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Ligand Pharmaceuticals Inc. Reports Operating Results (10-Q/A)
Posted by: gurufocus (IP Logged)
Date: February 10, 2012 05:37PM

Ligand Pharmaceuticals Inc. (LGND) filed Amended Quarterly Report for the period ended 2011-06-30. Ligand Pharmaceuticals Inc. has a market cap of $280.7 million; its shares were traded at around $14.9048 with and P/S ratio of 11.9. Ligand Pharmaceuticals Inc. had an annual average earning growth of 7.2% over the past 10 years.



Highlight of Business Operations:

Total revenues for the three and six months ended June 30, 2011 were $7.5 million and $11.4 million compared to $5.8 million and $11.8 million for the same period in 2010. We reported a loss from continuing operations of $0.9 million for the three months ending June 30, 2011 and income from continuing operations of $9.1 million for the six months ended June 30, 2011, compared to losses from continuing operations of $0.3 million and $3.3 million for the three and six months ended June 30, 2010.

We recorded collaborative research and development and other revenues of $2.3 million and $3.2 million for the three and six months ended June 30, 2011, compared to $4.2 million and $8.2 million for the same 2010 periods. The decrease of $1.9 million and $5.0 million, respectively for the three and six months ended June 30, 2011, compared to the same period in 2010, is primarily due to the termination of our remaining research obligations under collaboration agreements, partially offset by the recognition of $1.2 million of deferred revenue related to the previous sale of royalty rights.

In connection with the acquisition of CyDex Pharmaceuticals, Inc. on January 24, 2011, we issued a series of Contingent Value Rights. We are obligated to pay $4.3 million in January 2012 and may be required to pay up to an additional $6.4 million upon achievement of certain milestones. In June 2011, $0.9 million was paid to the CyDex Shareholders upon completion of a licensing agreement with The Medicines Company for the Captisol enabled Intravenous formulation of Clopidogrel. In addition, we will pay CyDex shareholders, for each respective year from 2011 through 2016, 20% of all CyDex-related revenue, but only to the extent that and beginning only when CyDex-related revenue for such year exceed $15.0 million; plus an additional 10% of all CyDex-related revenue recognized during such year, but only to the extent that and beginning only when aggregate CyDex-related revenue for such year exceeds $35.0 million.

The cash generated for the six months ended June 30, 2011 reflects net income of $9.1 million, adjusted by $4,000 of gain from discontinued operations and $10.5 million of non-cash items to reconcile the net income to net cash used in operations. These reconciling items primarily reflect the change in deferred income taxes of $13.6 million, accretion of deferred gain on the sale leaseback of the building of $0.9 million and non-cash lease costs of $0.1 million partially offset by the change in estimated fair value of contingent value rights of $1.1 million, depreciation and amortization of $1.3 million and stock-based compensation of $1.7 million. The cash generated during the six months ended June 30, 2011 is further impacted by changes in operating assets and liabilities due primarily to a decrease in other liabilities of $1.6 million, an increase in inventory of $0.2 million, a decrease in deferred revenue of $1.2 million and a decrease in accounts payable and accrued liabilities of $8.9 million, partially offset by increases in other current assets of $4.3 million, accounts receivable of $1.2 million and other long term assets of $0.6 million. None of the cash used in operating activities for the six months ended June 30, 2011 related to discontinued operations.

The use of cash for the six months ended June 30, 2010 reflects a net loss of $3.0 million, adjusted by $0.2 million of gain from discontinued operations and $2.9 million of non-cash items to reconcile the net income to net cash used in operations. These reconciling items primarily reflect the change in estimated fair value of CVRs of $4.2 million, accretion of deferred gain on the sale leaseback of the building of $0.9 million and realized gain on investment of $0.6 million, partially offset by depreciation of assets of $1.4 million and the recognition of $1.5 million of stock-based compensation expense. The use of cash during the six months ended June 30, 2010 is further impacted by changes in operating assets and liabilities due primarily to decreases in accounts payable and accrued liabilities of $8.0 million, an increase in other long term assets of $0.4 million, a decrease in other liabilities of $1.1 million and a decrease in deferred revenue of $3.3 million, partially offset by a decrease in accounts receivable, net of $0.6 million. Net cash provided by operating activities of discontinued operations was $0.3 million for the six months ended June 30, 2010.

Read the The complete Report



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