Galapagos reports record revenues and increased profitability in 2010
(Thomson Reuters ONE) -
·        Revenues ?136.6 M (+29%)
·        Net profit ?4.4 M ('09: ?3.0 M)
· Operating profit ?1.0 M ('09: ?1.7 M)
·        Year end cash ?40.4 M
·        Over 50 R&D programs, including 7 programs in clinical development
·        2011 guidance: operational and net profitability, positive cash-flow,
revenues at least ?150 M
Click here to access the live audio webcast presentation at 10.00 CET,
call number +32Â 2290 1791
Mechelen, Belgium; 4 March 2011 - Galapagos NV (Euronext: GLPG) presents audited
financial results for the full year 2010 and highlights the successful execution
of its business strategy.
"No other company in the world can discover drug targets the way Galapagos
does. We have a unique ability to create new medicines from these targets; this
satisfies the patient need for breakthrough therapies in major diseases, at a
time when pharmaceutical companies struggle to deliver. Galapagos has grown
into a profitable biotech company that is seen as one of the major successes in
the industry. The combined cash flow from our services and our pharma alliances
enable Galapagos to build a broad pipeline of new mode-of-action drugs. With
plans to show results in two patient studies, 2011 will be a pivotal year for
the Company," said Galapagos' CEO Onno van de Stolpe.
Guillaume Jetten, Galapagos' CFO, added, "Galapagos achieved its second year of
operational and net profitability in 2010, despite the ending of our alliances
with Merck. This proves that our business model forms a solid basis for
financing our operations. Â We have a flexible and tightly controlled cost base,
we generate milestones on a regular basis and have steady income from fee-for-
service deals. Â This combination enables us to fund over 50 R&D programs,
including 7 in clinical development."
Key figures (consolidated)
(? millions, except basic result per share)
+-----------------------------+-------------+-------------+
| Â | 31 Dec 2010 | 31 Dec 2009 |
+-----------------------------+-------------+-------------+
| Revenues | 136.6 | 106.0 |
+-----------------------------+-------------+-------------+
| Negative goodwill | 5.0 | - |
+-----------------------------+-------------+-------------+
| Total operating income | 141.6 | 106.0 |
+-----------------------------+-------------+-------------+
| Cost of sales | -31.4 | -25.1 |
+-----------------------------+-------------+-------------+
| R&D expenditure | -84.7 | -60.0 |
+-----------------------------+-------------+-------------+
| General & administrative | -21.5 | -16.9 |
+-----------------------------+-------------+-------------+
| Sales & marketing | -2.6 | -2.1 |
+-----------------------------+-------------+-------------+
| Restructuring & integration | -0.4 | -0.3 |
+-----------------------------+-------------+-------------+
| Operating profit | 1.0 | 1.7 |
+-----------------------------+-------------+-------------+
| Net profit for the period | 4.4 | 3.0 |
+-----------------------------+-------------+-------------+
| Basic profit per share | 0.18 | 0.14 |
+-----------------------------+-------------+-------------+
| Cash and cash equivalents | 40.4 | 47.4 |
+-----------------------------+-------------+-------------+
Notes:
1)Â Â Â Cash and cash equivalents on 31 December 2010 did not include ?25.0
million in receivables for revenues recognized in 2010.
2)Â Â Â The results of Argenta and Zagreb have been integrated into the full year
2010 financial reporting.
3)Â Â Â Negative goodwill was recorded for the Zagreb Research Center. It
represents the difference between the net estimated fair value of the net assets
acquired and the purchase price.
Details of the financial results
Revenues
Galapagos' revenues for the full year 2010 grew 29% to ?136.6 million. The
service operations generated ?65.8 million in revenues (+30%), including ?15.0
million intra-company revenues, which are eliminated in the consolidation. The
R&D division increased its revenues by 41% to ?89.9 million, including ?3.6
million intra-company revenues.
Result
The Group net profit for the full year 2010 was ?4.4 million, or ?0.18 earnings
per share, compared to ?3.0 million, or ?0.14 earnings per share in 2009. R&D
investment increased from ?60.0 million to ?84.7 million, making Galapagos' R&D
budget one of the largest in European biotech.
The 2010 segment report was impacted by a transfer pricing study, changing the
distribution of the operating result between the two divisions. Â Consequently,
the R&D result improved to almost break even. The BioFocus and Argenta service
operations reported a gross margin of 33% and a positive segment result of ?4.8
million using the new transfer pricing. The service operations showed improved
results in the second half of 2010; this was attributable to the acquisition of
Argenta, better capacity utilization, and the initiation of work on the two
largest service deals to date.
General and administrative costs increased to ?21.5 million due to the
acquisition of Argenta and the Zagreb Research Center, but remained at an
unchanged 16% of revenues. The group net result was positively impacted by
recognition of ?3.8 million in deferred tax assets.
Cash position
Galapagos' cash and cash equivalents amounted to ?40.4 million on 31 December
2010, compared to ?47.4 million at the end of 2009.  The 2010 cash flow
benefited from a share placement of ?28.7 million. Although cash flow for the
full year was negative, milestones leading to payments totaling ?25.0 million
were achieved and recognized as revenue in 2010. They are included in accounts
receivable on the balance sheet and will be collected in the first quarter of
2011.
Operational highlights
R&D operations
·        Achieved milestones across all alliances
·        Increased total number of programs in development to eight (two in
Phase II, five in Phase I, and one in pre-clinical development)
o   initiated Phase II studies for RA candidate drug GLPG0259 in September 2010
o   completed first-in-human clinical studies for both metastasis candidate
drug GLPG0187 and cachexia candidate drug GLPG0492
o   initiated Phase I clinical studies for two arthritis candidate drugs,
GLPG0634 and GLPG0778
o   delivered new candidate drug in arthritis alliance with GSK
·        Advanced 50 discovery programs, including five antibody programs with
MorphoSys, and Alzheimer's and cystic fibrosis drug discovery programs
·        Awarded two major grants to progress research in cystic fibrosis and
antiviral drug discovery
·        Announced a strategic alliance with Roche in chronic lung disease and
broadened this alliance to include fibrosis
·        Signed strategic alliance with Servier in osteoarthritis
·        Acquisition of R&D center in Zagreb, providing increased capacity
·        Ended strategic alliances with Merck in February 2011, regaining all
rights to targets and assays
Service operations
· Acquired Argenta's service operations, solidified lead position in Western
drug discovery services
· Delivered candidate drug in Wellcome Trust funded, anti-aging program
· Capitalized on long-term, integrated service agreements
      o both companies signed their largest deals ever in 2010, for five-year
contracts with CHDI (BioFocus) and Janssen Pharmaceutica (Argenta)
      o extended/expanded existing deals with, among others, Amgen, Chiesi and
Genentech
· Signed new target, drug discovery deals with Dr. Reddy's, Ono Pharmaceutical,
Usher III Patient Foundation and University of Bristol
· Announced compound management agreements with U.S. National Institutes of
Health, National Cancer Institute and Lundbeck
Corporate
·        Appointed Howard Rowe and Ronald Brus to Galapagos Board
·        Raised ?28.7 million through private placement of 2,389,347 new shares
·        Increased average daily trading volumes and amounts from 53,000
shares/?0.4 million in 2009 to 85,000 shares/?0.9 million in 2010
·        Grew from 500 to more than 800 employees in the course of 2010
Outlook 2011
Management anticipates an interim analysis of the Phase II clinical study for
GLPG0259 in the second quarter of this year, with top-line results for this
trial expected by the end of 2011. Â The Company expects to make significant
progress in both partnered and non-partnered R&D programs as the pipeline
continues to mature across a broad range of therapeutic areas. Â Management also
anticipates signing a new alliance and outlicensing one non-partnered program in
2011. The service operations are expected to increase their cash and profit
contribution in 2011. Continued growth from alliance revenues and service
contracts, and partnering of a proprietary program, encourage management to give
guidance of at least ?150 million in revenues, sustained operational and net
profitability, and positive cash flow in 2011.
Annual Financial Report 2010
Galapagos is currently finalizing its financial statements for the year ended
31 December 2010. Â The auditor has confirmed that his audit procedures, which
are substantially completed, have not revealed any material corrections that are
required to be made to the financial information included in this press
release. Should any material changes arise during the audit finalization, an
additional press release will be issued. Galapagos expects to be able to
publish its fully audited Annual Financial Report for the full year 2010Â on or
before 1 April 2011.
Conference call and webcast presentation
Galapagos will conduct a conference call open to the public today at 10.00
Central European Time (CET), which will also be webcast. To participate in the
conference call, please call +32 2290 1791 ten minutes prior to commencement. A
question and answer session will follow the presentation of the results. Â Click
here to access the live audio webcast. The archived webcast also will be
available for replay shortly after the close of the call.
Financial calendar
15 April 2011Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â R&D Update in Leiden (NL)
26 April 2011Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Annual general meeting of shareholders in Mechelen
(BE)
13 May 2011Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â First quarter 2011 business update
5 August 2011Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â First half 2011 results
10 November 2011Â Â Â Â Â Â Â Â Third quarter 2011 business update
2 March 2012Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Full year 2011 results
About Galapagos
Galapagos (Euronext: GLPG; OTC: GLPYY) is a mid-size biotechnology company
specialized in the discovery and development of small molecule and antibody
therapies with novel modes-of-action. The Company is progressing one of the
largest pipelines in biotech, with seven clinical and over 50 discovery
programs. Through risk/reward-sharing alliances with GlaxoSmithKline, Eli
Lilly, Janssen Pharmaceutica, Roche and Servier, Galapagos is eligible to
receive up to ?2.5 billion in downstream milestones, plus royalties. The
Galapagos Group has over 800 employees and operates facilities in seven
countries, with global headquarters in Mechelen, Belgium. More info at:
www.glpg.com
CONTACT
Galapagos NV
Onno van de Stolpe, CEO
Tel: +31 6 2909 8028
Elizabeth Goodwin, Director Investor Relations
Tel: +31 6 2291 6240
ir(at)glpg.com
This release may contain forward-looking statements, including, without
limitation, statements containing the words "believes," "anticipates,"
"expects," "intends," "plans," "seeks," "estimates," "may," "will," "could,"
"stands to," and "continues," as well as similar expressions. Such forward-
looking statements may involve known and unknown risks, uncertainties and other
factors which might cause the actual results, financial condition, performance
or achievements of Galapagos, or industry results, to be materially different
from any historic or future results, financial conditions, performance or
achievements expressed or implied by such forward-looking statements. Given
these uncertainties, the reader is advised not to place any undue reliance on
such forward-looking statements. These forward-looking statements speak only as
of the date of publication of this document. Galapagos expressly disclaims any
obligation to update any such forward-looking statements in this document to
reflect any change in its expectations with regard thereto or any change in
events, conditions or circumstances on which any such statement is based, unless
required by law or regulation.
Financial statements 2010:
http://hugin.info/133350/R/1494476/430318.pdf
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Source: Galapagos NV via Thomson Reuters ONE
[HUG#1494476]
Unternehmensinformation / Kurzprofil:
Datum: 04.03.2011 - 07:31 Uhr
Sprache: Deutsch
News-ID 52140
Anzahl Zeichen: 15121
contact information:
Town:
Mechelen
Kategorie:
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