News Release Detail

May 8, 2002

Mylan Reports Record Revenues and Earnings For The Fourth Quarter and Fiscal 2002

Mylan Reports Record Revenues and Earnings For The Fourth Quarter and Fiscal 2002PITTSBURGH, May 8, 2002 (BUSINESS WIRE) -- Mylan Laboratories Inc.(NYSE: MYL)

    -   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 Results
Net 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 Results

Net 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 Segment
Net 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 Segment
Despite 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 Segment

Fiscal 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 Guidance
We 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 Webcast
A 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

URL:              http://www.businesswire.com
Today's News On The Net - Business Wire's full file on the Internet
with Hyperlinks to your home page.
Copyright (C) 2002 Business Wire.  All rights reserved.
Email Alerts
Investor FAQs
Contact Us
LinkedIn