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Mylan Inc. – ‘8-K’ for 3/31/03 – EX-99.1

On:  Friday, 5/9/03, at 4:49pm ET   ·   For:  3/31/03   ·   Accession #:  69499-3-29   ·   File #:  1-09114

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  As Of                Filer                Filing    For·On·As Docs:Size

 5/09/03  Mylan Inc.                        8-K:9       3/31/03    2:76K

Current Report   —   Form 8-K
Filing Table of Contents

Document/Exhibit                   Description                      Pages   Size 

 1: 8-K         Current Report                                      HTML     14K 
 2: EX-99.1     Press Release May 8, 2003                           HTML     74K 


EX-99.1   —   Press Release May 8, 2003


This exhibit is an HTML Document rendered as filed.  [ Alternative Formats ]



  exhibit 99.1  

NEWS RELEASE

FOR IMMEDIATE RELEASE

   

FOR:

Mylan Laboratories Inc.

FOR FURTHER INFORMATION

 

1500 Corporate Drive, Suite 400

Contact :

Kris King

 

Canonsburg, PA 15317-8574

 

724-514-1800

   

Mylan Reports Record EPS, Revenues and Net Earnings

For the Fourth Quarter and Fiscal 2003

Financial Highlights

PITTSBURGH, PA - May 8, 2003 - Mylan Laboratories Inc. (NYSE: MYL) announced today financial results for the fiscal year and fourth quarter ended March 31, 2003, which included record results for both periods. Net revenues for the fiscal year increased 15% to a record $1.27 billion from $1.10 billion in the prior year. Net revenues for the fourth quarter increased 25% to a record $353.7 million from $282.6 million for the same prior year period.

Net earnings for the fiscal year ended March 31, 2003, increased 5% to $272.4 million from $260.3 million in the prior year. Diluted earnings per share for fiscal 2003 were $1.45 per share compared to $1.36 in fiscal 2002, an increase of 7%. Net earnings for the fourth quarter were $73.8 million compared to $67.3 million for the same prior year period, an increase of 10%. Diluted earnings per share increased 14% to $.40 per share in the current quarter from $.35 per share.

"2003 was a milestone year in terms of revenue and earnings for Mylan," commented Robert J. Coury, Vice Chairman and Chief Executive Officer. "Our generic business continued its strong growth, exceeding one billion in sales for the first time ever. At the same time, Bertek Pharmaceuticals, our branded business, successfully launched a significant new product and continued to grow its existing core products."

Net revenues for Mylan's Generic Segment were $1.01 billion in fiscal 2003 compared to $971.1 million in fiscal 2002, an increase of $41.5 million or 4%. The increase in net revenues was achieved despite the expiration of exclusivity on buspirone in March 2002, which contributed net revenues of $167.7 million in fiscal 2002. Excluding sales of buspirone in both periods, net revenues in fiscal 2003 would have increased 24% over the prior fiscal year.

The Brand Segment reported record net revenues of $256.6 million compared to $133.0 million in fiscal 2002, an increase of $123.6 million or 93%. The increase in net revenues is attributable to the launch of Amnesteem(R) and the growth of existing products including Digitek(R), phenytoin and Avita(R). Amnesteem was launched late in the third quarter of fiscal 2003, and contributed net revenues of $61.2 million for the fiscal year.

The fourth quarter and fiscal 2003 results included the resolution of three legal matters which in the aggregate did not significantly impact Mylan's financial position or results of operations. In January 2003, Mylan announced that it had reached an agreement with Bristol Myers Squibb to resolve all outstanding disputes between the companies involving buspirone and paclitaxel. As part of the settlement, Mylan received a one-time payment of $35.0 million. In March 2003, Mylan reached a tentative settlement of a class action lawsuit concerning Mylan's 1998 lorazepam and clorazepate anti-trust litigation and received an arbitration decision in a dispute involving verapamil. The anti-trust settlement was for $35.0 million, of which Mylan is responsible for up to $27.9 million, with the remainder to be paid by the other co-defendants. The $27.9 million, along with $4.2 million plus interest to be paid as a result of the verapamil arbitration, was included in expense in the current quarter. The net effect of the resolution of these three legal matters was a gain of $2.4 million during the quarter.

"We are pleased to have resolved these outstanding legal matters as we begin our next fiscal year," stated Mr. Coury. "In addition, subsequent to the end of fiscal 2003, we reached a tentative agreement to receive an additional $10.0 million from the other co-defendants, further reducing our $27.9 million liability under the lorazepam and clorazepate litigation."

Segment Information

Three Months Ended

Fiscal Year Ended

March 31,

March 31,

2003

2002

Change

2003

2002

Change

Net Revenues (in millions)

Generic Segment

$ 248.8

$ 247.1

1%

$ 1,012.6

$ 971.1

4%

Brand Segment

104.9

35.5

195%

256.6

133.0

93%

Total

$ 353.7

$ 282.6

25%

$ 1,269.2

$ 1,104.1

15%

 

Generic Segment

Net revenues for the fiscal year ended March 31, 2003, increased 4% or $41.5 million to $1.01 billion from $971.1 million for the prior fiscal year. The increase in net revenues in fiscal 2003 was realized despite the loss of exclusivity on buspirone. During the prior year, the Company had market exclusivity with respect to buspirone 15mg and 30mg. Following the expiration of such exclusivity, which occurred in March 2002, buspirone experienced price and volume erosion which is considered normal in the generic industry. Excluding revenue from buspirone, net revenues for fiscal 2003 increased $188.9 million or 24%, due to new products launched during the fiscal year, as well as increased volume and favorable pricing on existing products. New products accounted for $79.5 million, or approximately 42% of the increase in net revenues excluding buspirone, with the remaining increase attributable to growth from the Company's existing product portfolio.

Gross profit for fiscal 2003 decreased $21.6 million to $531.1 million from $552.7 million, primarily attributable to the lower gross profit related to buspirone. Earnings from operations for fiscal 2003 were $454.0 million compared to $483.1 million for the prior year, a decrease of 6% or $29.0 million. The decrease in earnings from operations was driven primarily by the lower gross profit and an increase in research and development expenses. The increase in research and development expense was the result of an increase in clinical studies being performed to expand the development platform.

 

Net revenues for the fourth quarter increased 1% to $248.8 million from $247.1 million for the same prior year period. Excluding revenue from buspirone, net revenues for the quarter ended March 31, 2003 increased $43.9 million or 22%. The increase was primarily attributable to new products launched in fiscal 2003, which contributed revenues of $30.3 million.

Gross profit for the quarter decreased $7.6 million to $135.0 million from $142.6 million which was primarily attributable to lower gross profit related to buspirone. Earnings from operations were $114.3 million for the quarter compared to $126.6 million for the prior year quarter, a decrease of 10% or $12.3 million. The lower earnings from operations were primarily a result of the lower gross profit along with an increase in research and development expenses.

Brand Segment

For fiscal 2003, the Brand Segment reported net revenues of $256.6 million, an increase of 93% or $123.6 million from $133.0 million in the prior fiscal year. The increase in net revenues was the result of the launch of Amnesteem and growth in the Company's existing portfolio of products including Digitek, phenytoin and Avita. Gross profit for fiscal 2003 increased $69.1 million or 97% to $140.3 million from $71.2 million. Earnings from operations were $32.7 million compared to a loss from operations of $16.2 million in the prior year.

Brand Segment operating expenses for fiscal 2003 increased 23% or $20.2 million to $107.6 million from $87.4 million. The increase was attributable to higher research and development expenses due to ongoing clinical studies related to nebivolol, and increased selling and marketing expenses related to the launch of Amnesteem. These increases were partially offset by lower general and administrative expenses.

The Brand Segment realized record net revenues for the current quarter of $104.9 million, an increase of $69.4 million. The launch of Amnesteem accounted for approximately 67% of the increase in net revenues, while existing products continued to grow. As a result of the increase in net revenues, gross profit for the fourth quarter increased $34.2 million to $52.5 million.

Earnings from operations for the fourth quarter were $21.2 million compared to $0.3 million for the same prior year period. The increase was the result of higher gross profit, partially offset by increased operating expenses, primarily research and development. Research and development expenses increased $11.1 million as a result of clinical studies related primarily to nebivolol.

Corporate/Other Segment

General and administrative expenses for fiscal 2003 were $75.1 million, an increase of $3.4 million from the prior year. Other income for fiscal 2003 was $12.5 million compared to $13.1 million in the prior year. General and administrative expenses for the fourth quarter of fiscal 2003 increased $11.0 million to $26.3 million, primarily due to increased legal costs associated with the litigation settlements previously discussed. Other income increased $11.5 million to $5.2 million for the current quarter versus $6.3 million of expense in the prior year. This increase was due to the performance of investments accounted for under the equity method, as well as realized gains from the sale of certain marketable securities.

Fiscal 2004 Earnings Guidance

Mylan confirmed its previously announced fiscal 2004 earnings guidance of $1.59 to $1.69 per diluted share. In addition to confirming its fiscal 2004 earnings guidance, the Company also noted that going forward it will provide only annual earnings guidance and adjust such earnings guidance as necessary.

Annual Meeting of Shareholders

The Annual Meeting of Shareholders will be held on Friday, July 25, 2003 at 10:00 am EDT at the Westin Convention Center, Pittsburgh, Pennsylvania.

Conference Call and Live Webcast

Mylan will host a conference call and live webcast to discuss its fiscal 2003 earnings today at 10:00 am EDT. The dial-in number to access the live call is (719) 457-2679. A replay of the conference call will be available until 12:00 pm EDT, May 15, 2003 at (719) 457-0820, access code 426275. To access the live webcast, please visit Mylan's website at www. mylan.com and click on the webcast icon. A replay of the webcast will be available until 12:00 pm EDT, May 15, 2003.

Forward Looking Statements

The statements made in this press release, in filings made with the SEC, on our website, or in other contexts (including statements made by our authorized representatives, either orally or in writing), are or may constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, which include:

    1. any statement regarding possible or assumed future results of operations of our business, the markets for our products, anticipated expenditures, regulatory developments or competition;
    2. any statement preceded by, followed by or that includes the words "intends", "estimates," "believes," "expects," "anticipates," "should," "could," or the negative or other variations of these or similar expressions; and
    3. other statement regarding matters that are not historical facts.

 

Because such statements are subject to risks and uncertainties, actual future results may differ materially from those expressed or implied by such forward-looking statements. Factors that could cause actual future results to differ materially from historic or expected results or that could cause market prices of our common stock to decline include, but are not limited to:

The cautionary statements referred to above should be considered in connection with any subsequent written or oral forward-looking statements that may be made by us or by persons acting on our behalf and in conjunction with our periodic SEC filings. In addition, we refer to the cautionary statements and risk factors mentioned in Item 7 of our Form 10-K for the year ended March 31, 2002, and our most recently filed Form 10-Q. We undertake no duty to update our forward-looking statements, even though our situation may change in the future.

Mylan Laboratories Inc. is a leading pharmaceutical company that develops, manufactures and markets generic and proprietary prescription products. Mylan has two operating segments that market an extensive line of generic and branded products through four business units: Mylan Pharmaceuticals Inc., Mylan Technologies Inc., UDL Laboratories, Inc. and Bertek Pharmaceuticals Inc. For more information about Mylan, visit www. mylan.com.


MYLAN LABORATORIES INC. AND SUBSIDIARIES

Consolidated Statements of Earnings

(in thousands, except per share amounts)

 

Three Months Ended

Fiscal Year Ended

March 31, 2003

March 31, 2002

March 31, 2003

March 31, 2002

Net revenues

$ 353,686

$ 282,598

$ 1,269,192

$ 1,104,050

Cost of sales

166,160

121,667

597,756

480,111

Gross profit

187,526

160,931

671,436

623,939

Operating expenses:

Research and development

26,795

12,160

86,748

58,847

Selling and marketing

17,027

15,238

65,625

59,913

General and administrative (1)

34,425

21,878

107,445

110,000

Litigation settlements, net

(2,370)

-

(2,370)

-

Total operating expenses

75,877

49,276

257,448

228,760

Earnings from operations

111,649

111,655

413,988

395,179

Equity in loss of Somerset

(223)

(1,229)

(4,573)

(4,719)

Other income (expense), net

5,413

(5,037)

17,098

17,863

Earnings before income taxes

116,839

105,389

426,513

408,323

Provision for income taxes

42,996

38,098

154,160

148,072

Net earnings

$ 73,843

$ 67,291

$ 272,353

$ 260,251

Earnings per common share:

Basic

$ 0.41

$ 0.36

$ 1.47

$ 1.38

Diluted

$ 0.40

$ 0.35

$ 1.45

$ 1.36

Weighted average common shares:

Basic

182,118

189,159

185,859

188,288

Diluted

185,687

191,805

188,220

191,052

 

(1) Due to the April 1, 2002, adoption of Statement of Financial Accounting Standard ("SFAS") No. 142, Goodwill and Other Intangible Assets, goodwill and certain other intangible assets are no longer amortized. General and administrative expenses for the three months and fiscal year ended March 31, 2002 include amortization expense of $1,801 and $7,204 for goodwill and certain other intangibles. Excluding such expense would increase net earnings to $69,092 and $267,455 and diluted earnings per share to $.36 and $1.40.


 

MYLAN LABORATORIES INC. AND SUBSIDIARIES

Consolidated Condensed Balance Sheets

(in thousands)

 

March 31, 2003

March 31, 2002

Assets:

Current assets:

Cash and cash equivalents

$ 258,902

$ 160,790

Marketable securities

427,904

456,266

Accounts receivable, net

187,587

150,054

Inventories

237,777

195,074

Other current assets

116,041

104,461

Total current assets

1,228,211

1,066,645

Non-current assets

517,012

554,628

Total assets

$ 1,745,223

$ 1,621,273

Liabilities:

Current liabilities

$ 265,771

$ 177,681

Non-current liabilities

33,120

41,353

Total liabilities

298,891

219,034

Total shareholders' equity

1,446,332

1,402,239

Total liabilities and shareholders' equity

$ 1,745,223

$ 1,621,273


MYLAN LABORATORIES INC. AND SUBSIDIARIES

Segment Results

(in thousands)

 

Three Months Ended

Fiscal Year Ended

March 31, 2003

March 31, 2002

March 31, 2003

March 31, 2002

Consolidated:

Net revenues

$ 353,686

$ 282,598

$ 1,269,192

$ 1,104,050

Cost of sales

166,160

121,667

597,756

480,111

Gross profit

187,526

160,931

671,436

623,939

Research and development

26,795

12,160

86,748

58,847

Selling and marketing

17,027

15,238

65,625

59,913

General and administrative

34,425

21,878

107,445

110,000

Litigation settlements, net

(2,370)

-

(2,370)

-

Earnings from operations

$ 111,649

$ 111,655

$ 413,988

$ 395,179

Generic Segment:

Net revenues

$ 248,803

$ 247,101

$ 1,012,617

$ 971,075

Cost of sales

113,776

104,479

481,511

418,339

Gross profit

135,027

142,622

531,106

552,736

Research and development

12,602

9,041

44,562

33,814

Selling and marketing

3,082

2,931

11,160

12,430

General and administrative

5,019

4,068

21,341

23,424

Earnings from operations

$ 114,324

$ 126,582

$ 454,043

$ 483,068

Brand Segment:

Net revenues

$ 104,883

$ 35,497

$ 256,575

$ 132,975

Cost of sales

52,384

17,188

116,245

61,772

Gross profit

52,499

18,309

140,330

71,203

Research and development

14,193

3,119

42,186

25,033

Selling and marketing

13,945

12,307

54,465

47,483

General and administrative

3,134

2,587

10,997

14,899

Earnings from operations

$ 21,227

$ 296

$ 32,682

$ (16,212)

Corporate/Other:

General and administrative

$ 26,272

$ 15,223

$ 75,107

$ 71,677

Litigation settlements, net

(2,370)

-

(2,370)

-

(Loss) earnings from operations

$ (23,902)

$ (15,223)

$ (72,737)

$ (71,677)


Dates Referenced Herein   and   Documents Incorporated by Reference

This ‘8-K’ Filing    Date    Other Filings
7/25/033,  DEF 14A,  PRE 14A
5/15/034,  5
Filed on:5/9/033
5/8/03
For Period End:3/31/0310-K,  5
4/1/02
3/31/0210-K,  10-K/A,  DEF 14A
 List all Filings 
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