Full Press Release Details
Therapeutics Reports Second-Quarter 2011 Financial Results
Quarter and six-month EPS increase 112% and 45%, respectively
drive 27% growth in Q2 orthobiologics revenue
BEDFORD, Mass.--(BUSINESS WIRE)--August 4, 2011--Anika Therapeutics,
Inc. (Nasdaq: ANIK), a leader in products for tissue protection,
healing, and repair, based on hyaluronic acid ("HA") technology, today
reported financial results for the second quarter and six months ended
For the second quarter of 2011, Anika's product revenue increased 12% to
$15.4 million, from $13.7 million in the second quarter of 2010. Total
revenue for the second quarter of 2011 grew 11% to $16.1 million, from
$14.5 million in the year-earlier quarter. Revenue for the second
quarter of 2011 included the shipment of approximately $1.4 million of
ophthalmic and Orthovisc products originally scheduled to be shipped
during the first quarter of 2011, but delayed due to an equipment
problem at the Company's Woburn facility as previously announced. In
addition to the effect of the shipment delay, this growth reflected
continued strong U.S. sales of Orthovisc.
For the six-month period ended June 30, 2011, total revenue increased 3%
to $27.9 million, compared to $26.9 million in last year's same period.
Product Gross Margin
Product gross margin for the second quarter of 2011 at 57% was the same
as in last year's second quarter. Product gross margin increased by 750
basis points from the sequential first quarter of 2011, when gross
margin was negatively affected by the loss of a batch of Orthovisc
product due to the aforementioned equipment problem.
For the six-month period ended June 30, 2011, product gross margin was
54%, compared to 57% in last year's same period, reflecting the
first-quarter 2011 equipment problem.
Research and development expenses for the second quarter of 2011
declined to $1.6 million, from $1.8 million in the second quarter last
year. The decrease in R&D expense was primarily due to lower clinical
study spending compared to last year's second quarter. R&D spending is
expected to increase modestly in future quarters. Selling, general and
administrative expenses decreased to $4.2 million, from $5.0 million in
the second quarter a year ago. The reduction in SG&A expenses was
primarily due to the company-wide operational efficiency improvements
and integration process completed last year subsequent to the
acquisition of Anika S.r.l., insourcing at Anika S.r.l. of accounting,
information technology, human resource and purchasing services that were
previously outsourced, as well as the delay in FDA approval of MonoviscTM.
Operating and Net Income
Operating income for the second quarter of 2011 increased to $3.7
million, from $1.8 million in the same period in 2010. Net income rose
to $2.3 million, or $0.17 per diluted share, from $1.1 million, or $0.08
per diluted share, in the second quarter of 2010. The Company's tax rate
for the second quarter of 2011 was lowered to 37.2%, versus 38.9% for
the second quarter of 2010, reflecting the rate impact of improved
results at Anika S.r.l. as it approaches breakeven.
For the six-month period ended June 30, 2011, net income rose to $2.6
million, or $0.19 per diluted share, from $1.8 million, or $0.13 per
diluted share, in the first six months of 2010. The 45% increase in EPS
was a result of increased revenue, as well as cost savings initiatives
implemented in the last 18 months.
Cash and Cash Equivalents
Anika's cash and cash equivalents at June 30, 2011 were $26.8 million,
compared with $28.2 million at December 31, 2010, mainly as a result of
an increase in net working capital requirements driven primarily by a
combination of higher June 2011 sales and required vendor payments.
Management Commentary
"Anika made good progress in the second quarter and first half of 2011,
both operationally and financially," said Charles H. Sherwood, Ph.D.,
president and chief executive officer. "It was another strong quarter
for our orthobiologics franchise, highlighted by 36% year-over-year
growth in domestic sales of Orthovisc. And it was a successful quarter
for Anika S.r.l., which cut its net loss in half for the quarter. Our
new distribution partner, Misonix, Inc., placed its first order for
Hyalomatrix , one of three Anika S.r.l. advanced
wound care products that have been approved for sale in the United
States. In addition, Anika S.r.l. received regulatory approval in Korea,
and made the first shipments of both its surgical products, Hyalobarrier
Gel and Hyalobarrier Endo, to our distribution partner, the Korean Green
On the regulatory front, although we are still waiting for a response
from the FDA regarding our Monovisc PMA application, we
remain optimistic regarding eventual approval," Sherwood said. "In
addition, we acquired and installed in Bedford new manufacturing
equipment for our aseptic products, and remain on track to complete the
migration of our manufacturing from Woburn to Bedford in the first
Conference Call Information
Anika will hold a conference call to discuss its financial results,
business highlights and outlook tomorrow, Friday, August 5, 2011 at 9:00
a.m. ET. In addition, the Company will answer questions concerning
business and financial developments and trends, and other business and
financial matters affecting the Company, some of the responses to which
may contain information that has not been previously disclosed.
To listen to the conference call, dial 877-556-5921(international
callers dial 617-597-5474) and use the passcode 22756608. Please call
approximately 10 minutes before the starting time and reference Anika
Therapeutics. In addition, the conference call will be available through
a live audio webcast in the "Investor Relations" section of the Anika
Therapeutics website, www.anikatherapeutics.com. An accompanying
slide presentation also can be accessed via the Anika Therapeutics
website. The conference call will be archived and accessible on the same
website shortly after the conclusion of the call.
About Anika Therapeutics, Inc.
Headquartered in Bedford, Mass., Anika Therapeutics, Inc. develops,
manufactures and commercializes therapeutic products for tissue
protection, healing, and repair. These products are based on hyaluronic
acid (HA), a naturally occurring, biocompatible polymer found throughout
the body. Anika's products range from orthopedic/joint health solutions
led by Orthovisc, a treatment for osteoarthritis of the knee, to