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Sucampo Pharmaceuticals, Inc. Reports Fourth Quarter And Full Year 2012 Financial And Operating Results

Stocks in this article: SCMP

Sucampo Forward-Looking Statement

This press release contains "forward-looking statements" as that term is defined in the Private Securities Litigation Reform Act of 1995. These statements are based on management's current expectations and involve risks and uncertainties, which may cause results to differ materially from those set forth in the statements. The forward-looking statements may include statements regarding product development, product potential, future financial and operating results, and other statements that are not historical facts. The following factors, among others, could cause actual results to differ from those set forth in the forward-looking statements: the impact of pharmaceutical industry regulation and health care legislation; Sucampo's ability to accurately predict future market conditions; dependence on the effectiveness of Sucampo's patents and other protections for innovative products; the risk of new and changing regulation and health policies in the U.S. and internationally and the exposure to litigation and/or regulatory actions.

No forward-looking statement can be guaranteed and actual results may differ materially from those projected. Sucampo undertakes no obligation to publicly update any forward-looking statement, whether as a result of new information, future events, or otherwise. Forward-looking statements in this presentation should be evaluated together with the many uncertainties that affect Sucampo's business, particularly those mentioned in the risk factors and cautionary statements in Sucampo's most recent Form 8-K and 10-K, which Sucampo incorporates by reference.

       
Sucampo Pharmaceuticals, Inc.
Consolidated Statements of Operations and Comprehensive Income (unaudited)
(in thousands, except per share data)
 
Three Months Ended December 31, Year Ended December 31,
2012 2011 2012 2011
 
Revenues:
Research and development revenue $ 15,127 $ 2,658 $ 21,545 $ 9,249
Product royalty revenue 14,175 10,793 50,696 41,517
Co-promotion revenue 323 610 3,576 3,378
Contract and collaboration revenue 200 154 633 617
Product sales revenue   5,037     -     5,037     -  

Total revenues

  34,862     14,215     81,487     54,761  
 
Cost of goods sold   3,030     -     3,030     -  
Gross profit   31,832     14,215     78,457     54,761  
 
Operating expenses:
Research and development 7,090 7,659 21,292 33,497
Settlement of legal dispute - (11,100 ) - (11,100 )
General and administrative 7,559 11,953 30,157 41,270
Selling and marketing   4,217     2,094     18,691     8,783  
Total operating expenses   18,866     10,606     70,140     72,450  
 
Income (loss) from operations 12,966 3,609 8,317 (17,689 )
Non-operating income (expense):
Interest income 61 89 179 249
Interest expense (566 ) (611 ) (2,346 ) (2,455 )
Other income (expense), net   875     14     1,602     (2,019 )
Total non-operating income (expense), net   370     (508 )   (565 )   (4,225 )
 
Income (loss) before income taxes 13,336 3,101 7,752 (21,914 )
Income tax benefit (provision)   196     (402 )   (2,916 )   4,608  
Net income (loss) $ 13,532   $ 2,699   $ 4,836   $ (17,306 )
 
Net income (loss) per share:
Basic net income (loss) per share $ 0.33   $ 0.06   $ 0.12   $ (0.41 )
Diluted net income (loss) per share $ 0.32   $ 0.06   $ 0.12   $ (0.41 )
Weighted average common shares outstanding - basic   41,553     41,766     41,660     41,839  
Weighted average common shares outstanding - diluted   41,991     41,832     41,785     41,839  
 
Comprehensive income (loss):
Net income (loss) $ 13,532 $ 2,699 $ 4,836 $ (17,306 )
Other comprehensive income gain (loss):
Unrealized loss on investments, net of tax effect 13 (110 ) 36 (2 )
Foreign currency translation   43     121     (1,724 )   1,282  
Comprehensive income (loss) $ 13,588   $ 2,710   $ 3,148   $ (16,026 )
 

 
Sucampo Pharmaceuticals, Inc.
Consolidated Balance Sheets (unaudited)
(in thousands, except share data)
 
 
    December 31,
2012     2011
ASSETS:
 
Current assets:
Cash and cash equivalents $ 52,022 $ 50,662
Investments, current 6,035 24,452
Product royalties receivable 14,175 10,795
Unbilled accounts receivable 732 2,036
Accounts receivable, net 1,360 4,616
Prepaid and income taxes receivable - 2,845
Deferred tax assets, current 874 163
Deferred charge, current 673 3,057
Restricted cash, current 15,113 15,113
Prepaid expenses and other current assets   1,930     1,177  
Total current assets 92,914 114,916
 
Investments, non-current 14,408 998
Property and equipment, net 1,540 1,669
Intangibles assets, net 7,415 8,364
Deferred tax assets, non-current 1,654 2,089
Deferred charge, non-current 5,213 26,751
Restricted cash, non-current 3,832 2,129
Other assets   820     653  
Total assets $ 127,796   $ 157,569  
 
LIABILITIES AND STOCKHOLDERS' EQUITY:
 
Current liabilities:
Accounts payable $ 5,496 $ 6,978
Accrued expenses 10,595 13,648
Deferred revenue, current 3,700 3,888
Deferred tax liability, current - 2,167
Income tax payable 148 -
Notes payable, current 19,129 20,400
Other current liabilities   1,003     -  
Total current liabilities 40,071 47,081
 
Notes payable, non-current 33,722 39,227
Deferred revenue, non-current 7,093 7,045
Deferred tax liability, non-current 2,627 23,019
Other liabilities   1,253     2,603  
Total liabilities   84,766     118,975  
 
 
 
Stockholders' equity:

Preferred stock, $0.01 par value; 5,000,000 shares authorized at December 31, 2012 and 2011; no shares issued and outstanding at December 31, 2012 and 2011

- -

Class A common stock, $0.01 par value; 270,000,000 shares authorized at December 31, 2012 and 2011; 41,964,905 and 15,690,780 shares issued and outstanding at December 31, 2012 and 2011, respectively

420 157

Class B common stock, $0.01 par value; 0 and 75,000,000 shares authorized at December 31, 2012 and 2011; 0 and 26,191,050 shares issued and outstanding at December 31, 2012 and 2011, respectively

- 262
Additional paid-in capital 62,521 59,957
Accumulated other comprehensive income 16,166 17,854
Treasury stock, at cost; 457,030 and 186,987 shares (1,977 ) (700 )
Accumulated deficit   (34,100 )   (38,936 )
Total stockholders' equity   43,030     38,594  
Total liabilities and stockholders' equity $ 127,796   $ 157,569  
 

       
Sucampo Pharmaceuticals, Inc.
Key Segment Information (unaudited)
 
 
(In thousands) Americas Europe Asia Consolidated
Three Months Ended December 31, 2012
Research and development revenue $ 311 $ (74 ) $ 14,890 $ 15,127
Product royalty revenue 14,175 - - 14,175
Co-promotion revenue 323 - - 323
Contract and collaboration revenue 141 46 13 200
Product sales revenue   -     14     5,023     5,037  
Total revenues 14,950 (14 ) 19,926 34,862
Cost of goods sold   98     9     2,923     3,030  
Gross profit 14,852 (23 ) 17,003 31,832
Research and development expenses 1,559 4,166 1,365 7,090
Depreciation and amortization 118 255 10 383
Other operating expenses   8,935     417     2,041     11,393  
Income (loss) from operations 4,240 (4,861 ) 13,587 12,966
Interest income 56 4 1 61
Interest expense - (527 ) (39 ) (566 )
Other non-operating expense, net   10     (269 )   1,134     875  
Income (loss) before income taxes $ 4,306   $ (5,653 ) $ 14,683   $ 13,336  
Capital expenditures $ 108   $ 25   $ -   $ 133  
 
Three Months Ended December 31, 2011
Research and development revenue $ 2,478 $ - $ 180 $ 2,658
Product royalty revenue 10,793 - - 10,793
Co-promotion revenue 610 - - 610
Contract and collaboration revenue   141     -     13     154  
Total revenues 14,022 - 193 14,215
Research and development expenses 4,593 2,002 1,064 7,659
Settlement for legal dispute (11,100 ) - - (11,100 )
Depreciation and amortization (133 ) 405 10 282
Other operating expenses   13,094     285     386     13,765  
Income (loss) from operations 7,568 (2,692 ) (1,267 ) 3,609
Interest income 85 3 1 89
Interest expense - (569 ) (42 ) (611 )
Other non-operating expense, net   (21 )   (105 )   140     14  
Income (loss) before income taxes $ 7,632   $ (3,363 ) $ (1,168 ) $ 3,101  
Capital expenditures $ 52   $ 3   $ -   $ 55  
 
Year Ended December 31, 2012
Research and development revenue $ 6,189 $ - $ 15,356 $ 21,545
Product royalty revenue 50,696 - - 50,696
Co-promotion revenue 3,576 - - 3,576
Contract and collaboration revenue 565 16 52 633
Product sales revenue   -     14     5,023     5,037  
Total revenues 61,026 30 20,431 81,487
Cost of goods sold   98     9     2,923     3,030  
Gross profit 60,928 21 17,508 78,457
Research and development expenses 7,809 9,571 3,912 21,292
Depreciation and amortization 484 964 40 1,488
Other operating expenses   41,410     2,993     2,957     47,360  
Income (loss) from operations 11,225 (13,507 ) 10,599 8,317
Interest income 161 16 2 179
Interest expense - (2,183 ) (163 ) (2,346 )
Other non-operating expense, net   77     (187 )   1,712     1,602  
Income (loss) before income taxes $ 11,463   $ (15,861 ) $ 12,150   $ 7,752  
Capital expenditures $ 401   $ 3,470   $ -   $ 3,871  
 
Year Ended December 31, 2011
Research and development revenue $ 8,033 $ - $ 1,216 $ 9,249
Product royalty revenue 41,517 - - 41,517
Co-promotion revenue 3,378 - - 3,378
Contract and collaboration revenue   565     -     52     617  
Total revenues 53,493 - 1,268 54,761
Research and development expenses 24,058 4,354 5,085 33,497
Settlement for legal dispute (11,100 ) - - (11,100 )
Depreciation and amortization 791 474 43 1,308
Other operating expenses   46,326     1,092     1,327     48,745  
Income (loss) from operations (6,582 ) (5,920 ) (5,187 ) (17,689 )
Interest income 240 6 3 249
Interest expense - (2,288 ) (167 ) (2,455 )
Other non-operating expense, net   (42 )   (1,884 )   (93 )   (2,019 )
Income (loss) before income taxes $ (6,384 ) $ (10,086 ) $ (5,444 ) $ (21,914 )
Capital expenditures $ 145   $ 6,006   $ 133   $ 6,284  
 




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