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Patients for GLPG0634 Phase 2a study now fully recruited
· Group revenues €64.5 M compared to €39.7 M in H1 2011 (+62%)
· Group net loss €11.3 M compared to €27.7 M loss last year
· Cash position of €122.6 M on 30 June 2012
· Service division external revenues €32.9 M compared to €24 M last year (+37%)
· Services EBITDA €5.7 M compared to €3.7 M last year (+54%)
· Full year guidance reiterated: €150 M in revenues, positive operating result and cash flow, and net profitability
Click here to access the live audio webcast presentation at 10.00 CET today, call numbers: US +1-480-629-9866, Belgium +32-2290-1608, Netherlands +31-20-794-8504
Mechelen, Belgium; 3 August 2012 - Galapagos NV (Euronext: GLPG) announces its unaudited half year results and maintains guidance for the full year 2012.
"Galapagos delivered strong results in the first half year, both operationally and financially. The Company is well on track in its global collaboration with Abbott to develop and commercialize GLPG0634. Patient recruitment for the Phase 2a dose-range finding study is complete, and we will announce topline results before year end. The Service division continues to deliver excellent growth in external sales and healthy margins in the first half of 2012. Galapagos is moving its own R&D programs forward and executing as planned to meet financial guidance given earlier this year," said Galapagos CEO, Onno van de Stolpe.
Key figures half year 2012
(€ millions, except net loss per share)
| 30 June 2012 | Continuing Operations 30 June 2011 | Change | |
| Revenues | 64.5 | 39.7 | 24.8 |
| Services cost of sales | -25.0 | -18.0 | -7.0 |
| Gross profit | 39.5 | 21.7 | 17.8 |
| R&D expenditure | -35.9 | -42.4 | 6.5 |
| General & administrative | -11.9 | -11.0 | -0.9 |
| Sales & marketing | -1.1 | -1.1 | - |
| Restructuring & integration costs | -0.4 | - | -0.4 |
| Result on liquidation | -2.9 | - | -2.9 |
| Result on divestment | - | 5.9 | -5.9 |
| Operating loss | -12.6 | -26.8 | 14.2 |
| Net loss for the period | -11.3 | -27.7 | 16.4 |
| Basic loss per share (€) | -0.43 | -1.05 | 0.62 |
| Cash and cash equivalents | 122.6 | 49.8 | 72.8 |
Note: In the column for H1 2011, continuing operations exclude the compound management business of BioFocus (Compound Focus Inc., based in South San Francisco, CA, USA) which was sold on 31 May 2011.
Details of the financial results
Revenues
Galapagos' revenues from continuing operations for the first half of 2012 amount to €64.5 M compared to €39.7 M in the same period of 2011. The R&D division reported revenues of €34.5 M (including €2.4 M intersegment revenues), compared to €19.3 M in the same period last year. The R&D division revenues benefited from pro rata revenue recognition on the upfront payment from Abbott in the global collaboration on GLPG0634 announced on 29 February. The Service division revenues showed 37% external revenues growth for the period, increasing to €32.9 M from €24 M. The Service division total revenues amount to €34.6 M (including €1.7 M in intersegment revenues), compared to €30.0 M (including €6.0 M in intersegment revenues) for continuing operations in the same period last year.
Results
The group net loss from continuing operations for the first half-year of 2012 was €11.3 M, compared to the loss of €27.7 M for the same period last year. The EBITDA for the Service division was €5.7 M, compared to €3.7 M last year. Gross margins of the continuing service operations were 34%, compared to 33% last year.
The R&D division reported an EBITDA loss of €6.3 M, compared to €29.0 M last year. R&D expenses for the Group were €35.9 M compared to €42.4 M last year.
General and administrative (G&A) expenses of the Group's continuing operations were €11.9 M in the first half of 2012 (18% of revenues), compared to €11.0 M (28% of revenues) last year.
The first half 2012 financials show a loss on liquidation of EUR 2.9 million. This non-cash line item is a one-off historical currency impact, a direct result of the reduction of the number of dormant corporate legal entities in the UK.
Cash flow and cash position
A net increase of €90.1 M in cash and cash equivalents was recorded during the first half of 2012, compared to an increase of €9.4 M in the same period last year. This increase is due to the collection of the $150 M (€112 M) cash payment made by Abbott in the collaboration on GLPG0634. Galapagos' cash and cash equivalents amount to €122.6 M on 30 June 2012.
Operational overview
R&D division
Service division
· Signed a target discovery agreement between BioFocus and Ono Pharma in the field of allergic disease
· Signed a multi-year agreement between BioFocus, Argenta, and AstraZeneca to find new compounds in the fields of respiratory and inflammatory disease
· Signed an agreement between BioFocus and Almirall to deliver drug development candidates in the field of respiratory disease
· Initiated closure of the Basel site in order to increase efficiency and capture more synergies with high-throughput screening activities in the UK
Corporate
Outlook 2012
In the past, Galapagos delivered the majority of its full-year revenues in the second half of the year. After good results in the first half of 2012, and expecting significant R&D revenues and a continued strong performance of the service operations in the second half of the year, management reiterates full-year 2012 financial guidance: Group revenues of €150 M, a positive operational and net result, and a year-end cash position of at least €130 million by the end of 2012.
The Company advances toward achievement of its strategic objectives for 2012:
· Deliver topline Phase 2a results for GLPG0634
· Increase cash and profit contribution of Service division
· Meet financial guidance for the full year
Interim Report 2012
The electronic version of Galapagos' Interim Report for half year 2012 is now available online at www.glpg.com/investor/financial_reports.htm. Printed versions of the report can be requested by e-mailing ir@glpg.com.
Conference call and webcast presentation
Galapagos will conduct a conference call open to the public today at 10.00 Central European Time (CET), which will also be webcast. To participate in the conference call, please call US +1-480-629-9866, Belgium +32-2290-1608, Netherlands +31-20-794-8504, ten minutes prior to commencement of the call. A question and answer session will follow the presentation of the results. Click here to access the live audio webcast. The archived webcast also will be available for replay shortly after the close of the call.
Financial calendar 2012
3Q12 interim update 16 November 2012
Full year results 2012 8 March 2013
Annual shareholders meeting 30 April 2013
About Galapagos
Galapagos (Euronext: GLPG; OTC: GLPYY) is a mid-size clinical stage biotechnology company specialized in the discovery and development of small molecule and antibody therapies with novel modes-of-action. The Company is progressing its JAK1 inhibitor GLPG0634, as well as one of the largest pipelines in biotech, with four programs in development and over 30 discovery programs. The Galapagos Group has over 800 employees and operates facilities in six countries, with global headquarters in Mechelen, Belgium. More info at: www.glpg.com
CONTACT
Elizabeth Goodwin, Director Investor Relations
Tel: +31 6 2291 6240
ir@glpg.com
This release may contain forward-looking statements, including, without limitation, statements containing the words "believes," "anticipates," "expects," "intends," "plans," "seeks," "estimates," "may," "will," "could," "stands to," and "continues," as well as similar expressions. Such forward-looking statements may involve known and unknown risks, uncertainties and other factors which might cause the actual results, financial condition, performance or achievements of Galapagos, or industry results, to be materially different from any historic or future results, financial conditions, performance or achievements expressed or implied by such forward-looking statements. Given these uncertainties, the reader is advised not to place any undue reliance on such forward-looking statements. These forward-looking statements speak only as of the date of publication of this document. Galapagos expressly disclaims any obligation to update any such forward-looking statements in this document to reflect any change in its expectations with regard thereto or any change in events, conditions or circumstances on which any such statement is based, unless required by law or regulation.
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