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Emergent BioSolutions Inc. Reports Operating Results (10-Q)
Posted by: gurufocus (IP Logged)
Date: August 6, 2010 06:20AM

Emergent BioSolutions Inc. (EBS) filed Quarterly Report for the period ended 2010-06-30. Emergent Biosolutions Inc. has a market cap of $589.1 million; its shares were traded at around $18.98 with a P/E ratio of 24 and P/S ratio of 2.5.

EBS is in the portfolios of Chuck Royce of Royce& Associates, Bruce Kovner of Caxton Associates, Steven Cohen of SAC Capital Advisors, Jim Simons of Renaissance Technologies LLC, Manning & Napier Advisors, Inc.

Highlight of Business Operations:

Product sales revenues decreased by $13.5 million, or 19%, to $55.9 million for the three months ended June 30, 2010 from $69.3 million for the three months ended June 30, 2009. This decrease in product sales revenues was primarily due to a lump-sum payment from HHS of $29.6 million related to the approval of four-year expiry dating for BioThrax received in June 2009, partially offset by a 15% increase in the sale price per dose and a 23% increase in the number of doses of BioThrax delivered in the three months ended June 30, 2010. Product sales revenues for the three months ended June 30, 2010 consisted of BioThrax sales to HHS of $53.5 million and aggregate international and other sales of $2.3 million. Product sales revenues for the three months ended June 30, 2009 consisted of BioThrax sales to HHS of $69.0 million, including the lump sum payment of $29.6 million, and aggregate international and other sales of $283,000.

Research and development expenses decreased by $2.1 million, or 10%, to $18.6 million for the three months ended June 30, 2010 from $20.7 million for the three months ended June 30, 2009. This decrease reflects lower contract service costs, and includes decreased expenses of $3.2 million on product candidates categorized in the commercial segment, partially offset by increased expenses of $417,000 on product candidates that are categorized in the biodefense segment and increased expenses of $657,000 in other research and development, which are in support of technology platform development activities and central research and development activities.

Selling, general and administrative expenses decreased by $1.7 million, or 9%, to $17.6 million for the three months ended June 30, 2010 from $19.4 million for the three months ended June 30, 2009. This decrease is primarily due to a decrease of $3.3 million in the impairment charge associated with our Frederick, Maryland facilities partially offset by increased personnel and professional services to support growth of the business. The majority of the expense is attributable to the biodefense segment, in which selling, general and administrative expenses increased by $635,000, or 5%, to $12.6 million for the three months ended June 30, 2010 from $12.0 million for the three months ended June 30, 2009. Selling, general and administrative expenses related to our commercial segment decreased by $2.4 million, or 32%, to $5.0 million for the three months ended June 30, 2010 from $7.4 million for the three months ended June 30, 2009.

Product sales revenues decreased by $36.3 million, or 28%, to $94.7 million for the six months ended June 30, 2010 from $131.0 million for the six months ended June 30, 2009. This decrease in product sales revenues was primarily due to a lump-sum payment from HHS of $29.6 million related to the approval of four-year expiry dating for BioThrax received in June 2009 coupled with a 20% decrease in the number of doses delivered in the six months ended June 30, 2010, partially offset by a 17% increase in the sales price per dose. Product sales revenues for the six months ended June 30, 2010 consisted of BioThrax sales to HHS of $92.4 million and aggregate international and other sales of $2.4 million. Product sales revenues for the six months ended June 30, 2009 consisted of BioThrax sales to HHS of $130.7 million, including the lump-sum payment of $29.6 million, and aggregate international and other sales of $337,000.

Contracts and grants revenues increased by $7.5 million, or 112%, to $14.2 million for the six months ended June 30, 2010 from $6.7 million for the six months ended June 30, 2009. Contracts and grants revenues for the six months ended June 30, 2010 consisted of $13.5 million in development contract and grant revenue from NIAID and BARDA and $750,000 from a milestone payment related to the 2008 sale of technology rights and related materials and documentation pertaining to our Pertussis technology. Contracts and grants revenues for the six months ended June 30, 2009 consisted entirely of development contract and grant revenue from NIAID and BARDA.

Research and development expenses increased by $1.9 million, or 5%, to $38.5 million for the six months ended June 30, 2010 from $36.6 million for the six months ended June 30, 2009. This increase reflects higher contract service costs, and includes increased expenses of $5.8 million on product candidates that are categorized in the biodefense segment, and increased expenses of $1.6 million in other research and development, which are in support of technology platform development activities and central research and development activities, partially offset by decreased expenses of $5.5 million on product candidates categorized in the commercial segment.

Read the The complete Report



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