News Release Detail
Mylan Reports Record Revenues and Earnings For The Fourth Quarter and Fiscal 2002
- Financial Highlights:
- Net revenues increased 30% to exceed $1.1 billion for the
fiscal year and 14% to $282.6 million for the quarter.
- Gross profit increased 63% to $623.9 million for the
fiscal year and 43% to $160.9 million for the quarter.
- Net earnings increased 98% (excluding the impact of the
FTC settlement) to $260.3 million for the fiscal year and
60% to $67.3 million for the quarter.
- Diluted earnings per share increased 96% (excluding the
impact of the FTC settlement) to $2.04 for the fiscal year
and 61% to $.53 for the quarter.
Mylan Laboratories Inc. (NYSE: MYL) announced today financial results for the
fourth quarter and fiscal year ended March 31, 2002. Net revenues exceeded $1.1
billion and net earnings per diluted share increased over 96% (excluding the
impact of the FTC settlement in fiscal 2001) to $2.04 for the year. Fiscal 2002
fourth quarter net earnings per diluted share increased 61% to $.53.
Fiscal 2002 Fourth Quarter ResultsNet earnings and diluted earnings per share for the fourth quarter increased by 60% to $67.3 million and 61% to $.53 compared to $42.1 million and $.33 in the prior year, respectively. These increases were principally due to the extended exclusivity of buspirone into the fourth quarter of fiscal 2002, new products launched subsequent to March 31, 2001 and improved profitability of our core generic business. Additionally, decreases in each operating expense category were partially offset by higher other expenses and a loss in our investment in Somerset Pharmaceuticals, Inc.
Fiscal 2002 ResultsNet earnings and diluted earnings per share were $260.3 million and $2.04, an increase of 98% and 96% (excluding the impact of the FTC settlement), respectively. These increases were due largely to the exclusivity of buspirone throughout most of fiscal 2002, new products launched subsequent to March 31, 2001 and improved profitability of our core generic business.
Additionally, excluding the impact of the FTC settlement in fiscal 2001, operating expenses for fiscal 2002 were higher primarily due to increased general and administrative expenses, which were partially offset by lower research and development expenses. These results were achieved despite lower sales and earnings in our brand division.
"I am proud that our revenues have increased ten fold over the last decade to $1.1 billion, with a great majority coming from organic growth," said Milan Puskar, Chairman & CEO. " We enter our new fiscal year as a clear leader in the generic pharmaceutical industry. Our brand division is developing in the controlled manner which supports our strategic plan. We remain committed to our branded strategy as we continue to invest and build upon the existing platform. Mylan's investment in both brand and generic research and development will continue to grow revenue and shareholder value."
Generic SegmentNet revenues for fiscal 2002 grew to $971.1 million from $675.1 million for the prior year, an increase of 44% or $296.0 million. During the fourth quarter, net revenues were $247.1 million compared to $199.5 million for the prior year quarter, an increase of 24% or $47.6 million.
Fiscal 2002 earnings from operations were $483.1 million compared to $187.1 million in the prior year, an increase of 158% or $296.0 million. Earnings from operations for the fourth quarter were $126.6 million compared to $61.6 million for the prior year quarter, an increase of 106% or $65.0 million.
The overall fiscal 2002 and fourth quarter growth in net revenues and net earnings from operations is principally related to sales of buspirone, new products and improved profitability of our core generic business.
Research and development expenses for the fourth quarter remained relatively flat with the prior year quarter, while research and development expenses for fiscal 2002 decreased by $13.4 million from the prior year. The decrease in fiscal 2002 was principally the result of the timing of expenses. We anticipate that research and development spending for fiscal 2003 will return to prior year levels.
Brand SegmentDespite the fact that fiscal 2002 and fourth quarter net revenues and earnings decreased from the prior year, we are extremely encouraged that prescription volume for Bertek promoted products grew 44% during the year. The lower net revenues and earnings were a result of the decision to curtail end of quarter promotional programs and changing customer buying patterns. Net revenues for fiscal 2002 declined to $133.0 million from $171.6 million for the prior year, a decrease of 22% or $38.6 million. During the fourth quarter, net revenues were $35.5 million compared to $49.1 million for the prior year quarter, a decrease of 28% or $13.6 million.
Fiscal 2002 loss from operations was $16.2 million compared to fiscal 2001 earnings from operations of $26.1 million, a decrease of $42.3 million. Earnings from operations for the fourth quarter were $0.3 million compared to $6.5 million for the prior year quarter, a decrease of $6.2 million.
Research and development expenses for fiscal 2002 increased by 46% or $7.9 million from the prior year, while research and development expenses for the fourth quarter decreased by 49% or $3.0 million from the prior year quarter. The increase in the fiscal 2002 expense was a result of the ongoing development costs related to nebivolol. The decrease in the fourth quarter was a result of the timing of expenses. Research and development expense will increase as spending for nebivolol progresses in fiscal 2003.
Corporate / Other SegmentFiscal 2002 total expenses were $71.7 million compared to $46.7 million (excluding the impact of the FTC settlement), an increase of 54% or $25.0 million. Total expenses for the fourth quarter were $15.2 million compared to $10.4 million for the prior year quarter, an increase of 46% or $4.8 million. The fiscal year increase was attributable to payroll related expenses, principally associated with retirement benefits for executives and management employees and a donation to a charitable trust foundation in the fourth quarter.
Confirmation of First Quarter and Fiscal 2003 Financial GuidanceWe remain comfortable with the diluted earnings per share guidance of $.45 to $.47 for the first quarter of fiscal 2003 and $2.05 to $2.09 for fiscal 2003 as provided in our press release dated March 5, 2002.
Conference Call and Live WebcastA conference call and live webcast to discuss this earnings release and other matters of interest to investors and analysts will be held today at 10:00 a.m. EDT. The dial-in number to access this call is (719) 457-2600. A replay of the conference call will be available from approximately 12:00 p.m. EDT on May 8 through 12:00 p.m. EDT on May 15, and can be accessed by dialing (719) 457-0820 with access pass code 578535.
To access the live webcast, go to Mylan's website at www.mylan.com and click on the webcast icon at least 15 minutes before the call is to begin to register and download or install any necessary audio software. If you are unable to listen to the live webcast, please access www.mylan.com at any time within seven days to listen to a replay of the webcast.
This press release contains "forward-looking statements" as defined in the Private Securities Litigation Reform Act of 1995. No forward-looking statement can be guaranteed, and actual results may differ materially from those projected. We undertake 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 document should be evaluated together with the many uncertainties that affect our businesses, particularly those mentioned in the cautionary statements in Item 7 of our Form 10-K for the year ended March 31, 2001, and other periodic reports filed with the Securities and Exchange Commission.
Mylan Laboratories Inc. is a leading pharmaceutical company that develops, manufactures, and markets generic and proprietary prescription products. We have two operating segments that market an extensive line of generic and branded products through four business units: Mylan Pharmaceuticals Inc., Mylan Technologies Inc., UDL Laboratories, Inc., and Bertek Pharmaceuticals Inc. For more information about Mylan, visit www.mylan.com.
MYLAN LABORATORIES INC. AND SUBSIDIARIES
Consolidated Statements of Earnings
(unaudited; in thousands, except per share amounts)
Three Months Ended Fiscal Year Ended
March 31, March 31,
------------------- --------------------
2002 2001 2002 2001
---- ---- ---- ----
Net revenues $282,598 $248,648 $1,104,050 $846,696
Cost of sales 121,667 136,490 480,111 464,521
-------- -------- ---------- --------
Gross profit 160,931 112,158 623,939 382,175
Operating expenses:
Research and development 12,160 14,771 58,847 64,385
Selling and marketing 15,238 15,501 59,913 59,238
General and administrative 21,878 24,213 110,000 91,974
Tentative litigation
settlement(1) - - - 147,000
-------- -------- ---------- --------
Earnings from operations 111,655 57,673 395,179 19,578
Equity in loss
of Somerset (1,229) (726) (4,719) (1,477)
Other (expense)
income, net (5,037) 8,775 17,863 39,912
-------- -------- ---------- --------
Earnings before
income taxes 105,389 65,722 408,323 58,013
Provision for
income taxes 38,098 23,660 148,072 20,885
-------- -------- ---------- --------
Net earnings $ 67,291 $ 42,062 $ 260,251 $ 37,128
======== ======== ========== ========
Earnings per common share:
Basic $ 0.53 $ 0.34 $ 2.07 $ 0.30
======= ======== ========== ========
Diluted $ 0.53 $ 0.33 $ 2.04 $ 0.29
======= ======== ========== ========
Weighted average
common shares:
Basic 126,106 124,908 125,525 125,788
======= ======== ========== ========
Diluted 127,870 125,633 127,368 126,749
======= ======== ========== ========
(1) In July 2000,the Company reached a tentative settlement, which was
approved and made final in the fourth quarter of fiscal 2002, with the
Federal Trade Commission, States Attorneys General and certain private
parties with regard to lawsuits filed against the Company relating to
pricing issues and raw material contracts on two of its products. Net
earnings for the fiscal year ended March 31, 2001, excluding the
$147,000 before tax effect of the settlement, were $131,208 or $1.04
per diluted share.
MYLAN LABORATORIES INC. AND SUBSIDIARIES
Consolidated Condensed Balance Sheets
(unaudited; in thousands)
March 31,
------------------------------
2002 2001
---- ----
Assets
Current assets:
Cash and cash equivalents $160,790 $ 229,183
Marketable securities 456,266 55,715
Accounts receivable, net 145,491 235,938
Inventories 195,074 161,810
Deposit - tentative litigation settlement - 135,000
Other current assets 104,461 64,917
------- -----------
Total current assets 1,062,082 882,563
Non-current assets 554,628 586,749
------- -----------
Total assets 1,616,710 1,469,312
========= ===========
Liabilities:
Tentative litigation settlement - 147,000
Other current liabilities 175,147 147,526
-------- -----------
Current liabilities 175,147 294,526
Non-current liabilities 39,324 42,250
------- -----------
Total liabilities 214,471 336,776
Total shareholders' equity 1,402,239 1,132,536
---------- -----------
Total liabilities and
shareholders' equity $1,616,710 $1,469,312
=========== ===========
MYLAN LABORATORIES INC. AND SUBSIDIARIES
Segment Results
(unaudited; in thousands)
Three Months Ended Fiscal Year Ended
March 31, March 31,
------------------- -------------------
2002 2001 2002 2001
---- ---- ---- ----
Consolidated
Net revenues $ 282,598 $248,648 $1,104,050 $846,696
Cost of sales 121,667 136,490 480,111 464,521
-------- -------- ---------- --------
Gross profit 160,931 112,158 623,939 382,175
Research and development 12,160 14,771 58,847 64,385
Selling and marketing 15,238 15,501 59,913 59,238
General and
administrative 21,878 24,213 110,000 91,974
Tentative litigation
settlement - - - 147,000
-------- -------- ---------- --------
Earnings from operations $ 111,655 $ 57,673 $ 395,179 $19,578
========= ======== ========== ========
Generic Segment
Net revenues $ 247,101 $199,521 $ 971,075 $675,118
Cost of sales 104,479 118,161 418,339 402,007
-------- -------- ---------- --------
Gross profit 142,622 81,360 552,736 273,111
Research and development 9,041 8,622 33,814 47,204
Selling and marketing 2,931 4,108 12,430 14,342
General and administrative 4,068 7,029 23,424 24,450
-------- -------- ---------- --------
Earnings from operations $126,582 $ 61,601 $ 483,068 $187,115
======== ======== ========== ========
Brand Segment
Net revenues $ 35,497 $ 49,127 $ 132,975 $171,578
Cost of sales 17,188 18,329 61,772 62,514
-------- -------- ---------- --------
Gross profit 18,309 30,798 71,203 109,064
Research and development 3,119 6,149 25,033 17,181
Selling and marketing 12,307 11,393 47,483 44,896
General and administrative 2,587 6,743 14,899 20,841
-------- -------- ---------- --------
Earnings/(Loss)
from operations $ 296 $ 6,513 $ (16,212) $26,146
======== ======== ========== ========
Corporate/Other Segment
General and
administrative $ 15,223 $ 10,441 $ 71,677 $ 46,683
Tentative litigation
settlement - - - 147,000
-------- -------- ---------- --------
Total expenses $ 15,223 $ 10,441 $ 71,677 $193,683
======== ======== ========== ========
Effective April 1, 2001, the Brand Segment assumed responsibility for
the marketing of EX phenytoin. Accordingly, for the quarter and year
ended March 31, 2001, generic net revenues, along with the
corresponding cost of sales, for this product have been reclassed to
the Brand Segment.
CONTACT: Mylan Laboratories, Pittsburgh
Patricia Sunseri, 412/232-0100
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