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Ligand Reports Fourth Quarter And Full Year 2012 Financial Results

Forward-Looking Statements

This news release contains certain forward-looking statements by Ligand that involve risks and uncertainties and reflect Ligand's judgment as of the date of this release. Actual events or results may differ from Ligand's expectations. For example, we may not receive expected revenue from material sales of Captisol, expected royalties on partnered products or from research and development milestones may not be received, and we and our partners may not be able to timely or successfully advance any product(s) in Ligand's internal or partnered pipeline. In addition, there can be no assurance that Ligand will achieve its guidance for 2013 or beyond, that Ligand will deliver strong cash flow over the long-term, that Ligand's 2013 revenues will be at the levels or be broken down as currently anticipated or that Captisol sales will be sufficiently strong, that Ligand will be able to create future revenues and cash flows by developing innovative therapeutics, that results of any clinical study will be timely, favorable or confirmed by later studies, that products under development by Ligand or its partners will receive regulatory approval, or that there will be a market for the product(s) if successfully developed and approved. Also, Ligand and its partners may experience delays in the commencement, enrollment, completion or analysis of clinical testing for its product candidates, or significant issues regarding the adequacy of its clinical trial designs or the execution of its clinical trials, which could result in increased costs and delays, or limit Ligand's ability to obtain regulatory approval. Further, unexpected adverse side effects or inadequate therapeutic efficacy of Ligand's product(s) could delay or prevent regulatory approval or commercialization. Ligand may also have indemnification obligations to King Pharmaceuticals or Eisai in connection with the sales of the Avinza and oncology product lines. In addition, Ligand may not be able to successfully implement its strategic growth plan and continue the development of its proprietary programs. The failure to meet expectations with respect to any of the foregoing matters may reduce Ligand's stock price. Additional information concerning these and other risk factors affecting Ligand's business can be found in prior press releases available via www.ligand.com as well as in Ligand's public periodic filings with the Securities and Exchange Commission at www.sec.gov. Ligand disclaims any intent or obligation to update these forward-looking statements beyond the date of this release. This caution is made under the safe harbor provisions of the Private Securities Litigation Reform Act of 1995.

[Tables to follow]

LIGAND PHARMACEUTICALS INCORPORATED
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

(in thousands, except share data)

 
  Three Months Ended December 31,   Twelve Months Ended December 31,
  2012       2011     2012       2011  
(unaudited) (unaudited)
Revenues:
Royalties $ 4,817 $ 2,616 $ 14,073 $ 9,213
Material sales 5,282 6,460 9,432 12,123
Collaborative research and development and other revenues   3,536     3,861     7,883     8,701  
Total revenues 13,635 12,937 31,388 30,037
 
Operating costs and expenses:
Cost of goods sold 2,328 2,059 3,601 4,909
Research and development 2,476 2,599 10,790 10,291
General and administrative 4,283 3,709 16,108 14,977
Write-off of in-process research and development - - - 2,282
Lease exit and termination costs   156     147     315     (22 )
Total operating costs and expenses 9,243 8,514 30,814 32,437
Amortization of deferred gain on sale leaseback   -     426       -       1,702  
Gain (loss) from operations 4,392 4,849 574 (698 )
Other income (expense), net (601 ) (174 ) (2,789 ) (1,847 )
Decrease (increase) in contingent liabilities (2,841 ) 304 (1,650 ) (1,013 )
Income tax (expense) benefit   1,636     (289 )   1,191     13,270  
Income (loss) from continuing operations   2,586     4,690     (2,674 )   9,712  
Income (loss) from discontinued operations, net of taxes   (1,523 )   -     2,147     3  
Net income $ 1,063   $ 4,690   $ (527 ) $ 9,715  
Basic and diluted per share amounts:
Income (loss) from continuing operations $ 0.13 $ 0.24 $ (0.13 ) $ 0.49
Discontinued operations   (0.08 )   -     0.11     -  
Net income $ 0.05   $ 0.24   $ (0.03 ) $ 0.49  
 
Weighted average number of common shares-basic 20,034,558 19,674,945 19,853,095 19,655,632
Weighted average number of common shares-diluted 20,124,331 19,738,228 19,853,095 19,713,320
 
LIGAND PHARMACEUTICALS INCORPORATED
CONDENSED CONSOLIDATED BALANCE SHEETS

(in thousands)

 
  December 31, 2012   December 31, 2011
Assets (unaudited)
Current assets:
Cash, cash equivalents and short-term investments $ 12,381 $ 17,041
Accounts receivable 4,589 6,110
Inventory 1,697 1,301
Other current assets 829 1,581
Current portion of co-promote termination asset   4,327   6,197
Total current assets 23,823 32,230
 
Restricted cash and investments 2,767 1,341
Property and equipment, net 788 455
Goodwill and other identifiable intangible assets 68,150 70,564
Long-term portion of co-promote termination asset 8,207 15,255
Other assets   525   738
Total Assets $ 104,260 $ 120,583
 
Liabilities and Stockholders' Equity
Accounts payable and accrued liabilities $ 16,277 $ 27,446
Current portion of co-promote termination liability 4,327 6,197
Current portion of note payable 14,835 -
Bank line of credit   -   10,000
Total current liabilities 35,439 43,643
Long-term portion of co-promote termination liability 8,207 15,255
Long-term portion of deferred revenue 2,369 3,466
Long-term debt 13,443 20,286
Other long-term liabilities   18,317   21,404
Total liabilities 77,775

 

104,054
Common stock subject to conditional redemption - 8,344
Stockholders' equity   26,485   8,185
Total liabilities and stockholders' deficit $ 104,260 $ 120,583
 
LIGAND PHARMACEUTICALS INCORPORATED
NON-GAAP FINANCIAL MEASURES

(in thousands, except share data)

 
  Three Months Ended December 31, 2012
GAAP   CVR Adjustment   NON-GAAP
(unaudited)
Gain (loss) from operations 4,392 - 4,392
Other income (expense), net (601 ) - (601 )
Decrease (increase) in contingent liabilities (2,841 ) 2,841 -
Income tax (expense) benefit   1,636     -     1,636  
Income (loss) from continuing operations   2,586     2,841     5,427  
Income (loss) from discontinued operations, net of taxes   (1,523 )   -     (1,523 )
Net income $ 1,063   $ 2,841   $ 3,904  
Basic and diluted per share amounts:
Income (loss) from continuing operations $ 0.13 $ 0.14 $ 0.27
Discontinued operations   (0.08 )   -     (0.08 )
Net income $ 0.05   $ 0.14   $ 0.19  
 
Weighted average number of common shares-basic 20,034,558 20,034,558 20,034,558
Weighted average number of common shares-diluted 20,124,331 20,124,331 20,124,331
 
Three Months Ended December 31, 2011
GAAP CVR Adjustment NON-GAAP
 
Gain (loss) from operations 4,849 - 4,849
Other income (expense), net (174 ) - (174 )
Decrease (increase) in contingent liabilities 304 (304 ) -
Income tax (expense) benefit   (289 )   -     (289 )
Income (loss) from continuing operations   4,690     (304 )   4,386  
Income (loss) from discontinued operations, net of taxes   -     -     -  
Net income $ 4,690   $ (304 ) $ 4,386  
Basic and diluted per share amounts:
Income (loss) from continuing operations $ 0.24 $ (0.02 ) $ 0.22
Discontinued operations   -     -     -  
Net income $ 0.24   $ (0.02 ) $ 0.22  
 
Weighted average number of common shares-basic 19,674,945 19,674,945 19,674,945
Weighted average number of common shares-diluted 19,738,228 19,738,228 19,738,228
 
LIGAND PHARMACEUTICALS INCORPORATED
NON-GAAP FINANCIAL MEASURES

(in thousands, except share data)

 
  Twelve Months Ended December 31, 2012
GAAP   CVR Adjustment   NON-GAAP
(unaudited)
Gain (loss) from operations 574 - 574
Other income (expense), net (2,789 ) - (2,789 )
Decrease (increase) in contingent liabilities (1,650 ) 1,650 -
Income tax (expense) benefit   1,191     -   1,191  
Income (loss) from continuing operations   (2,674 )   1,650   (1,024 )
Income (loss) from discontinued operations, net of taxes   2,147     -   2,147  
Net income $ (527 ) $ 1,650 $ 1,123  
Basic and diluted per share amounts:
Income (loss) from continuing operations $ (0.13 ) $ 0.08 $ (0.05 )
Discontinued operations   0.11     -   0.11  
Net income $ (0.03 ) $ 0.08 $ 0.06  
 
Weighted average number of common shares-basic 19,853,095 19,853,095 19,853,095
Weighted average number of common shares-diluted 19,935,718 19,935,718 19,935,718
 
 
Twelve Months Ended December 31, 2011
GAAP CVR Adjustment NON-GAAP
 
Gain (loss) from operations (698 ) - (698 )
Other income (expense), net (1,847 ) - (1,847 )
Decrease (increase) in contingent liabilities (1,013 ) 1,013 -
Income tax (expense) benefit   13,270     -   13,270  
Income (loss) from continuing operations   9,712     1,013   10,725  
Income (loss) from discontinued operations, net of taxes   3     -   3  
Net income $ 9,715   $ 1,013 $ 10,728  
Basic and diluted per share amounts:
Income (loss) from continuing operations $ 0.49 $ 0.05 $ 0.55
Discontinued operations   -     -   -  
Net income $ 0.49   $ 0.05 $ 0.55  
 
Weighted average number of common shares-basic 19,655,632 19,655,632 19,655,632
Weighted average number of common shares-diluted 19,713,320 19,713,320 19,713,320




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