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Emergent BioSolutions Inc. Reports Operating Results (10-Q)
Posted by: gurufocus (IP Logged)
Date: May 4, 2012 10:57AM

Emergent BioSolutions Inc. (EBS) filed Quarterly Report for the period ended 2012-03-31. Emergent Biosul has a market cap of $522.9 million; its shares were traded at around $13.73 with a P/E ratio of 24.2 and P/S ratio of 1.9. Emergent Biosul had an annual average earning growth of 1.2% over the past 5 years.



Highlight of Business Operations:

We have derived substantially all of our product sales revenues from BioThrax sales to the U.S. government. We are currently a party to a contract with the Centers for Disease Control and Prevention, or CDC, to supply 44.75 million doses of BioThrax for placement into the Strategic National Stockpile, or SNS, over a five year period. We expect for the foreseeable future to continue to derive substantially all of our product sales revenues from our sales of BioThrax to the U.S. government. Our total revenues from BioThrax sales were $34.4 million and $5.6 million for the three months ended March 31, 2012 and 2011, respectively. We are focused on increasing sales of BioThrax to U.S. government customers, expanding the market for BioThrax to other customers domestically and internationally and pursuing label expansions and improvements for BioThrax.

Product sales revenues increased by $28.8 million to $34.4 million for the three months ended March 31, 2012 from $5.6 million for the three months ended March 31, 2011. This increase in product sales revenues was due to a 636% increase in the number of doses of BioThrax delivered. This increase in the number of doses delivered was due to the use of production lots in the qualification of a second fill-finish contract manufacturer and the redeployment of our potency testing capacity from BioThrax release testing to qualification of replacement reference standards and other development testing during the first quarter of 2011. Product sales revenues during the three months ended March 31, 2012 consisted of BioThrax sales to the CDC of $34.3 million and aggregate international and other sales of $89,000. Product sales revenues for the three months ended March 31, 2011 consisted of BioThrax sales to the CDC of $5.0 million and aggregate international and other sales of $565,000.

Contracts and grants revenues increased by $3.0 million, or 23%, to $16.0 million for the three months ended March 31, 2012 from $12.9 million for the three months ended March 31, 2011. The increase in contracts and grants revenues was primarily due to increased activity and associated revenue from our development contracts with BARDA for large-scale manufacturing of BioThrax and PreviThrax. Contracts and grants revenues during the three months ended March 31, 2012 consisted of $14.3 million in development contract and grant revenue from BARDA and NIAID and $1.7 million from Abbott and Pfizer. Contracts and grants revenues for the three months ended March 31, 2011 consisted of $9.9 million in development contract and grant revenue from BARDA and NIAID and $3.0 million from Abbott and Pfizer.

Cost of product sales increased by $6.4 million to $7.5 million for the three months ended March 31, 2012 from $1.1 million for the three months ended March 31, 2011. This increase was substantially attributable to the 636% increase in the number of BioThrax doses sold.

Research and development expenses decreased by $8.5 million, or 24%, to $26.2 million for the three months ended March 31, 2012 from $34.8 million for the three months ended March 31, 2011. This decrease primarily reflects lower contract service expenses, and includes decreased expenses of $9.6 million for product candidates and technology platform development activities that are categorized in the Biosciences segment, increased expenses of $474,000 for product candidates that are categorized in the Biodefense segment, and increased expenses of $595,000 in other research and development, which are in support of central research and development activities. During the three months ended March 31, 2012 and 2011, we incurred research and development expenses net of development contract and grant revenues along with the net loss attributable to noncontrolling interests of $9.1 million and $20.0 million, respectively.

Read the The complete Report



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