Total revenues of $62.7M and $252.0 million for the three and nine months ended September 30, 2017, respectively.
Third Quarter GAAP EPS Increased 75%
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| [02-November-2017] |
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INCLINE VILLAGE, Nev., Nov. 2, 2017 /PRNewswire/ -- PDL BioPharma, Inc. (PDL or the Company) (NASDAQ: PDLI) today reported financial results for the third quarter ended September 30, 2017 including:
Revenue Highlights
Operating Expense Highlights
Recent Developments
Other Financial Highlights
Conference Call and Webcast Details PDL will hold a conference call to discuss financial results at 4:30 p.m. Eastern Time today, November 2, 2017. To access the live conference call via phone, please dial (800) 668-4132 from the United States and Canada or (224) 357-2196 internationally. The conference ID is 8794857. Please dial in approximately 10 minutes prior to the start of the call. A telephone replay will be available beginning approximately one hour after the call through one week following the call, and may be accessed by dialing (855) 859-2056 from the United States and Canada or (404) 537-3406 internationally. The replay passcode is 8794857. To access the live and subsequently archived webcast of the conference call, go to the Company's website at http://www.pdl.com and go to "Events & Presentations." Please connect to the website at least 15 minutes prior to the call to allow for any software download that may be necessary. About PDL BioPharma, Inc. We seek to provide a significant return for its shareholders by acquiring and managing a portfolio of companies, products, royalty agreements and debt facilities in the biotech, pharmaceutical and medical device industries. In 2012, PDL began providing alternative sources of capital through royalty monetizations and debt facilities, and in 2016, began acquiring commercial-stage products and launching specialized companies dedicated to the commercialization of these products. To date, PDL has consummated 17 such transactions, of which 9 are active and outstanding. PDL has one debt transaction outstanding, representing deployed and committed capital of $20.0 million: CareView; one hybrid royalty/debt transaction outstanding, representing deployed and committed capital of $44.0 million: Wellstat Diagnostics; and five royalty transactions outstanding, representing deployed and committed capital of $396.1 million and $397.1 million, respectively: KYBELLA®, AcelRx, University of Michigan, Viscogliosi Brothers and Depomed. Our equity and loan investments in Noden represent deployed and committed capital of $179.0 million and $202.0 million, respectively, and its converted equity and loan investment in LENSAR represents deployed capital of $40 million. NOTE: PDL, PDL BioPharma, the PDL logo and the PDL BioPharma logo are trademarks or registered trademarks of, and are proprietary, to PDL BioPharma, Inc. which reserves all rights therein. Forward-looking Statements This press release contains "forward-looking statements" within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Each of these forward-looking statements involves risks and uncertainties. Actual results may differ materially from those, express or implied, in these forward-looking statements. Important factors that could impair the value of the Company's assets and business, restrict or impede the ability of the Company to invest or acquire new products are disclosed in the risk factors contained in the Company's Annual Report on Form 10-K, filed with the Securities and Exchange Commission, filed with the Securities and Exchange Commission on March 1, 2017. All forward-looking statements are expressly qualified in their entirety by such factors. We do not undertake any duty to update any forward-looking statement except as required by law. TABLE 1
PDL BIOPHARMA, INC.
CONDENSED CONSOLIDATED STATEMENTS OF INCOME DATA
(In thousands, except per share amounts)
Three Months Ended Nine Months Ended
September 30, September 30,
2017 2016 2017 2016
---- ---- ---- ----
Revenues
Royalties from Queen et al.
patents $1,443 $14,958 $31,884 $150,645
Royalty rights -change in fair
value 35,353 16,085 132,224 (11,872)
Interest revenue 6,051 8,594 16,968 24,901
Product revenue, net 20,067 14,128 51,477 14,128
License and other (165) (127) 19,471 7
---- ---- ------ ---
Total revenues 62,749 53,638 252,024 177,809
------ ------ ------- -------
Operating Expenses
Cost of product revenue
(excluding intangible
amortization) 5,565 - 12,632 -
Amortization of intangible
assets 6,275 6,014 18,438 6,014
General and administrative
expenses 11,989 10,396 35,853 27,193
Sales and marketing 4,994 11 11,194 11
Research and development 605 1,933 6,652 1,933
Change in fair value of
anniversary payment and
contingent consideration 700 2,083 3,349 2,083
Acquisition-related costs - 546 - 3,505
Total operating expenses 30,128 20,983 88,118 40,739
------ ------ ------ ------
Operating income 32,621 32,655 163,906 137,070
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Non-operating expense, net
Interest and other income, net 238 162 726 404
Interest expense (5,096) (4,513) (15,082) (13,524)
Gain (loss) on bargain purchase (2,276) - 3,995 -
------ --- ----- ---
Total non-operating expense, net (7,134) (4,351) (10,361) (13,120)
------ ------ ------- -------
Income before income taxes 25,487 28,304 153,545 123,950
Income tax expense 4,755 14,400 65,180 50,011
----- ------ ------ ------
Net income 20,732 13,904 88,365 73,939
Less: Net (loss)/income
attributable to noncontrolling
interests - (3) (47) (3)
Net income attributable to PDL's
shareholders $20,732 $13,907 $88,412 $73,942
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Net income per share
Basic $0.14 $0.08 $0.56 $0.45
===== ===== ===== =====
Diluted $0.14 $0.08 $0.56 $0.45
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Shares used to compute income
per basic share 151,146 163,856 156,802 163,771
======= ======= ======= =======
Shares used to compute income
per diluted share 152,317 164,285 157,529 164,075
======= ======= ======= =======
Cash dividends declared per
common share $ - $ - $ - $0.10
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TABLE 2
PDL BIOPHARMA, INC.
CONDENSED CONSOLIDATED BALANCE SHEET DATA
(Unaudited)
(In thousands)
September 30, December 31,
2017 2016
---- ----
Cash, cash
equivalents
and short-
term
investments $516,494 $242,141
Total notes
receivable $70,636 $270,950
Total
royalty
rights -
at fair
value $351,969 $402,318
Total
assets $1,223,838 $1,215,387
Total
convertible
notes
payable $240,638 $232,443
Total
stockholders'
equity $822,982 $755,423
TABLE 3
PDL BIOPHARMA, INC.
CONDENSED CONSOLIDATED STATEMENT OF CASH FLOW DATA
(Unaudited)
(In thousands)
Nine Months Ended
September 30,
2017 2016
---- ----
Net income $88,365 $73,939
Adjustments to
reconcile net
income to net
cash provided
by (used in)
operating
activities (74,202) 22,682
Changes in
assets and
liabilities 43,900 (10,556)
Net cash
provided by
operating
activities $58,063 $86,065
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TABLE 4
PDL BIOPHARMA, INC.
GAAP to NON-GAAP RECONCILIATION:
NET INCOME AND DILUTED EARNINGS PER SHARE
(Unaudited)
(In thousands, except per share amount)
A reconciliation between net income on a GAAP basis and on a non-GAAP basis is as follows:
Three Months Ended Nine Months Ended
September 30, September 30,
2017 2016 2017 2016
---- ---- ---- ----
GAAP net income attributed to PDL's
shareholders as reported $20,732 $13,907 $88,412 $73,942
Adjustments to Non-GAAP net income
(as detailed below) 975 4,960 (14,730) 44,211
Non-GAAP net income attributed to
PDL's shareholders $21,707 $18,867 $73,682 $118,153
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An itemized reconciliation between net income on a GAAP basis and on a non-GAAP basis is as follows:
Three Months Ended Nine Months Ended
September 30, September 30,
2017 2016 2017 2016
---- ---- ---- ----
GAAP net income attributed to PDL's
shareholders as reported $20,732 $13,907 $88,412 $73,942
------- ------- ------- -------
Adjustments:
Mark-to-market adjustment to fair
value assets (9,011) (754) (57,820) 59,112
Non-cash interest revenues (670) (468) (823) (2,744)
Non-cash stock-based compensation
expense 939 1,050 3,014 2,649
Non-cash debt offering costs 2,801 2,048 8,195 6,067
Mark-to-market adjustment on
warrants held 165 128 29 875
Amortization of the intangible
assets 6,275 6,014 18,438 6,014
Mark-to-market adjustment of
anniversary payment and contingent
consideration 700 2,083 3,349 2,083
Income tax effect related to above
items (224) (5,141) 10,888 (29,845)
---- ------ ------ -------
Total adjustments 975 4,960 (14,730) 44,211
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Non-GAAP net income $21,707 $18,867 $73,682 $118,153
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Use of Non-GAAP Financial Measures We supplement our consolidated financial statements presented on a GAAP basis by providing additional measures which may be considered "non-GAAP" financial measures under applicable SEC rules. We believe that the disclosure of these non-GAAP financial measures provides our investors with additional information that reflects the amounts and financial basis upon which our management assesses and operates our business. These non-GAAP financial measures are not in accordance with generally accepted accounting principles and should not be viewed in isolation or as a substitute for reported, or GAAP, net income, and diluted earnings per share, and are not a substitute for, or superior to, measures of financial performance performed in conformity with GAAP. "Non-GAAP net income" is not based on any standardized methodology prescribed by GAAP and represent GAAP net income adjusted to exclude (1) mark-to market adjustments related to the fair value election for our investments in royalty rights presented in our earnings, which include the fair value re-measurement of future discounted cash flows for each of the royalty rights assets we have acquired, (2) non-cash interest revenue from notes receivable (3) stock-based compensation expense, (4) non-cash interest expense related to PDL debt offering costs, (5) mark-to market adjustments related to warrants held, (6) mark-to-market adjustment related to acquisition-related contingent considerations, (7) amortization of intangible assets, and to adjust (7) the related tax effect of all reconciling items within our reconciliation of our GAAP to Non-GAAP net income. Non-GAAP financial measures used by PDL may be calculated differently from, and therefore may not be comparable to, non-GAAP measures used by other companies.
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Company Codes: NASDAQ-NMS:PDLI |
