[October 21, 2014] |
|
Cubist Reports Third Quarter 2014 Financial Results
LEXINGTON, Mass. --(Business Wire)--
Cubist
Pharmaceuticals, Inc. (NASDAQ: CBST) today announced results for the
third quarter ended September 30, 2014. The Company will host a
conference call and webcast today at 5:00 p.m. ET (details below).
Financial highlights for the third quarter of 2014 (unaudited)
-
Q3 2014 total net revenues were $309.2 million, up 16% compared to
$266.0 million in Q3 2013.
-
U.S. CUBICIN® (daptomycin for injection) net product revenues
increased 12% to $256.7 million from $229.9 million in Q3 2013, the
first quarter with U.S. net revenue representing an annualized run
rate of greater than $1 billion.
-
International product revenues were $16.6 million compared to $13.0
million in Q3 2013.
-
Non-GAAP adjusted operating income was $99.1 million compared to $52.5
million in the third quarter of 2013. GAAP operating income was $67.8
million compared to $4.1 million in the third quarter of 2013.
-
Non-GAAP diluted earnings per share (EPS) was $0.58 compared to $0.41
in the third quarter of 2013. GAAP diluted EPS was $0.29 compared to
$(0.50) in the third quarter of 2013.
"This was a strong quarter for Cubist in which we made significant
progress against our 2014 financial and business objectives, driven by
CUBICIN and meaningful contributions across our portfolio," said Mike
Bonney, CEO of Cubist. "We are pleased with the early interest in our
new antibiotic for the treatment of adult acute bacterial skin and skin
structure infections, SIVEXTRO, as well as the traction we are seeing in
our re-launch of DIFICID and with sales of ENTEREG. Third quarter
results reflect important momentum across our portfolio and complement
our continued launch preparation leading up to the December FDA action
date of our potential blockbuster ceftolozane/tazobactam, now known as
ZERBAXA."
As of September 30, 2014, Cubist had $687.0 million in cash, cash
equivalents and investments. The total number of Cubist's common shares
outstanding as of September 30, 2014, was 76,012,863.
Recent Corporate Highlights
-
On October 20, Cubist announced that current President and Chief
Operating Officer Rob Perez will become the Company's Chief Executive
Officer, effective January 1, 2015. At that time, Mr. Bonney will
retire from his role as CEO and become non-executive Chair of Cubist's
Board of Directors and current Board Chair, Kenneth M. Bate, will
become Lead Independent Director.
-
On September 18, Cubist announced the official opening of its
international headquarters in Zurich, Switzerland, reinforcing its
commitment to global public health. Located in a growing
biopharmaceutical hub in Switzerland, the Company's international
operations complement Cubist's corporate headquarters in Lexington,
Massachusetts, in the United States.
Recent Product and Pipeline Highlights
-
On August 22, the European Medicines Agency (EMA) announced that it
accepted for review the Company's Marketing Authorization Application
(MAA) for its investigational antibiotic ZERBAXA™
(ceftolozane/tazobactam for injection). Cubist is seeking approval of
ZERBAXA for the treatment of complicated urinary tract infections and
complicated intra-abdominal infections, with a decision from the
European Commission (EC) expected during the second half of 2015.
Prior to the MAA acceptance, the U.S. Food and Drug Administration
(FDA) accepted the Company's New Drug Application (NDA) for ZERBAXA
with Priority Review and assigned an action date of December 21, 2014.
-
On August 5, Cubist announced that SIVEXTRO® (tedizolid phosphate),
indicated for the treatment of adult acute bacterial skin and skin
structure infections (ABSSSI), is now available in the U.S. in
once-daily I.V. and oral formulations. Approved by the FDA on June 20,
2014, SIVEXTRO addresses ABSSSI caused by susceptible Gram-positive
bacteria, including methicillin-resistant Staphylococcus aureus -
which has been categorized by the U.S. Centers for Disease Control and
Prevention as a serious public health threat.
Use of Non-GAAP Financial Measures
Cubist has presented certain non-GAAP financial measures, including
non-GAAP adjusted operating income, non-GAAP net income, non-GAAP
diluted earnings per share, non-GAAP cost of product revenues, non-GAAP
R&D expenses, non-GAAP SG&A expenses, non-GAAP other income (expense)
and non-GAAP provision for income taxes. These non-GAAP financial
measures exclude certain amounts, expenses or income, from the
corresponding financial measures determined in accordance with
accounting principles generally accepted in the U.S. (GAAP). Management
believes this non-GAAP information is useful for investors, taken in
conjunction with Cubist's GAAP financial statements, because it provides
greater transparency regarding Cubist's operating performance.
Management uses these measures, among other factors, to assess and
analyze operational results and trends and to make financial and
operational decisions. Non-GAAP information is not prepared under a
comprehensive set of accounting rules and should only be used to
supplement an understanding of Cubist's operating results as reported
under GAAP, not as a substitute for GAAP. In addition, these non-GAAP
financial measures are unlikely to be comparable with non-GAAP
information provided by other companies. The determination of the
amounts that are excluded from non-GAAP financial measures is a matter
of management judgment and depends upon, among other factors, the nature
of the underlying expense or income amounts. Reconciliations between
these non-GAAP financial measures and the most comparable GAAP financial
measures are included in the tables accompanying this press release
after the unaudited condensed consolidated financial statements.
***********************CONFERENCE CALL & WEBCAST
INFORMATION***********************
CUBIST Q3 2014 FINANCIAL RESULTS Tuesday, October 21, 2014 at 5:00
pm ET
U.S./Canada Attendee Dial-in: (855) 319-7654 International Attendee
Dial-in: (484) 756-4327 Conference ID: 11866394
24-HOUR REPLAY U.S./CANADA: (855) 859-2056 24-HOUR REPLAY
INTERNATIONAL: (404) 537-3406 Conference ID: 11866394
CALL WILL ALSO BE BROADCAST LIVE, LISTEN ONLY, VIA THE WEB AT: https://cubist.webex.com/cubist/onstage/g.php?t=a&d=294736098 Attendee
Password: 10212014
Replay will be available for 90 days at www.cubist.com
*********************************************************************************
About Cubist
Cubist Pharmaceuticals, Inc. is a biopharmaceutical company focused on
the research, development, and commercialization of pharmaceutical
products that address significant unmet medical needs in the acute care
environment. Cubist is headquartered in Lexington, Mass. Additional
information can be found at Cubist's web site at www.cubist.com.
Forward Looking Statements
This press release contains forward-looking statements. Any statements
contained herein which do not describe historical facts, including but
not limited to, statements regarding: our expected third quarter 2014
financial results; our progress against our 2014 financial and business
objectives; the projected CUBICIN U.S. revenue annualized run rate of
greater than $1 billion; our belief that ZERBAXA has the potential to
achieve blockbuster status; the Prescription Drug User Fee Act (PDUFA)
action date for our NDA with the FDA for ZERBAXA, including our launch
preparation actions; the expected timing for a decision from the EC on
our MAA with the EMA for ZERBAXA; the therapeutic and commercial
potential of SIVEXTRO, including the level of interest in SIVEXTRO; our
progress in our re-launch of DIFICID® and sales of ENTEREG®; the
expected retirement of our current CEO and the expected appointment of
our new CEO, our new non-executive Chair of the Board and our new Lead
Independent Director; and our commitment to global public health, are
forward-looking statements which involve risks and uncertainties that
could cause actual results to differ materially from those discussed in
such forward-looking statements. Such risks and uncertainties include,
among others: the risk that our final third quarter 2014 financial
results will differ materially from our expected results disclosed in
this release; regulatory developments, including the risk that the FDA
and EC may not agree with our interpretation of the results from the
clinical studies of ZERBAXA, may not approve on a timely basis or at all
our NDA and/or MAA for ZERBAXA or may require additional data, analysis,
information or further studies that may not be clinically feasible or
financially practicable; the review of our NDA and/or MAA for ZERBAXA
may take longer than anticipated, including as a result of internal
regulatory authority constraints; our ability to achieve our financial
and business objectives, including as a result of our ability to
continue to grow revenues from the sale of our commercial products,
generic and other competition, manufacturing issues, our ability to
successfully develop, gain marketing approval for and commercially
launch our product candidates for their planned indications and on their
expected timelines, and our ability to discover, in-license or acquire
new products and product candidates; any marketing approval for ZERBAXA
may impose significant limitations on its use and additional
post-marketing requirements; our ability to obtain adequate pricing and
reimbursement levels for our products; our ability to successfully
commercialize our products; the acceptance of and demand for new
pharmaceutical products; competitive risks from current and future
therapeutic alternatives to our products; our ability to obtain,
maintain and enforce intellectual property for our products and product
candidates; additional clinical trials of SIVEXTRO and/or ZERBAXA may
produce negative or inconclusive results or may not be initiated or
conducted in a timely manner; technical difficulties, excessive costs or
other issues relating to the manufacture or supply of our products and
product candidates, including our ability to work with our third party
contract manufacturers that manufacture and supply our product and
product candidates on our behalf; our ability to work with, and the
performance of our third party contract research organizations that help
us conduct our clinical trials; the risk that the planned leadership
transition does not occur in the manner or on the time frame that we
currently expect; we may encounter other unanticipated or unexpected
risks with respect to the development, manufacture or commercialization
of our products and product candidates; and those additional factors
discussed in our most recent Annual Report on Form 10-K and subsequent
Quarterly Reports on Form 10-Q filed with the Securities and Exchange
Commission. We caution investors not to place considerable reliance on
the forward-looking statements contained in this press release. These
forward-looking statements speak only as of the date of this document,
and we undertake no obligation to update or revise any of these
statements.
Tables to follow
|
|
|
|
|
|
|
|
|
CUBIST PHARMACEUTICALS, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
UNAUDITED
(in thousands)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
September 30, 2014
|
|
|
December 31, 2013
|
ASSETS
|
Cash, cash equivalents and investments
|
|
|
|
|
$
|
686,982
|
|
|
|
$
|
578,558
|
Accounts receivable, net
|
|
|
|
|
115,125
|
|
|
|
123,155
|
Inventory
|
|
|
|
|
120,552
|
|
|
|
116,829
|
Property and equipment, net
|
|
|
|
|
182,532
|
|
|
|
177,544
|
Deferred tax assets, net
|
|
|
|
|
46,877
|
|
|
|
52,507
|
In-process research and development
|
|
|
|
|
237,400
|
|
|
|
896,400
|
Goodwill
|
|
|
|
|
381,930
|
|
|
|
381,930
|
Other intangible assets, net
|
|
|
|
|
1,322,382
|
|
|
|
721,066
|
Other assets
|
|
|
|
|
89,492
|
|
|
|
97,143
|
Total assets
|
|
|
|
|
$
|
3,183,272
|
|
|
|
$
|
3,145,132
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
LIABILITIES AND STOCKHOLDERS' EQUITY
|
Accounts payable and accrued liabilities
|
|
|
|
|
$
|
198,101
|
|
|
|
$
|
276,955
|
Deferred tax liabilities, net
|
|
|
|
|
363,772
|
|
|
|
357,113
|
Deferred revenue
|
|
|
|
|
34,519
|
|
|
|
37,421
|
Contingent consideration
|
|
|
|
|
167,454
|
|
|
|
223,322
|
Debt and other liabilities, net
|
|
|
|
|
879,779
|
|
|
|
856,590
|
Total liabilities
|
|
|
|
|
1,643,625
|
|
|
|
1,751,401
|
Total stockholders' equity
|
|
|
|
|
1,539,647
|
|
|
|
1,393,731
|
Total liabilities and stockholders' equity
|
|
|
|
|
$
|
3,183,272
|
|
|
|
$
|
3,145,132
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
CUBIST PHARMACEUTICALS, INC.
CONDENSED CONSOLIDATED STATEMENTS OF INCOME
UNAUDITED
(in thousands, except share and per share data)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended September 30,
|
|
|
Nine Months Ended September 30,
|
|
|
|
|
|
2014
|
|
2013
|
|
|
2014
|
|
2013
|
Revenues:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
U.S. CUBICIN product revenues, net
|
|
|
|
|
$
|
256,694
|
|
|
$
|
229,920
|
|
|
|
$
|
703,601
|
|
|
$
|
659,082
|
|
U.S. DIFICID product revenues, net
|
|
|
|
|
17,440
|
|
|
-
|
|
|
|
47,723
|
|
|
-
|
|
U.S. ENTEREG product revenues, net
|
|
|
|
|
15,315
|
|
|
13,676
|
|
|
|
43,842
|
|
|
37,265
|
|
U.S. SIVEXTRO product revenues, net
|
|
|
|
|
2,434
|
|
|
-
|
|
|
|
2,434
|
|
|
-
|
|
Total U.S. product revenues, net
|
|
|
|
|
291,883
|
|
|
243,596
|
|
|
|
797,600
|
|
|
696,347
|
|
International product revenues
|
|
|
|
|
16,619
|
|
|
12,987
|
|
|
|
51,131
|
|
|
40,349
|
|
Other revenues
|
|
|
|
|
653
|
|
|
9,410
|
|
|
|
16,055
|
|
|
18,005
|
|
Total revenues, net
|
|
|
|
|
309,155
|
|
|
265,993
|
|
|
|
864,786
|
|
|
754,701
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Costs and expenses:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cost of product revenues
|
|
|
|
|
94,959
|
|
|
60,989
|
|
|
|
257,113
|
|
|
179,705
|
|
Research and development expense
|
|
|
|
|
66,032
|
|
|
123,423
|
|
|
|
291,497
|
|
|
352,822
|
|
Contingent consideration expense (income)
|
|
|
|
|
2,224
|
|
|
2,641
|
|
|
|
(55,868
|
)
|
|
7,280
|
|
Selling, general and administrative expense
|
|
|
|
|
77,791
|
|
|
73,855
|
|
|
|
227,510
|
|
|
171,945
|
|
Restructuring charges
|
|
|
|
|
340
|
|
|
1,029
|
|
|
|
6,248
|
|
|
1,029
|
|
Total costs and expenses
|
|
|
|
|
241,346
|
|
|
261,937
|
|
|
|
726,500
|
|
|
712,781
|
|
Operating income
|
|
|
|
|
67,809
|
|
|
4,056
|
|
|
|
138,286
|
|
|
41,920
|
|
Total other (income) expense, net
|
|
|
|
|
14,031
|
|
|
43,171
|
|
|
|
42,253
|
|
|
56,051
|
|
Income (loss) before income taxes
|
|
|
|
|
53,778
|
|
|
(39,115
|
)
|
|
|
96,033
|
|
|
(14,131
|
)
|
Provision (benefit) for income taxes
|
|
|
|
|
30,949
|
|
|
(5,220
|
)
|
|
|
24,943
|
|
|
(1,566
|
)
|
Net income (loss)
|
|
|
|
|
$
|
22,829
|
|
|
$
|
(33,895
|
)
|
|
|
$
|
71,090
|
|
|
$
|
(12,565
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic net income (loss) per common share
|
|
|
|
|
$
|
0.30
|
|
|
$
|
(0.50
|
)
|
|
|
$
|
0.94
|
|
|
$
|
(0.19
|
)
|
Diluted net income (loss) per common share
|
|
|
|
|
$
|
0.29
|
|
|
$
|
(0.50
|
)
|
|
|
$
|
0.90
|
|
|
$
|
(0.19
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Shares used in calculating:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic net income (loss) per common share
|
|
|
|
|
75,834,443
|
|
|
67,841,665
|
|
|
|
75,400,064
|
|
|
66,122,521
|
|
Diluted net income (loss) per common share
|
|
|
|
|
85,995,727
|
|
|
67,841,665
|
|
|
|
85,901,660
|
|
|
66,122,521
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
CUBIST PHARMACEUTICALS, INC.
RECONCILIATION OF GAAP TO NON-GAAP FINANCIAL INFORMATION
UNAUDITED
(in thousands)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended September 30,
|
|
|
Nine Months Ended September 30,
|
|
|
|
|
|
2014
|
|
2013
|
|
|
2014
|
|
2013
|
Operating income reconciliation: 1
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
GAAP operating income
|
|
|
|
|
$
|
67,809
|
|
|
$
|
4,056
|
|
|
|
$
|
138,286
|
|
|
$
|
41,920
|
Cost of product revenues adjustments 1
|
|
|
|
|
27,762
|
|
|
5,620
|
|
|
|
60,903
|
|
|
16,619
|
Research and development expense adjustments 1
|
|
|
|
|
927
|
|
|
12,305
|
|
|
|
7,482
|
|
|
52,305
|
Contingent consideration expense (income)
|
|
|
|
|
2,224
|
|
|
2,641
|
|
|
|
(55,868
|
)
|
|
7,280
|
Selling, general and administrative expense adjustments 1
|
|
|
|
|
-
|
|
|
26,875
|
|
|
|
2,158
|
|
|
26,875
|
Restructuring charges
|
|
|
|
|
340
|
|
|
1,029
|
|
|
|
6,248
|
|
|
1,029
|
Non-GAAP adjusted operating income
|
|
|
|
|
$
|
99,062
|
|
|
$
|
52,526
|
|
|
|
$
|
159,209
|
|
|
$
|
146,028
|
Non-GAAP other (income) expense 2
|
|
|
|
|
5,338
|
|
|
3,828
|
|
|
|
16,579
|
|
|
9,431
|
Non-GAAP provision for income taxes 2
|
|
|
|
|
41,311
|
|
|
15,965
|
|
|
|
63,372
|
|
|
44,670
|
Non-GAAP net income
|
|
|
|
|
$
|
52,413
|
|
|
$
|
32,733
|
|
|
|
$
|
79,258
|
|
|
$
|
91,927
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
1 Detail on the adjustments included herein is provided in
the tables below.
2 A reconciliation to the most comparable GAAP financial
measure is included in the tables below.
|
|
|
|
|
|
|
|
|
CUBIST PHARMACEUTICALS, INC.
RECONCILIATION OF GAAP TO NON-GAAP FINANCIAL INFORMATION
UNAUDITED
(in thousands, except percentages)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended September 30,
|
|
|
Nine Months Ended September 30,
|
|
|
|
|
|
2014
|
|
2013
|
|
|
2014
|
|
2013
|
Cost of product revenues reconciliation:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
GAAP cost of product revenues
|
|
|
|
|
$
|
94,959
|
|
|
$
|
60,989
|
|
|
|
$
|
257,113
|
|
|
$
|
179,705
|
|
Intangible asset amortization
|
|
|
|
|
(26,554
|
)
|
|
(4,552
|
)
|
|
|
(57,344
|
)
|
|
(13,529
|
)
|
Inventory fair value step-up
|
|
|
|
|
(1,208
|
)
|
|
(1,068
|
)
|
|
|
(3,559
|
)
|
|
(3,090
|
)
|
Non-GAAP cost of product revenues
|
|
|
|
|
$
|
67,197
|
|
|
$
|
55,369
|
|
|
|
$
|
196,210
|
|
|
$
|
163,086
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Product gross margin reconciliation:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
GAAP product gross margin
|
|
|
|
|
69.2
|
%
|
|
76.2
|
%
|
|
|
69.7
|
%
|
|
75.6
|
%
|
Intangible asset amortization
|
|
|
|
|
8.6
|
%
|
|
1.8
|
%
|
|
|
6.8
|
%
|
|
1.8
|
%
|
Inventory fair value step-up
|
|
|
|
|
0.4
|
%
|
|
0.4
|
%
|
|
|
0.4
|
%
|
|
0.4
|
%
|
Non-GAAP product gross margin
|
|
|
|
|
78.2
|
%
|
|
78.4
|
%
|
|
|
76.9
|
%
|
|
77.8
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Research and development expenses reconciliation:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
GAAP research and development expenses
|
|
|
|
|
$
|
66,032
|
|
|
$
|
123,423
|
|
|
|
$
|
291,497
|
|
|
$
|
352,822
|
|
Acquisition-related expenses
|
|
|
|
|
(110
|
)
|
|
(12,305
|
)
|
|
|
(5,032
|
)
|
|
(12,305
|
)
|
Intangible asset amortization
|
|
|
|
|
(817
|
)
|
|
-
|
|
|
|
(2,450
|
)
|
|
-
|
|
Upfront license fees
|
|
|
|
|
-
|
|
|
-
|
|
|
|
-
|
|
|
(40,000
|
)
|
Non-GAAP research and development expenses
|
|
|
|
|
$
|
65,105
|
|
|
$
|
111,118
|
|
|
|
$
|
284,015
|
|
|
$
|
300,517
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Selling, general and administrative expenses reconciliation:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
GAAP selling, general and administrative expenses
|
|
|
|
|
$
|
77,791
|
|
|
$
|
73,855
|
|
|
|
$
|
227,510
|
|
|
$
|
171,945
|
|
Acquisition-related expenses
|
|
|
|
|
-
|
|
|
(26,875
|
)
|
|
|
(2,158
|
)
|
|
(26,875
|
)
|
Non-GAAP selling, general and administrative expenses
|
|
|
|
|
$
|
77,791
|
|
|
$
|
46,980
|
|
|
|
$
|
225,352
|
|
|
$
|
145,070
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Other (income) expense reconciliation:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
GAAP other (income) expense
|
|
|
|
|
$
|
14,031
|
|
|
$
|
43,171
|
|
|
|
$
|
42,253
|
|
|
$
|
56,051
|
|
Non-cash debt discount amortization
|
|
|
|
|
(8,693
|
)
|
|
(4,765
|
)
|
|
|
(25,674
|
)
|
|
(12,042
|
)
|
Loss on extinguishment of convertible notes
|
|
|
|
|
-
|
|
|
(34,578
|
)
|
|
|
-
|
|
|
(34,578
|
)
|
Non-GAAP other (income) expense
|
|
|
|
|
$
|
5,338
|
|
|
$
|
3,828
|
|
|
|
$
|
16,579
|
|
|
$
|
9,431
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Provision (benefit) for income taxes reconciliation:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
GAAP provision (benefit) for income taxes
|
|
|
|
|
$
|
30,949
|
|
|
$
|
(5,220
|
)
|
|
|
$
|
24,943
|
|
|
$
|
(1,566
|
)
|
Tax adjustment
|
|
|
|
|
10,362
|
|
|
21,185
|
|
|
|
38,429
|
|
|
46,236
|
|
Non-GAAP provision for income taxes
|
|
|
|
|
$
|
41,311
|
|
|
$
|
15,965
|
|
|
|
$
|
63,372
|
|
|
$
|
44,670
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
CUBIST PHARMACEUTICALS, INC.
RECONCILIATION OF GAAP TO NON-GAAP FINANCIAL INFORMATION
UNAUDITED
(in thousands, except share and per share amounts)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended September 30,
|
|
|
|
Nine Months Ended September 30,
|
|
|
|
|
|
|
2014
|
|
2013
|
|
|
|
2014
|
|
2013
|
|
Non-GAAP net income reconciliation:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
GAAP net income (loss)
|
|
|
|
|
$
|
22,829
|
|
|
$
|
(33,895
|
)
|
|
|
|
$
|
71,090
|
|
|
$
|
(12,565
|
)
|
|
Non-cash debt discount amortization
|
|
|
|
|
8,693
|
|
|
4,765
|
|
|
|
|
25,674
|
|
|
12,042
|
|
|
Loss on extinguishment of convertible notes
|
|
|
|
|
-
|
|
|
34,578
|
|
|
|
|
-
|
|
|
34,578
|
|
|
Intangible asset amortization
|
|
|
|
|
27,371
|
|
|
4,552
|
|
|
|
|
59,794
|
|
|
13,529
|
|
|
Inventory fair value step-up
|
|
|
|
|
1,208
|
|
|
1,068
|
|
|
|
|
3,559
|
|
|
3,090
|
|
|
Restructuring charges
|
|
|
|
|
340
|
|
|
1,029
|
|
|
|
|
6,248
|
|
|
1,029
|
|
|
Acquisition-related expenses
|
|
|
|
|
110
|
|
|
39,180
|
|
|
|
|
7,190
|
|
|
39,180
|
|
|
Upfront license fees
|
|
|
|
|
-
|
|
|
-
|
|
|
|
|
-
|
|
|
40,000
|
|
|
Contingent consideration expense (income)
|
|
|
|
|
2,224
|
|
|
2,641
|
|
|
|
|
(55,868
|
)
|
|
7,280
|
|
|
Tax adjustment
|
|
|
|
|
(10,362
|
)
|
|
(21,185
|
)
|
|
|
|
(38,429
|
)
|
|
(46,236
|
)
|
|
Non-GAAP net income
|
|
|
|
|
$
|
52,413
|
|
|
$
|
32,733
|
|
|
|
|
$
|
79,258
|
|
|
$
|
91,927
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Diluted earnings per common share reconciliation:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
GAAP diluted earnings (loss) per common share
|
|
|
|
|
$
|
0.29
|
|
|
$
|
(0.50
|
)
|
|
|
|
$
|
0.90
|
|
|
$
|
(0.19
|
)
|
|
Non-GAAP dilutive adjustments
|
|
|
|
|
0.29
|
|
1
|
0.91
|
|
1
|
|
|
0.03
|
|
1
|
1.36
|
|
1
|
Non-GAAP diluted earnings per common share
|
|
|
|
|
$
|
0.58
|
|
|
$
|
0.41
|
|
|
|
|
$
|
0.93
|
|
|
$
|
1.17
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Shares used in diluted per common share calculation
reconciliation:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
GAAP shares used in diluted earnings (loss) per common share
|
|
|
|
|
85,995,727
|
|
|
67,841,665
|
|
|
|
|
85,901,660
|
|
|
66,122,521
|
|
|
Non-GAAP dilutive share adjustments
|
|
|
|
|
9,705,442
|
|
2
|
18,644,465
|
|
3
|
|
|
9,705,442
|
|
2
|
17,925,826
|
|
3
|
Non-GAAP shares used in diluted earnings per common share
|
|
|
|
|
95,701,169
|
|
|
86,486,130
|
|
|
|
|
95,607,102
|
|
|
84,048,347
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
1 Includes impact of non-GAAP adjustments from GAAP net
income to non-GAAP net income and add back of interest expense and debt
issuance costs on Cubist's outstanding convertible notes, net of tax
effect
2 Additional dilutive weighted average shares issuable upon
conversion of Cubist's outstanding convertible notes
3 Additional dilutive weighted average shares issuable upon
conversion of Cubist's outstanding convertible notes and exercise or
vesting of Cubist's outstanding equity awards
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