Lantheus Holdings, Inc. Reports Third Quarter 2020 Financial Results

Lantheus Holdings, Inc. (the “Company”) (NASDAQ: LNTH), the parent company of Lantheus Medical Imaging, Inc. and Progenics Pharmaceuticals, Inc., and a global leader in the development, manufacture and commercialization of innovative diagnostic and therapeutic agents and products, today reported financial results for its third quarter ended September 30, 2020.

The Company’s worldwide revenue for the third quarter of 2020 totaled $88.5 million, compared with $85.8 million for the third quarter of 2019, representing an increase of 3.2% from the prior year period.

The Company’s third quarter 2020 net loss was $6.4 million, or $(0.10) per fully diluted share, as compared to net income of $4.9 million, or $0.12 per fully diluted share for the third quarter of 2019.

The Company’s third quarter 2020 adjusted fully diluted earnings per share were $0.04, as compared to $0.28 for the third quarter of 2019, representing a decrease of 87.1% from the prior year period.

Lastly, net cash provided by operating activities was $8.6 million for the third quarter 2020. Free Cash Flow was $4.8 million in the third quarter of 2020, representing a decrease of approximately $18.3 million from the prior year period.

“We continued to see steady recovery throughout the quarter primarily driven by DEFINITY and complemented by accelerated synergy capture, delivering a strong adjusted EPS performance,” said Mary Anne Heino, President and CEO. “Importantly, despite increased investment during the quarter related to our newly-combined business and our on-going integration efforts, we generated positive free cash flow. We remain committed to executing on our corporate initiatives even during these unprecedented times. In our first quarter as an integrated company, we received approval for VIALMIXRFID and submitted the NDA for our PSMA-targeted PET imaging agent, PyL. We believe these accomplishments and our continued financial discipline position us to drive sustainable future growth and enhanced shareholder value.”

Outlook

On April 9, 2020, the Company withdrew full year 2020 revenue, revenue growth, and adjusted fully diluted earnings per share guidance as a result of the continued uncertainties surrounding the scope, duration and impacts of the COVID-19 pandemic. Due to these uncertainties, and uncertain timing of global recovery and economic normalization, the Company continues to be unable to provide guidance as to the overall impacts on its operations and financial results during the ongoing pandemic.

Internet Posting of Information

The Company routinely posts information that may be important to investors in the “Investors” section of its website at www.lantheus.com. The Company encourages investors and potential investors to consult its website regularly for important information about the Company.

Conference Call and Webcast

As previously announced, the Company will host a conference call and webcast on Thursday, November 5, 2020 at 8:00 a.m. ET. To access the live conference call via telephone, please dial 1-866-498-8390 (U.S. callers) or 1-678-509-7599 (international callers) and provide passcode 8872902. A live webcast will be available in the Investors section of the Company’s website at www.lantheus.com.

A replay of the audio webcast will be available in the Investors section of our website at www.lantheus.com approximately two hours after completion of the call and will be archived for 30 days.

The conference call will include a discussion of non-GAAP financial measures. Reference is made to the most directly comparable GAAP financial measures, the reconciliation of the differences between the two financial measures, and the other information included in this press release, our Form 8-K filed with the SEC today, or otherwise available in the Investor Relations section of our website located at www.lantheus.com.

The conference call may include forward-looking statements. See the cautionary information about forward-looking statements in the safe-harbor section of this press release.

About Lantheus Holdings, Inc.

Lantheus Holdings, Inc. is the parent company of Lantheus Medical Imaging, Inc., Progenics Pharmaceuticals, Inc., and EXINI Diagnostics AB, and a global leader in the development, manufacture and commercialization of innovative diagnostic and therapeutic agents and products. Lantheus provides a broad portfolio of products, including the echocardiography agent DEFINITY® Vial for (Perflutren Lipid Microsphere) Injectable Suspension; TechneLite® (Technetium Tc99m Generator), a technetium-based generator that provides the essential medical isotope used in nuclear medicine procedures; AZEDRA® for the treatment of certain rare neuroendocrine tumors; and RELISTOR® for the treatment of opioid-induced constipation, which is partnered with Bausch Health Companies, Inc. The Company is headquartered in North Billerica, Massachusetts with offices in New York, New Jersey, Puerto Rico, Canada and Sweden. For more information, visit www.lantheus.com.

Non-GAAP Financial Measures

The Company uses non-GAAP financial measures, such as adjusted net income and its line components; adjusted net income per share - fully diluted; and free cash flow. The Company’s management believes that the presentation of these measures provides useful information to investors. These measures may assist investors in evaluating the Company’s operations, period over period. However, these measures may exclude items that may be highly variable, difficult to predict and of a size that could have a substantial impact on the Company’s reported results of operations for a particular period. Management uses these and other non-GAAP measures internally for evaluation of the performance of the business, including the allocation of resources and the evaluation of results relative to employee performance compensation targets. Investors should consider these non-GAAP measures only as a supplement to, not as a substitute for or as superior to, measures of financial performance prepared in accordance with GAAP.

Safe Harbor for Forward-Looking and Cautionary Statements

This press release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, as amended, that are subject to risks and uncertainties and are made pursuant to the safe harbor provisions of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Forward-looking statements may be identified by their use of terms such as “anticipate,” “believe,” “confident,” “could,” “estimate,” “expect,” “intend,” “may,” “plan,” “predict,” “project,” “target,” “will” and other similar terms. Such forward-looking statements are based upon current plans, estimates and expectations that are subject to risks and uncertainties that could cause actual results to materially differ from those described in the forward-looking statements. The inclusion of forward-looking statements should not be regarded as a representation that such plans, estimates and expectations will be achieved. Readers are cautioned not to place undue reliance on the forward-looking statements contained herein, which speak only as of the date hereof. The Company undertakes no obligation to publicly update any forward-looking statement, whether as a result of new information, future developments or otherwise, except as may be required by law. Risks and uncertainties that could cause our actual results to materially differ from those described in the forward-looking statements include : (i) the impact of the global COVID-19 pandemic on our business, financial conditions or prospects, or on the timing and enrollment of our clinical trials; (ii) continued market expansion and penetration for our commercial products, particularly DEFINITY®, in the face of segment competition and potential generic competition as a result of patent and regulatory exclusivity expirations; (iii) the global Molybdenum-99 supply; (iv) our products manufactured at Jubilant HollisterStier and our plans to develop a modified formulation of DEFINITY with Samsung Biologics; (v) our efforts in new product development, including for PyL, the Progenics prostate cancer diagnostic imaging agent, including our ability to obtain FDA approval of PyL in 2021, and new clinical applications for our products; (vi) our dependence upon third parties for the manufacture and supply of PyL and the timing of that manufacturing capacity becoming available; (vii) the continued integration of the Progenics product and product candidate portfolio following the consummation of the Progenics transaction; (viii) our capacity to use in-house manufacturing; and (ix) our ability to commercialize our products in new ex-U.S. markets; (x) the expected timing for commercialization of products we or our strategic partners may develop, including flurpiridaz F 18; (xi) our ability to develop highly contextualized assessments of disease burden using PSMA AI and (xii) the risk and uncertainties discussed in our filings with the Securities and Exchange Commission (including those described in the Risk Factors section in our Annual Reports on Form 10-K and our Quarterly Reports on Form 10-Q).

- Tables Follow -

 

Lantheus Holdings, Inc.

Consolidated Statements of Operations

(in thousands, except per share data – unaudited)

 

Three Months Ended
September 30,

Nine Months Ended
September 30,

2020

2019

2020

2019

Revenues

$

88,544

$

85,776

$

245,258

$

257,991

Cost of goods sold

52,284

44,187

145,148

127,745

Gross profit

36,260

41,589

100,110

130,246

Operating expenses

Sales and marketing

11,609

10,151

28,044

31,496

General and administrative

18,217

18,061

55,586

43,943

Research and development

11,684

4,860

20,150

15,584

Total operating expenses

41,510

33,072

103,780

91,023

Operating (loss) income

(5,250)

8,517

(3,670)

39,223

Interest expense

2,808

2,356

6,668

11,491

Loss on extinguishment of debt

3,196

Other (income) loss

(596)

804

(1,702)

(1,695)

(Loss) income before income taxes

$

(7,462)

$

5,357

$

(8,636)

$

26,231

Income tax (benefit) expense

(1,076)

501

1,425

5,014

Net (loss) income

$

(6,386)

$

4,856

$

(10,061)

$

21,217

Net (loss) income per common share:

Basic

$

(0.10)

$

0.12

$

(0.20)

$

0.55

Diluted

$

(0.10)

$

0.12

$

(0.20)

$

0.53

Weighted-average common shares outstanding:

Basic

66,820

39,123

49,858

38,901

Diluted

66,820

40,286

49,858

40,123

 

Lantheus Holdings, Inc.

Consolidated Segment Revenues Analysis

(in thousands – unaudited)

 

Three Months Ended
September 30,

Nine Months Ended
September 30,

2020

2019

% Change

2020

2019

% Change

United States

DEFINITY

$

53,792

$

50,917

5.6

%

$

148,346

$

154,099

(3.7)

%

TechneLite

17,652

18,281

(3.4)

%

52,599

55,204

(4.7)

%

Other nuclear

11,571

9,355

23.7

%

26,437

28,006

(5.6)

%

Rebates and allowances

(5,540)

(3,903)

41.9

%

(13,763)

(12,035)

14.4

%

Total United States

77,475

74,650

3.8

%

213,619

225,274

(5.2)

%

International

DEFINITY

1,637

1,478

10.8

%

4,239

4,036

5.0

%

TechneLite

3,837

3,466

10.7

%

10,897

10,794

1.0

%

Other nuclear

5,596

6,186

(9.5)

%

16,507

17,901

(7.8)

%

Rebates and allowances

(1)

(4)

(75.0)

%

(4)

(14)

(71.4)

%

Total International

11,069

11,126

(0.5)

%

31,639

32,717

(3.3)

%

Worldwide

DEFINITY

55,429

52,395

5.8

%

152,585

158,135

(3.5)

%

TechneLite

21,489

21,747

(1.2)

%

63,496

65,998

(3.8)

%

Other nuclear

17,167

15,541

10.5

%

42,944

45,907

(6.5)

%

Rebates and allowances

(5,541)

(3,907)

41.8

%

(13,767)

(12,049)

14.3

%

Total Revenues

$

88,544

$

85,776

3.2

%

$

245,258

$

257,991

(4.9)

%

 

Lantheus Holdings, Inc.

Reconciliation of GAAP to Non-GAAP Financial Measures

(in thousands, except per share data – unaudited)

 

Three Months Ended
September 30,

Nine Months Ended
September 30,

2020

2019

2020

2019

Net (loss) income

$

(6,386)

$

4,856

$

(10,061)

$

21,217

Stock and incentive plan compensation

3,992

3,423

10,452

9,580

Amortization of acquired intangible assets

4,768

451

6,087

1,353

Acquired debt fair value adjustment

(385)

(385)

Contingent consideration fair value adjustments

800

800

Non-recurring refinancing related fees

460

Extinguishment of debt

3,196

Strategic collaboration and license costs

300

Integration costs

855

4,428

Acquisition-related costs

1,593

5,176

10,522

5,176

Impairment of long-lived assets

7,275

Other

(75)

Income tax effect of non-GAAP adjustments(a)

(2,819)

(2,653)

(8,265)

(7,449)

Adjusted net income

$

2,418

$

11,253

$

21,238

$

33,373

Adjusted net income, as a percentage of revenues

2.7

%

13.1

%

8.7

%

12.9

%

Three Months Ended
September 30,

Nine Months Ended
September 30,

2020

2019

2020

2019

Net (loss) income per share - diluted

$

(0.10)

$

0.12

$

(0.20)

$

0.53

Stock and incentive plan compensation

0.06

0.08

0.21

0.24

Amortization of acquired intangible assets

0.08

0.01

0.12

0.03

Acquired debt fair value adjustment

(0.01)

(0.01)

Contingent consideration fair value adjustments

0.01

0.01

Non-recurring refinancing related fees

0.01

Extinguishment of debt

0.08

Strategic collaboration and license costs

0.01

Integration costs

0.01

0.09

Acquisition-related costs

0.02

0.13

0.21

0.12

Impairment of long-lived assets

0.14

Income tax effect of non-GAAP adjustments(a)

(0.03)

(0.06)

(0.16)

(0.18)

Adjusted net income per share - diluted

$

0.04

$

0.28

$

0.42

$

0.83

Weighted-average common shares outstanding - diluted(b)

67,006

40,286

50,210

40,123

  1. The income tax effect of the adjustments between GAAP net (loss) income and non-GAAP adjusted net income takes into account the tax treatment and related tax rate that apply to each adjustment in the applicable tax jurisdiction.
  2. Diluted shares may differ for non-GAAP measures as compared to GAAP due to a GAAP net loss position.
 

Lantheus Holdings, Inc.

Reconciliation of Free Cash Flow

(in thousands – unaudited)

 

Three Months Ended
September 30,

Nine Months Ended
September 30,

2020

2019

2020

2019

Net cash provided by operating activities

$

8,575

$

26,442

$

15,827

$

57,963

Capital expenditures

(3,736)

(3,336)

(8,689)

(17,320)

Free cash flow

$

4,839

$

23,106

$

7,138

$

40,643

 

Lantheus Holdings, Inc.

Condensed Consolidated Balance Sheets

(in thousands – unaudited)

 

September 30,
2020

December 31,
2019

Assets

Current assets

Cash and cash equivalents

$

87,994

$

92,919

Accounts receivable, net

49,206

43,529

Inventory

37,623

29,180

Other current assets

9,709

7,283

Total current assets

184,532

172,911

Property, plant and equipment, net

122,381

116,497

Intangibles, net

384,747

7,336

Goodwill

57,765

15,714

Deferred tax assets, net

69,345

71,834

Other long-term assets

60,824

21,627

Total assets

$

879,594

$

405,919

Liabilities and stockholders’ equity

Current liabilities

Current portion of long-term debt and other borrowings

$

18,138

$

10,143

Accounts payable

24,070

18,608

Accrued expenses and other liabilities

39,792

37,360

Total current liabilities

82,000

66,111

Asset retirement obligations

13,962

12,883

Long-term debt, net and other borrowings

204,669

183,927

Other long-term liabilities

65,384

28,397

Total liabilities

366,015

291,318

Total stockholders’ equity

513,579

114,601

Total liabilities and stockholders’ equity

$

879,594

$

405,919

Contacts:

Mark Kinarney
Senior Director, Investor Relations
978-671-8842
ir@lantheus.com

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