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TheStreet Open House

Three-Month Interim Report (Q1) 2014

Stocks in this article: ALK

COPENHAGEN, Denmark, May 8, 2014 (GLOBE NEWSWIRE) --

Performance for the period (unaudited)

(Comparative figures for 2013 are shown in brackets / revenue growth is measured in local currencies)

Revenue and operating profit (EBITDA) in Q1 was strong. In particular, performance of allergy immunotherapy products in Europe exceeded expectations.

  • Revenue grew by 14% to DKK 684 million (610) driven by a 70% increase in revenue from SLIT-tablets in North America (milestone payments) and Europe (organic growth) as well as a 6% increase in revenue from SCIT/SLIT-drops.
  • Total sales of SCIT/SLIT-drops and GRAZAX (R) (previously reported as 'vaccine sales') grew organically by 7% including 12% organic growth in sales of GRAZAX (R).
  • EBITDA before special items more than doubled to DKK 211 million (101) as a result of higher revenue, efficiency improvements, lower R&D expenses following completion of certain development activities and receipt of milestone payments of DKK 81 million (36).
  • Cash flow from operations amounted to DKK 93 million (82). Free cash flow was DKK 39 million (26).

Partner and pipeline activities in 2014

Significant progress in ALK's work to globalise its product portfolio:

  • GRASTEK (R) and RAGWITEK(TM) launched by Merck in the USA following the FDA's grant of marketing authorisations for both products. GRASTEK (R) was also launched in Canada.
  • House dust mite SLIT-tablet commences Phase III trial in North America.
  • Positive results from a pivotal Phase II/III trial into the SLIT-tablet for house dust mite-induced hay fever in Japan. Results from a parallel trial with allergic asthma are expected in the coming months.
  • ALK and Abbott (NYSE:ABT) have entered into a partnership for the commercialisation of SLIT-tablets in selected emerging markets. The partnership adds ALK's portfolio of SLIT-tablets to Abbott's established franchise of respiratory products.
  • Collaboration with Eddingpharm in China to expand ALK's reach and accelerate growth from ALK's already marketed house dust mite products. ALK will maintain a local organisation in China.

2014 financial guidance

Due to the better than expected performance in Q1, the outlook for 2014 is adjusted: Revenue, including milestone payments, is now expected to equal approximately DKK 2.4 billion before future income streams from product supply and sales royalties from SLIT-tablets in North America (previously DKK 2.15-2.2 billion before milestones and any other contribution from SLIT-tablets in North America). EBITDA is now expected at approximately DKK 425 million (previously 'up to 400') before special items and future income from product supply and sales royalties in North America.

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