costs |
|
— |
|
|
4.9 |
|
|
0.1 |
|
|
|
5.0 |
|
|
|
| |
|
|
|
|
|
|
|
| Adjusted gross
margin |
$ |
48.1 |
|
$ |
126.3 |
|
$ |
(7.0 |
) |
|
$ |
167.4 |
|
|
|
| Adjusted gross margin
% |
|
50 |
% |
|
73 |
% |
(49 |
)% |
|
|
59 |
% |
|
|
| Three Months Ended
September 30, 2023(unaudited, in millions) |
Commercial Products |
MCM Products |
Services |
|
Total Segment |
Contracts & Grants |
Total Revenues |
|
Revenues |
$ |
142.1 |
|
$ |
107.7 |
|
$ |
14.2 |
|
|
$ |
264.0 |
|
$ |
6.5 |
$ |
270.5 |
| |
|
|
|
|
|
|
|
| Cost of sales or
services |
|
60.0 |
|
|
72.5 |
|
|
44.3 |
|
|
|
176.8 |
|
|
|
| |
|
|
|
|
|
|
|
| Gross
margin |
$ |
82.1 |
|
$ |
35.2 |
|
$ |
(30.1 |
) |
|
$ |
87.2 |
|
|
|
| Gross margin
% |
|
58 |
% |
|
33 |
% |
(212 |
)% |
|
|
33 |
% |
|
|
| |
|
|
|
|
|
|
|
| Add
back: |
|
|
|
|
|
|
|
|
Changes in fair value of financial instruments |
$ |
— |
|
$ |
(1.1 |
) |
$ |
— |
|
|
$ |
(1.1 |
) |
|
|
|
Restructuring costs |
|
— |
|
|
5.0 |
|
|
8.1 |
|
|
|
13.1 |
|
|
|
| |
|
|
|
|
|
|
|
| Adjusted gross
margin |
$ |
82.1 |
|
$ |
39.1 |
|
$ |
(22.0 |
) |
|
$ |
99.2 |
|
|
|
| Adjusted gross margin
% |
|
58 |
% |
|
36 |
% |
(155 |
)% |
|
|
38 |
% |
|
|
| |
|
Emergent BioSolutions, Inc.Reconciliations
of Total Revenues to Total Segment Revenues and of Segment and
Total Segment Gross Margin and Gross Margin % to Segment and Total
Segment Adjusted Gross Margin and Adjusted Gross Margin
%(1) |
| |
| Nine Months Ended
September 30, 2024(unaudited, in millions) |
Commercial Products |
MCM Products |
Services1 |
|
Total Segment |
Contracts & Grants |
Total Revenues |
|
Revenues |
$ |
333.8 |
|
$ |
393.0 |
|
$ |
97.5 |
|
|
$ |
824.3 |
|
$ |
24.6 |
$ |
848.9 |
| |
|
|
|
|
|
|
|
| Cost of sales or
services |
|
152.7 |
|
|
147.3 |
|
|
263.3 |
|
|
|
563.3 |
|
|
|
| |
|
|
|
|
|
|
|
| Gross
margin |
$ |
181.1 |
|
$ |
245.7 |
|
$ |
(165.8 |
) |
|
$ |
261.0 |
|
|
|
| Gross margin
% |
|
54 |
% |
|
63 |
% |
(170 |
)% |
|
|
32 |
% |
|
|
| |
|
|
|
|
|
|
|
| Add
back: |
|
|
|
|
|
|
|
|
Changes in fair value of financial instruments |
$ |
— |
|
$ |
0.6 |
|
$ |
— |
|
|
$ |
0.6 |
|
|
|
|
Inventory step-up provision |
|
— |
|
|
1.2 |
|
|
— |
|
|
|
1.2 |
|
|
|
|
Settlement charges, net |
|
— |
|
|
— |
|
|
110.2 |
|
|
|
110.2 |
|
|
|
|
Restructuring costs |
|
— |
|
|
7.5 |
|
|
0.3 |
|
|
|
7.8 |
|
|
|
| |
|
|
|
|
|
|
|
| Adjusted gross
margin |
$ |
181.1 |
|
$ |
255.0 |
|
$ |
(55.3 |
) |
|
$ |
380.8 |
|
|
|
| Adjusted gross margin
%(1) |
|
54 |
% |
|
65 |
% |
(57 |
)% |
|
|
46 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
(1) Total Segment results for the nine months ended September 30,
2024 includes $50.0 million attributable to the Settlement
Agreement with Janssen. The revenue and cost of services is related
to raw materials purchased for the Janssen Agreement which Janssen
had not reimbursed. Excluding the impacts of the Settlement
Agreement, Total Segment Adjusted Gross Margin % would have been 3%
higher for the nine months ended September 30, 2024. |
| Nine Months Ended
September 30, 2023(in millions) |
Commercial Products |
MCM Products |
Services |
|
Total Segment |
Contracts & Grants |
Total Revenues |
|
Revenues |
$ |
386.2 |
|
$ |
309.2 |
|
$ |
57.7 |
|
|
$ |
753.1 |
|
$ |
19.6 |
$ |
772.7 |
| |
|
|
|
|
|
|
|
| Cost of sales or
services |
|
160.2 |
|
|
208.4 |
|
|
151.7 |
|
|
|
520.3 |
|
|
|
| |
|
|
|
|
|
|
|
| Gross
margin |
$ |
226.0 |
|
$ |
100.8 |
|
$ |
(94.0 |
) |
|
$ |
232.8 |
|
|
|
| Gross margin
% |
|
59 |
% |
|
33 |
% |
(163 |
)% |
|
|
31 |
% |
|
|
| |
|
|
|
|
|
|
|
| Add
back: |
|
|
|
|
|
|
|
|
Changes in fair value of financial instruments |
$ |
— |
|
$ |
(0.4 |
) |
$ |
— |
|
|
$ |
(0.4 |
) |
|
|
|
Inventory step-up provision |
|
— |
|
|
1.9 |
|
|
— |
|
|
|
1.9 |
|
|
|
|
Restructuring costs |
|
— |
|
|
7.0 |
|
|
8.1 |
|
|
|
15.1 |
|
|
|
| |
|
|
|
|
|
|
|
| Adjusted gross
margin |
$ |
226.0 |
|
$ |
109.3 |
|
$ |
(85.9 |
) |
|
$ |
249.4 |
|
|
|
| Adjusted gross margin
% |
|
59 |
% |
|
35 |
% |
(149 |
)% |
|
|
33 |
% |
|
|
| |
|
Emergent BioSolutions, Inc.Reconciliation
of Net Loss Forecast to Adjusted Net Income (Loss)
Forecast |
| |
|
($ in millions) |
2024 Full Year Forecast |
Source |
| Net loss |
$(203) - $(183) |
|
|
Adjustments: |
|
|
|
Non-cash amortization charges |
$65 |
Amortization of intangible
assets and Other Income (Expense) |
|
Changes in fair value of financial instruments |
(1) |
Other Income (Expense) |
|
Impairments |
27 |
Impairment of long-lived
assets |
|
Severance and restructuring costs |
23 |
Cost of MCM Products, Cost of
Services, SG&A and R&D |
|
Inventory step-up provision |
1 |
Cost of MCM Products |
|
Exit and disposal costs |
13 |
R&D |
|
Loss (gain) on sale of business |
(24) |
Other Income (Expense) |
|
Settlement charges, net |
120 |
Cost of Services and
SG&A |
|
Contingent consideration milestones |
(30) |
Other Income (Expense) |
|
Other expense (income), net items |
10 |
Other Income (Expense) |
| Tax effect |
(51) |
|
| Total adjustments: |
$153 |
|
| Adjusted net
loss |
$(50) - $(30) |
|
|
Reconciliation of Net Loss Forecast to Adjusted EBITDA
Forecast |
| |
|
($ in millions) |
2024 Full Year Forecast |
| Net loss |
$(203) - $(183) |
| Adjustments: |
|
|
Depreciation & amortization |
$109 |
|
Income taxes |
60 |
|
Total interest expense, net |
75 |
|
Impairments |
27 |
|
Inventory step-up provision |
1 |
|
Changes in fair value of financial instruments |
(1) |
|
Severance and restructuring costs |
23 |
|
Exit and disposal costs |
13 |
|
Loss (gain) on sale of business |
(24) |
|
Settlement charges, net |
120 |
|
Contingent consideration milestones |
(30) |
|
Other expense (income), net items |
10 |
|
Total adjustments |
$383 |
| Adjusted EBITDA |
$180 - $200 |
|
|
|
|
Reconciliations of Forecasted Total Revenues to Forecasted
Total Segment Revenues and of Forecasted Segment and Total Segment
Gross Margin and Gross Margin % to Forecasted Segment and Total
Segment Adjusted Gross Margin and Adjusted Gross Margin
%(1) |
| |
|
| (in millions) |
2024 Full Year Forecast |
| Total
revenues |
$1,065 - $1,125 |
|
Contracts & Grants |
(30) - (35) |
| Total segment
revenues |
$1,035 - $1,090 |
| |
|
| Cost of sales or
services |
$710 - $719 |
| Total segment gross
margin |
$325 - $371 |
| Total segment gross
margin % |
31% - 34% |
| Add
back: |
|
|
Changes in fair value of financial instruments |
$1 |
|
Inventory step-up provision |
1 |
|
Settlement charges, net |
110 |
|
Restructuring costs |
8 |
| Total segment adjusted
gross margin |
$445 - $491 |
| Total segment adjusted
gross margin % |
43% - 45% |
Emergent Biosolutions (NYSE:EBS)
Graphique Historique de l'Action
De Jan 2025 à Fév 2025
Emergent Biosolutions (NYSE:EBS)
Graphique Historique de l'Action
De Fév 2024 à Fév 2025
