Senetek PLC Announces Turnaround in Full Year Operating Results and Cash Flow
NAPA, Calif., March 14 /PRNewswire-FirstCall/ -- Senetek PLC (Nasdaq: SNTK - news), senetekplc.com , a biopharmaceutical company that develops products in two key markets, skincare/dermatologicals and sexual dysfunction, today announced a sharp increase in revenues and a turnaround in the Company's operating and net income and cash flow for its year ended December 31, 2001, recording its first annual profit.
Coming off its third consecutive quarter of positive net income, revenue for 2001 more than doubled from the previous year totaling $8.9 million compared to $3.8 million for the year ended December 31, 2000, an increase of 136%. Operating income for the year totaled $2 million compared to an operating loss of $(3.7) million for 2000, and net income was $0.4 million, or $0.01 per fully diluted share, compared to a net loss of $(4.7) million, or $(0.08) per fully diluted share in 2000. Operating expenses for the year decreased by 10% in absolute terms, and operating expenses as a percentage of revenues for 2001 decreased to 60%, compared to 158% in 2000. Operating cash flow for 2001 was $1.7 million, compared to negative operating cash flow of $(1.1) million in 2000, and the Company's total cash flow for 2001 was $1 million versus a negative $(1) million in 2000.
Commenting on the results for the year, Frank J. Massino, Chairman and CEO, said, ``We are very pleased with the turnaround in Senetek's results, which we believe shows the effectiveness of the business strategy we launched in 1999 of building a strong, dependable platform of high margin, license-driven revenues and tightly controlling non-revenue producing expenses. This business model is now generating cash to be reinvested in the business and we expect increased revenue from existing licenses and a broadened revenue base from new licensing and development of our erectile dysfunction business.''
Senetek PLC, headquartered in Napa, Ca., senetekplc.com , is a science-driven biopharmaceutical company engaged in the development of skincare/dermatological and sexual dysfunction products. Kinetin, the Company's patented anti-aging skincare technology, has been licensed to leading cosmetics and dermatological companies worldwide. Invicorp(TM) is Senetek's technology for the treatment of erectile dysfunction, a condition suffered by more than 100 million men worldwide. To learn more about Senetek, visit the Company's web site at senetekplc.com .
This news release contains statements that may be considered ``forward-looking statements'' within the meaning of the Private Securities Litigation Reform Act, including the Company's expectation that revenues will increase from existing licenses and from the signing of new licenses and the development of the Company's erectile dysfunction business; the Company's expectation that its strategy of reducing expenses will continue to be effective and will not adversely affect revenues; and the Company's expectation that it will continue to generate free cash for investment in the business. Forward-looking statements by their nature involve substantial uncertainty, and actual results may differ materially from those expressed in such statements. Important factors identified by the Company that it believes could result in such material differences are described in the Company's Annual Report on Form 10-K and Quarterly Reports on Form 10-Q for the year 2000 and its Annual Report on Form 10-K to be filed for the year 2001. However, the Company necessarily can give no assurance that it has identified all of the factors that may result in any particular forward-looking statement materially differing from actual results, and the Company assumes no obligation to correct or update any forward-looking statements which may prove to be inaccurate, whether as a result of new information, future events or otherwise.
SENETEK PLC
CONSOLIDATED STATEMENTS OF OPERATIONS
YEAR ENDED DECEMBER 31,
--------------------------
2001 2000
-------- --------
($ IN THOUSANDS, EXCEPT FOR PER SHARE DATA)
Revenue
Product Sales $4,216 $2,503
Royalties & Licensing 4,641 1,256
-------- ---------
Total Revenue 8,857 3,759
Cost of Sales - Products 1,470 1,469
-------- ---------
Gross Profit 7,387 2,290
-------- ---------
Operating Expenses:
Research & Development 344 821
General & Administrative 5,006 5,147
-------- ---------
Total Operating Expenses 5,350 5,968
-------- ---------
Income (Loss) from Operations 2,037 (3,678)
Interest Income 30 46
Other (Expense)/Income - net (62) (5)
Settlement Expense -- --
Interest Expense (including amortization
of deferred financing cost) (1,614) (2,055)
-------- ---------
Income (Loss) before extraordinary loss
on extinguishment of debt and change
in accounting principle $391 $(5,692)
Provision for taxes 6 --
Cumulative effect of change in accounting
principle -- 1,038
-------- ---------
Net Income (Loss) available to $385 $(4,654)
common stockholders ======== =========
Basic and Diluted Loss before
extraordinary item and change
in accounting principle per
Ordinary share outstanding $0.01 $(0.10)
Basic and Diluted Loss from change in
accounting principle per Ordinary
share outstanding -- 0.02
-------- ---------
Basic and Diluted Income (Loss)
per Ordinary share outstanding $0.01 $(0.08)
======== =========
Weighted average Ordinary
shares outstanding 58,755 58,388
SENETEK PLC
CONSOLIDATED STATEMENTS OF CASH FLOWS
YEAR ENDED DECEMBER 31,
2001 2000
-------- --------
($ IN THOUSANDS)
CASH FLOWS FROM
OPERATING ACTIVITIES:
Net Income (Loss) $385 $(4,654)
Adjustments to reconcile net loss
to net cash used by operating activities:
Depreciation and Amortization 624 824
Bad Debt Expense -- (16)
Loss on Impairment of Assets -- --
Stock Option Compensation 223 227
Stock Option Compensation -
Change in accounting principle -- (1,038)
Settlement Expense -- --
Loss on Extinguishment of debt -- --
Amortization of Deferred Finance costs 1,107 1,200
Changes in Assets and Liabilities:
Trade Receivables (738) (29)
Non-trade Receivables (14) 265
Receivable from Employee 10 (10)
Inventory 284 (85)
Prepaids 58 3
Accounts Payable and Accrued Liabilities (52) (1,185)
Deferred License Fees (217) 3,373
--------- --------
Net Cash Used by Operating Activities $1,670 $(1,125)
--------- --------
CASH FLOW FROM INVESTING ACTIVITIES:
Purchase of Property & Equipment (42) (196)
--------- --------
Net Cash Used by Investing Activities $(42) $(196)
YEAR ENDED DECEMBER 31,
2001 2000
-------- -------
($ IN THOUSANDS)
CASH FLOW FROM FINANCING ACTIVITIES:
Proceeds of Issuance of Ordinary Shares
from exercise of Warrants and Options -- 490
Proceeds from issuance of 8% Notes Payable -- --
Principal Payment on Convertible Short
term debt (526) --
Costs of Financing - debt issue costs (113) --
Short-term Loans and Overdrafts -- (154)
------ -------
Net Cash Provided by Financing Activities $(639) $336
------- -------
NET (DECREASE)/INCREASE IN CASH
AND CASH EQUIVALENTS 989 (985)
Cash and Cash Equivalents at the Beginning
of the year 828 1,840
Effects of Exchange Rate Changes on Cash (3) (27)
-------- -------
Cash and Cash Equivalents at the
End of the Year $1,814 828
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SOURCE: Senetek PLC |
