Full Press Release Details
Repligen Reports Second Quarter 2020 Financial Results
and Updates Full Year 2020 Financial Guidance
WALTHAM, Mass. July 30, 2020 Repligen Corporation (NASDAQ:RGEN), a life sciences company
focused on bioprocessing technology leadership, today reported financial results for its second quarter of 2020. Provided in this press release are financial highlights for the three- and six- month periods
ended June 30, 2020, updates to our financial guidance for the fiscal year 2020 and access information for today s webcast and conference call.
Tony J. Hunt, President and Chief Executive Officer said, I m pleased to report that the company delivered outstanding financial performance during
the second quarter as we continue to focus on keeping all our manufacturing sites fully operational and managing our supply chain and logistics while also prioritizing the health and safety of our employees. During the second quarter, we saw
increased demand in all of our product franchises, highlighted by strong growth in Asia and a significant pick up in orders both in the quarter and into the second half of 2020 related to COVID-19 vaccine and
therapeutic programs. We finished the quarter by announcing our acquisition of Engineered Molding Technology, which closed in July, to enhance our single-use portfolio. We are confident about the full year
outlook for the company and are updating guidance to reflect our expectations for margin expansion and revenue growth in the range of 23%-26%. .
Financial Highlights for the Second Quarter 2020
Financial Highlights for the First Half of 2020
Financial Details for the Second Quarter and First Half of 2020
GROSS PROFIT and GROSS MARGIN
All reconciliations of GAAP to adjusted
(non-GAAP) figures above, as well as EBITDA to adjusted EBITDA, are detailed in the reconciliation tables included later in this press release.
Financial Guidance for 2020
Our financial guidance for
the fiscal year 2020 is based on expectations for our existing business and includes the financial impact of our acquisition of C Technologies (which closed on May 31, 2019) and Engineered Molding Technology (which closed on July 13,
2020). The guidance below excludes the impact of potential additional acquisitions and future fluctuations in foreign currency exchange rates.
Our non-GAAP guidance for the fiscal year 2020 excludes the following items:
Our non-GAAP guidance for the fiscal year 2020 includes:
All reconciliations of GAAP to adjusted (non-GAAP) guidance are detailed in the tables included later in this press
Repligen will host a
conference call and webcast today, July 30, 2020, at 8:30 a.m. EDT, to discuss second quarter 2020 financial results and corporate developments. The conference call will be accessible by dialing toll-free (844)
701-1063 for domestic callers or (412) 317-5487 for international callers. No passcode is required for the live call. In addition, a webcast will be accessible via the
Investor Relations section of the Company s website. Both the conference call and webcast will be archived for a period of time following the live event. The replay dial-in numbers are (877) 344-7529 from the U.S., (855) 669-9658 from Canada and (412) 317-0088 for international callers. Replay listeners must provide the
Non-GAAP Measures of Financial Performance
To supplement our financial statements, which are presented on the basis of U.S. generally accepted accounting principles (GAAP), the following non-GAAP measures of financial performance are included in this release: revenue growth rate at constant currency, adjusted gross profit and adjusted gross margin, adjusted income from operations and adjusted
operating margin, earnings before interest, taxes, depreciation and amortization (EBITDA), adjusted EBITDA, adjusted net income, adjusted net income per share, adjusted earnings per diluted share (EPS), adjusted cost of sales, adjusted
research & development expense, adjusted selling, general and administrative expense, adjusted income tax expense and adjusted income tax rate. The Company provides organic revenue growth rates in constant currency to exclude the impact of
both foreign currency translation, and the impact of acquisition revenue for current year periods that have no prior year comparable, in order to facilitate a comparison of its current revenue performance to its past revenue performance. The Company
provides revenue growth rates in constant currency in order to facilitate a comparison of its current revenue performance to its past revenue performance. To calculate revenue growth rates in constant currency, the Company converts actual net sales
from local currency to U.S. dollars using constant foreign currency exchange rates in the current and prior period.
The Company s non-GAAP financial results and/or non-GAAP guidance exclude the impact of: acquisition and integration costs, inventory step-up charges
and intangible amortization costs related to the Company s acquisitions, as well as non-cash interest expenses related to the Company s convertible debt, and the related impact on tax of non-GAAP charges. These costs are excluded because management believes that such expenses do not have a direct correlation to future business operations, nor do the resulting charges recorded accurately reflect the
performance of our ongoing operations for the period in which such charges are recorded.
A reconciliation of GAAP to adjusted non-GAAP financial measures is included as an attachment to this press release. When analyzing the Company s operating performance and guidance investors should not consider
non-GAAP measures as substitutable for the comparable financial measures prepared in accordance with GAAP.
About Repligen Corporation
Repligen Corporation is a
global life sciences company that develops and commercializes highly innovative bioprocessing technologies and systems that increase efficiencies in the process of manufacturing biological drugs. We are inspiring advances in bioprocessing for the
customers we serve; primarily biopharmaceutical drug developers and contract development and manufacturing organizations (CDMOs) worldwide. Our corporate headquarters are located in Waltham, MA (USA), and we have additional administrative and
manufacturing operations in Marlborough, MA; Bridgewater, NJ; Rancho Dominguez, CA; Clifton Park, NY; Lund, Sweden; Breda, The Netherlands and Ravensburg, Germany.
The following constitutes a Safe Harbor statement under the Private Securities Litigation Reform Act of 1995: This press release contains
forward-looking statements, which are made pursuant to the safe harbor provisions of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Investors are cautioned that
statements in this press release which are not strictly historical statements, including, without limitation, express or implied statements or guidance regarding current or future financial performance and position, including cash and investment
position, demand in the markets in which we operate, the expected performance of our business, the expected performance of the C Technologies and Engineered Molding Technology businesses, the expected
performance and success of our strategic partnerships, management s strategy, plans and objectives for future operations or acquisitions, product development and sales, selling, general and
administrative expenditures, intellectual property, development and manufacturing plans, availability of materials and product and adequacy of capital resources, our financing plans, and the projected impact of, and response to, the COVID-19 coronavirus pandemic, and the related downturn of the U.S. and global economies constitute forward-looking statements identified by words like believe, expect, may,
will, should, seek, anticipate, or could and similar expressions. Such forward-looking statements are subject to a number of risks and uncertainties that could cause actual results to
differ materially from those anticipated, including, without limitation, risks associated with the following: the effect of the COVID-19 coronavirus pandemic, including mitigation efforts and economic effects,
on our business operations and the operations of our customers and suppliers; the ultimate impact of the COVID-19 coronavirus pandemic on our business or financial results; our ability to successfully grow our
bioprocessing business, including as a result of acquisition, commercialization or partnership opportunities; our ability to successfully integrate any acquisitions, our ability to develop and commercialize products and the market acceptance of our
products; our ability to integrate the C Technologies and Engineered Molding Technology businesses successfully into our business and achieve the expected benefits of the acquisitions; reduced demand for our products that adversely impacts our
future revenues, cash flows, results of operations and financial condition; our ability to compete with larger, better financed bioprocessing, pharmaceutical and biotechnology companies; our compliance with all U.S. Food and Drug Administration and
EMEA regulations; our volatile stock price; and other risks detailed in Repligen s Annual Report on Form 10-K for the year ended December 31, 2019 and Quarterly Report on Form 10-Q for the quarter ended March 31, 2020 on file with the Securities and Exchange Commission and the other reports that Repligen periodically files with the Securities and Exchange Commission. Actual results
may differ materially from those Repligen contemplated by these forward-looking statements. These forward-looking statements reflect management s current views and Repligen does not undertake to update any of these forward-looking statements to
reflect a change in its views or events or circumstances that occur after the date hereof except as required by law.
Global Head of Investor Relations
REPLIGEN CORPORATION
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited, amounts in thousands, except share and per share data)
| Three Months Ended June 30, | Six Months Ended June 30, | |||||||||||||||
| 2020 | 2019 | 2020 | 2019 | |||||||||||||
| Revenue: | ||||||||||||||||
| Product revenue | $ | 87,432 | $ | 70,670 | $ | 163,492 | $ | 131,282 | ||||||||
| Royalty and other revenue | 30 | 22 | 60 | 44 | ||||||||||||
| Total revenue | 87,462 | 70,692 | 163,552 | 131,326 | ||||||||||||
| Costs and expenses: | ||||||||||||||||
| Cost of product revenue | 36,863 | 30,708 | 68,845 | 57,553 | ||||||||||||
| Research and development | 4,336 | 5,231 | 9,038 | 8,851 | ||||||||||||
| Selling, general and administrative | 26,726 | 23,699 | 54,226 | 42,697 | ||||||||||||
| 67,925 | 59,638 | 132,109 | 109,101 | |||||||||||||
| Income from operations | 19,537 | 11,054 | 31,443 | 22,225 | ||||||||||||
| Investment income | 253 | 1,005 | 1,617 | 1,718 | ||||||||||||
| Interest expense | (3,004 | ) | (1,743 | ) | (5,980 | ) | (3,469 | ) | ||||||||
| Other income, net | (766 | ) | (697 | ) | (384 | ) | (339 | ) | ||||||||
| Income before income taxes | 16,020 | 9,619 | 26,696 | 20,135 | ||||||||||||
| Income tax provision | 159 | 1,524 | 1,020 | 3,987 | ||||||||||||
| Net income | $ | 15,861 | $ | 8,095 | $ | 25,676 | $ | 16,148 | ||||||||
| Earnings per share: | ||||||||||||||||
| Basic | $ | 0.30 | $ | 0.17 | $ | 0.49 | $ | 0.36 | ||||||||
| Diluted | $ | 0.30 | $ | 0.17 | $ | 0.48 | $ | 0.34 | ||||||||
| Weighted average shares outstanding: | ||||||||||||||||
| Basic | 52,381,201 | 46,367,187 | 52,259,937 | 45,174,134 | ||||||||||||
| Diluted | 53,305,827 | 49,055,814 | 53,212,596 | 47,691,772 |
| June 30, 2020 | December 31, 2019 | |||||||
| Balance Sheet Data: | ||||||||
| Cash, cash equivalents and marketable securities | $ | 560,364 | $ | 528,392 | ||||
| Working capital | 642,756 | 593,515 | ||||||
| Total assets | 1,442,045 | 1,400,113 | ||||||
| Long-term obligations | 297,617 | 292,032 | ||||||
| Accumulated earnings | 31,519 | 5,843 | ||||||
| Stockholders equity | 1,100,027 | 1,059,768 |
REPLIGEN CORPORATION
RECONCILIATION OF GAAP INCOME FROM OPERATIONS TO
NON-GAAP (ADJUSTED) INCOME FROM OPERATIONS
(Unaudited, amounts in thousands)
| Three Months Ended June 30, | Six Months Ended June 30, | |||||||||||||||
| 2020 | 2019 | 2020 | 2019 | |||||||||||||
| GAAP INCOME FROM OPERATIONS | $ | 19,537 | $ | 11,054 | $ | 31,443 | $ | 22,225 | ||||||||
| ADJUSTMENTS TO INCOME (LOSS) FROM OPERATIONS: | ||||||||||||||||
| Acquisition and integration costs | 2,134 | 4,822 | 4,687 | 6,621 | ||||||||||||
| Intangible amortization | 3,874 | 3,051 | 7,752 | 5,662 | ||||||||||||
| Inventory step-up charges | 1,169 | 1,169 | ||||||||||||||
| ADJUSTED INCOME FROM OPERATIONS | $ | 25,545 | $ | 20,096 | $ | 43,882 | $ | 35,677 |
REPLIGEN CORPORATION
RECONCILIATION OF GAAP NET INCOME TO NON-GAAP (ADJUSTED) NET
(Unaudited, amounts in thousands)
| Three Months Ended June 30, | Six Months Ended June 30, | |||||||||||||||
| 2020 | 2019 | 2020 | 2019 | |||||||||||||
| GAAP NET INCOME | $ | 15,861 | $ | 8,095 | $ | 25,676 | $ | 16,148 | ||||||||
| ADJUSTMENTS TO NET INCOME: | ||||||||||||||||
| Acquisition and integration costs | 2,134 | 5,322 | 4,687 | 7,121 | ||||||||||||
| Inventory step-up charges | 1,169 | 1,169 | ||||||||||||||
| Intangible amortization | 3,874 | 3,051 | 7,752 | 5,662 | ||||||||||||
| Non-cash interest expense | 2,724 | 1,124 | 5,415 | 2,231 | ||||||||||||
| Tax effect of non-GAAP charges (1) | (2,085 | ) | (2,610 | ) | (4,262 | ) | (3,961 | ) | ||||||||
| ADJUSTED NET INCOME | $ | 22,508 | $ | 16,151 | $ | 39,268 | $ | 28,370 |
REPLIGEN CORPORATION
RECONCILIATION OF GAAP NET INCOME PER SHARE TO
NON-GAAP (ADJUSTED) NET INCOME PER SHARE
| Three Months Ended June 30, | Six Months Ended June 30, | |||||||||||||||
| 2020 | 2019 | 2020 | 2019 | |||||||||||||
| GAAP NET INCOME PER SHARE - DILUTED | $ | 0.30 | $ | 0.17 | $ | 0.48 | $ | 0.34 | ||||||||
| ADJUSTMENTS TO NET INCOME PER SHARE - DILUTED: | ||||||||||||||||
| Acquisition and integration costs | 0.04 | 0.11 | 0.09 | 0.15 | ||||||||||||
| Inventory step-up charges | 0.02 | 0.02 | ||||||||||||||
| Intangible amortization | 0.07 | 0.06 | 0.15 | 0.12 | ||||||||||||
| Non-cash interest expense | 0.05 | 0.02 | 0.10 | 0.05 | ||||||||||||
| Tax effect of non-GAAP charges (1) | (0.04 | ) | (0.05 | ) | (0.08 | ) | (0.09 | ) | ||||||||
| ADJUSTED NET INCOME PER SHARE - DILUTED | 0.42 | $ | 0.33 | $ | 0.74 | $ | 0.59 |
Totals may not add due to rounding.
REPLIGEN CORPORATION
RECONCILIATION OF GAAP NET INCOME TO ADJUSTED EBITDA
(Unaudited, amounts in thousands)
| Three Months Ended June 30, | Six Months Ended June 30, | |||||||||||||||
| 2020 | 2019 | 2020 | 2019 | |||||||||||||
| GAAP NET INCOME | $ | 15,861 | $ | 8,095 | $ | 25,676 | $ | 16,148 | ||||||||
| ADJUSTMENTS: | ||||||||||||||||
| Investment Income | (253 | ) | (1,005 | ) | (1,617 | ) | (1,718 | ) | ||||||||
| Interest Expense | 3,004 | 1,743 | 5,980 | 3,469 | ||||||||||||
| Tax Provision | 159 | 1,524 | 1,020 | 3,987 | ||||||||||||
| Depreciation | 2,578 | 1,762 | 5,063 | 3,337 | ||||||||||||
| Amortization (1) | 3,902 | 3,079 | 7,807 | 5,716 | ||||||||||||
| EBITDA | 25,251 | 15,198 | 43,929 | 30,939 | ||||||||||||
| OTHER ADJUSTMENTS: | ||||||||||||||||
| Acquisition and integration costs | 2,134 | 5,322 | 4,687 | 7,121 | ||||||||||||
| Inventory step-up charges | 1,169 | 1,169 | ||||||||||||||
| ADJUSTED EBITDA | $ | 27,385 | $ | 21,689 | $ | 48,616 | $ | 39,229 |
REPLIGEN CORPORATION
RECONCILIATION OF GAAP COST OF SALES TO NON-GAAP (ADJUSTED)
(Unaudited, amounts in thousands)
| Three Months Ended June 30, | Six Months Ended June 30, | |||||||||||||||
| 2020 | 2019 | 2020 | 2019 | |||||||||||||
| GAAP COST OF SALES | $ | 36,863 | $ | 30,708 | $ | 68,845 | $ | 57,553 | ||||||||
| ADJUSTMENT TO COST OF SALES: | ||||||||||||||||
| Acquisition and integration costs | (185 | ) | (133 | ) | (465 | ) | (151 | ) | ||||||||
| Inventory step-up charges | (1,169 | ) | (1,169 | ) | ||||||||||||
| Intangible amortization | (127 | ) | (130 | ) | (254 | ) | (264 | ) | ||||||||
| ADJUSTED COST OF SALES | $ | 36,551 | $ | 29,276 | $ | 68,126 | $ | 55,969 |
REPLIGEN CORPORATION
RECONCILIATION OF GAAP R&D EXPENSE TO NON-GAAP (ADJUSTED)
(Unaudited, amounts in thousands)
| Three Months Ended June 30, | Six Months Ended June 30, | |||||||||||||||
| 2020 | 2019 | 2020 | 2019 | |||||||||||||
| GAAP R&D | $ | 4,336 | $ | 5,231 | $ | 9,038 | $ | 8,851 | ||||||||
| ADJUSTMENT TO R&D: | ||||||||||||||||
| Acquisition and integration costs | (189 | ) | (100 | ) | (471 | ) | (127 | ) | ||||||||
| ADJUSTED R&D | $ | 4,147 | $ | 5,131 | $ | 8,567 | $ | 8,724 |
REPLIGEN CORPORATION
RECONCILIATION OF GAAP SG&A EXPENSE TO NON-GAAP (ADJUSTED)
(Unaudited, amounts in thousands)
| Three Months Ended June 30, | Six Months Ended June 30, | |||||||||||||||
| 2020 | 2019 | 2020 | 2019 | |||||||||||||
| GAAP SG&A EXPENSE | $ | 26,726 | $ | 23,699 | $ | 54,226 | $ | 42,697 | ||||||||
| ADJUSTMENTS TO SG&A EXPENSE: | ||||||||||||||||
| Acquisition and integration costs | (1,760 | ) | (4,590 | ) | (3,750 | ) | (6,343 | ) | ||||||||
| Intangible amortization | (3,747 | ) | (2,921 | ) | (7,498 | ) | (5,398 | ) | ||||||||
| ADJUSTED SG&A EXPENSE | $ | 21,219 | $ | 16,188 | $ | 42,977 | $ | 30,956 |
REPLIGEN CORPORATION
RECONCILIATION OF GAAP NET INCOME GUIDANCE TO ADJUSTED
(NON-GAAP NET INCOME GUIDANCE)
| (in thousands) | Twelve months ending December 31, 2020 | |||||||
| Low End | High End | |||||||
| GUIDANCE ON NET INCOME | $ | 41,000 | $ | 44,000 | ||||
| ADJUSTMENTS TO GUIDANCE ON NET INCOME: | ||||||||
| Acquisition and integration costs | 5,706 | 5,706 | ||||||
| Anticipated pre-tax amortization of acquisition-related intangible assets | 15,733 | 15,733 | ||||||
| Inventory step-up costs | 233 | 233 | ||||||
| Non-cash interest expense | 10,963 | 10,963 | ||||||
| Tax effect of non-GAAP charges | (7,790 | ) | (7,790 | ) | ||||
| Guidance rounding adjustment | 155 | 155 | ||||||
| GUIDANCE ON ADJUSTED NET INCOME | $ | 66,000 | $ | 69,000 |