Highlights:
- Delivered revenues of ?49.3 million, an increase of 40% on Q1 2019
- Operating profit of ?19.4 million, an increase of 59% on Q1 2019
- Despite significant one- off financial expenses of ?3.7 million from full pay-off of loan, net profits increased by 25% to ?8.4 million, compared to Q1 2019,
LEIDEN, Netherlands, May 14, 2020 /PRNewswire/ -- Pharming Group N.V. ("Pharming" or "the Company") (Euronext Amsterdam: PHARM) presents its (unaudited) financial report for the first quarter of the year ended 31 March 2020.
Financial highlights
Operational highlights
On 14 January 2020, the Company announced the launch and placement of an over-subscribed offering (the "Offering") of ?125 million, 3% senior unsecured convertible bonds due 2025 (the "Bonds"). The conversion price was set at ?2.0028 which represented a premium of 40% to the volume weighted average share price (VWAP) when the placement was completed. Net proceeds of the issue of the Bonds were used to redeem the remaining $56 million of the originally $100 million loan from Orbimed Advisors in full, thereby reducing the Company's financing costs and extending its debt maturity through the period to approval of most of the Company's existing pipeline. The balance of the net proceeds will be used to support capital expenditure in relation to the expansion of the commercialisation and manufacturing infrastructure of the Company and serve as funding for the launch of Pharming's recently acquired leniolisib product and for additional acquisitions/in- licensing opportunities.
During the first quarter of 2020, Pharming received European and US validation of its new production facility of starting material for the Company's lead product, RUCONEST®. In January 2020, the European Medicines Agency (EMA) approved a Type II Variation for the new production facility. In March 2020, the US Food and Drug Administration (FDA) approved Pharming's Prior Approval Supplement to add the new production facility to the Biologics License Application (BLA) to support RUCONEST®. With the addition of this new facility, Pharming will significantly increase the production capacity of RUCONEST® as it becomes fully operational during this year.
On 11 March 2020, the Company announced its Chief Financial Officer (CFO), Robin Wright, had decided not to put himself up for re-election as a member of the Board of Management and therefore as CFO at the General Meeting of Shareholders on 20 May 2020. As a result of this decision, Robin's term with the Company will end as at that date. The search for a new Chief Financial Officer is meanwhile well underway.
On 23 March 2020, the Company announced it has been included in the Euronext Amsterdam Midkap index (AMX). Composition of the AMX is reviewed quarterly by Euronext Amsterdam. Entry eligibility into any of the Amsterdam indexes is evaluated by certain criteria, including free float/market capitalisation and free float/velocity. Based on these evaluations, Euronext ranks the companies by size into one of the three indexes; AEX, AMX or AScX of the Amsterdam stock exchange. The promotion to AMX further validates Pharming's strong growth and the success of the Company's commercialisation platform, as well as providing access to a new pool of funds mandated to invest in companies in this index.
Post period operational highlights
On 21 April 2020, the Company announced encouraging results from five patients with confirmed COVID-19 (SARS-CoV-2) infections hospitalised with related severe pneumonia that were treated with RUCONEST® under a compassionate use program at the University Hospital Basel, Switzerland. Following these initial results, a multinational, randomized, controlled, investigator-initiated clinical trial with up to 150 patients with confirmed COVID-19 infections, requiring hospitalisation due to significant COVID-19 related symptoms is planned. The study will be led by Dr Michael Osthoff, University Hospital Basel, Switzerland.
On 30 April 2020, the Company announced that the European Commission approved an extension in the indication of RUCONEST®'s Marketing Authorisation to include the treatment of acute angioedema attacks in children with hereditary angioedema (HAE). The European Commission's decision allows children aged two years and older to be treated with RUCONEST® for acute angioedema attacks. In the European Union, RUCONEST® has been approved for this indication in adults since 2010 and in adolescents since 2016.
COVID-19 update
During the COVID-19 pandemic, Pharming is complying with international guidance and requirements across its operations to prioritise the health and safety of its employees.
The current impact of COVID-19 on the business is summarised below.
Sijmen de Vries, Chief Executive Officer of Pharming, commented:
"The start of 2020 has been very busy for Pharming. Importantly, we completed a highly successful convertible bond refinancing, replacing our existing debt facility, providing additional cash resources and further strengthening our balance sheet to support our long-term growth prospects. We also received EMA and FDA approval of our new production facility for RUCONEST®, which will double our production capacity once fully operational later this year. In addition, approval from the European Commission to treat acute HAE attacks in children with RUCONEST® allows us to serve the most vulnerable patients and further demonstrates the safety and efficacy of our lead product.
"In addition to these achievements, Pharming has continued to deliver strong sales growth as new patients continue to benefit from RUCONEST®'s product profile. Following the reacquisition of RUCONEST®-licensed territories from January 2020, we are excited to expand our distribution network in Europe, where we are seeing increasing demand for the product.
"Looking forward to the remainder of 2020, we expect continued sales growth versus last year, driven by increasing patient numbers and despite competitive pressure, whilst remaining cognisant of the macro-environment and uncertainty around COVID-19."
Financial summary
3 months to 31 March
2020 | 2019 | % | |
Amounts in ?m except per share data | 1st Quarter | 1st Quarter | Change |
Income Statement | |||
Revenues | 49,3 | 35,2 | 40% |
Gross profit | 43,9 | 29,8 | 47% |
Operating result | 19,4 | 12,2 | 59% |
Net result | 8,4 | 6,7 | 25% |
Balance Sheet | |||
Cash & marketable securities | 136,1 | 68,6 | 98% |
Share Information | |||
Earnings per share (?): - Undiluted | 0,013 | 0,011 | 18% |
- Fully diluted | 0,011 | 0,010 | 10% |
Outlook
For the remainder of 2020, the Company expects:
No further financial guidance for 2020 is provided.
About Pharming Group N.V.
Pharming is a specialty pharmaceutical company developing innovative products for the safe, effective treatment of rare diseases and unmet medical needs. Pharming's lead product, RUCONEST® (conestat alfa) is a recombinant human C1 esterase inhibitor approved for the treatment of acute Hereditary Angioedema ("HAE") attacks in patients in Europe, the US, Israel and South Korea. The product is available on a named-patient basis in other territories where it has not yet obtained marketing authorisation.
RUCONEST® is commercialised by Pharming in the US and in Europe, and the Company holds all other commercialisation rights in other countries not specified below. In some of these other countries distribution is made in association with the HAEi Global Access Program (GAP). RUCONEST® is distributed in Argentina, Colombia, Costa Rica, the Dominican Republic, Panama, and Venezuela by Cytobioteck, in South Korea by HyupJin Corporation and in Israel by Kamada.
RUCONEST® is also being evaluated for various additional indications. Pharming's technology platform includes a unique production process that has proven capable of producing industrial quantities of pure high quality recombinant human proteins in a more economical and less immunogenic way compared with current cell-line based methods.
Leads for enzyme replacement therapy ("ERT") for Pompe and Fabry's diseases are also being produced and optimised respectively at present.
Pharming has recently in-licensed leniolisib from Novartis, a small molecule and selective PI3K? inhibitor, which is in a registrational study for activated PI3K-delta syndrome (APDS), a rare form of Primary Immunodeficiency.
Pharming has a long term partnership with the China State Institute of Pharmaceutical Industry ("CSIPI"), a Sinopharm company, for joint global development of new products, starting with recombinant human Factor VIII for the treatment of Haemophilia A. Preclinical development and manufacturing will take place to global standards at CSIPI and its affiliates and are funded by CSIPI. Clinical development will be shared between the partners with each partner taking the costs for their territories under the partnership.
Additional information is available on the Pharming website: www.pharming.com.
Forward-looking Statements
This press release of Pharming Group N.V. and its subsidiaries ("Pharming", the "Company" or the "Group") may contain forward-looking statements including without limitation those regarding Pharming's financial projections, market expectations, developments, partnerships, plans, strategies and capital expenditures.
The Company cautions that such forward-looking statements may involve certain risks and uncertainties, and actual results may differ. Risks and uncertainties include without limitation the effect of competitive, political and economic factors, legal claims, the Company's ability to protect intellectual property, fluctuations in exchange and interest rates, changes in taxation laws or rates, changes in legislation or accountancy practices and the Company's ability to identify, develop and successfully commercialize new products, markets or technologies.
As a result, the Company's actual performance, position and financial results and statements may differ materially from the plans, goals and expectations set forth in such forward-looking statements. The Company assumes no obligation to update any forward-looking statements or information, which should be taken as of their respective dates of issue, unless required by laws or regulations.
Pharming Group N.V.
Consolidated Interim Financial Statements (Unaudited)
For the first three months ended 31 March 2020
Consolidated statement of income
Consolidated statement of comprehensive income
Consolidated balance sheet
Consolidated statement of cash flows
Appendix: Main Financial Statements reported in US dollars
(The appendix does not form part of the Consolidated Interim Financial Statements)
Consolidated statement of income in US Dollars (unaudited)
Consolidated balance sheet in US Dollars (unaudited)
Consolidated statement of cash flows in US Dollars (unaudited)
Consolidated Statement of Income
For the first three months ended 31 March
Amounts in ? '000 except per share data | YTD 2020 | YTD 2019 |
Revenues | 49,294 | 35,224 |
Costs of sales | (5,390) | (5,420) |
Gross profit | 43,904 | 29,804 |
Other income | 241 | 281 |
Research and development | (8,017) | (5,305) |
General and administrative | (5,167) | (2,968) |
Marketing and sales | (11,515) | (9,568) |
Costs | (24,699) | (17,841) |
Operating result | 19,446 | 12,244 |
Fair value gain (loss) on revaluation derivatives | 121 | (28) |
Other financial income | 370 | 176 |
Other financial expenses | (7,525) | (2,673) |
Financial income and expenses | (7,034) | (2,525) |
Share of net profits in associates using the equity method | 14 | - |
Result before income tax | 12,426 | 9,719 |
Income tax credit (expense) | (3,999) | (2,980) |
Net result for the year | 8,427 | 6,739 |
Attributable to: | ||
Owners of the parent | 8,427 | 6,739 |
Total net result | 8,427 | 6,739 |
Basic earnings per share (?) | 0.013 | 0.011 |
Fully-diluted earnings per share (?) | 0.011 | 0.010 |
Consolidated Statement of Comprehensive Income
For the first three months ended 31 March
Amounts in ? '000 | YTD 2020 | YTD 2019 |
Net result for the period | 8,427 | 6,739 |
Currency translation differences | (53) | (304) |
Items that may be subsequently reclassified to profit or loss | (53) | (304) |
Other comprehensive income (loss), net of tax | (53) | (304) |
Total comprehensive income (loss) for the period | 8,374 | 6,435 |
Attributable to: | ||
Owners of the parent | 8,374 | 6,435 |
Consolidated Balance Sheet
As at date shown
Amounts in ? '000 | March 31 2020 | December 31 |
Intangible assets | 77,620 | 70,809 |
Property, plant and equipment | 8,689 | 8,553 |
Right-of-use assets | 5,581 | 5,979 |
Deferred tax assets | 25,314 | 28,590 |
Investment accounted for using the equity method | 5,515 | 5,508 |
Restricted cash | 2,306 | 2,268 |
Non-current assets | 125,025 | 121,707 |
Inventories | 14,511 | 14,467 |
Trade and other receivables | 30,564 | 25,737 |
Cash and cash equivalents | 133,834 | 66,299 |
Current assets | 178,909 | 106,503 |
Total assets | 303,934 | 228,210 |
Share capital | 6,350 | 6,313 |
Share premium | 394,255 | 392,266 |
Legal reserves | 3,757 | 3,718 |
Accumulated deficit | (288,742) | (297,618) |
Shareholders' equity | 115,620 | 104,679 |
Convertible bonds | 121,277 | - |
Lease liabilities | 4,340 | 4,363 |
Other financial liabilities | 18,298 | 17,282 |
Non-current liabilities | 143,915 | 21,645 |
Loans and borrowings | - | 45,590 |
Derivative financial liabilities | 147 | 268 |
Trade and other payables | 42,607 | 36,247 |
Lease liabilities | 1,644 | 1,946 |
Other financial liabilities | - | 17,835 |
Current liabilities | 44,399 | 101,886 |
Total equity and liabilities | 303,934 | 228,210 |
Consolidated Statement of Cash Flows
For the first three months ended 31 March
Amounts in ?'000 | YTD 2020 | YTD 2019 |
Operating result | 19,446 | 12,244 |
Non-cash adjustments: | ||
Depreciation, amortisation, impairment | 1,704 | 1,353 |
Accrued employee benefits | 666 | 541 |
Release contract liabilities | - | (200) |
Operating cash flows before changes in working capital | 21,816 | 13,938 |
Changes in working capital: | ||
Inventories | (57) | 3,673 |
Trade and other receivables | (4,827) | (4,969) |
Payables and other current liabilities | 2,499 | (2,833) |
Total changes in working capital | (2,385) | (4,129) |
Changes in non-current assets, liabilities and equity | (53) | 3 |
Cash generated from (used in) operations before interest and taxes | 19,378 | 9,812 |
Net cash flows generated from (used in) operating activities | 19,378 | 9,812 |
Capital expenditure for property, plant and equipment | (597) | (229) |
Investment intangible assets | (190) | (114) |
Investment in associate | 7 | - |
Acquisition of license | (5,500) | - |
Net cash flows used in investing activities | (6,280) | (343) |
Repayment on loans and borrowings | (49,742) | (7,728) |
Payment of contingent consideration | (18,135) | (17,635) |
Interests on loans | (346) | (2,510) |
Lease liabilities | (475) | (379) |
Convertible bond | 122,682 | - |
Interest received | 370 | 165 |
Proceeds of equity and warrants | 495 | 228 |
Net cash flows generated from (used in) financing activities | 54,849 | (27,859) |
Increase (decrease) of cash | 67,947 | (18,390) |
Exchange rate effects | (374) | 3,364 |
Cash and cash equivalents at 1 January | 68,567 | 81,515 |
Total cash and cash equivalents at 31 March | 136,140 | 66,489 |
Appendix: Main Financial Statements reported in US dollars
The original Financial Statements are reported in Euros. In case of differences of interpretation between the Financial Statements in US Dollars and the Financial Statements in Euros, the Financial Statements in Euros will prevail.
Principal exchange rate used for the income statement: ?1 = $1.1050
Principal period end exchange rate used for the balance sheet ?1 = $1.0976
Consolidated Statement of Income in US Dollars
For the first three months ended 31 March
Amounts in $ '000 except per share data | YTD 2020 | YTD 2019 |
Revenues | 54,469 | 40,159 |
Costs of sales | (5,955) | (6,179) |
Gross profit | 48,514 | 33,980 |
Other income | 267 | 320 |
Research and development | (8,859) | (6,048) |
General and administrative | (5,709) | (3,384) |
Marketing and sales | (12,725) | (10,908) |
Costs | (27,293) | (20,341) |
Operating result | 21,488 | 13,959 |
Fair value gain (loss) on revaluation derivatives | 134 | (32) |
Other financial income | 409 | 201 |
Other financial expenses | (8,378) | (2,922) |
Financial income and expenses | (7,835) | (2,753) |
Share of net profits in associates using the equity method | 15 | - |
Result before income tax | 13,668 | 11,206 |
Income tax credit (expense) | (4,418) | (3,397) |
Net result for the period | 9,250 | 7,809 |
Attributable to: | ||
Owners of the parent | 9,250 | 7,809 |
Total net result | 9,250 | 7,809 |
Basic earnings per share ($) | 0.015 | 0.013 |
Fully-diluted earnings per share ($) | 0.013 | 0.011 |
Consolidated Balance Sheet in US Dollars
As at date shown
Amounts in $ '000 | March 31 | December 31 |
Intangible assets | 85,196 | 79,405 |
Property, plant and equipment | 9,537 | 9,591 |
Right-of-use assets | 6,126 | 6,705 |
Deferred tax assets | 27,784 | 32,061 |
Investment accounted for using the equity method | 6,053 | 6,177 |
Restricted cash | 2,532 | 2,543 |
Non-current assets | 137,228 | 136,482 |
Inventories | 15,927 | 16,223 |
Trade and other receivables | 33,547 | 28,861 |
Cash and cash equivalents | 146,896 | 74,348 |
Current assets | 196,370 | 119,432 |
Total assets | 333,598 | 255,915 |
Share capital | 6,970 | 7,079 |
Share premium | 432,734 | 439,887 |
Legal reserves | 4,123 | 4,169 |
Accumulated deficit | (316,923) | (333,749) |
Shareholders' equity | 126,904 | 117,387 |
Convertible bonds | 133,114 | - |
Lease liabilities | 4,764 | 4,893 |
Other financial liabilities | 20,084 | 19,380 |
Non-current liabilities | 157,962 | 24,273 |
Loans and borrowings | - | 51,125 |
Derivative financial liabilities | 162 | 301 |
Trade and other payables | 46,765 | 40,647 |
Lease liabilities | 1,805 | 2,182 |
Other financial liabilities | - | 20,000 |
Current liabilities | 48,732 | 114,255 |
Total equity and liabilities | 333,598 | 255,915 |
Consolidated Statement of Cash Flows in US Dollars
For the first three months ended 31 March
Amounts in $'000 | YTD 2020 | YTD 2019 |
Operating result | 21,488 | 13,959 |
Non-cash adjustments: | ||
Depreciation, amortisation, impairment | 1,883 | 1,543 |
Accrued employee benefits | 736 | 617 |
Release contract liabilities | - | (228) |
Operating cash flows before changes in working capital | 24,107 | 15,891 |
Changes in working capital: | ||
Inventories | (63) | 4,188 |
Trade and other receivables | (5,334) | (5,665) |
Payables and other current liabilities | 2,761 | (3,230) |
Total changes in working capital | (2,636) | (4,707) |
Changes in non-current assets, liabilities and equity | (59) | 3 |
Cash generated from (used in) operations before interest and taxes | 21,412 | 11,187 |
Net cash flows generated from (used in) operating activities | 21,412 | 11,187 |
Capital expenditure for property, plant and equipment | (660) | (261) |
Investment intangible assets | (210) | (130) |
Investment in associate | 8 | - |
Acquisition of license | (6,077) | - |
Net cash flows used in investing activities | (6,939) | (391) |
Repayment on loans and borrowings | (54,965) | (8,811) |
Payment on contingent consideration | (20,039) | (20,106) |
Interests on loans | (382) | (2,862) |
Lease liabilities | (525) | (432) |
Convertible Bond | 135,563 | - |
Interest Received | 409 | 188 |
Proceeds of equity and warrants | 547 | 260 |
Net cash flows generated from (used in) financing activities | 60,608 | (31,762) |
Increase (decrease) of cash | 75,081 | (20,966) |
Exchange rate effects | (2,544) | 2,282 |
Cash and cash equivalents at 1 January | 76,891 | 93,245 |
Total cash and cash equivalents at 31 March | 149,428 | 74,561 |
For further public information, contact:
Pharming Group N.V.
Sijmen de Vries, CEO, Tel: +31 71 524 7400
Susanne Embleton, Investor Relations Manager: +31 71 524 7400
FTI Consulting, London, UK:
Victoria Foster Mitchell, Tel: +44 203 727 1136
LifeSpring Life Sciences Communication, Amsterdam, The Netherlands:
Leon Melens, Tel: +31 6 53 81 64 27
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