TIDM0RB9
Stallergenes Greer, a biopharmaceutical company specialising in
treatments for respiratory allergies, today announced its half-year
results for the six-month period ended 30 June 2018.
H1 2018 Financial Highlights
(in EUR million) H1 (unaudited)
2018 2017 % change
Net sales 142.3 129.6 10%
Gross margin 96.9 83.4 16%
Gross margin as a % of sales 68% 64%
EBIT 17.4 (3.5) n.a.
Net income/(loss) 13.6 (8.9) n.a.
EBITDA 27.6 8.3 n.a.
EBITDA as a % of sales 19% 6%
Fereydoun Firouz, Chairman and Chief Executive Officer of
Stallergenes Greer, commented:
"Our performance through the first half of 2018 reflects our
continued focus on business fundamentals: grow our share in
priority markets and strengthen profitability to sustain
investments. We delivered double digit sales growth in a
competitive global market, despite reimbursement and pricing
challenges in European and International markets. At the same time,
we reduced our operating expenses by 12% while investing in quality
at each of our global manufacturing sites and advancing our
clinical pipeline.
Our ability to drive growth while controlling our costs resulted
in another important milestone in our recovery that is critical for
the future of our company: positive net income at EUR13.6 million
compared to a loss of EUR8.9 million in the first half of 2017. We
also succeeded in generating positive cash flow. As a result of
these important milestones being reached, we now have the
organizational flexibility, balance sheet stability and internal
capability to pursue our goals. We will continue to grow and expand
our current business and be opportunistic to accelerate our future
growth through external innovation.
In the second half of 2018, we will solidify our leadership
position in priority markets and continue to grow our share
strategically across our Europe/International and Americas regions.
We also expect to release initial results from the phase III
clinical trial for our house dust mite tablet candidate STAGR320
later this year. Most importantly, we will sustain our commitments
to quality and technical operations to offer a complete range of
high quality subcutaneous and sublingual AIT treatments that meet
the current global market demand, to position ourselves for future
growth and to deliver long-term value creation."
Half-year net sales increased 10% because of continued growth
across the product portfolio and regions
Net sales by region: Solid growth in Southern Europe and the
United States
(in EUR million) H1 (unaudited)
2018 2017 % change
Southern Europe 72.1 53.7 34%
North & Central Europe 17.9 18.5 (3)%
International 6.9 11.8 (42)%
United States 45.4 45.6 (0)%
The 10% increase year-over-year in first half net sales reflects
strong growth in Southern Europe and in the United States. However,
results in the United States were negatively impacted by foreign
currency exchange. While reported sales were stable compared to the
same period in 2017, the region delivered 12% year-over-year sales
growth in local currency (USD).
Stallergenes Greer continued to gain share in the European grass
tablet market with Oralair®1 and in the German birch tree market
with Staloral®2. In addition, the Company had a strong performance
in France, Italy, Switzerland, the Benelux region, Slovakia and
Russia. Sales in international markets were down due to a
combination of effects from the application of the new revenue
recognition standard from 1 January 20183 and a large shipment of
products in the same period of 2017 to prepare for in-market
launches.
In the United States, Stallergenes Greer has strengthened its
leadership of the bulk allergen market by executing on a
recalibrated marketing approach as well as by maximising production
capabilities to meet the demand of a market-wide shortage of
priority allergens during a high allergy season in the United
States.
Net sales by product category: Sublingual sales grew in
EU/International while United States strengthened leadership
position in subcutaneous
(in EUR million) H1 (unaudited)
2018 2017 % change
Sublingual4 91.3 76.9 19%
Subcutaneous5 34.7 36.9 (6)%
Veterinary 4.3 5.0 (14)%
Other products6 12.0 10.8 11%
In the first half 2018, sublingual product sales increased 19%
to EUR91.3 million from the first half of 2017, primarily driven by
Staloral as a result of market share gains in priority markets, a
strong performance in the paediatric market and, to some extent,
the industry-wide shortage of subcutaneous immunotherapy treatments
in Europe.
In the subcutaneous product category, the Company reported first
half 2018 sales of EUR34.7 million, a 6% decrease compared to 2017.
In Europe/International, sales decreased as a result of production
delays at the Company's Antony facility. In the U.S., solid sales
growth was offset by the negative impact of foreign currency
exchange.
First half 2018 veterinary sales declined 14% to EUR4.3 million
compared to the same period of 2017, due to increased competition
in this segment and the negative impact of foreign exchange. Sales
from the other product category grew 11% year-over-year to EUR12.0
million in the first half of 2018 as a result of captured market
opportunities in the U.S.
_______________1 Source: IQVIA MIDAS2 Source: Insight Health3
IFRS154 Product category includes oral drops (Staloral) and tablets
(Oralair and Actair®)5 Product category includes Named Patient
Prescription products and bulk allergens6 Product category includes
diagnostic and ancillary products
Operational efficiencies delivered margin improvement and return
to positive net income
Stallergenes Greer's first half 2018 gross margin of EUR96.9
million represented a margin of 68% of net sales, compared to 64%
in the prior year first half. In addition, efficiency measures
continued to deliver significant cost savings and the Company
reported a positive first half 2018 EBIT of EUR17.4 million,
compared to a loss of EUR3.5 million in the same period of 2017.
First half 2018 EBITDA increased by EUR19.3 million to EUR27.6
million as a result of a EUR12.7 million increase in sales as well
as a 12% decline in operating expenses, from EUR86.8 million in the
first half of 2017 to EUR76.6 million in the same period of 2018.
The Company reported a net income of EUR13.6 million in the first
half of 2018, compared to a net loss of EUR8.9 million in the same
period of 2017. As of 30 June 2018, the Company's shareholders'
equity represented 83% of the balance sheet total.
Company continues to invest in innovation to fuel long-term
growth
Stallergenes Greer is committed to developing innovative
therapies for major respiratory allergies and invested EUR20.1
million in R&D in the first half of 2018, primarily to fund the
phase III global multi-centre clinical trial for the Company's
tablet candidate STAGR320 for the treatment of house dust
mite-induced allergic rhinitis. With more than 1,600 patients
enrolled, this is the largest study conducted to assess the
efficacy and safety of a sublingual immunotherapy tablet treatment.
The Company expects to release top line results from the trial
during the fourth quarter of 2018.
In addition, Stallergenes Greer announced positive results from
two real-world evidence studies regarding the use of allergy
immunotherapy (AIT) compared to the use of only symptomatic
treatments to treat patients with respiratory allergies in June
2018. These studies were retrospective longitudinal analyses of
French and German prescription databases and further substantiated
the long-term benefits of AIT to significantly reduce the need for
allergic rhinitis and asthma medication in patients suffering from
grass pollen- and birch tree pollen-induced allergies. These
studies are part of the BREATH real-world evidence program, which
is designed to understand the real-world benefits of AIT outside of
a clinical trial setting.
Investments in Quality and Technical Operations to continue
Stallergenes Greer continued investments in Technical and
Quality Operations capabilities at all its manufacturing sites to
comply with evolving regulatory requirements and the latest Good
Manufacturing Practice (GMP) biological manufacturing standards; to
strengthen its quality culture across the organisation; and to
ensure product quality and patient safety for all released and
distributed products.
During the first half of 2018, the Company successfully
completed maintenance of its manufacturing operations with major
renovations and upgrades. In France, the Company continued to
progress on its remediation plan to address observations related to
a 4 January 2018 injunction for its Antony facility from the
National Agency for Medicines and Health Products Safety (ANSM),
including renovation to key manufacturing areas, employee training
and an enhanced quality system focused on consistency across
operations. In the U.S., the Company continued to strengthen its
quality system and introduced state-of-the-art manufacturing
technologies and advanced initiatives to increase capacity.
The company also demonstrated its manufacturing flexibility to
meet market demands during the first half of 2018. In France, the
company increased production of sublingual products to partially
offset the temporary shortage of injectable products in the
European/International markets and sourced a new venom supply to
meet a market shortage in Europe and Asia. In the U.S., the company
increased its volume and delivered high priority allergens.
2018 Business Outlook unchanged
The Company expects 2018 net sales to be in the range of EUR270
million to EUR280 million and EBITDA to be in the range of EUR40
million to EUR50 million.
Senior Leadership Succession Plan
Fereydoun Firouz, currently Chairman & Chief Executive
Officer, has informed the Board of his decision to retire from
these positions at the end of 2018. He will be succeeded at that
time as Chairman by Stefan Meister, a member of the Board since
2015, and as Chief Executive Officer by Michele Antonelli,
currently Executive Vice President, Head of Europe &
International & President of Stallergenes SAS. The announcement
comes at the culmination of the successful turnaround of the
Company led by Fereydoun Firouz. Stallergenes Greer is now well
positioned to regain its global market leadership and continue its
positive business momentum.
Fereydoun Firouz said "Stallergenes Greer is a special company
with an inspiring purpose and highly dedicated people. By the end
of 2018, I will have been Chairman and CEO for nearly four years
and I believe this is the right time for a new leader to build upon
what has been accomplished. I have been privileged to work with a
passionate leadership team to successfully overcome some
challenging phases and ultimately deliver the strong results we
published today. These results demonstrate our achievements and the
Company can now look to the future with great confidence. Michele
has been an instrumental leader in the Company's success over the
past three years. He has the expertise and experience to take the
lead as CEO and drive Stallergenes Greer to its next phase of
growth."
Fereydoun continued "I will leave the Company in very good hands
and at a time when the strategy we devised and executed is showing
through in our financial results and market performance. My
colleagues on the Board of Directors and the management team have
the knowledge and abilities to take the Company to new heights and
capitalise on our product, manufacturing, and geographic
opportunities. I would also like to thank the Board and our
shareholders for their resolute support at all times and wish the
very best success to the Company."
"On behalf of the Board and our shareholders, I would like to
recognise and thank Fereydoun for his remarkable contribution to
the Company and its performance." said Elmar Schnee, an Independent
Director and the Chairman of the Remuneration and Appointment
Committee. "Fereydoun oversaw the creation of the Company through
the successful integration of Stallergenes and Greer Laboratories
in 2015 and then led it through the resolution of significant
problems from an earlier implementation of Enterprise Resource
Planning software that unfortunately temporarily halted the supply
of products in early 2016 to its major markets."
He concluded by saying "Fereydoun combined a determination and
relentless commitment to meeting challenges, with a penetrating
vision to first develop and then implement a strategy to
successfully bring the Company back to a path of growth and
profitability. There is no doubt that the strength of the Company
today is due to his leadership, of both the Company's strategy and
its great people. We recognise these achievements and are truly
grateful for Fereydoun's dedicated service and for assisting the
process of transition until the end of 2019."
The Chairman-designate, Stefan Meister, then welcomed Michele
Antonelli to the role of Chief Executive Officer and said "In
Michele we are fortunate to have ready the leader for the next
phase of the Company's development. His experience and insight,
combined with his commitment and passion for the business, are the
ideal combination of talent and motivation for the future of
Stallergenes Greer. I look forward to serving as Chairman and join
Elmar in thanking Fereydoun for his great service to the Company
over the last four years."
Commenting on his appointment, Michele said today "I am honoured
to have been invited to take on the role of CEO of Stallergenes
Greer. This Company is a global leader in an important and growing
market and makes a real difference to the lives of the patients it
serves. The transformation driven by Fereydoun over the last four
years leaves us in a remarkable place, ready to move forward and
deliver even more outstanding results for all its stakeholders. I
am delighted to accept this position at such an exciting time and
look forward to working with the team of great professionals
Fereydoun has attracted to the Company and build upon the strong
foundations he has secured for this fantastic business."
Michele Antonelli has more than 20 years of international
experience in the biopharmaceutical industry with extensive
expertise in both manufacturing and commercial. He previously
worked at UCB, the multinational biopharmaceutical Company, where
he held roles of various responsibility and scope, most recently
serving as Executive Vice President and Head of lmmunology Europe,
overseeing the region's commercial, medical, and market access
activities. Prior to joining UCB, Michele spent 16 years at Merck
Serono, ultimately serving as Senior Vice President and Global Head
of Biotech Manufacturing and Process Development.
The Company and Fereydoun Firouz will enter into an agreement
governing Fereydoun Firouz's retirement from the Company that
reflects the terms of his existing contract of employment. This
agreement contemplates a one-year garden-leave period that will run
through to the end of 2019, consistent with Fereydoun Firouz's
existing one year undertaking to not compete with the Company.
During this one-year garden-leave period, Fereydoun will assist as
needed with the transition to the Company's new leadership,
providing support as required to Michele Antonelli and to the Board
and management team generally when requested. At the end of 2019,
Fereydoun Firouz will leave the Company's employment and be
entitled to the severance terms set out in his existing
contract.
Webcast and Conference Call Information
Stallergenes Greer will host an Investors and Analysts meeting
tomorrow, 30 August 2018. The event will be available via live
webcast at 10:30 am GMT / 11:30 am CET / 5:30 am EDT. The webcast
will be available via the following link:
https://edge.media-server.com/m6/go/STAGR_18HY and on the Company's
website,http://stallergenesgreer.com/financial-calendar-events.
Participants are asked to connect at least 15 minutes prior to
the conference call to register, download and install any necessary
audio software.
ABOUT STALLERGENES GREER PLC
Headquartered in London (UK), Stallergenes Greer plc is a global
healthcare company specialising in the diagnosis and treatment of
allergies through the development and commercialisation of allergy
immunotherapy products and services. Stallergenes Greer plc is the
parent company of GREER Laboratories, Inc. (whose registered office
is in the US) and Stallergenes SAS (whose registered office is in
France).
TRADING INFORMATION
Name: Stallergenes GreerISIN: GB00BZ21RF93 1 - Ticker: STAGRICB
Classification: 4577LEI: 213800CYVZA7GJQEME86Market: Euronext Paris
regulated market
Additional information is available at
http://www.stallergenesgreer.com.
This document (including information incorporated by reference
in this document), oral statements made, and other information
published by the Company contain statements that are or may be
forward-looking with respect to the financial condition and/or
results of operations and businesses of the Company. These
statements can be identified by the use of forward-looking
terminology such as "believe," "expects," "project," "estimated,"
"forecast," "should," "plan," "may" or the negative of any of
these, or other variations thereof, or comparable terminology
indicating expectations or beliefs concerning future events. These
forward-looking statements include risk and uncertainty because
they relate to events and depend on circumstances that will occur
in the future. Without being exhaustive, such factors include
economic situations and business conditions, including legal and
product evaluation issues, fluctuations in currencies and demand,
and changes in competitive factors. These and other factors are
more fully described in the Company's 2017 annual report published
on 16 April 2018 on the Company's website
www.stallergenesgreer.com. Actual results may differ from those set
forth in the forward-looking statements, due to various factors.
Save as required by applicable law, neither the Company nor any
other person assumes any obligation to update these forward-looking
statements or to notify any person of any such update.
Stallergenes GreerCommunications and Investor RelationsNatacha
Gassenbach, +1
617-682-2626natacha.gassenbach@stallergenesgreer.comorCaitlin
Stefanik, +1
857-331-4117caitlin.stefanik@stallergenesgreer.comorMedia Relations
AgencyHavas Paris (Europe)Samuel Rousseau, +33 6 77 88 32
43samuel.rousseau@havas.comorInvestor Relations AgencyFTI
ConsultingArnaud de Cheffontaines, +33 1 47 03 68
10stalleregenesgreer@fticonsulting.com
TABLE OF CONTENTS
Consolidated income statement as of 30 June 2018
Consolidated balance sheet as of 30 June 2018
Consolidated cash flow statement as of 30 June 2018
The financial information set out above does not constitute the
Group's financial statements for the period ended 30 June 2018 and
2017 but are derived from those statements. The annual report for
2017 have been delivered to the UK Companies House. The auditor has
reported on those statements. Their report was unqualified, did not
draw attention to any matters by way of emphasis and did not
contain statements under Section 498 (2) or (3) Companies Act 2006
or equivalent preceding legislation. While the financial
information included in this preliminary announcement has been
computed in accordance with International Financial Reporting
Standards (IFRS), this announcement itself does not contain
sufficient information to comply with IFRS.
The Group published full financial statements that comply with
IFRS that are available on its website at
http://stallergenesgreer.com/half-year-report.
The financial statements were approved by the Board of Directors
on 29 August 2018.
Consolidated income statement as of 30 June 2018
For the period ended 30 June 2018
EUR thousands 30 June 30 June
2018 2017
Net sales 142,327 129,615
Other revenue 57 10
Total revenues 142,384 129,625
Cost of goods sold (45,531) (46,265)
Gross margin 96,853 83,360
Distribution costs (5,439) (5,383)
Selling and marketing expenses (24,447) (29,894)
Administrative expenses (24,626) (28,807)
Other general expenses (3,168) (1,027)
Selling, general and administrative expenses (57,680) (65,111)
Research and development costs (R&D) (20,132) (24,947)
R&D-related income 1,189 3,225
Net R&D costs (18,943) (21,722)
Operating result (EBIT) before transformation costs 20,231 (3,473)
Transformation costs (2,800) -
Operating result (EBIT) 17,430 (3,473)
Financial income 3 20
Financial expenses (401) (847)
Net financial expense (398) (827)
Net income / (loss) before tax and associates 17,032 (4,300)
Income tax (3,394) (4,582)
Share of loss from associated companies - (8)
Net income / (loss) for the period 13,638 (8,890)
All the activities were in respect of continuing operations.The
basic profit and diluted net income per share for the six months to
June 2018 was EUR 0.69 (June 2017: loss of EUR 0.45)
Consolidated balance sheet as of 30 June 2018
As at 30 June 2018
EUR thousands 30 June 31 December
2018 2017
Goodwill 199,711 195,187
Other intangible assets 67,878 70,913
Property, plant and equipment 66,768 69,138
Non-current financial assets 4,279 3,957
Deferred tax assets 26,717 26,754
Other non-current assets 237 237
Non-current assets 365,590 366,186
Inventories 60,828 56,793
Trade receivables 26,030 33,199
Current financial asset 732 684
Other current assets 10,888 9,231
Current income tax receivable 661 611
Research tax credit and subsidies receivable 26,151 22,708
Cash and cash equivalents 70,702 50,849
Current assets 195,991 174,075
Total assets 561,581 540,261
Share capital 19,788 19,788
Share premium 539 539
Merger and contribution premium 342,149 342,149
Revaluation reserve (236) (236)
Retained earnings 103,448 85,086
Group shareholders' equity 465,688 447,326
Non-controlling interests - -
Total shareholders' equity 465,688 447,326
Provision for employee retirement 3,560 3,442
obligations and related benefits
Non-current provisions 526 514
Non-current financial liabilities 6,318 6,318
Deferred tax liabilities 6,432 6,283
Non-current liabilities 16,836 16,557
Trade payables 23,836 19,793
Current provisions 4,547 2,115
Current financial liabilities 12,378 12,204
Income tax payable 2,538 1,313
Other current liabilities 35,757 40,953
Current liabilities 79,057 76,378
Total equity and liabilities 561,581 540,261
Consolidated cash flow statement as of 30 June 2018
EUR thousands 30 June 30 June
2018 2017
Cash flow from operating
activities
Group share of net 13,638 (8,890)
income / (loss)
Share of earnings from equity - 8
accounted investments
Tax 3,394 4,582
Net financial result 398 827
Amortisation and depreciation 11,728 11,752
charges
Change in provisions 2,620 (3,048)
Share-based compensation 976 1,391
Capital losses from 1,090 49
disposal of assets
Financial (profits) / losses (2) (385)
excluding interest
Operating cash flow before 33,842 6,286
changes in working capital
Current income tax paid (2,418) (961)
Change in subsidies and R&D (3,253) (3,585)
tax credit receivables
Change in working capital (1,681) (13,375)
of operating activities
Change in deferred income 82 (315)
Net cash flow from operating 26,572 (11,950)
activities
Cash flow from investing
activities
Purchase of non-current assets (8,319) (4,653)
Acquisition of investments in consolidated - -
undertakings, net of cash acquired
Proceeds from sale of 2,363 2,274
non-current assets
Change in working capital (906) (2,234)
of investment activities
Net cash flow from investing (6,862) (4,613)
activities
Free cash flow after 19,710 (16,563)
investing activities
Cash flow from financing
activities
Treasury shares transactions 48 374
Net financial interest (396) (441)
received / (paid)
Repayment of bank overdrafts (8) (238)
Repayment of borrowings (5,368) (15,704)
Proceeds from borrowings 5,393 9,766
Net cash flow from financing (331) (6,243)
activities
Change in cash and 19,379 (22,806)
cash equivalents
+ Cash and cash equivalents 50,849 71,262
- opening balance
-/+ effect of translation adjustment on 474 (811)
foreign currency - denominated cash
=Cash and cash equivalents 70,702 47,645
- closing balance
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(END) Dow Jones Newswires
August 30, 2018 02:00 ET (06:00 GMT)
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