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Unilife Corporation Announces Financial Results For Fiscal Year 2012 Fourth Quarter

July 30, 2012

YORK, Pa., July 30, 2012 /PRNewswire/ — Unilife Corporation (“Unilife” or “Company”) (NASDAQ: UNIS; ASX: UNS) today announced financial results for the quarter ended June 30, 2012, (the fourth quarter of Fiscal Year 2012).

Unilife CEO, Alan Shortall stated, “We are pleased to have delivered on our key business milestones set out for the past twelve months, and remain on schedule to continue this consistent trend in the current fiscal year. I believe we are at a key inflection point in our growth. We have established a large and growing base of pharmaceutical companies who are seeking access to the Unifill(®) syringe and our other proprietary devices in order to generate brand differentiation and optimize revenues for their brand name, generic and biosimilar drugs. We look forward to the formalization of a series of long-term commercial partnerships moving forward.”

Unifill Prefilled Syringe

Mr. Shortall continued, “During the last quarter, we began to enter into commercial supply contracts with pharmaceutical customers for the Unifill syringe. New and recurring shipments of small batches of the Unifill syringe are now being made to a number of pharmaceutical customers on a regular basis. It has been indicated to us that some of these customers are now at various stages in the evaluation, stability study and fill-finish validation of our device. Several customers have reported to us that they are targeting the Unifill syringe for use with several of their approved and late-stage pipeline molecules. It has also been confirmed that the initial supply of the Unifill to other new global pharmaceutical customers will commence over the coming months.”

AutoInfusor Devices of Disposable Subcutaneous Delivery Systems

“Our AutoInfusor(TM) devices are generating market activity with a number of global pharmaceutical companies for the delivery of large dose volume drugs, such as monoclonal antibodies,” continued Mr. Shortall. “Utilizing a standard primary drug container, an LED display and intuitive steps of use, these compact and disposable patient-self administration systems can support the delivery of doses ranging from 1mL to 30mL.

“We have created a number of distinct technology platforms within our AutoInfusor family of devices. The Precision-Therapy(TM) range is designed for use with bolus based therapies that require short or long duration injections, while our Flex-Therapy(TM) range is for rate-based therapies requiring infusion over a longer duration of time. Brought together, our AutoInfusor family of devices represents the most complete and customer-focused range of disposable delivery systems available for use with large dose volume drugs.

“Following head-to-head user acceptance and preference studies conducted by one of our pharmaceutical customers, we have been advised that our Precision-Therapy line of devices has been selected to enter the next phase of evaluations for use with a number of their pipeline drugs. Upon successful completion of these evaluations, the products will be considered by the pharmaceutical customer for a number of long-term development and commercial supply agreements. Similar progress is also being made with other global pharmaceutical companies with our Precision-Therapy product line as well as our Flex-Therapy product line, with additional evaluations scheduled for a number of pipeline drugs during this calendar year.”

A Large and Expanding Commercial Pipeline

“By showcasing our unparalleled capacity to address customer needs with speed, agility and innovation, we have doubled our pipeline of current and potential customers to more than 40 pharmaceutical companies in this fiscal year,” continued Mr. Shortall.

“Having made significant R&D investments in recent quarters to expand our portfolio in response to customer needs, we are pleased to advise that the majority of these companies are seeking access to more than one of our devices and targeting multiple drugs. We estimate that between five and ten of these customer relationships have now reached an advanced stage. We expect to generate recurring and incremental revenues for Unilife from many of these long-term partnerships as they are formalized,” Mr. Shortall concluded.

Cash Position

Unilife had $13.8 million of total cash (including restricted cash) as of June 30, 2012. In July 2012, Unilife raised net proceeds of $18.8 million from the sale of common stock, resulting in a pro forma cash balance of $32.6 million.

Financial Results for Three Months Ended June 30, 2012

Revenues for the three months ended June 30, 2012 were $1.2 million compared to $0.7 million for the same period in 2011. During the three months ended June 30, 2012, the Company recognized revenue of $0.6 million related to the clinical development and supply of a novel device for targeted organ delivery.

The Company’s net loss for the three months ended June 30, 2012 was $14.9 million, or $0.21 per share, compared to a net loss of $10.5 million, or $0.17 per share, for the same period in 2011. The increase in the net loss was primarily attributable to an increase in research and development expenses related to the development of the Company’s portfolio of advanced drug delivery devices.

Adjusted net loss for the three months ended June 30, 2012 was $11.0 million, or $0.15 per share, compared to $6.3 million, or $0.10 per share, for the same period in 2011. Adjusted net loss excludes non-cash share-based compensation expense, depreciation and amortization and interest expense.

Financial Results for the Year Ended June 30, 2012

Revenues for the year ended June 30, 2012 were $5.5 million compared to $6.7 million for the same period in 2011. During the year ended June 30, 2012, the Company recognized revenue of $1.4 million related to the clinical development and supply of a novel device for targeted organ delivery. During both the year ended June 30, 2012 and 2011, the Company recognized revenue related to a milestone payment under its industrialization agreement. During the year ended June 30, 2011, the Company recorded $2.7 million in product sales related to its contract manufacturing operations which was discontinued during December 2010, in order to focus on the commercialization, production and supply of its own propriety line of products.

The Company’s net loss for the year ended June 30, 2012 was $52.3 million, or $0.78 per share, compared to a net loss of $40.7 million, or $0.70 per share, for the same period in 2011. The increase in the net loss was primarily attributable to an increase in research and development expenses related to the development of the Company’s portfolio of advanced drug delivery devices. These amounts were partially offset by a reduction in payroll and share-based compensation expense included in selling, general and administrative expenses.

Adjusted net loss for the year ended June 30, 2012 was $37.7 million, or $0.56 per share, compared to $27.1 million, or $0.47 per share, for the same period in 2011. Adjusted net loss excludes non-cash share-based compensation expense, depreciation and amortization and interest expense.

Conference Call Information

Management has scheduled a conference call for 4:30 p.m. U.S. Eastern Standard Time on July 30, 2012, to review the Company’s financial results, market trends and future outlook. The conference call and accompanying slide presentation will be broadcast over the Internet as a “live” listen only Webcast. An archive of the presentation and webcast will be available for 30 days after the call. To listen, please go to: http://ir.unilife.com/events.cfm.

About Unilife Corporation

Unilife Corporation (NASDAQ:UNIS / ASX: UNS) is a U.S. based developer and commercial supplier of advanced drug delivery systems. Unilife collaborates with pharmaceutical and biotechnology companies seeking innovative, differentiated devices that can enable or enhance the delivery of injectable drugs and vaccines supplied in either a liquid stable or lyophilized form. The Unifill syringe, the world’s first and only prefilled syringe with fully integrated safety features, sits at the leading edge of this diversified portfolio. In addition to prefilled and hypodermic safety syringes with automatic, user-controlled needle retraction, Unilife has other proprietary technology platforms including drug reconstitution delivery systems, auto-injectors, auto-infusion pump systems and specialized devices for targeted organ delivery. Unilife’s global headquarters and state-of-the-art manufacturing facilities are located in York, PA. For more information on Unilife, please visit www.unilife.com

Forward-Looking Statements

This press release contains forward-looking statements. All statements that address operating performance, events or developments that we expect or anticipate will occur in the future are forward-looking statements. These forward-looking statements are based on management’s beliefs and assumptions and on information currently available to our management. Our management believes that these forward-looking statements are reasonable as and when made. However, you should not place undue reliance on any such forward-looking statements because such statements speak only as of the date when made. We do not undertake any obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise, except as required by law. In addition, forward-looking statements are subject to certain risks and uncertainties that could cause actual results, events and developments to differ materially from our historical experience and our present expectations or projections. These risks and uncertainties include, but are not limited to, those described in “Item 1A. Risk Factors” and elsewhere in our Annual Report on Form 10-K and those described from time to time in other reports which we file with the Securities and Exchange Commission.

Non-GAAP Financial Measures

U.S. securities laws require that when we publish any non-GAAP financial measure, we disclose the reason for using the non-GAAP measure and provide reconciliation to the most directly comparable GAAP measure. The presentation of adjusted net income (loss) and adjusted net income (loss) per share are non-GAAP measures. Adjusted net income (loss) represents net income (loss) calculated in accordance with U.S. GAAP as adjusted for the impact of share-based compensation expense, depreciation and amortization and interest expense.

Management believes the presentation of adjusted net income (loss) and adjusted net income (loss) per share provides useful information because these measures enhance its own evaluation, as well as investor’s understanding, of the Company’s core operating and financial results. Non-GAAP financial measures should be considered in addition to results prepared in accordance with GAAP, but should not be considered a substitute for, or superior to, GAAP results. A reconciliation of net income (loss) to adjusted net income (loss) is included in the attached table.

General: UNIS-G

    Investor Contacts (US):       Analyst Enquiries    Investor Contacts
                                                       (Australia)
    Todd Fromer / Garth Russell   Lynn Pieper         Jeff Carter
    KCSA Strategic Communications Westwicke Partners  Unilife Corporation
    P: + 1 212-682-6300           P: + 1 415-202-5678 P: + 61 2 8346 6500

(Tables Below)

                                     UNILIFE CORPORATION AND SUBSIDIARIES
                                          Consolidated Balance Sheets
                                                  (unaudited)

                                                June 30, 2012             June 30, 2011
                                                -------------             -------------
                                         (in thousands, except share
                                                    data)
                       Assets
    Current Assets:
      Cash and cash equivalents                                 $11,410                  $17,910
      Restricted cash                                             2,400                    2,400
      Accounts receivable                                         1,042                       13
      Inventories                                                   212                      626
      Prepaid expenses and other
       current assets                                               676                      381
                                                                    ---                      ---
      Total current assets                                       15,740                   21,330
    Property, plant and
     equipment, net                                              52,514                   54,020
    Goodwill                                                     12,734                   13,265
    Intangible assets, net                                           34                       42
    Other assets                                                  1,286                      821
      Total assets                                              $82,308                  $89,478
                                                                =======                  =======
                  Liabilities and
                Stockholders' Equity
    Current Liabilities:
      Accounts payable                                           $2,399                   $2,405
      Accrued expenses                                            2,209                    2,696
      Current portion of long-
       term debt                                                  5,655                    2,274
      Deferred revenue                                            2,595                    2,706
                                                                  -----                    -----
      Total current liabilities                                  12,858                   10,081
    Long-term debt, less
     current portion                                             23,110                   20,413
    Deferred revenue                                              2,595                    5,412
      Total liabilities                                          38,563                   35,906
                                                                 ------                   ------
    Stockholders' Equity:
      Preferred stock, $0.01 par
       value, 50,000,000 shares
       authorized as of June 30,
       2012; none issued or
       outstanding as of June 30,
       2012 and 2011                                                  -                        -
      Common stock, $0.01 par
       value, 250,000,000 shares
       authorized as of June 30,
       2012; 75,849,439 and
       63,924,403 shares issued,
       and 75,820,769 and
       63,905,053 shares
       outstanding as of June 30,
       2012 and 2011, respectively                                  758                      639
    Additional paid-in-capital                                  212,326                  169,590
    Accumulated deficit                                        (172,634)                (120,332)
    Accumulated other
     comprehensive income                                         3,435                    3,775
    Treasury stock, at cost,
     28,670 and 19,350 shares as
     of June 30, 2012 and 2011,
     respectively                                                  (140)                    (100)
                                                                   ----                     ----
    Total stockholders' equity                                   43,745                   53,572
      Total liabilities and
       stockholders' equity                                     $82,308                  $89,478
                                                                =======                  =======

                                                                     UNILIFE CORPORATION AND SUBSIDIARIES
                                                                    Consolidated Statements of Operations
                                                                                 (unaudited)

                            Three Months Ended                                                   Year Ended
                                 June 30,                                                         June 30,
                                 --------                                                         --------
                                               2012                                                             2011      2012      2011
                                               ----                                                             ----      ----      ----
                                                     (in thousands, except per share
                                                                               data)
    Revenues:
      Industrialization and
       development fees                        $565                                                  $             -    $2,820    $1,350
      Licensing fees                            645                                                              678     2,638     2,527
      Product sales and
       other                                     16                                                               17        61     2,773
                                                ---                                                              ---       ---     -----
      Total revenues                          1,226                                                              695     5,519     6,650
    Cost of product sales                       476                                                              148       584     2,597
                                                ---                                                              ---       ---     -----
      Gross profit                              750                                                              547     4,935     4,053
    Operating expenses:
      Research and
       development                            6,909                                                            2,690    23,137     9,631
      Selling, general and
       administrative                         7,113                                                            7,185    27,685    31,571
      Depreciation and
       amortization                           1,239                                                            1,517     4,582     4,009
      Total operating
       expenses                              15,261                                                           11,392    55,404    45,211
                                             ------                                                           ------    ------    ------
      Operating loss                        (14,511)                                                         (10,845)  (50,469)  (41,158)
    Interest expense                            572                                                              270     2,120       511
    Interest income                             (22)                                                             (67)     (124)     (399)
    Other income                               (200)                                                            (503)     (163)     (588)
      Net loss                             $(14,861)                                                        $(10,545) $(52,302) $(40,682)
                                           ========                                                         ========  ========  ========
    Loss per share:
    Basic and diluted loss
     per share                               $(0.21)                                                          $(0.17)   $(0.78)   $(0.70)
                                             ======                                                           ======    ======    ======
                                                                     UNILIFE CORPORATION AND SUBSIDIARIES
                                                                      Reconciliation of Non-GAAP Measure
                                                                                 (unaudited)

                      Three Months Ended                                                    Year Ended
                           June 30,                                                          June 30,
                           --------                                                          --------
                                         2012                                                                2011      2012      2011
                                         ----                                                                ----      ----      ----
                                               (in thousands, except per share
                                                                      amounts)
    Net loss                         $(14,861)                                                           $(10,545) $(52,302) $(40,682)
    Share-based
     compensation
     expense                            2,098                                                               2,420     7,886     9,022
    Depreciation and
     amortization                       1,239                                                               1,517     4,582     4,009
    Interest expense                      572                                                                 270     2,120       511
    Adjusted net loss                $(10,952)                                                            $(6,338) $(37,714) $(27,140)
                                     ========                                                             =======  ========  ========
    Adjusted net loss
     per share -
     diluted                           $(0.15)                                                             $(0.10)   $(0.56)   $(0.47)
                                       ======                                                              ======    ======    ======

SOURCE Unilife Corporation


Source: PR Newswire