Trimeris Reports Financial Results for the First Quarter 2008
Thursday May 8, 4:13 pm ET
-- Company reports earnings of $0.10 per share for the first quarter of 2008
-- Cash and investments increase to $80.0 million up from $69.6 million at December 31, 2007
-- Company announces special cash dividend and share repurchase program
MORRISVILLE, N.C.--(BUSINESS WIRE)--Trimeris, Inc. (Nasdaq: TRMS - News) today announced financial results for the quarter ended March 31, 2008, reporting net income of $2.3 million, or $0.10 per share. This compares to adjusted net income for the quarter ended March 31, 2007 of $3.8 million, or $0.17 per share, excluding the impact of two non-recurring events in the first quarter of 2007, or $8.2 million, or $0.37 per share on a GAAP basis, including these events. As previously reported, Trimeris recognized two one-time events in the first quarter of 2007, the acceleration of $8.7 million of revenue for past milestone payments received from Roche and a $4.3 million charge for a reduction-in-force. A reconciliation and explanation of the differences between GAAP and adjusted earnings is detailed in the table below.
Total revenue and collaboration income for the quarter ended March 31, 2008 totaled $5.6 million. In the first quarter of 2007, total revenue and collaboration income, excluding the non-recurring acceleration of milestone revenues, was $8.7 million. This decrease was primarily driven by lower worldwide FUZEON® sales. Total revenue and collaboration income in the first quarter of 2007, including the one-time acceleration of milestone revenues from Roche, was $17.4 million.
Total operating expenses for the quarter ended March 31, 2008 were $3.0 million compared with $9.6 million in the first quarter of 2007, which included a $4.3 million charge for the reduction-in-force recorded during the first quarter of 2007. First quarter 2008 operating expenses have further declined as a result of the Company’s 2008 strategic plan which significantly reduced personnel levels at Trimeris compared to the first quarter of 2007.
Cash, cash equivalents and investment securities available-for-sale totaled $80.0 million at March 31, 2008, compared to $69.6 million at December 31, 2007. As previously reported, in the first quarter of 2008, the Company received approximately $4.7 million from Roche related to a credit derived from collaboration calculations of costs of goods sold. This amount was included in our other current assets as of December 31, 2007.
In addition, based on a preliminary analysis of changes in our common stock ownership, the Company believes that the threshold for an "ownership change" under Section 382 of the Internal Revenue Code has been surpassed. If an ownership change has occurred, this would limit our utilization of NOL's generated prior to such ownership change. These financial statements included for the first quarter of 2008 have been prepared based on an assumption that an ownership change occurred during the first quarter of 2008.
Special Cash Dividend and Stock Repurchase Program
As part of its plan to return up to $50 million to shareholders by the end of 2008, the Board of Directors has declared a one-time special cash dividend of $1.50 per share of common stock to stockholders of record on May 22, 2008. The aggregate dividend payment will total approximately $33 million based on the number of shares of common stock currently outstanding. The dividend will be paid on June 6, 2008.
As a further step in this plan, the Board of Directors authorized a share repurchase program to purchase up to $17.0 million of Trimeris common stock from time to time on the open market, in block trades or otherwise.
The timing of repurchases and the amount of any shares repurchased will be determined by Trimeris management based on its evaluation of market conditions and other factors. The repurchase program may be suspended or discontinued at any time. Any repurchased shares will be available for use in connection with Trimeris stock plans and for other corporate purposes.
Both the special cash dividend and any repurchases under the stock repurchase program will be funded using Trimeris working capital. As of March 31, 2008, Trimeris had cash, cash equivalents and investment securities available-for-sale of approximately $80.0 million and approximately 22.2 million shares of common stock outstanding.
2008 and 2009 Guidance
As a convenience to investors, Trimeris is providing its outlook for 2008. This outlook is based upon numerous assumptions, all of which are subject to certain risks and uncertainties. For a discussion of the risks and uncertainties associated with these forward-looking statements, please see the Trimeris Safe Harbor Statement below.
The Company reiterates its previous guidance that total operating expenses are expected to be in the range of $10.0 million to $14.0 million in 2008, down from $24.0 million in 2007. The Company expects total operating expenses in 2009 to be in the range of $5.0 million to $10.0 million.
