MorphoSys AG Reports Strong Results for First Quarter 2009
04/28/2009 at 07:00 AM
MorphoSys AG (FSE: MOR; Prime Standard Segment; TecDAX) today announced its financial results for the three months ended March 31, 2009 according to International Financial Reporting Standards (IFRS). Group revenues increased by 17 % to EUR 19.1 million (Q1 2008: EUR 16.3 million) and operating profit amounted to EUR 4.2 million (Q1 2008: EUR 4.1 million). Net profit increased by 6 % to EUR 3.5 million (Q1 2008: EUR 3.3 million). At March 31, 2009 MorphoSys's cash position was EUR 136.1 million (December 31, 2008: EUR 137.9 million).
Highlights of the First Quarter of 2009:
Underscoring its plans to expand and broaden its proprietary pipeline, MorphoSys selected two new targets as the basis for the therapeutic antibody programs MOR203 and MOR205, both of which are in oncology.
MorphoSys substantially strengthened its management in two positions by appointing Dr. Ulrich Moebius as VP and Head of Preclinical Development & Project Management and Dieter Feger as SVP and Head of the AbD Serotec segment of MorphoSys.
HuCAL, the Company's core technology, received extended patent protection from the European Patent Office. The newly granted patent captures the technology's modular design at the DNA level, providing solid product claim protection throughout Europe.
Novartis advanced the HuCAL-based antibody program BHQ880 into a phase 1/2 combination study.
MorphoSys's partnered pipeline increased to 58 therapeutic antibody programs in total (compared to 55 at the beginning of the year), of which four are currently in clinical development, 31 are in preclinical development and 23 are in research.
"We continue to make significant progress in both operating segments, as evidenced by the highlights of this quarter", commented Dave Lemus, Chief Financial Officer of MorphoSys AG. "Moreover, we also continue to increase substantially our R&D investment in proprietary antibody therapeutics, and thereby creating sizeable future value in the form of a larger, and more mature, proprietary product pipeline".
Financial Review for the First Three Months of 2009 (IFRS):
Group revenues for the first three months of 2009 amounted to EUR 19.1 million (Q1 2008: EUR 16.3 million), an increase of 17 % over the prior year. Revenues arising from the Therapeutic Antibodies segment accounted for 75 % or EUR 14.3 million of the total (Q1 2008: EUR 12.0 million), while the AbD Research Antibodies segment generated 25 % or EUR 4.9 million of total revenues (Q1 2008: EUR 4.3 million). Measured at constant foreign exchange rates, revenues in the Therapeutic Antibodies segment would have amounted to EUR 14.2 million while revenues in the AbD segment would have remained unchanged. MorphoSys's overall revenue growth was driven primarily by higher levels of funded research, licensing fees and success-based revenues in the Therapeutic Antibodies segment as well as increased sales across the AbD segment.
Total operating expenses for the first three months of 2009 increased by 22 % to EUR 14.9 million (Q1 2008: EUR 12.2 million). The change in operating expenses was mainly due to higher investment in research and development which rose by 60 % to EUR 8.5 million (Q1 2008: EUR 5.3 million). This increase was partly offset by a decrease of sales, general and administrative expenses to EUR 4.8 million (Q1 2008: EUR 5.2 million) while cost of goods sold remained unchanged at EUR 1.7 million. Stock-based compensation expenses are embedded in COGS, S,G&A and R&D expenses and remained unchanged at EUR 0.3 million.
Total operating profit for the first three months of 2009 amounted to EUR 4.2 million (Q1 2008: EUR 4.1 million). The result for the Therapeutic Antibodies segment amounted to EUR 5.5 million (Q1 2008: EUR 6.1 million). The AbD segment result amounted to EUR 0.6 million (Q1 2008: EUR 0.04 million). Unallocated corporate costs in the first quarter of 2009 amounted to EUR 1.9 million (Q1 2008: EUR 2.1 million).
For the first three months of 2009, non-operating income (excluding tax expenses) amounted to EUR 0.9 million (Q1 2008: EUR 0.6 million). Profit before taxes amounted to EUR 5.1 million (Q1 2008: EUR 4.7 million). The Company reported income tax expenses for the first three months of 2009 in the amount of EUR 1.6 million (Q1 2008: EUR 1.4 million).
Net profit for the first three months of 2009 amounted to EUR 3.5 million compared to a net profit of EUR 3.3 million in the same period of the previous year. The resulting diluted earnings per share for the first quarter of 2009 amounted to EUR 0.16 (Q1 2008: Diluted earnings per share of EUR 0.15).
As of March 31, 2009, the Company held EUR 136.1 million in cash, cash equivalents and marketable financial assets, compared to a balance of EUR 137.9 million on December 31, 2008. Cash outflow from operations in the first three months of 2009 amounted to EUR 1.7 million (Q1 2008: cash inflow of EUR 4.0 million). The number of issued shares at March 31, 2009 was 22,492,287, compared to 22,478,787 shares as of December 31, 2008.
Financial Outlook for 2009:
MorphoSys re-confirmed its financial guidance for 2009 as previously communicated in February 2009. The Company anticipates total group revenues between EUR 80 million and EUR 85 million, and an operating profit of EUR 8 million to EUR 11 million. In line with its plans to expand the Company's proprietary pipeline, MorphoSys anticipates making investments in technology and product development of between EUR 18 million and EUR 20 million, compared to EUR 7.7 million in the previous year.
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